Introduction

Name
Qualification

Junaid Nasir
BE ( Mechanical) NED MBA IBA PGD Comp. Science IBA 29 years in Engineering Sector at top management positions, teaching and consultancy at reputable university and organizations

Experience

Introduction

COO of Alupak Ltd and Alucan Ltd

Ex Deputy Managing Director of Adamjee Engineering (Pvt.) Ltd Travelled 20 countries for trainings, business development, procurement of Plants, Machines and Raw Materials Visited more than 150 companies including 65 foreign companies to get trainings, business development and for auditing QMS.

RESPECT DISCIPLINE

TENSION FREE

Text Book
Operations Management (Strategy and Analysis) by lee J. Krajewski and Larry P. Ritzman, fifth edition,

By : Junaid Nasir

Reference Books
Productions & Operations Management by Barry Render and Jay Heizer Productions & Operations Management by Stevenson Modern Production & Operation Management by Elwood S. Buffa and Rakesh K Sarin

By : Junaid Nasir

Course Plan
Introduction, Production/Operations System, Operation Strategy
Decision Making Case Study Process Management Management of Technology Work Force Management Learning Curves Total Quality Management
By : Junaid Nasir

Course Plan
Inventory Control
Statistical Process Control Location and Layout Capacity Supply Chain Management Forecasting Project Management Network Analysis, CPM & PERT

By : Junaid Nasir

Advise from Rector

Attendance
All absences will be strictly recorded. No late comings will be allowed and will be considered as an absence.

For Executive sessions (Saturday and Sunday), of 3 hours each, 2 absences are allowed out of 15 sessions.
Any student exceeding this limit would be awarded an F Grade and the faculty has to bring this to the notice of the concerned Head of the Department and Academics Department.
By : Junaid Nasir

Advise from Rector

Dress Code
IoBM expects its students to reflect its values and standards in every way, and especially in the way they dress and conduct themselves. This will enable them to make a positive impression and project a professional image wherever they go. In order to achieve the above stated objectives, the following guidelines must be strictly observed: All clothing worn by students should be well laundered. Clothes should be inoffensive in terms of cuts and style, or by way of messages printed on them.
By : Junaid Nasir

Advise from Rector

Female students may only wear jeans provided their tops are of mid-thigh length. They should also be modest and avoid transparent materials and short lengths for sleeves and trousers/ shalwars. Only light make up, jewelry and perfume is permitted. Male students are only allowed full length trousers or jeans. For footwear, they must wear dress shoes, moccasins, joggers or sandals with back straps. Male students should maintain proper haircuts and refrain from piercing their ears and faces. No variations or violations in all of the above will be permitted and students doing so will be marked absent in their respective classes.
By : Junaid Nasir

Advise from Rector

Mobile Phones Students should not be allowed to use or play with mobile phones in the classroom. In case they are using one, phones should be confiscated and handed over to the Administration Department. Absences during mid-terms Students tend to miss classes during examinations. This must be discouraged by awarding a penalty in the form of marks as well as attendance.

By : Junaid Nasir

Examination
N 1 policy is no longer in place and now only two mid-terms and final examination will take place.

Marks Distribution 40% Final 30% Mid terms (15% each) 30% Sessional
By : Junaid Nasir

Examination
Sessional Marks Two quizzes 10 (4th and 9th weeks)

Assignments

10 ( 4 assignments to
be submitted in 5th, 8th, 10th and 12th weeks, no late submission is allowed)

Presentations

10

By : Junaid Nasir

Operations Management
Operations management is the set of activities that creates value in the form of goods and services by transforming inputs into outputs
Production is the creation of goods and services

By : Junaid Nasir

Operations Management
Essential functions: Marketing generates demand Operations creates the product Finance/accounting tracks organizational performance, pays bills, collects money

By : Junaid Nasir

Organizational Functions
Marketing
Gets customers

Operations

creates product or service

Finance/Account ing

Obtains funds Tracks money

1995 Corel Corp.

By : Junaid Nasir

Why Study OM?

OM is one of three major functions (marketing, finance, and operations) of any organization. We want (and need) to know how goods and services are produced. We want to understand what operations managers do. OM is such a costly part of an organization.
By : Junaid Nasir

Why Study OM?

What Operations Managers Do Plan - Organize - Staff - Lead - Control

By : Junaid Nasir

Ten Critical Decisions

1. Service, product design 2. Quality management 3. Process, capacity design 4. Location 5. Layout design 6. Human resources, job design 7. Supply-chain management 8. Inventory management 9. Intermediate and short term scheduling 10.Maintenance
By : Junaid Nasir

Ten Critical Decisions

Service and product design
What product or service should we offer? How should we design these products and services?

Quality management
Who is responsible for quality? How do we define quality?

By : Junaid Nasir

Ten Critical Decisions

Process and capacity design
What processes will these products require and in what order? What equipment and technology is necessary for these processes?

By : Junaid Nasir

Ten Critical Decisions

Location
Where should we put the facility On what criteria should we base this location decision?

Layout design
How should we arrange the facility? How large a facility is required?

By : Junaid Nasir

Ten Critical Decisions

Human resources and job design
How do we provide a reasonable work environment? How much can we expect our employees to produce?

Supply chain management

Should we make or buy this item? Who are our good suppliers and how many should we have?
By : Junaid Nasir

Ten Critical Decisions

Inventory, material requirements planning,
How much inventory of each item should we have?

When do we re-order? Intermediate, short term, and project scheduling

Is subcontracting production a good idea? Are we better off keeping people on the payroll during slowdowns?
By : Junaid Nasir

Ten Critical Decisions

Maintenance
Who is responsible for maintenance? When do we do maintenance?

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Significant Events in Operations Management

The Heritage of Operations Management

Division of labor (Adam Smith 1776 and Charles Babbage 1852) Standardized parts (Whitney 1800) Scientific Management (Taylor 1881) Coordinated assembly line (Ford/Sorenson/Avery 1913) Gantt charts (Gantt 1916) Motion study (Frank and Lillian Gilbreth 1922 Quality control (Shewhart 1924; Deming 1950) Computer (Atanasoff 1938)

CPM/PERT (DuPont 1957)

The Heritage of Operations Management

Material requirements planning (Orlicky 1960) Computer aided design (CAD 1970)

Flexible manufacturing system (FMS 1975)

Baldrige Quality Awards (1980) Computer integrated manufacturing (1990) Globalization(1992)

Internet (1995)

Significant Events in OM
Division of labor (Smith, 1776) Standardized parts (Whitney, 1800) Scientific management (Taylor, 1881) Coordinated assembly line (Ford 1913) Gantt charts (Gantt, 1916) Motion study (the Gilbreths, 1922) Quality control (Shewhart, 1924)

Significant Events
CPM/PERT (Dupont, 1957) MRP (Orlicky, 1960) CAD Flexible manufacturing systems (FMS) Manufacturing automation protocol (MAP) Computer integrated manufacturing (CIM)

New Challenges in OM
From To

Local or national focus Batch shipments Low bid purchasing

Global focus Just-in-time Supply chain partnering

Lengthy product development Standard products Job specialization

Rapid product development, alliances

Mass customization Empowered employees, teams

Characteristics of Service
Intangible product Produced & consumed at same time Often unique High customer interaction Inconsistent product definition Often knowledgebased Frequently dispersed

1995 Corel Corp.

Goods Versus Services

Goods Can be resold Can be inventoried Services Reselling unusual Difficult to inventory Quality difficult to measure Selling is part of service

Some aspects of quality measurable Selling is distinct from production

Goods Versus Services Continued

Goods Product is transportable Site of facility important for cost Often easy to automate Revenue generated primarily from tangible product Services
Provider, not product is transportable Site of facility important for customer contact Often difficult to automate Revenue generated primarily from intangible service.

Changing Challenges for the Operations Manager

Past
Local or national focus Batch (large) shipments Low-bid purchasing Lengthy product development

Causes
Low-cost, reliable worldwide communication and transportation networks Cost of capital puts pressure on reducing investment in inventory Quality emphasis requires that suppliers be engaged in product improvement Shorter life cycles, rapid international communication, computer-aided design, and international collaboration

Future
Global Focus Just-in-time shipments Supply-chain partners Rapid product development, alliances, collaborative designs

Changing Challenges for the Operations Manager

Past
Standardized products Job specialization Low cost focus

Causes
Affluence and worldwide markets; increasingly flexible production processes Changing sociocultural milieu. Increasingly a knowledge and information society. Environmental issues, ISO 14000, increasing disposal costs

Future
Mass customization Empowered employees, teams, and lean production Environmentally sensitive production, Green manufacturing, recycled materials, remanufacturing

The Productivity Challenge

The Economic System Transforms Inputs to Outputs

Inputs
Land, Labor, Capital, Management

Process
The economic system transforms inputs to outputs at about an annual 2.5% increase in productivity (capital 38% of 2.5%), labor (10% of 2.5%), management (52% of 2.5%)
Feedback loop

Outputs
Goods and Services

Typical Impact of Quality Improvement

As productivity improved Costs were pared Wages increased

Parts per man hour

Cost per unit decreased

$2.25 $2.00 $1.75 $1.50

Average worker's annual cash compensation increased

27000 26000 25000 24000

115 110 105 100

95
Year A Year B Year C

Year A

Year B

Year C

Year A

Year B

Year C

Productivity
Measure of process improvement Represents output relative to input

Productivity = Units produced Input used

Only through productivity increases can our standard of living improve

Multi-Product Productivity

Productivity

Output Labor + material + energy + capital + miscellaneous

Measurement Problems
Quality may change while the quantity of inputs and outputs remains constant External elements may cause an increase or decrease in productivity Precise units of measure may be lacking

Productivity Variables
Labor - contributes about 10% of the annual increase Capital - contributes about 32% of the annual increase Management - contributes about 52% of the annual increase

Key Variables for Improved Labor Productivity

Basic education appropriate for the labor force Diet of the labor force Social overhead that makes labor available Maintaining and enhancing skills in the midst of rapidly changing technology and knowledge

Service Productivity
Typically labor intensive Frequently individually processed Often an intellectual task performed by professionals Often difficult to mechanize Often difficult to evaluate for quality

Productivity
Problem
A company makes 2000 (9000 per dayGeneral tyre) tires per day with the following resources Labour 400 hours per day @ Rs 50 per hour ( 8 hour shift) Raw material 20,000 kg per day @ Rs 100 per kg Energy Rs 100,000 per day Capital Rs 200,000 per day

By : Junaid Nasir

Productivity
Problem
What is the labour productivity per labour hour?
What is the multifactor productivity for these tires? What is the percent change in multifactor productivity if labour hours is reduced to 380, material is reduced by 10% and energy cost is reduced by 30% for the same production?
By : Junaid Nasir

Productivity
Answers 5 tire per labour hour 0.000862 tire per rupee Multiple productivity tire 0.0009574 per rupee (11.07% increase in productivity)

By : Junaid Nasir

Productivity
Problem Three employees processed 600 insurance policies last week. They worked 8 hours per day, 5 days per week. Calculate labour productivity for the week. A team of workers made 400 units of a product which has a cost of Rs 10. The labour, material and over head costs of making the product are Rs 400, Rs 1000 and Rs 300. Calculate multifactor productivity.
By : Junaid Nasir

Productivity
Answers 5 policies per labour hour

2.35

By : Junaid Nasir

By : Junaid Nasir