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Unit 1 Introduction To Operations N Supply Chain Management

1. The document discusses operations management and supply chain management. It covers the objectives, functions, features, participants, and issues related to operations and supply chain functions. 2. Key aspects of operations management discussed include forecasting, quality management, maintenance management, and process improvement. The objectives of operations management are discussed as delivering the right quality, quantity, time, and cost. 3. Supply chain management is presented as having a systems orientation to create synergy through cooperation. Its objectives include minimizing time, improving customer service and quality, and reducing costs.

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aKSHAT sHARMA
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337 views77 pages

Unit 1 Introduction To Operations N Supply Chain Management

1. The document discusses operations management and supply chain management. It covers the objectives, functions, features, participants, and issues related to operations and supply chain functions. 2. Key aspects of operations management discussed include forecasting, quality management, maintenance management, and process improvement. The objectives of operations management are discussed as delivering the right quality, quantity, time, and cost. 3. Supply chain management is presented as having a systems orientation to create synergy through cooperation. Its objectives include minimizing time, improving customer service and quality, and reducing costs.

Uploaded by

aKSHAT sHARMA
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Operations Management: Systems
Perspective

Forecasting

Processing Output
Input (Labor, - Process and Product Design (Goods
Material, Capital) - Purchasing and Inventory Control and
-Operations Planning and Control Services
)

Feedback
Quality Management Maintenance Management Process Improvement
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Objectives of Operations Management

• Right Quality
Ultimate • Right Quantity
Objectives • Right Time
• Pre-Established Cost

• Machinery and Equipment


Intermediate • Materials
Objectives • Manpower
• Manufacturing Services

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Objectives of SCM

o Systems orientation: synergy due to cooperation and


coordination.
o Minimizing the time: Reduces the time required to
convert orders into cash.
o Service to the customer: Delivering Values.
o Minimizing WIP: Reduces total WIP.
o Improving Quality: Improving operations
o Reducing logistics cost: Efficient supply chain reduces
overall logistics cost and improving value.
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Functions of Supply Chain
Management
• Supply chain Network Design
• Strategic partnerships
• IT Infrastructure
Strategic • Make or Buy decisions

• Purchasing Decisions
• Inventory Decisions
• Transportation Strategy
Tactical • Production related decisions

• Daily Production and distribution planning


• Production scheduling
• Inbound and Outbound Operations
Operational • Constraints Management

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Features of SCM
• Mutually sharing information: Making suppliers as a
partners by sharing non-core information. E.g. Sharing of
production plans, design of components.
• Focus on serving customers: Synergy and goal congruence
of supply chain members. E.g. Domino’s Pizza.
• Integration: From Supplier’s suppliers to ultimate
customers. Integration can be accomplished through CFT, in
plant supplier personnel, third party services provider. E.g.
Courier tracking services.
• Mutually sharing channel risks and rewards: Sharing of
profit margins also sharing risk E.g. Obsolescence.
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Supply Chain Participants
✓ Raw Materials Suppliers
✓ Manufacturers
✓ Distributers
✓ Resellers
✓ Franchisers
✓ Sales Representative
✓ Logistics Providers
✓ Financiers
✓ Credit Support Providers
✓ End Users: Consumers
✓ Lessors: Leasing
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Issues on Operations and Supply Chain Functions
1. Impact of Global Competition: Global view to gain competitive advantage.
How companies gone global: Transportation & Communication (Internet),
Reduced Financial Regulations(FDI),Increased demand for imported goods
and services (Thyrocare labs)
2. Technological Change: Disruptive changes ( Mobile phones in 2000 and
2014)
3. Ethical and Environmental: Some countries are more concerned about
these issues. Ethical treatment includes bribery, conflicts of interests,
discrimination against minorities and women etc. E.g. Reliance Vs. Tata
Environmental issues includes quality of natural resources, quality of life etc.
E.g. Areva in Jaitapur, Hybrid cars.

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Development of SCM: Physical Distribution to
Logistics to SCM
Earlier
Logistics
Secondary
During 1970’s Function: - SCM Phase:
- operational Ranked After Global
and cost Marketing, competition,
Operational activities inefficiencies Sales, Emergence
split among Marketing, Uncoordinated Production of ICT,
Manufacturing, functions into now logistics Internal as
Finance. a single cost Management well as
Physical Distribution: focused conceived as external
Warehousing+ MH+ integrated internal competitive
Freight transportation department strategic advantage
advantage

1900 1960 1980 1990


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The Different Views of Quality
• Meeting requirements is a producer’s view of quality. This is the view
of the organization responsible for the project and processes, and the
products and services acquired, developed, and maintained by those
processes.
• Meeting requirements means that the person building the product does
so in accordance with the requirements. Requirements can be very
complete or they can be simple, but they must be defined in a
measurable format, so it can be determined whether they have been
met.
The producer’s view of quality has these four characteristics:

• Doing the right thing


• Doing it the right way
• Doing it right the first time
• Doing it on time without exceeding cost
The customer’s view of quality has these characteristics:

• Receiving the right product for their use


• Being satisfied that their needs have been met
• Meeting their expectations
• Being treated with integrity, courtesy and respect
The Two Quality Gaps

Closing these two gaps is the responsibility of the Closing the second gap requires the quality function to
quality function. The quality function must first understand the true needs of the customer. This can be done by
improve the processes to the point where the customer surveys, Joint Application Development (JAD)
producer can develop the products according to sessions, and more user involvement through the process of
requirements received and its own internal building information products.
standards.
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Quality Tools

5S KANBAN

KAIZEN LEAN

FISHBONE QUALITY
DIAGRAM CIRCLE
Obstacles to TQM
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• Lack of Top Management Commitment

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• Should be Taken seriously by everyone.

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• Removal of functional silos

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• Lack of structure for TQM activities.

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• Difficulty in implementation (Clear Understanding)

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• Awards E.g. ISO 9000 should be a start point for quality
Benefits of TQM
• Creates good corporate culture: TQM philosophy focus on developing a
culture that advocates total commitment to customer satisfaction through
continuous improvement.
• Better Employee Relations: Highly involved and motivated workforce. How
to Measure it? (Employee satisfaction, attendance, retention rate, OHSAS,
No. of suggestions made {Japanese- Transparency: suggestion box})
• Increased Profitability: Market share can be increased through improved
quality/ value which in turn increases Profitability. Also measured by sales per
sales person, sales made by each shop, return on assets etc.
• Improves operational performance: Quality and the costs by mapping
reliability, quality costs, adherence to delivery schedules, defects and
defectives, Inventory turnover etc.
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