MBCQ 722 Operations & Materials Management L T P C

Version 1.0 2 1 0 3
Pre-requisites/Exposure Graduate in Engineering/Science discipline
Co-requisites

Course Objectives

 To develop an understanding of how the operations, have strategic importance and can provide a
competitive advantage in the workplace.
 To understand the relationship between operations and other business functions.
 To understand techniques of location and facility planning; line balancing; job designing; and
capacity planning in operations management.
 To understand the Materials Management function starting from Demand Management through
Inventory Management.

Course Outcomes

On completion of this course, the students will be able to

CO1. Identify the elements of operations management and various transformation processes to
enhance productivity and competitiveness.
CO2. Analyze and evaluate various facility alternatives and their capacity decisions, develop a
balanced line of production & scheduling and sequencing techniques in operation environments
CO3. Develop aggregate capacity plans and MPS in operation environments.
CO4. Plan and implement suitable materials handling principles and practices in the operations.
CO5. Plan and implement suitable quality control measures in Quality Circles to TQM.

Catalog Description

Operations & Materials Management (OMM) deals with the design and operation of the
systems for production of goods and services. It will explore the approaches and analyze
strategic decisions in operations management with a focus on designing products and
processes, allocating scarce resources to strategic alternatives, and do long-range capacity
and facility planning. These operations functions help in achieving the organization’s long-range
objectives. Subsequent focus will be on medium and short term planning and
controlling. Care will be taken to strike a balance between theoretical and practical
perspectives in manufacturing and service organizations.

Course Content

Unit I: INTRODUCTION [6 Lecture Hours]

Introduction to operations and Materials Management, Evolution Scope and Development Stages of
OM, Operations strategy: As a competitive weapon & Concept of
productivity
Unit II: FORECASTING [3 Lecture Hours]
Introduction to Forecasting Time Series Introduction, Components of Time Series, Types of
Forecasting, Regression Method, Moving Average, Exponential method, Forecasting errors.

Unit III: FACILITY LOCATION & LAYOUT [6 Lecture Hours]

Facility location: Parameters & Criterion for selection of a location, Different types of layouts, their
planning and production systems, Service Layouts & Operations.

Unit IV: ASSEMBLY LINE BALANCING & SCHEDULING [6 Lecture Hours]

Networking of Process Flow, Assembly Line Balancing, Scheduling of Operations.

Unit V: CAPACITY PLANNING [3 Lecture Hours]

Planning Capacity Across the Organization, Planning Long-Term Capacity, Capacity Timing and
Sizing Strategies.

Unit VI: MATERIALS MANAGEMENT [3 Lecture Hours]

Materials Handling, Role of purchase department, Inventory Basics, ERP, KANBAN System, Lean
operations and JIT.

Unit VII: INVENTORY PLANNING & CONTROL [6 Lecture Hours]

EOQ Models, Inventory Control Techniques: ABC,VED analysis, EOQ using Quantity discount,
POQ

Unit VIII: QUALITY PLANNING & CONTROL [3 Lecture Hours]

Total Quality Management (TQM), Statistical Process Control, Control Charts.

Text Books
1. James R Evans & David A Collier – Operations Management: Thomson Press Pub.
2. Richard B Chase, F Robert Jacobs, Nicholas J Aquilano, & Nitin K Agarwal – Operations
Management for Competitive Advantage; Tata McGraw-Hill (12th Edition)

Reference Books
1. Richard B. Chase, Ravi Shankar and F. Robert Jacobs (2014); Operations & Supply Chain
Management; McGraw-Hill - 2014 (14th Edition).
2. Chary S. N. Theory and Problems in Production & Operations Mgt.; Tata McGraw Hill (14th
Edition).
3. Krajewski Lee; Operations Mgt. Process for Value Chains; Prentice Hall (8th Edition).
4. Russell S. Roberta & Taylor, Operations Mgt., Prentice Hall (4th Edition).

Modes of Evaluation: Quiz/Assignment/ presentation/ extempore/ Written

Examination
Examination Scheme:

Components MSE Internal Assessment ESE

(Class Participation/Project Assignment/Quiz)
Weightage (%) 20 30 50

Program Outcomes:
PO 1 Students will be able to develop and evaluate alternate managerial choices and identify
optimal solutions.
PO 2 Students will demonstrate effective application capabilities of their conceptual
understanding to infrastructure planning, development and management

PO 3 Students will be able to exhibit effective decision-making skills, employing analytical and
critical thinking ability for planning, development and management of soft and hard
infrastructure.

PO 4 Students will demonstrate effective oral and written communication skills in the
professional context

PO 5 Students will be able to work effectively in teams and demonstrate team-working

capabilities

PO 6 Students will exhibit leadership and networking skills.

PO 7 Students will demonstrate sensitivity towards ethical and moral issues and have ability
to address them in the context of urban planning, development and management
including cost effective financing and good governance.

PO 8 Students will demonstrate employability traits in line with the needs of changing hard
and soft urban infrastructure sector.

PO 9 Students will demonstrate strong conceptual knowledge and execution in soft and hard
infrastructure planning, development, management, financing, regulation and
governance.

PO 10 Students will demonstrate effective understanding of infrastructure planning and

development, utility & energy management, urban transportation including metro rail,
e-vehicle with charging and other modes of urban surface transportation, water supply
and sewerage, smart city planning and effective financing urban infrastructure.

PO 11 Students will demonstrate analytical skills to understand issues with remedial solutions
relating to urban infrastructure.

PO 12 Students will exhibit the ability to integrate planning, construction & development,
operation & management, financing, regulation and governance of urban infrastructure
projects and facilities.

PO 13 Students will exhibit the ability to integrate technical, economic, social and regulatory
frameworks for urban infrastructure sector planning and resource management.

PO 14 Students will exhibit deployable skills pertinent to urban hard and soft infrastructure
sector and smart city development and management.

Relationship between the Course Outcomes (COs) and Program Outcomes (POs)
Mapping between COs and POs
Mapped
Course Outcomes (COs) Programme
Outcomes
 Identify the elements of operations management and various PO1, PO8,
CO 1 transformation processes to enhance productivity and PO9, P10,
competitiveness. PO14
Analyze and evaluate various facility alternatives and their
capacity decisions, develop a balanced line of production &
CO 2 PO2, P11, P13
scheduling and sequencing techniques in operation
environments
Develop aggregate capacity plans and MPS in operation
CO 3 environments. PO3, P12, P13

Plan and implement suitable materials handling principles and PO4, PO6,
CO 4 practices in the operations PO8 , P12,
P13
Plan and implement suitable quality control measures in PO5, PO3,
CO 5
Quality Circles to TQM PO10, PO14

Course PO PO PO PO PO PO PO PO PO PO PO PO PO PO
Course Title
Code 1 2 3 4 5 6 7 8 9 10 11 12 13 14

Operations &
MBCQ
Materials 3 2 1 3 3 1 1 2 1 2 2 1 2 2
722
Management

1=weakly mapped
2= moderately mapped
3=strongly mapped

Master’s-Level Programs
In master’s-level programs, knowledge of the key content areas and functional disciplines
of business is assumed. Graduates of master’s-level programs should acquire a depth of
knowledge in these areas that exceeds that of the typical bachelor’s degree graduate.

Graduates of master’s-level programs in business should be able to:

1. Recognize problems
2. Integrate theory and practice for the purpose of strategic analysis
3. Employ and apply quantitative techniques and methods in the analysis of real-world
business situations
4. Communicate to relevant audiences; graduates should be able to:
a). Compose clear, consistent, and effective written forms of communication
b). Compose and present effective oral business presentations
5. Work effectively with a team of colleagues on diverse projects
6. Identify and analyze the ethical obligations and responsibilities of business
 Model Question Paper

Name:
Enrolment No:

Course: MBCQ722 – Operations & Materials Management

Programme: MBA (Urban Infrastructure) Semester: Even-
Time: 03 hrs. Max. Marks: 100

Instructions:
Note: All sections are compulsory & this question paper carries 4 sections.
Section A (20)
Attempt all questions in this section
1.
1. (A) Write the full form of the following
(a) DMAIC
(b) DPMO (2*4=8
(c) TOC marks)
CO
(d) MRP - 1,
2,
(B) Explain the following
3,
(a) Throughput rate (3*4=12 ,5
(b) MPS marks)
(c) FMS
(d) Six sigma

SECTION B (20 Marks)

Attempt any 4 question, each question carries 5 marks only
2. (a) Determine the reliability of the system shown below where lamp 2(backup of lamp 1), lamp
4(backup of lamp 3), lamp 5(backup of lamp 4), lamp 7(back up of lamp 6)

(5*4=
CO
20
1,
marks)
2,4

(b Discuss the design process, its importance & the various stages of design process?
(c) Define little’s law? Describe an example that you have observed where little’s law
Applies?
(d) What are the various types of process design? Explain with examples
(e) Differentiate between make to order, make to stock & assemble to order?
 SECTION C(30 marks)
(Attempt any 3 question, each question carries 10 marks only)
3. (a) Smart metering is a new startup that develops and markets smart meters. The company is
currently located in Delhi & employs 15 people. Due to a strong growth, the company needs
additional office space. The company has the option of leasing additional space at its current
location in Delhi for the next two years, but after that will need to move to a new building.
Another option the company is considering is moving the entire operation to a small town in
Bhiwadi immediately. A third option is for the company to lease a new building in Delhi
immediately. If the company chooses the first option & leases new space at its current location, it
can, at the end of two years, either lease a new building in Delhi or move to the small town
Bhiwadi
The following are some additional facts about the alternatives and current situation
1. The company has a 75% chance of surviving the next two years
2. Leasing the new space for two years at the current location in Delhi would cost $750000
per year
3. Moving the entire operation to Bhiwadi towm would cost $ 1million, leasing space would
run only $500000 per year
4. Moving to a new building in Delhi would cost $200000, and leasing the new building’s
space would cost $650000 per year
5. The company can cancel the lease at any time
6. The company will build its own building in five years, if it survives
7. Assumes all other costs and revenues are the same no matter where the company is
located
What should Smart Metering do? CO
[10 x 3] – 2,
3(b) Anik & Co. produces electric wires for state electricity department. Quality is not quite good 3,4
as it could be at this point, but the selling price is low and Anik can study the market response
while spending more time on R&D. At this stage, however Anik & co. needs to develop
aggregate production plan for the next six months January through June. You have been
commissioned to create the plan. The following information should help:
January February March April May June Total
Demand 500 600 650 800 900 800 4250
forecast
Number 22 19 21 21 22 20 125
of
working
days

Costs

Materials $ 100/unit
Inventory holding cost $ 10/unit/month
Marginal cost of stockout $ 20/unit/month
Marginal cost of subcontracting $ 100/unit
Hiring & training cost $ 50/worker
Layoff cost $ 100/worker
Labour hours required 4/unit
 Straight time cost(first eight hours each day) $12.5/hour

Inventory
Beginning inventory 200 units
Safety stock required 0% of moth required
What is the cost of each of the following production strategies?
(a) Level strategy (b) subcontracting

3(c) The task shown in the following table identifies the work elements, time & immediate
predecessors, management has designed an output rate of 192 units per 8 hours shift

Work element Time(sec) Immediate predecessors

A 40 none
B 80 A
C 30 D,E,F
D 25 B
E 20 B
F 15 B
G 120 A
H 145 G
I 130 H
J 115
(i) What is the desired cycle time?
(ii) What is the theoretical minimum number of workstation?
(iii) Use a trial & error to work out a solution, and show your solution on a precedence
diagram
(iv) What is the efficiency & balance delay of the solution found?

3(d) Jayant & company makes customized electric meter to order. They are analyzing the
processes at their plant. The general flow of the process is shown below. There is a separate
person working at each of the steps in the process

Jayant want to figure out the following for a typical 1 year(52 week)
(i) What is the current maximum output of the process?
(ii) If we add another person, where would we add him or her & what is the benefit
(iii) If there is a benefit if we can shift 1 week from contacting supplier to customizing
order? Assume we do not want make the change in part b above
(iv) Is there a benefit if we shift 1 week from assembling process to dispatch? Assume we
do not make the change in part b & c above
SECTION D (30 marks)
Attempt the situation & provide the solution for this situation
4. [30] CO-
3

In the above figure, the bills of material and inventory records for product A is given & their
components. The MPS for product A calls for completion of 100 units in period 2, 125 units in
period 4 & 150 units in period 6. The manufacturing lead time for product A is 1 week. The
numbers in parentheses are the number of parts needed to make the parent item. Compute a full
MRP explosion & apply the appropriate lot sizing rules to determine a schedule of planned order
releases

Part C Part D Part E Part F

Lot size rule FOQ=250 LFL FOQ=1000 POQ=2 weeks
Lead time(weeks) 2 1 1 2
Schedule receipts 300(week 1) None None 1000 (week 2)
Beginning 0 125 750 2500
inventory
Spare parts orders None 100 each in None none
week 3 & 6
Source of item Manufactured Manufactured Manufactured Purchase items
in house in house in house from supplier