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aMB0044 PRODUCTION AND OPERATIONS MANAGEMENT SET-1

Q1.Explain in brief the origins of Just In Time. Explain how JIT is implemented?

Just-In-time manufacturing, or JIT, is a management philosophy aimed at eliminating

manufacturing wastes by producing only the right amount and combination of parts at the right place at

the right time. This is based on the fact that wastes result from any activity that adds cost without

adding value to the product, such as transferring of inventories from one place to another or even the

mere act of storing them.

The goal of JIT, therefore, is to minimize the presence of non-value-adding operations and non-

moving inventories in the production line. This will result in shorter throughput times, better on-time

delivery performance, higher equipment utilization, lesser space requirement, lower dpms, lower costs,

and greater profits.

JIT finds its origin in Japan, where it has been in practice since the early 1970s. It was developed

and perfected by Taiichi Ohno of Toyota, who is now referred to as the father of JIT. Taiichi Ohnodeveloped this philosophy as a means of meeting customer demands with minimum delays. Thus, in the

olden days, JIT is used not to reduce manufacturing wastage, but primarily to produce goods so that

customer orders are met exactly when they need the products

Although the history of JIT traces back to Henry Ford who applied Just in Time principles to manageinventory in the Ford Automobile Company during the early part of the 20th Century, the origins ofthe JIT as a management strategy traces to Taiichi Onho of the Toyota Manufacturing Company. Hedeveloped Just in Time strategy as a means of competitive advantage during the post World War IIperiod in Japan.

The post-World War II Japanese automobile industry faced a crisis of existence, and companies suchas Toyota looked to benchmark their thriving American counterparts. The productivity of anAmerican car worker was nine times that of a Japanese car worker at that time, and Taiichi Onhosought ways to reach such levels.

Two pressing challenges however prevented Toyota from adopting the American way:

1. Americancar manufacturersmade lots or a batch of a model or a component beforeswitching over to a new model or component. This system was not suited to the Japaneseconditions where a small market required manufacturing in small quantities.

2. The car pricing policy of US manufacturers was to charge a mark-up on the cost price. The lowdemand in Japan led to price resistance. The need of the hour was thus to reducemanufacturing costs to increase profits.

To overcome these two challenges, Taiichi Onho identified waste as the primary evil. The categoriesof waste identified included

overproduction inventory or waste associated with keeping dead stock time spent by workers waiting for materials to appear in the assembly line time spend on transportation or movement workers spending more time than necessary processing an item

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waste associated with defective items

Taiichi Onho then sought to eliminate waste through thejust-in-timephilosophy, where itemsmoved through the production system only as and when needed.

Implementation of JIT

JIT, total quality management (TQM) and other developmental measures, are possibleonly with top management commitment and a learning culture in the organization. The mainhandicap to any programme is the resistance by the organizational members, even at the top, tomake changes. This resistance may take the from of non-cooperation and may enlarge to becomesabotage. These usually shows up at the implementation stage. So, communication of the goalsis to be realized and the objective of each team are to be framed effectively. Initially, a milestonechart helps in establishing various steps to be taken and correcting the activities as the process ison . this is the best way of ensuring success. It is well to remind you at this stage that JIT is not adestination, but an ongoing continuous improvement programme in the process of achieving

TQM.Pre-requisites for implementation

Like any advanced method of production and quality improvement , some pre-requisitesare needed to be in place so that, implementation is easy and the results are identifiable .(a)design flow process:

1.link operations2.balance workstation capacities3.relay-out for flow4.emphasise preventive maintenance5.reduce lot sizes6.reduce set-up and changeover times

(b) total quality control:1.worker responsibility for quality2.measures SQC3.enforce compliance4.fail-safe method5.automatic inspection

(c) stabilize schedule1level schedule2.under utilize capacity

(d) kanban pull1.demand pull

2.back flush3.reduce lot size

(e) work with vendor1.reduce lead times2.frequent deliveries3.project usage requirement4.quality expectation

(f) reduce inventories

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1.look for other areas2.stores3.transit4.carousales5.convayours

(g) improved product design1.standard product configuration2.standardise and reduce number of parts3.process design with product design4.quality expectation

The above activities lead to:(A) solving problems concurrently

1.root cause2.solve permanently3.team approach4.line and specialist responsibility

5.continual education(B) measuring performances1.emphasise improvement2.track trends

Shop floor control

Realistic planning and scheduling take the frequency with which setups have to changed tomanage material flow without building up inventories into consideration and leads to JITmanufacturing.

SMED( single minute exchange of dies) gives flexible for production process. Advocatedby Shigeo Shingo, SMED method calls for designing, making fixtures, and tooling which areinstrumental in changing setups so that changes are to be effected with in a minute . the de-clamping and clamping elements should be made for this process.

Application for kanban, wherever suitable is another mechanism for controlling flow of thematerial. Maintenance of the machines and periodic shop floor inspection is necessary.

Purchasing

The essence of JIT purchasing lies in treating the purchaser as a participant in youractivities. Cooperative relationship leads to the development of the supplier who understandscompanys requirements. being open and trusting help the organizations to identify the problemsand go to the source which is like implementing TQM.

Every problem or discovery of a defect is considered an opportunity, which the supplier andthe company together get a deeper understanding of the problem, and the solutions will not onlysolve that problem, but also the ones that were hidden. It is also the practice of many companieswho procure a large number of parts manufactured from their vendors to have supplies made tothe assembly in specific quantities to meet the needs just in time.

Self certification by the vendor is resorted to ensure quality of the material. The actual usersare given autonomy to demand from the supplier, the quantities required as well as the time ofits need. Any change in demand is conveyed and complied. This requires cooperation and trustbetween the supplier and the customer. This is how JIT purchases work.

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Vendor managed inventory

The very purpose of JIT is to reduce inventory at all places in the supply chain. Inventory isconsidered a waste because inventory is created by using materials, machines and efforts ofpersons. All of these are resources which have already been used up and that portion of it whichis not consumed and sent up the value chain causes a drag on the system. However ,inventories

are inevitable because uncertainties exist at every stage, making it necessary to provide a bufferso that demands do not go unfulfilled. The challenge is to keep it to the minimum. To make thishappen ,the calculation involving the following are necessary:For cast of the market demandCapacities of the equipmentsWorker absenteeismSuppliers lead times

Quality of the produced components .

Q2.Bring out the historical background of Value Engineering. Elucidate three

companies which have incorporated VE with brief explanation.

Value Engineering aims at a systematic identification and elimination of unnecessary costs

resulting in the increased use of alternatives, less expensive material, cheaper designs, less costly

methods of manufacturing etc. to provide the same performance, quality and efficiency and in a

decrease of overall unit costs and consequently greater profits.

Historical Background:

During the Second World War, one of the most serious problems faced by companies engaged inthe war effort was the shortage of materials. This led to experimenting with substitutes, quiteoften in very unorthodox ways. In many cases, the experiments clicked and surprisingly therewere a large number of instances where the substitutes were much cheaper and functioned moreefficiently than the original material.

After the war, Harry Erlicher, the Vice President of Purchasing, General Electric Co (USA) feltthat this problem of finding out substitute could be done in a more scientific way and as adeliberate approach, rather than by an ad hoc crisis approach. He entrusted this job to a team of

engineers headed by Lawrence Miles. In fact it was Miles who coined the term Value Analysisand its synonym, Value Engineering. This team under his stewardship pioneered this techniqueand perfected it and, it is said, saved their company $ 200 million over a period of 17 years. InAmerica, the technique is very widely used and is given a great deal of importance.

LD Miles, the father of this concept, wrote in 1961, a book, Techniques of Value Analysis andEngineering. Navy Bureau of Ships was the first organization to use VA in 1954. Society forAmerican value Engineers (SAVE) was established in 1959. VE programs came in vogue in

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many companies of the US, UK, and Japan. In India, now we have Indian Value EngineeringSociety (INVEST) to create awareness of this approach and to propagate this concept.

The companies which have incorporate value engineering are:

1. General ElectricalCorporation (GEC)The concepts of value engineering originated in 1947in General Electricals corporation (GEC)When a substitute for asbestos for flooring had to befound. Specialized dealers could provide an equally good material at a lesser price. Initially, thepractioners were the people in charge of purchasing who tried to locate substitute material whichwould be equally good, if not better, at a lower price. This is the first and basic approach tovalue engineering. The concept percolated to the manufacturing departments, engineers appliedthe same principles and found that, they could use alternate materials, which were cheaper givingthe same performance. It was also fund that dimensions and tolerance could be altered withoutaffecting the performance of the part or the product. The investigations took them on the path ofeliminating some operations. The focus was on the value of each bit materials, each operation.This approach led to the design stage.

2. Ashok Leyland In implementation of VA, Ashok Leyland changed gear material fromphosphor bronze to a less expensive cast iron and eliminated frequent field complaint of gearseizure in trucks. 3. TVS :T.V. Sundaram Lyenger (TVS) Limited is one of the largestautomobile distribution companies in India. During the mid 1940 to 1960s, TVS based inMadurai was ranked as the best bus transportation system in India. It could manage to run thefleets for about 96% of the time.TVS used the VE approach to restore the mobility of buses thathad broken down. They stocked their garage with some critical assemblies of a bus. Whenever, apart or an assembly failed of a bus, they replaced it immediately with a new one, thus restoringmobility within a couple of hours. When compared to the traditional method, this approach hasgained much more benefits to the company, it helped to save time, reduce cost, efficient, quicker,

and competitive. 4. MODI Xerox: Modi Xerox designed the VE-d low cost copier 1025 ST,which uses a single tray. The advantage of new design is that it is easy to operate and the cost isalso very low. 5. TITAN : Titan watches introduced new designs adopting a strategy ofinnovation.

Q.3. Explain the key elements of quantitative modeling . what is work study

and motion study.

Quantitative models are needed for a variety of management tasks, including(a) Identification of

critical variables to use for health monitoring,(b) Anticipating service level violations by using predictivemodels, and(c) On-going optimization of configurations. Unfortunately, constructing quantitativemodels requires specialized skills that are in short supply.

Even worse, rapid changes in provider configurations and the evolution of business demands mean thatquantitative models must be updated on an on-going basis. This paper de-scribes an architectureand algorithms for on-line discovery of quantitative models without prior knowledge of the managed elements.The architecture makes use of an element schema that describes managed elements using thecommon information model (CIM). Algorithms are presented for selecting a subset of the

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4.INVENTORY CONTROL MODEL:

Inventory control model considers the:

* Frequency of placing orders.

* Quantities per order considering the cost of placing an order.* Number of pieces that are to be kept in reserve.

* Rate of consumption.

* Lead time required for the supplier.

* Cost involved in storage.

We have different models which give solutions to optimization depending upon the

probabilities of consumption and supply.

5. WAITINGLINE MODELS:

Queues are formed when the rate of services is at a variance withthe rate of arrival.

They are formed when the rate of production is less at particular pointscompared to the

previous one. Sometimes we see multiple service points and a single queue areformed for

feeding them. Number of items which includes the following is studied with somespecial

techniques.

* People to be serviced.

* Rate of service

* Type of queue discipline that is intended to be followed.

* Policy of priority

* Tolerable amounts of waiting

6. SIMULATION MODELS:

Simulation models are used when we will not be able to formulate mathematical model.

So, we develop a model which resembles a real life situation. Based on this pattern, we predict

and plan our procurement, production, delivery and other actions.7. PERT (PROJECT EVALUATION AND REVIEW TECHNIQUE) AND

CPM(CRTICALPATHMETHOD)MODELS:

When projects are undertaken with a number of activities, some happens in sequence,

with gaps of weeks or months and some happens simultaneously. It is important to estimate

the time required for completion of the project. A lot of coordination is needed while supplying

the resources. It is also equally important to identify the bottlenecks and smoothen resources

so that time schedules are maintained. Delayed completion may entail penalties. In this model,

we adopt special methods to make the system.

Work study and Motions study.We can say that work study is being conducted when analysis of work methods is

conducted during the period when a job is done on a machine or equipment. Method study is

on studying the method currently being used and developing a new method of performing the

task in a better way. The study helps in designing the optimum work method and

standardization of the work method. Operation flow charts, motion charts, flow process charts,

which are the elements of the task are studied to find the purpose of each activity, the

sequences in which they are done, and the effect of these on the work. The study enables the

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methods engineer to search for better methods for higher utilization of man and machine and

accomplishment of higher productivity. The study may help in changing some of them and

even eliminate some of them to effect improvements. The study gives an opportunity to the

workmen to learn the process of study thus making them able to offer suggestions for

improved methods. The new method should result in saving of time, reduced motions and

simpler activities.

Q.4. what is Rapid Prototyping? Explain the difference between automated flow line and

automated assembly line with example.

Ans:

Rapid Prototyping: Prototyping is a process by which a new product is developed in smallnumbers so as to determine the suitability of the materials, study the various methods ofmanufacture, type of machinery required and to develop techniques to overcome problems thatmay be encountered when full scale manufacture is undertaken. Prototypes do meet thespecifications of the components that enter a product and performance can be measured on those.It helps in confirming the design and any shortcomings can be rectified at low cost. If seriousdefects or problems arise during the manufacture, a thorough change in design or even itsreplacement may be considered. To arrive at decisions to make use of the advantages statedabove, it is important that the prototypes are made within the shortest possible time. Rapidprototyping facilitates this. It uses virtual designs from Computer Aided DesignCAD oranimation modeling which transforms dimensional data to 3dimensional views. The physical

space of the product is amenable to have cross sections made.

Cross sections taken at very close positions gives thin layers which enable the generation of asolid model of the designed product. The data that is thus created helps build a solid modelexactly as per the drawings. Any shape can be generated in this method. Advanced technologieslikeSLS (Selective Laser Sintering), FDM (Fused Deposition Modeling), LOM (LaminatedObject Manufacture), EBM (Electronic Beam Melting) are some of Rapid Prototype ModelingProcesses.

Since the basis data about the product is already available in CAD, the above processes canproduce models in a matter of a few days. Conventional machines like lathes, milling machines,

grinding machines, EDM (Electro Discharge Machining) also help in the production ofprototypes. Because of their advantages Rapid Prototyping is being increasingly used.

Difference between Automated Flow lines and Assembly Flow line.

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AUTOMATED FLOW LINES ASSEMBLY FLOW LINES

Several Automated machines are linkedby a transfer system.

All equipments are needed to in automatedAssesmbly line

Handling machine have main role tomove semi finished product to the nextstage.

All equipments make role of making sub-assemblies put together and fitted.

Semi-finished products are the maincore activities.

Here Sub-assemblies product are the coreactivites.

Here raw materials are achieving to getrequired shapes and acquire specialproperties.

Here intermediated products are achievingto get finished product.

The materials are needed to be moved,held, rotated, fitted and positioned for

completing different operations.

Here All parts or sub-assemblies are fittedto enables the product to be in readiness to

perform the function it was designed to.This process is called assembly.

Human intervention may be needed toverify that the operations are takingplace according to standards.

No human intervention is needed,methodologies are framed to achieve thefinal result, basic principle is to fit partstogether and ensure linkages so that thefunctions are integrated and give out thedesired output.

Q.5. list different methods for selecting a suitable plant location and explain any

two.

Plant location :

Plant location Meaning-the establishment of an industry at a particular place. It is of 2

types- Localization /centralization-means concentration of similar type of industries at some

particular place. E.g. textile in Mumbai. Delocalization /Decentralization-means spreading of

similar type of industries at different places. E.g. banking industries.

Factors affecting location & site decisions :

Factors affecting location & site decisions Availability of raw material Nearness to thepotential market Near to the source of operating requirements like electricity, disposal of waste,

drainage facilities. Supply of labor Transport & communication facilities Integration with other

group of companies Suitability of land & climate Availability of housing, other amenities &

services Local building & planning regulations Safety requirements Others like low interest on

loans, special grants, living standards

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selection of the site for the factory :

selection of the site for the factory Known as location analysis where firstly some

geographical area is selected & from that area a particular site is selected for the establishment

of the plant. Methods for the evaluation of plant location-

1. Involving quantitative factors

a. Comparative cost chart,

b. dimensional analysis.

2. Comparison of qualitative factors.

Comparative cost chart :

Comparative cost chart Is appropriate where the location problem concerns the

placement of a single plant. This is based on location cost summary chart. A comparative chart

of total costs involved in setting up a plant of desired size is prepared.

The total cost is represented by the height of column for each location. we select a

location for which total cost is minimum. The cost summary chart has advantage of clarity in

presentation. but analysis is restricted to certain specified factors only. Least cost centre

analysis- Here transportation cost associated with various location alternatives is considered.

Limitation of these techniques- 1.Choice of plant location assumed to be entirely dependentupon minimization of operational costs. 2.Operational costs are assumed to be linearly related

to distance involved.

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Dimensional analysis :

Dimensional analysis It involves calculation of the relative merits or cost ratios for each

of the factors, giving each of the cost factor an appropriate weightage by means of an index to

which the cost ratio is raised & multiplying these weighted ratios in order to arrive at a figure on

the relative merits of alternative sites.

Let Cm1,Cm2,Cm3,..Cmz are the costs associated with site M for various cost factors.

Cn1,Cn2,Cn3,.Cnz are of site

N.W1,W2,W3,.Wz are weightage for various factors.

Merit of location M=(Cm1)W1*(Cm2)W2*(Cmz)Wz

Merit of location N=(Cn1)W1*(Cn2)W2*(Cnz)Wz

Relative merits of sites M & N are-

merit of M

merit of N

If this value is > 1, then select site M & vice-versa.

Advantages- it compares both subjective & objective factors & gives a quantitative

figure.

Comparison of qualitative factors. :

Comparison of qualitative factors. These are the factors to which cost values cant be

assigned. Like lack of good schools, community attitude. These can be termed as good orexcellent. Clearly location B appears to be better one.

Q.6. explain Jurans Quality Triology and Crosbys absolutes of quality. List out

Demings 14 points.

JURANs Quality Triology

Juran uses his famous universal Breakthrough Sequence to implement qualityprogrammes. The universal break through sequences are ; Proof of need: there should be a

compelling need to make changes. Project identification: here what is to be changed is

identified. Specific projects with time frames and the resource allocation are decided. Top

management commitment: Commitment of the top management is to assign people and fix

responsibilities to complete the project. Diagnostic journey: Each team will determine whether

the problems result from systemic causes or are random or are deliberately caused. Root

causes are ascertained with utmost certainty. Remedial Action: This is the stage when changes

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are introduced. Inspection, testing, and validation are also included at this point. Holding on to

the gains: the above steps results in beneficiary results. Having records or all actions and

consequences will help in further improvements. The actions that results in the benefits derived

should be the norm for establishing standards.

JURAN has categorised cost of quality in to four categories:1. Failure CostsInternal :These

are cost of rejections, repairs in terms of materials, labour, machine time and loss of morale. 2.

Failure Costs-External: These are cost of replacement, on-site rework including spareparts and

expenses of the personnel, warranty costs and loss of goodwill. 3. Appraisal Costs: These are

cost inspection, including maintenance of records, certification, segregation costs, and others. 4.

Prevention costs: Prevention cost is the sequence of three sets of activities, Quality planning,

Quality control, and Quality improvement, forming the triology to achieve TOTAL QUALITY

MANAGEMENT. JURANs argument says that; Quality is the result of good planning

consideration the needs of both internal and external customers and develops processes to

meet them. Theprocesses are also planned to meet them. Quality is built into the system of

manufacture, inputs and processes that are on stream like raw material, spare parts, labour,

machine maintenance, training, warehousing, inspection procedures, packaging, and other. Allthese have to follow standards and control exercises to make sure that mistake do not occur

often and that if mistakes do occur then they are corrected at the source. Quality improvement

measures are essential to keep the quality culture alive. Newer methods will be found, some

operations can be eliminated, improved technology available. In short, as experience is gained

things can always be done better. IT is for the management to take the initiative and encourage

the employees to be on lookout for opportunities for improvement.

CROSBY'S FOUR ABSOLUTES OF QUALITY.

Crosby espoused his basic theories about quality in four Absolutes of Quality Management as

follows:

1. Quality means conformance to requirements, not goodness.

2. The system for causing quality is prevention, not appraisal.

3. The performance standard must be zero defects, not "that's close enough."

4. The measurement of quality is the price of nonconformance, not indexes.

To support his Four Absolutes of Quality Management, Crosby developed the Quality

Management Maturity Grid and Fourteen Steps of Quality Improvement. Crosby sees the

Quality Management Maturity Grid as a first step in moving an organization towards qualitymanagement. After a company has located its position on the grid, it implements a quality

improvement system based on Crosby's Fourteen Steps of Quality Improvement as shown in

Figure 4.

Crosby's Absolutes of Quality Management are further delineated in his Fourteen Steps of

Quality Improvement as shown below:

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Step 1. Management Commitment

Step 2. Quality Improvement Teams

Step 3. Quality Measurement

Step 4. Cost of Quality Evaluation

Step 5. Quality Awareness

Step 6. Corrective Action

Step 7. Zero-Defects Planning

Step 8. Supervisory Training

Step 9. Zero Defects

Step 10. Goal Setting

Step 11. Error Cause Removal

Step 12. Recognition

Step 13. Quality Councils

Step 14. Do It All Over Again

Different between Automated Flow lines and Assembly Flow line. Automated Flow Lines

Assembly Flow Lines 1. Several Automated machines are linkedby a transfer system.1. All

equipments are needed to in automated Assembly line2. Handling machine have main role to

move semi finished product to the nextstage.2. All equipments make role of making sub-

assemblies put together andfitted.3. Semi-finished products are the main core activities.3. Here

Sub-assemblies products are the core activities.

DEMING'S FOURTEEN POINTS

Deming formulated the following Fourteen Points to cure (eliminate) the SevenDeadly Diseases and help organizations to survive and flourish in the long term:

1. Create constancy of purpose toward improvement of product and service. Develop a plan to be

competitive and stay in business. Everyone in the organization, from top management to shopfloor workers, should learn the new philosophy.

2. Adopt the new philosophy. Commonly accepted levels of delays, mistakes, defective materials,

and defective workmanship are now intolerable. We must prevent mistakes.

3. Cease dependence on mass inspection. Instead, design and build in quality. The purpose ofinspection is not to send the product for rework because it does not add value. Instead of

leaving the problems for someone else down the production line, workers must take

responsibility for their work. Quality has to be designed and built into the product; it cannot be

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inspected into it. Inspection should be used as an information-gathering device, not as a means

of "assuring" quality or blaming workers.

4. Don't award business on price tag alone (but also on quality, value, speed and long term

relationship). Minimize total cost. Many companies and organizations award contracts to the

lowest bidder as long as they meet certain requirements. However, low bids do not guarantee

quality; and unless the quality aspect is considered, the effective price per unit that a company

pays its vendors may be understated and, in some cases, unknown. Deming urged businesses to

move toward single-sourcing, to establish long-term relationships with a few suppliers (one

supplier per purchased part, for example) leading to loyalty and opportunities for mutual

improvement. Using multiple suppliers has been long justified for reasons such as providing

protection against strikes or natural disasters or making the suppliers compete against each

other on cost. However, this approach has ignored "hidden" costs such as increased travel to

visit suppliers, loss of volume discounts, increased set-up charges resulting in higher unit costs,

and increased inventory and administrative expenses. Also constantly changing suppliers solely

on the base of price increases the variation in the material supplied to production, since each

supplier's process is different.

5. Continuously improve the system of production and service. Management's job is to

continuously improve the system with input from workers and management. Deming was adisciple of Walter A. Shewhart, the developer of control charts and the continuous cycle of

process improvement known as the Shewhart cycle. Deming popularized the Shewhart Cycle as

the Plan-Do-Check-Act (PDCA) or Plan-Do-Study-Act (PDSA) cycle; therefore, it is also often

referred to as the Deming cycle. In the planning stage, opportunities for improvement are

recognized and operationally defined. In the doing stage, the theory and course of action

developed in the previous stage is tested on a small scale through conducting trial runs in a

laboratory or prototype setting. The results of the testing phase are analyzed in the check/study

stage using statistical methods. In the action stage, a decision is made regarding the

implementation of the proposed plan. If the results were positive in the pilot stage, then the

plan will be implemented. Otherwise alternative plans are developed. After full scale

implementation, customer and process feedback will again be obtained and the process ofcontinuous improvement continues.

6. Institute training on the job. When training is an integral part of the system, operators are

better able to prevent defects. Deming understood that employees are the fundamental asset of

every company, and they must know and buy into a company's goals. Training enables

employees to understand their responsibilities in meeting customers' needs.

7. Institute leadership (modern methods of supervision). The best supervisors are leaders andcoaches, not dictators. Deming high-lighted the key role of supervisors who serve as a vital link

between managers and workers. Supervisors first have to be trained in the quality management

before they can communicate management's commitment to quality improvement and serve as

role models and leaders.

8. Drive out fear. Create a fear-free environment where everyone can contribute and work

effectively. There is an economic loss associated with fear in an organization. Employees try to

please their superiors. Also, because they feel that they might lose their jobs, they are hesitant

to ask questions about their jobs, production methods, and process parameters. If a supervisor

or manager gives the impression that asking such questions is a waste of time, then employees

will be more concerned about pleasing their supervisors than meeting long-term goals of the

organization. Therefore, creating an environment of trust is a key task of management.

9. Break down barriers between areas. People should work cooperatively with mutual trust,

respect, and appreciation for the needs of others in their work. Internal and external

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organizational barriers impede the flow of information, prevent entities from perceiving

organizational goals, and foster the pursuit of subunit goals that are not necessarily consistent

with the organizational goals. Barriers between organizational levels and departments are

internal barriers. External barriers are between the company and its suppliers, customers,

investors, and community. Barriers can be eliminated through better communication, cross-

functional teams, and changing attitudes and cultures.

10.Eliminate slogans aimed solely at the work force. Most problems are system-related and require

managerial involvement to rectify or change. Slogans don't help. Deming believed that people

want to do work right the first time. It is the system that 80 to 90 percent of the time prevents

people from doing their work right the first time.

11.Eliminate numerical goals, work standards, and quotas. Objectives set for others can force sub-

optimization or defective output in order to achieve them. Instead, learn the capabilities of

processes and how to improve them. Numerical goals set arbitrarily by management, especially

if they are not accompanied by feasible courses of action, have a demoralizing effect. Goals

should be set in a participative style together with methods for accomplishment. Deming argued

that the quota or work standard system is a short-term solution and that quotas emphasize

quantity over quality. They do not provide data about the process that can be used to meet the

quota, and they fail to distinguish between special and common causes when seekingimprovements to the process.

12.Remove barriers that hinder workers (and hinder pride in workmanship). The direct effect of

pride in workmanship is increased motivation and a greater ability for employees to see

themselves as part of the same team. This pride can be diminished by several factors: (1)

management may be insensitive to workers' problems; (2) they may not communicate the

company's goals to all levels; and (3) they may blame employees for failing to meet company

goals when the real fault lies with the management.

13. Institute a vigorous program of education and self improvement. Deming's philosophy is based

on long-term, continuous process improvement that cannot be carried out without properly

trained and motivated employees. This point addresses the need for ongoing and continuous

education and self-improvement for the entire organization. This educational investment servesthe following objectives: (1) it leads to better motivated employees; (2) it communicates the

company goals to the employees; (3) it keeps the employees up-to-date on the latest techniques

and promotes teamwork; (4) training and retraining provides a mechanism to ensure adequate

performance as the job responsibilities change; and (5) through increasing job loyalty, it reduces

the number of people who "job-hop."

14.Take action to accomplish the transformation. Create a structure in top management that willpromote the previous thirteen points. It is the top management's responsibility to create and

maintain a structure for the dissemination of the concepts outlined in the first thirteen points.

Deming felt that people at all levels in the organization should learn and apply his Fourteen

Points if statistical process control is to be a successful approach to process improvement and if

organizations are to be transformed. However, he encouraged top management to learn them

first. He believed that these points represent an all-or-nothing commitment and that they

cannot be implemented selectively.

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MB0044 PRODUCTION AND OPERATIONS MANAGEMENT SET-2

Q1.Sketch the business process model and define the terms. Differentiate between Logical process

Modeling and Physical Process modeling.

Business process models consist of simple diagrams constructed from a limited set ofgraphical elements. For both business users and developers, they simplify understandingbusiness activities' flow and process. BPM's four basic element categories are:

*Flow objects

Events, activities, gateways

*Connecting objects

Sequence flow, message flow, association

*Swim lanes

Pool, lane

*Artifacts

Data object

group, annotation

These four categories enable creation of simple business process diagrams (BPDs). BPDsalso permit making new types of flow object or artifact, to make the diagram moreunderstandable.

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Flow objects and connecting objects

EVENT ACTIVITY GATE WAY CONNECTION

Flow objects are the main describing elements within BPMN, and consist of three core elements:events, activities, and gateways.

Event

An Event is represented with a circle and denotes something that happens (compared with an

activity, which is something that is done). Icons within the circle denote the type of event (e.g.,

an envelope representing a message, or a clock representing time). Events are also classified as

Catching (for example, if catching an incoming message starts a process) or Throwing (such as

throwing a completion message when a process ends).

Start event

Acts as a process trigger; indicated by a single narrow border, and can only be Catch, so is shown

with an open (outline) icon.

End event

Represents the result of a process; indicated by a single thick or bold border, and can only

Throw, so is shown with a solid icon.

Intermediate event

Represents something that happens between the start and end events; is indicated by a

tramline border, and can Throwor Catch (using solid or open icons as appropriate). For example,

a task could flow to an event that throws a message across to another pool, where a subsequentevent waits to catch the response before continuing.

Activity

An activity is represented with a rounded-corner rectangle and describes the kind of work which

must be done.

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Task

A task represents a single unit of work that is not or cannot be broken down to a further level of

business process detail without diagramming the steps in a procedure (which is not the purpose

of BPMN)

Sub-process

Used to hide or reveal additional levels of business process detail. When collapsed, a sub-

process is indicated by a plus sign against the bottom line of the rectangle; when expanded, the

rounded rectangle expands to show all flow objects, connecting objects, and artifacts.

Has its own self-contained start and end events; sequence flows from theparentprocess must

not cross the boundary.

Transaction

A form of sub-process in which all contained activities must be treated as a whole; i.e., they

must all be completed to meet an objective, and if any one of them fails, they must all be

compensated (undone). Transactions are differentiated from expanded sub-processes by being

surrounded by a tramline border.

Gateway

A gateway is represented with a diamond shape and determines forking and merging of paths,

depending on the conditions expressed.

Flow objects are connected to each other using Connecting objects, which are of threetypes: sequences, messages, and associations.

Sequence Flow

A Sequence Flow is represented with a solid line and arrowhead, and shows in which order the

activities are performed. The sequence flowmay also have a symbol at its start, a small diamond

indicates one of a number ofconditional flows from an activity, while a diagonal slash indicates

the default flow from a decision or activity with conditional flows.

Message Flow

A Message Flow is represented with a dashed line, an open circle at the start, and an open

arrowhead at the end. It tells us what messages flow across organizational boundaries (i.e.,

between pools). A message flow can never be used to connect activities or events within the

same pool.

Association

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An Association is represented with a dotted line. It is used to associate an Artifact or text to a

Flow Object, and can indicate some directionality using an open arrowhead (toward the artifact

to represent a result, from the artifact to represent an input, and both to indicate it is read and

updated). No directionality is used when the Artifact or text is associated with a sequence or

message flow (as that flow already shows the direction).

Swimlanes and artifacts

Swimlanes Data objects Groups Annotation

Swim lanesare a visual mechanism of organising and categorising activities, based oncross functional flowcharting, and in BPMN consist of two types:

Pool

Represents major participants in a process, typically separating different organisations. A pool

contains one or more lanes (like a real swimming pool). A pool can be open (i.e., showing

internal detail) when it is depicted as a large rectangle showing one or more lanes, or collapsed

(i.e., hiding internal detail) when it is depicted as an empty rectangle stretching the width or

height of the diagram.

Lane

Used to organise and categorise activities within a pool according to function or role, and

depicted as a rectangle stretching the width or height of the pool. A lane contains the flow

objects, connecting objects and artifacts.

Artifacts allow developers to bring some more information into the model/diagram. Inthis way the model/diagram becomes more readable. There are three pre-defined Artifactsand they are:

Data objects

Data objects show the reader which data is required or produced in an activity.

Group

A Group is represented with a rounded-corner rectangle and dashed lines. The group is used to

group different activities but does not affect the flow in the diagram.

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Annotation

An annotation is used to give the reader of the model/diagram an understandable impression.

Examples of business process diagrams

A process with a normal flow Discussion cycle E-mail voting process Collect votes

Business requirements have been gathered for a proposed database, they must be modeled. Models are

created to visually represent the proposed database so that business requirements can easily be

associated with database objects to ensure that all requirements have been completely and accurately

gathered. Different types of diagrams are typically produced to i llustrate the business processes, rules,

entities, and organizational units that have been identified. These diagrams often include entity

relationship diagrams, process flow diagrams, and server model diagramsBasically, data modeling serves

as a link between business needs and system requirements.

Two types of data modeling are as follows:

Logical Process Modeling

Physical Process Modeling

Logical Modeling vs Physical Modeling

*Logical modeling deals with gathering business requirements and converting those requirements into a

model.whereas, Physical modeling involves the actual design of a database according to the

requirements that were established during logical modeling.

*Logical modeling involves gathering information about business processes, business entities (categories

of data), and organizational units. After this information is gathered, diagrams and reports are produced

including entity relationship diagrams, business process diagrams, and eventually process flow diagrams.

Whereas, Physical modeling deals with the conversion of the logical, or business model, into a relational

database model. When physical modeling occurs, objects are being defined at the schema level. A

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schema is a group of related objects in a database. A database design effort is normally associated with

one schema.

*The diagrams and documentation generated during logical modeling is used to determine whether the

requirements of the business have been completely gathered. Management, developers, and end usersalike review these diagrams and documentation to determine if more work is required before physical

modeling commences.

During physical modeling, objects such as tables and columns are created based on entities and

attributes that were defined during logical modeling. Constraints are also defined, including primary keys,

foreign keys, other unique keys, and check constraints. Views can be created from database tables to

summarize data or to simply provide the user with another perspective of certain data. Other objects such

as indexes and snapshots can also be defined during physical modeling. Physical modeling is when all

the pieces come together to complete the process of defining a database for a business.

*Logical modeling affects not only the direction of database design, but also indirectly affects the

performance and administration of an implemented database. When time is invested performing logical

modeling, more options become available for planning the design of the physical database.

Physical modeling is database software specific, meaning that the objects defined during physical

modeling can vary depending on the relational database software being used. For example, most

relational database systems have variations with the way data types are represented and the way data is

stored, although basic data types are conceptually the same among different implementations.Additionally, some database systems have objects that are not available in other database systems.

*Typical deliverables of logical modeling include

Entity relationship diagrams

An Entity Relationship Diagram is also referred to as an analysis ERD. The point of the initial

ERD is to provide the development team with a picture of the different categories of data for the

business, as well as how these categories of data are related to one another.

Business process diagramsThe process model illustrates all the parent and child processes that are performed by individuals

within a company. The process model gives the development team an idea of how data moves

within the organization. Because process models illustrate the activities of individuals in the

company, the process model can be used to determine how a database application interface is

design.

User feedback documentation

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Typical deliverables of physical modeling include the following:

Server model diagrams

The server model diagram shows tables, columns, and relationships within a database.

User feedback documentation Database design documentation

Q2.Explain project management lifecycle and its phases with an example. Explain Work Breakdown

Structure.

Project management lifecycle

A life cycle of a project consists of the following steps:

Understanding the scope of the project.

Establishing objectives of the projects.

Formulating and planning various activities.

Executing the project.

Monitoring and controlling the project resources.

Closing and post completion analysis.

Phases of project management life cycle

Project management life cycle has six phases:

1. Analysis and evaluation phases2. Marketing phases.

3. Design phases.

4. Execution phases.

5. Control-inspecting , testing, and delivery phases.

6. Closure and post completion analysis phases.

Analysis and evaluation phase is the initial phase of any project. In this phase , information is

collected from the customer pertaining to the project. From the collected information , the

requirement of the project are analyzed . according to the customer requirement , the entire project

is planned in a strategic manner. The project manager conducts the analysis of the problem and

submits a detailed report to the top management.

Marketing phases

A project proposal is prepared by a group of people including the project manager. This proposal

has to contain the strategies adopted to market the product to the customers.

Design phase

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Design phase involves the study of inputs and outputs of the various project stages. Inputs received

consist of project feasibility study, preliminary project evaluation details, project proposal and customer

interviews. Outputs produced consist of system design specifications, functional specifications of the

project ,design specifications of the project and project plan.

Execution phase

In this phase the project manager and the team members work on the project objectives as per the

plan. At every stage during the execution, reports are prepared.

Control-inspecting, testing, and delivery phase

During this phase, the project team works under the guidance of the project manager. The project

manager has to ensure that the team working under him is implementing the project design accurately.

The project has to be monitored through its cost, manpower and schedule. The project manager has to

ensure ways of managing the customer and marketing the future work.

Closure and post completion analysis phase

Upon satisfactory completion and delivery of the intended product of service the staff performance has

to be evaluated . the project manager has to be document the lessons from the project .

Work Breakdown Structure (WBS)

The entire process of a project may be considered to made up on number of sub process placed in

different stage called the work Breakdown Structure.

WBS is the technique to analyze the content of work and cost by breaking it down in to its component

parts. Project key stages from the highest level of the WBS, which is than used to show the details of

the lower levels of the projects. Each key stage comprises many tasks identified at the start of the

planning and latter this list will have to be validated.WBS is produced by identifying the key elements.

Breaking each elements down into component parts and continuing to breakdown until manageable

work packages have been identified. These can be allocated to the appropriate person. The WBS does

not show dependencies other than grouping under the key stages. It is not time based.

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Example of a product oriented work breakdown structure is anaircraft system.

Q3.Define industries best practices? Explain any one popular industry best practice followed by all

companies.

A best practice is a method or technique that has consistently shown results superior to thoseachieved with other means, and that is used as a benchmark. In addition, a "best" practice canevolve to become better as improvements are discovered. Best practice is considered by some asa business buzzword, used to describe the process of developing and following a standard way ofdoing things that multiple organizations can use.

Best practices are used to maintain quality as an alternative to mandatory legislated standardsand can be based on self-assessment or bench marking . Best practice is a feature of accreditedmanagement standards such as ISO 9000 and ISO 14001

Documenting and charting procedures and practices is a complicated and time-consumingprocess often skipped by companies, even though they may practice the proper processesconsistently. Some consulting firms specialize in the area of Best Practice and offer pre-made'templates' to standardize business process documentation. Sometimes a "best practice" is notapplicable or is inappropriate for a particular organization's needs. A key strategic talent requiredwhen applying best practice to organizations is the ability to balance the unique qualities of anorganization with the practices that it has in common with others.

A best practice tends to spread throughout a field or industry after a success has beendemonstrated. However, it is often noted that demonstrated best practices can be slow to spread,even within an organization. According to the American Productivity & Quality Center, the threemain barriers to adoption of a best practice are a lack of knowledge about current best practices,a lack of motivation to make changes involved in their adoption, and a lack of knowledge andskills required to do so.

Companies are constantly trying to find ways to improve performance and warehouse operations isarea where supply chain managers can focus to gain maximum efficiency for minimum cost. To getthe most out of the operation, a number of best practices can be adopted to improve productivity andoverall customer satisfaction. Although best practices vary from industry to industry and by theproducts shipped there are a number of best practices that can be applied to most companies.

When considering the level of effort involved in warehouse operations, the greatest expenditure ofeffort is in the picking process. To gain efficiencies in picking the labor time to pick orders needs to bereduced and this can achieved in a number of ways. Companies with the most efficient warehouseshave the most frequently picked items closest to the shipping areas to minimize picking time. Thesecompanies achieve their competitive advantage by constantly reviewing their sales data to ensure thatthe items are stored close to the shipping area are still the most frequently picked.

Warehouse layout is also important in achieve greater efficiencies. Minimizing travel time betweenpicking locations can greatly improve productivity. However, to achieve this increase in efficiency,companies must develop processes to regularly monitor picking travel times and storage locations.

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Warehouse operations that still use hard copy pick tickets find that it is not very efficient and prone tohuman errors. To combat this and to maximize efficiency, world class warehouse operations hadadopted technology that is some of todays most advanced systems. In addition to hand-held RFreaders and printers, companies are introducing pick-to-light and voice recognition technology.

In a pick-to-light system, an operator will scan a bar-coded label attached to a box. A digital display

located in front of the pick bin will inform the operator of the item and quantity that they need to pick.Companies are typically using pick-to-light systems for their top 5 to 20% selling products. Byintroducing this system companies can gain significant efficiencies as it is totally paperless andeliminates the errors caused by pick tickets.

Voice picking systems inform the operator of pick instructions through a headset. The pick instructionsare sent via RF from the companys ERP or order management software. The system allows operatorsto perform pick operations without looking at a computer screen or deal with paper pick tickets. Manyworld class warehouse operations have adopted voice picking to complement the pick-to-light systemsin place for their fast moving products.

Although many companies will not be able to afford new technologies for picking, weve seen here thatthere are a number of best practices that can be adopted to improve efficiency and reduce cost.

Q4.Explain PMIS. What is Key Success Factor(KSF),Explain with example.

A project management information system (PMIS) is a part ofmanagement information systems

(MIS) and manage information of a project centric organization. Project Management Information

System (PMIS) aresystemtools and techniques used in project management to deliver information.

Project managers use the techniques and tools to collect, combine and distribute information through

electronic and manual means. Project Management Information System (PMIS) is used by upper and

lower management to communicate with each other.

Upper managers need information on all projects regarding progress, problems, resource uses,

costs and project goals. This info helps them take decision on the project. They should review the

projects at each milestone and arrive at appropriate decision. Project managers and department

managers need info to see each project schedule, priority and use of resources to determine the most

efficient use across the organization. Project team members need information to see schedule, task list

and specification so that they know what needs to be done next.

The four major aspects of a PIMS are:

1. Providing information to the major stakeholders.

2. Assisting the team members, stakeholders, managers with necessary information and summary

of the information shared to the higher level managers.

3. Assisting the manager in doing what if analyses about project staffing. Proposed staffing

changes and total allocation of recourses.

4. Helping organizational learning by helping the members of the organization learn about project

management.

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Usually, the team members , and not the systems administrations of the company, develop a

good PIMS . organizations tend to allocate such responsibility by rotation among members with

a well designed and structured data entry and analytical format.

Project Management Information System (PMIS) help plan,executeandclose project

management goals. During the planningprocess, project managers use PMIS forbudget

framework such as estimatingcosts. The Project Management Information System is also used

to create a specific schedule and define the scope baseline. At theexecutionof the project

management goals, the project management team collects information into one database. The

PMIS is used to compare thebaselinewith the actual accomplishment of eachactivity, manage

materials, collect financial data, and keep a record for reporting purposes. During the close of

the project, the Project Management Information System is used to review the goals to check if

the tasks were accomplished. Then, it is used to create a final report of the project close.

To conclude, the project management information system (PMIS) is used to plan schedules,

budget and execute work to be accomplished in project management.

Key Success Factors:

Key Success Factors, also known as Critical Success Factors, is the term for elements necessary

for an organization or project to achieve its mission. This methodology is commonly used in data

analysis and business analysis.

When writing a business plan, it's crucial to identify what will make your business asuccess. Think of key success factors as the small towns you must pass through to reach yourdestination. If you don't consult a map to found out where those towns are, you may miss aturnoff and your destination. Key success factors, also known as critical success factors, keepyou and your employees on track to make your business a success.

Measurable key success factors

Increasing the sales of a product or service is a common key success factor, but it should belinked to a measurable goal, such as "sales of product X will increase by 30 percent in the fourthquarter." Measuring the outcome of the goals related to your key success factors is essential tokeeping your business on target.

General key success factors

Almost all businesses can benefit from having the key success factor "attract new customers."Decide how many new customers your business needs to succeed, and set a related goal, suchas "increase walk-in traffic by 25 percent by offering samples at the door." Other examples ofcommon key success factors are, "retain quality employees," "increase profit margin" and"increase customer satisfaction.

Regulatory key success factorsSome businesses are subject to more regulation than others. Manufacturing facilities mustcomply with OSHA regulations, and they may want to develop a key success factor thataddresses the company's compliance. For example, "Provide all employees with hazardousmaterial training."

Industry specific key success factors

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Key success factors should always be relevant to the business you are in. An example of anindustry specific key success factor is "increase load factor relative to the industry average." Thiskey success factor is specific to the airline industry, as referenced in "Air line Industry KeySuccess Factors" in the Graziadio Business Report. Fleet management is essential to airlines,limousine companies and taxi services, but it's not relevant to the development of computergames.

Temporal key success factor

The key success factor "Build a manufacturing facility to produce 80 percent of inventory" is anexample of what RapidBi.com calls temporal factors. According to the web site, temporal factors"relate to short-term situations, often crises. These CSF's may be important, but are usually short-lived." In this example, once the manufacturing facility is constructed and operational, the keysuccess factor is no longer needed and can be replaced by a currently relevant one.

Q5.Explain the seven principles of Supply Chain Management. Take an example of any product

in the market and explain Bullwhip effect.

A supply chain is a network of facilities and distribution options that performs the function of

procurement of materials, transformation of these materials into intermediate and finished

products and the distribution of these finished products to customers. supply chains exist in

both service and manufacturing organization.

Supply Chain Management is the practice of coordinating the flow of goods, service,

information, and finances as they move from raw materials to parts supplier to manufacture to

wholesaler to retailer to consumer.

The seven principals of SCM are

1. Group customers by needs: effective SCM groups customers by distinct service needs,

regardless of industry and then tailor services to those particular segments.

2. Customize the logistic network : in designing their logistic network , companies need tofocus on the service requirement and profit potential of the customer segments identified.

3. Listen to signals of the market demand and plan accordingly: sales and operations planners

must monitor the entire supply chain to detect early warning signals of changing customers

demand and needs. This demand driven approach leads to more consistent forecast and

optimal resource allocation.

4. Differentiate the product closer to the customer: companies today no longer can afford to

stockpile inventory to compensate for possible forecasting errors. Instead, they need to

postpone product differentiation in the manufacturing process closer to actual consumer

demand. This strategy allows the supply chain to respond quickly and cost effectively to

changes customers needs.5. Strategically manage the sources of supply: by working closely with their key suppliers to

reduce the overall costs of owning materials and services , SCM maximizes profit margins

both for themselves and their suppliers.

6. Develop a supply chain wide technology strategy: as one of the cornerstones of successful

SCM ,information technology must be able to support multiple levels of decision making. It

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also should afford a clear view and ability to measure the flow of products, services, and

information.

7. Adopt channel spanning performance measures: excellent supply chain performance

measurement system do more than just monitor internal functions. They apply performance

criteria to every link in the supply chaincriteria that embrace both service and financial

matrices.

Bullwhip effect on SCM:

The uncertainty caused from distorted information flowing up and down the supply chain is

known as BULLWHIP EFFECT. This has its effect on almost all the industries , posses a risk

to firms that experience large variations in demand, and also those firms which are

dependent on suppliers, distributors and retails. A bullwhip effect may arise because of:

Increase in the lead time of the project due to increase in variability of demand.

Increase in the stocks to accommodate the increasing demand arising out of

complicated demand models and forecasting techniques.

Reduced service level in the organization.

Inefficient allocation of recourses.

Increased transportation cost.

The bullwhip effect is phenomenon observed in supply chains whereby unpredictable elementsintroduced by human behavior in the lower part of the chain become more pronounced the higher up thechain they move. The effect is important because it is frequently the cause of serious inefficiencies thatresult from ordering too much or too little of a given product as links in the chain overreact to changesfurther downstream.

Example of bullwhip effect

The bullwhip effect is seen in real life as well. It originally takes its name from executives at

Proctor & Gamble who began to see disturbing and often inexplicable variations in supply and orderingfigures on diapers, despite a relatively stable demand from consumers. Oddly, the company even saw

that variability increased further when examining its own ordersto its suppliers.

5. Time taken by three machines on five jobs in a factory is tabulated below in table

below. Find out the optimal sequence to be followed to minimise the idle time

taken by the jobs on the machines.

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Ans. Consider M1 and M3

Using Johnsons algorithm , the job order sequence obtained is:

D E C A B

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The organizations that have incorporated VE:

General Electricals Corporation (GE Corp):The concept of VE originated in 1947 in GE Corp when a substitute for asbestos flooring had to be found.Specialized dealers could provide an equally good 'material' at a lesser price. Initially the practitionerswere the people in charge of purchasing who tried to locate substitute material which would be equallygood or at a lower price. This concept then made its way to the other units and departments of the

organization.Ashok Leyland:In implementation of VA, Ashok Leyland changed gear material from phosphor bronze to a lessexpensive cast iron and eliminated frequent field complaint of gear seizure in trucks.T.V.Sundaram Iyenger & Sons Limited (TVS Ltd):During the 1940s to 1960s,Madurai based TVS was ranked as the best bus transportation system in India.It could manage to run the fleets for about 96% of the time. TVS used the VE approach to restore themobility of the buses that had broken down. They stocked their garages with some of the criticalassemblies of the bus. Whenever, a part or an assembly of the bus failed, an immediate replacement wasalways at hand.