Name Anil Kumar Joshi

Roll No. 520949950

Course &
MBA Semester – II
Semester
Subject Name & PRODUCTION & OPERATIONS
Code MANAGEMENT - MB0028

Assignment No. Set-2

LC name & Code NIPSTec LTD. 1640

Date of
Submission

Session FEB – 2010 (Spring 2010)

1. Explain how material flow information helps in work centre decision.
Consider the example of a shopping centre to illustrate your answer.

The decision which involves during uses of material flow information is

mentioned below by considering the example of a shopping centre:

A work center (E.g. Shopping Center) is a production facility comprising of one

or more machines and one or more workmen considered as a single unit for
purposes of estimation of capacity. This shopping center may have a single
operation/ process or a number of them conducted on the input items. In the
pipeline of receiving the material to supplying to customers, each work center’s
contribution is vital as materials are scheduled, routed and loads to be sent to it.

They are even considered as cash centers. Location trust means relative
position of different centers so as to minimize the movement of materials, meet
technological sequences, to reduce congestion, maximize throughput, improve
part tracking ability and avoid repetitive movements. In addition another
consideration is to provide for expansion of production.

Each work center receives information along with material that enters it in a
shopping center; the material also leaves the shopping center with information.
The route sheet contains information about the material, process, quantities,
and inspection procedures. Etc. the drawings or instructions tell the condition of
the material of entry and the required condition at exit.

In this sense every operation consists of material transformation occurring on

the basis of information. Activities conducted are on the basis of information
that flows with material. Different locations have to accommodate the
constraints of the basis of darning maximums benefit of the information that is
available. Basically, each location is determined on the basis of from and to:
where does it receive material goes. Some centers have to close as a matter of
necessity, some need not to be and some need to be as far away as possible.
This aspect has been given a rating scale in terms of alphabets as under:
Absolutely necessary to be close
Essential to be close
Important that they are close
Ordinary closeness
Unimportant that they are close or not
Not desirable that the centers are close

It can be seen that this is only a guide for Indian location as the work centers as
there will many competing factors that have to be accommodated.
What are the reasons for failure of a project? Give suitable examples.

Before knowing the reasons of failure we have to know about project.

Project is a set of activities which are networked in order and aimed towards
achieving goal of a project.

The reasons are project failure:

A. General:

• Incidence of Project failure

• Higher cost of capital
• Projects being initiated of random at all levels
• Project objective not in line with business objective
• Project management not observed
• Project manager with no prior experience in the related project
• Non- dedicated team
• Lack of complete support from clients
• Misuse of financial resources
• Business strategy superseded
• Overspends in excess of agreed budgets

B. Management Reasons

• Ability to adapt to new resource combinations

• Differences between management and client
• Insufficient risk management
• Insufficient end-user management
• Insufficient training of users
• Inappropriate procedures and routines
• Lack of management judgement
• Lack of software development metrics
• Loss of key personnel
• Poor vendor management
• Poor communication between stakeholders
• Poor contract management
• Poor financial management
• Project management capability
• Poor delegation and decision making
• Unfilled promises to users and other stakeholders

Technical reasons

• Inappropriate architecture
• Insufficient reuse of existing technical objects
• Inappropriate testing tools
• Inappropriate coding language
• Inappropriate technical methodologies
• Lack of formal technical standards
• Lack of technical innovation (obsolescence)
• Misstatement of technical risk
 • Obsolescence of technology
• Poor interface specifications
• Poor quality code
• Poor systems testing
• Poor data migration
• Poor systems integration
• Poor configuration management
• Poor change management procedures
• Poor technical judgement

C. Factors contributing to project success not emphasized:

• Project objective in alignment with business objective

• Working within the framework of project management methodology
• Effective scoping planning, estimation, execution, controls and
reviews, project bottlenecks
• Communication and managing expectations effectively with clients,
team merits and stake holders
• Prior expectance of PM in a similar project

D. Overview of information and communication Technologies (ICT)

project:

• Involve information and communication technologies such as the

world wide web, e-mail, fibre-optics satellites
• Enable societies to produce, access, adapt and apply information in
greater amount, more rapidly and at reduce costs
• Offer enormous opportunities for enhancing business and economic
viability
• Common problems encountered during projects
• No prioritization of project activity from an organizational position
• One or more of the stages in the project mishandled
• Less qualified non-dedicated manpower
• Absence of smooth flow of communication between the involved
parties

These basic reasons lead a project to failures. In the project failures business
management and project management is directly involved. From the
management point of view it is basic things to care above topics to success of a
project. Project is the core business of a company.
 2. Explain the various phases in project management life cycle?

This is the initial phase of any project. In this phase information is collected from
the customer pertaining to the project and the requirements are analyzed. The
entire project has to be planned and it should be done in a strategic manner.
The project manager conducts the analysis of the problem and submits a
detailed report to the top project justification, details on what the problem is a
method of solving the problem, list of the objectives to be achieved, project
budget and the success rate of completing the project. The report must also
contain information and the project feasibility, and the risks involved in the
project.

Project management life cycle is the integrated part of management. It is attach

with project responsibility or failure of a project.

The important tasks of this phase are as follows:

• Specification Requirements Analysis (SRA): It has to be conducted to

determine the essential requirements of a project in order to achieve the
target.
• Feasibility study: To analyze whether the project is technically,
economically and practically feasible to be undertaken.
• Trade off analysis: To understand and examine the various alternatives
which could be considered.
• Estimation: To estimate the project cost, effort requires for the project and
functionality of various process in the project.
• System design: Choose a general design that can fusil the requirements.
• Project evolution: Evaluate the project in terms of expected profit, cost
and risks involved marketing phase.

Phases in Project Management Life Cycle:

• Marketing Phase: 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: This 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 the
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, Inspection, Testing & 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 his, implements the
project designs accurately. The project has to be monitored or tracked
through its cost, manpower and schedule. The project manager has to
ensure ways of managing the customer, perform quality control work.
Closure and post completion analysis Phase: Upon satisfactory completion and
delivery of the intended product or service the staff performance has to be
evaluated. Document the lessons from the project. Prepare the reports on
project feedback analysis followed by the project execution report.

General practices involved in the above phases are:

The preparation stage involves the preparation and approval of project

outline, project plan and project budget.

The next stage involves selecting and briefing the project team about the
proposals followed by discussions on the roles and responsibility of the
project member and the organization.

The feasibility or research stage will establish whether the project is feasible or
not and establishes the risk factors likely to be faced during the course of
project execution and the related key factors to overcome the problems.

A detailed definition and plan for the project and its execution is prepared by the
team and coordinated by project Manager.

The final stage involves satisfactory delivery of the product/service to the

customers. Upon completion of the project, review is to be conducted by
the project team along with the sponsors and customers to discuss about
the progress, performance and hurdles.
4. What are the Seven Principles of SCM?

1. Group customer by needs- Effective SCM groups, customer by

distinct service needs, regardless of industry and then tailors services
to those particular segments.

2. Customize the logistic network- In designing their logistics network;

companies need to focus on the service requirement and profit of the
customer segments identified.

3. Listen to signals of market demand and plan accordingly- Sales

and operations planners must monitor the entire supply chain to detect
early warning signals of changing customer 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 stock pile 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 change in customer 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 also should afford a
clear view and ability to measure the flow of products, services and
information.

7. Adopt channel spanning chain 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 chain-criteria that embrace both service and financial
metrics, including each account’s profitability.
5. Explain what is meant by bullwhip effect and how it could be
prevented?
An organisation will always have ups and downs. It is necessary that the
managers of the organisation keep track on the market conditions and
analyze the changes. They must take decisions on the resources and make
necessary changes within the organisation to meet the market demands.
Failing to do so may result in wild swing in orders. This may adversely affect
functioning of the organisation resulting in lack of coordination and trust
among supply chain members. The changes may affect the information and
may lead to demand amplification in the supply chain. The bullwhip effect is
the uncertainty caused from distorted information flowing up and down the
supply chain. This has its effect on almost all the industries, poses a risk to
firms that experience large variations in demand, and also those firms which
are dependent on suppliers, distributors and retailers.

A bullwhip effect may also arise because of:

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

demand.
b. Increase in the stocks to accommodate the increasing demand arising
out of complicated demand models and forecasting techniques.
c. Reduced service levels in the organisation.
d. Inefficient allocation of resources.
e. Increased transportation costs.

Measures to prevent bullwhip effect:

Bullwhip effect may be avoided by one or more of the following measures:

a. Avoid multiple demand forecasting.

b. Breaking the single orders into number of batches of orders.
c. Stabilising the prices, avoid the risk involved in overstocking by
maintaining a proper stock.
d. Reduce the variability and uncertainty in Point Of Sale[POS] and
sharing information.
e. Reduce the lead time in the stages of the project.
f. Always keep analysing the past figures and track current and future
levels of requirements.
g. Enhance the operational efficiency and outsourcing logistics to a
capable and efficient agency.
6. What do you understand by line balancing? What is the importance
of order picking in material handling? Give suitable examples.

Line Balancing:

Productivity increases when product moves the various operations toward

completion without any holdovers. Balancing a variety of operation is the
major concern which is addressed by design and allocation of machines at
workstations.

Material handling has become one of the important functions of operations

management owing to the necessity of making them efficient and
economical. The necessity is the outcome of worldwide outsourcing and
meeting demands of a global market. Assemblies take place at various
locations and distribution is across the world. Many companies do not have
main stores at their manufacturing facilities. Suppliers deliver the required
quantities to the places where they are required for further processing or
assembly. To reduce the inventory only required quantities have to be made
and delivered at appropriate times.

This necessitates that the flow lines are smooth. Balancing flow lines,
different equipments to achieve the same is the objective of line balancing.

Production lines have a number of work enters in particular sequence so

that the material that gets processed has to move further without
encountering any bottlenecks. The quantities processed the rate of
production at each centre, the number of operations and the total production
required are factors taken into account.

The purpose of balancing is to see that no shortages occur between work

centres and minimum inventory gets created.
The principles of Linear Programming, JIT and Lean Manufacturing are used
to achieve these.

The importance of order picking in material handling

Order picking is a process by which items or products for which supply is to

be made have to be retrieved from specific storage locations. It is found to
take 60% of labour activities in a warehouse. Since it is critical to the
business to meet customer’s demands accurately, lot of attention is being
given to this aspect of operations. In the manufacturing arena, we desire to
move towards small lot sizes, point of use delivery and cycle time
reductions. Efficient order picking is necessary for being competitive. In the
supply chain, storage, retrieval, and delivery do not add value to the product,
but are necessary.

Types of equipments that help in bring efficiency to the process:

a. Horizontal Travel – These are in the aisle, picker to part systems.

The picker, a worker walks or rides a vehicle and pickers the item or
 product and puts into the vehicle, or conveyor. The storage system
could be pallet racks, shelves or gravity racks.

b. Person Abroad- In this system the picker is on a platform of a

vehicle he can move up and also horizontally along the aisle.

c. Part to Picker – these are mechanised systems here a storage /

retrieval device carries the trays or bins to the person picking. More
than one picker can also access the system.

d. Special equipment – for high throughput and space efficiently

special equipments are made which are in the form of movable
shelves, rotary racks mobile shuttles that travel in lanes.

e. Workplace equipment – items can be kept in work benches and be

picked up. The carts are used to keep items for being picked up.

Before implementing any of these systems, a detailed study of alternatives,

a plan for expansion or reduction will have to be considered. Some of these
factors are:

A. Material Properties
- Size, weight and nest ability
- Carton counts, pallet counts
- Fragility
- Value
- Environment[ temperature, humidity]
B. System Requirements
- Volume per product
- Number of orders to be shipped
- Response time
- Supporting processes [labelling, pricing]
- Growth factors
C. Economic factors
- Investment required
- Product life
- Rate of return
D. Design considerations
- Total number of products that are to be stored
- Number of products received per shift
- Total number of retrieved per shift
- Labour force
- Variability of the product
- Management Information System