Copyright © 2009 Pearson Education Canada8-1 Chapter 8 Producing Quality Goods and Services.
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Transcript of Copyright © 2009 Pearson Education Canada8-1 Chapter 8 Producing Quality Goods and Services.
Copyright © 2009 Pearson Education Canada 8-1
Chapter 8Chapter 8
Producing Producing Quality Goods Quality Goods and Servicesand Services
Copyright © 2009 Pearson Education Canada 8-2
What Is Production?What Is Production?
LeadingLeading
Plan
ning
Plan
ning
Organizing
Organizing
Production OperationsProduction OperationsManagement Management
(POM)(POM)
Production OperationsProduction OperationsManagement Management
(POM)(POM)
ControllingControlling
Copyright © 2009 Pearson Education Canada 8-3
What Is the What Is the Conversion Process?Conversion Process?
TransformationTransformation OutputsOutputsInputsInputs
Analytic Systems
Synthetic Systems
Copyright © 2009 Pearson Education Canada 8-4
Input-Transformation-Output Input-Transformation-Output Relationships for Typical SystemsRelationships for Typical Systems
Department Store
Shoppers, stock of goods
Displays, sales clerks
Attract customers, promote products,
fill orders
Sales to satisfied customers
College or University
High School graduates, books
Teachers, classrooms
Impart knowledge & skills
Educated individuals
Automobile Factory
Sheet steel, engine parts
Tools, equipment, workers
Fabrication & assembly of cars High-quality cars
Restaurant Hungry customers, food
Chef, waitress, environment
Well-prepared & well-served food
Satisfied customers
Hospital Patients, medical supplies
MDs, nurses, equipment Health care Healthy
individuals
Typical Desired Output
Transformation Function
Transformation Components
InputsSystem
Copyright © 2009 Pearson Education Canada 8-5
Manufacturing Manufacturing GoodsGoods
MassMassProductionProduction
MassMassCustomizationCustomization
Copyright © 2009 Pearson Education Canada 8-6
Production Process Production Process DesignDesign
Plan for capacity
Choose facility location
Design facility layout
Identify the supply chainForecast demand
Schedule work
Copyright © 2009 Pearson Education Canada 8-7
Forecasting DemandForecasting Demand
CustomerCustomerFeedbackFeedback
MarketMarketResearchResearch
SalesSalesFiguresFigures
IndustryIndustryAnalysesAnalyses
EducatedEducatedGuessesGuesses
BusinessBusinessResourcesResources
PlanningPlanning BudgetingBudgetingSchedulingScheduling
Copyright © 2009 Pearson Education Canada 8-8
Capacity PlanningCapacity Planning
Level ofLevel ofresourcesresourcesLevel ofLevel of
resourcesresourcesCustomerCustomerdemanddemand
CustomerCustomerdemanddemand
Copyright © 2009 Pearson Education Canada 8-9
LabourLabourLabourLabourLandLandLandLand
TransportationTransportationTransportationTransportation EnergyEnergyEnergyEnergy
Local taxesLocal taxesLocal taxesLocal taxesRawRawmaterialsmaterials
RawRawmaterialsmaterials
ConstructionConstructionConstructionConstruction
LivingLivingstandardsstandards
LivingLivingstandardsstandards
FacilityFacilityLocationLocationFacilityFacility
LocationLocation
Copyright © 2009 Pearson Education Canada 8-10
Types of Facility Types of Facility LayoutLayout
• Process (functional)– concentrates everything needed to complete one phase of the
production process in one place
• Product (assembly line)– the production process occurs along a line– products move from one workstation to the next
• Cellular – groups dissimilar machines into work centers (or cells) to process
parts that have similar shapes and processing requirements
• Fixed-Position– labour, materials, and equipment are brought to the location where the good
is being produced or the customer is being served– i.e.: buildings, roads, bridges, airplanes
Copyright © 2009 Pearson Education Canada 8-15
Production Production ScheduleSchedule
SchedulingScheduling
DispatchingDispatching
ContingenciesContingencies
Copyright © 2009 Pearson Education Canada 8-17
Program Evaluation and Program Evaluation and Review Technique (PERT)Review Technique (PERT)
• Identify activities
• Determine sequence
• Establish time frame
• Diagram activity network
• Calculate longest completion path
• Refine timing
Copyright © 2009 Pearson Education Canada 8-18
PERT Time PERT Time EstimatesEstimates
OptimisticOptimistic
PessimisticPessimistic
Most likelyMost likely
ExpectedExpected
Copyright © 2009 Pearson Education Canada 8-19
PERT Diagram PERT Diagram for Manufacturing Shoesfor Manufacturing Shoes
Copyright © 2009 Pearson Education Canada 8-20
Improving Production Improving Production Through TechnologyThrough Technology
• Robots
• Computer-aided design (CAD)
• Computer-aided engineering (CAE)
• Computer-aided manufacturing (CAM)
• Computer-integrated manufacturing (CIM)
• Flexible Manufacturing Systems (FMS)
Copyright © 2009 Pearson Education Canada 8-21
Electronic Electronic Information Information
SystemsSystemsResponsiveness
Service
Communication
Copyright © 2009 Pearson Education Canada 8-22
Manufacturing Manufacturing SystemsSystems
TraditionalTraditionalManufacturingManufacturing
FlexibleFlexibleManufacturingManufacturing
Mass Production
Resistant to Change
High Set-Up Costs
Specialty Operations
Conducive to Change
Minimal Set-Up Costs
Copyright © 2009 Pearson Education Canada 8-23
The Production The Production ProcessProcess
InventoryInventorymanagementmanagement
QualityQualityassuranceassurance
Copyright © 2009 Pearson Education Canada 8-24
Inventory Inventory ManagementManagement
InventoryInventory
InventoryInventorycontrolcontrol
InventoryInventorycontrolcontrolLead timeLead timeLead timeLead time
PurchasingPurchasingPurchasingPurchasing
Copyright © 2009 Pearson Education Canada 8-25
Inventory ControlInventory Control
Just-In-Time (JIT)
Material RequirementsPlanning (MRP)
ManufacturingResource Planning (MRP II)
Copyright © 2009 Pearson Education Canada 8-26
Manufacturing Resource Manufacturing Resource Planning Planning
Copyright © 2009 Pearson Education Canada 8-27
Maintaining QualityMaintaining Quality
Statistical Quality ControlStatistical Quality Control
Statistical Process ControlStatistical Process Control
Continuous ImprovementContinuous Improvement
Quality ControlQuality Control Quality AssuranceQuality Assurance
Copyright © 2009 Pearson Education Canada 8-28
Global Quality Global Quality StandardsStandards
ISO CertificationISO Certification
CAE Quality AwardsCAE Quality Awards
Malcolm Malcolm Baldrige AwardBaldrige Award
Copyright © 2009 Pearson Education Canada 8-29
Supply Chain Supply Chain ManagementManagement
Suppliers Manufacturers Distributors Retailers
The Supply Chain
Production of Goods and Services
Facilities Functions Activities
Copyright © 2009 Pearson Education Canada 8-30
Manufacturing Manufacturing TrendsTrends
OutsourcingOutsourcing Supplier InvolvementSupplier Involvement
Redirect resourcesand capital
Increase productionefficiencies
Access state-of-the-artfacilities
Improve overall quality
Maximize the use of time
Reduce work-in-processinventory