Question 1: What are the current trends in operations management?

Answer: In the global market, companies are right to focus on trends in operations
management and strategies for getting ahead in their respective industries. While
technology almost seems to change too quickly to pinpoint at times, modern
developments mean more ways to enhance business operations and increase profits.
Whether one is aiming for an organizational overhaul to become more competitive in
market or merely seeking to cut down on costs of everyday business, these 5 trends
may deliver the results one needs to meet the operations management goals:
1. Internal Communications: Satisfied employees work harder and invest more in
the company, but how can business owners encourage employee satisfaction?
Promoting internal communication is a helpful first step. Peer to peer
communication can enhance workplace morale and improve project outcomes,
regardless of your industry.
2. Mobile Accessibility: Whether one is in the technology industry and rely on
mobile devices to achieve sales targets, or one is in the hospitality business and
need client portals to reach your target market, mobile accessibility is vital to the
future of operations management. Apart from today’s reliance on mobile devices
for communication, consumers also turn to their smart devices for everything
from household goods to travel accommodations to job applications.
3. Automatization: Automating processes throughout your business can save
money and increase efficiency when it comes to all areas of operations
management. Online reservation services, automated chatbots, inline translation
functions, and mobile hotel check-in features are only a handful of examples of
business dependency on technology.
4. Performance Measurement: Detailed analytics give companies a baseline for
implementing changes in areas from development and production to customer
service. With metrics solutions that deliver comprehensive measurements,
business owners can make informed decisions regarding business practices
moving forward. Not only are companies able to track website performance and
on-site sales, they can also zero in on employee productivity and
communication.
5. Outsourcing: When it comes to reducing costs, outsourcing is often on the top
of companies’ lists. Contracting with outside agencies or individuals can help
companies save money and ensure each task receives the appropriate attention.
In cases where outsourcing is cheaper than hiring additional staff, or when no
staff is available to tackle extra projects, companies should have no qualms
about accepting outside assistance.
Question 2: Mention the recent technologies used in product and process design
Answer: Technology plays an important part in in design and production settings. The
use of appropriate technology can improve the quality and profit for the designer and
manufacturer. By using technology costs can be reduced through using less time and
staff to perform tasks and electronic storage tools can allow things to be manufactured
quicker and more accurately. The recent technologies used in product and process
design process are:

Research and communication

The increase in technology in research- The Internet, Scanners, Digital Cameras, Software-
word, publisher, excel etc. The increase in technology in communication- The Internet,
Mobile Phones, SMS, Digital Cameras, E-Mail, Software- word, publisher, excel etc.

Management and Marketing

Software such as, Software- e-mail word, publisher, excel etc. allow managers to keep track
of projects, costs and employees. Products can be marketed more quickly and effectively
using technology, TV, the Internet, Radio, Spam Email etc.

Engineering
Materials, suppliers, appropriate forms of storage and transportation are searched, such as
connecting parts and benefiting inputs, defining which professionals will need to be hired
and trained, among other measures.

Continuous improvement
Once launched, both the product or service and the process flows used to produce and
deliver them to end customers are constantly measured and analyzed, with the aim of
looking for ways to improve them even more, adding even more perceived value to the final
customers.

CAD- Computer-aided design is the use of computer systems to aid in the creation,
modification, analysis, or of a design. CAD software is used to increase the productivity of
the designer, improve the quality of design, improve communications through
documentation, and to create a database for manufacturing.

CAM (computer aided manufacturing) - Computer-aided manufacturing (CAM) is an

application technology that uses computer software and machinery to facilitate and
automate manufacturing processes. CAM is the successor of computer-aided engineering
(CAE) and is often used in tandem with computer-aided design (CAD).
N/C Machine (numerically controlled) - Numerical control, popularly known as the NC is
very commonly used in the machine tools. Numerical control is defined as the form of
programmable automation, in which the process is controlled by the number, letters, and
symbols. In case of the machine tools this programmable automation is used for the
operation of the machines.
FMS (Flexible manufacturing systems) - A flexible manufacturing system (FMS) is a
method for producing goods that is readily adaptable to changes in the product being
manufactured, both in type and quantity.

Question3. Medanalysis, Inc., provides medical laboratory services to patients of

Health Providers, a group of 10 family practice doctors associated with a new health
maintenance program. Managers are interested in forecasting the number of blood
analysis requests per week. Recent publicity about the damaging effects of cholesterol
on the heart has caused a national increase in requests for standard blood tests. The
arrivals over the last 16 weeks are given below. What is the forecasting demand for the
next three periods? Calculate the forecast accuracy (MAD, MAPE, MSE and Tracking
signal)

Week Arrivals
1 28
2 27
3 44
4 37
5 35
6 53
7 38
8 57
9 61
10 39
11 55
12 54
13 52
14 60
15 60
16 75
Linear Trend

Intercept Slope

28.50 2.35

MAD 6 CFE 0

MSE 61 MAPE 13.53%

Period Actual Forecast Error Error^2

1 28 31 3 9
2 27 33 6 36
3 44 36 8 64
4 37 38 1 1
5 35 40 5 25
6 53 43 10 100
7 38 45 7 49
8 57 47 10 100
9 61 50 11 121
10 39 52 13 169
11 55 54 1 1
12 54 57 3 9
13 52 59 7 49
14 60 61 1 1
15 60 64 4 16
16 75 66 9 81
17 68
18 71
19 73

Linear Trend
80

70

60

50

40

30

20

10

0
1 6 11 16

Period
Actual Forecast
Forecasting demand for next three period are 68, 71 & 73.

Using the below formulas, MAD, MSE, MAPE are calculated as:

MAD = ∑ |Actual|t – |Forecast|t / n = 6

MSE = ∑ (|Actual|t – |Forecast|t)2 / n = 61

MAPE = ∑ |Actual|t – |Forecast|t/Actualt * 100 / n = 13.53%

Tracking Signal = 8

Question4. A manager must decide how many machines of a certain type to buy. The
machines will be used to manufacture a new gear for which there is increased demand.
The manager has narrowed the decision of two alternatives: buy one machine or buy
two. If only one machine is purchased and demand is more than it can handle, a second
machine can be purchased at a later time. However, the cost per machine would be
lower if the two machines were purchased at the same time.

The estimated probability of low demand is 0.30 and the estimated probability of high
demand is 0.70.

The net present value associated with the purchase of two machines initially is $75000
if demand is low and $130000 if demand is high.

The net present value for one machine and low demand is $90000. If demand is high,
there are three options. One option is to do nothing, which would have a net present
value of $90000. A second option is to subcontract; that would have a net present value
of $110000. The third option is to purchase a second machine. This option would have
a net present value of $100000.

How many machines should the manager purchase initially? Use a decision tree to
analyse this problem.
Answer

Ev (node 4) = Max {90000, 110000, 100000} = $110,000 (Sub contract)

Ev (node 3) = Max {(0.3*75000) + (0.7*130000)} = $113,500
Ev (node 2) = Max {(0.3*90000) + (0.7*110000)} = $104,000

Ev (node 1) = Max {113500, 104000} = $113,500

Hence the best option is to buy 2 machines and the expected payoff is $113,500.