KALYAN CITY BLOG

Advantages of Operations Research (OR) The role, importance or advantages of Operations Research (OR) are:- Picture or Image depicting the Advantages of Operations Research (OR). 1. Effective Decisions Operations Research (OR) helps the managers to take better and quicker decisions. It increases the number of alternatives. It helps the managers to evaluate the risk and results of all the alternative decisions. So, OR makes the decisions more effective. 2. Better Coordination Operations Research (OR) helps to coordinate all the decisions of the organisation . It coordinates all the decisions taken by the different levels of management and the various departments of the organisation. For e.g. It coordinates the decisions taken by the production department with the decisions taken by the marketing department. 3. Facilitates Control Operations Research (OR) helps the manager to control his subordinates. It helps the manager to decide which work is most important. The manager ...

Operations Research - Definition According to Philip McCord Morse and George E. Kimball , "Operations research is a scientific method of providing executive departments with a quantitative basis for decisions regarding the operations under their control." According to Russell L. Ackoff and C. West Churchman , "Operations research is the application of scientific methods to arrive at the optimal solutions to the problems." Image Credits © Emir . Meaning of Operations Research Operations research OR means to apply scientific and mathematical methods for decision making and dilema solving. OR does not provide decisions else it provides quantitative data to the managers. The managers use this data for making decisions. OR tries to find better solutions to different problems. Hence, it is used to solve complex management problems. OR helps to take decisions about operations and production. OR was first used during the Second World War by England to solve thei...

Productivity improvement techniques Twelve productivity improvement techniques, methods or measures: quality . At the maturity stage, it reduces the cost by replacing the costly components (parts) by cheaper components. VE also tries to improve the value and product quality . Value is the satisfaction which the consumer gets by using the product. VE tries to give maximum value for the lowest price. This enhances the productivity. Quality Circles (QC) was introduced in 1960 in Japan. QC is a small group of employees who meet regularly to identify, analyze, and solve problems in their department. The QC members advise the management to implement new methods to solve work-related problems. QC increases the productivity. Financial and non-financial incentives : The organization must motivate the employees by providing financial and non-financial incentives. Financial incentives include better wages and salaries, bonus, etc. Nonfinancial incentives include bet...

What is Production Management? Meaning Production management means planning, organising, directing and controlling of production activities. Production management deals with converting raw materials into finished goods or products. It brings together the 6M's i.e. men, money, machines, materials, methods and markets to satisfy the wants of the people. business management. It is also called " Production Function ." Production management is slowly being replaced by operations management. The main objective of production management is to produce goods and services of the right quality, right quantity, at the right time and at minimum cost. It also tries to improve the efficiency. An efficient organisation can face competition effectively. Production management ensures full or optimum utilisation of available production capacity. Definition of Production Management According to Elwood Spencer Buffa , "Production management deals with decision-making related to pr...

Functions of Production Management Functions of production management are depicted, listed & explained below. The components or functions of production management are as follows: Selection of Product and Design, Selection of Production Process, Selecting Right Production Capacity, Production Planning, Production Control, Quality and Cost Control, Inventory Control, and Maintenance and Replacement of Machines The above functions of production management are briefly discussed below. 1. Selection of Product and Design Production management first selects the right product for production. Then it selects the right design for the product. Care must be taken while selecting the product and design because the survival and success of the company depend on it. The product must be selected only after detailed evaluation of all the other alternative products. After selecting the right product, the right design must be selected. The design must be according to the customers' r...

What are Production Strategies? Meaning Production strategies are broad long-term action plans. They are made for achieving the main objectives of organisation . Production strategies tell us what the production department must do to achieve the top aims of the organisation. It provides a road map for the production department. investment to be made for production, the technology to be used for production, the pembinaan to be given to the production staff, the production schedule to be followed, etc. It also decides about the goods and services to be produced and when to introduce them in the market. It is the top level of management that first fixes the main objectives of the organisation. Then top-level managers make strategies for achieving these objectives. Generally, there are two types of strategies, viz., Business Strategies are strategies made for the entire organisation. It covers all departments of the organisation. These are made by the top-level management. Functi...

Developing and Implementing Production Strategy Steps for developing and implementing production strategies are as follows: Image Credits © Moon Rodriguez. Fixing organisational objectives Developing production and other strategies Selecting the production strategy to be used Selecting the production process Selecting production infrastructure Implementing production strategies Now let's discuss above individual steps one by one in brief. 1. Fixing organisational objectives First, the top-level management fixes the main objectives of the organization . The objectives give direction to the organization. They make the boundaries for strategies. All the strategies must be made within these boundaries. Strategies are the action plans which are designed to achieve the main objectives of the organization. 2. Developing production and other strategies After fixing the main objectives of the organization, the management makes strategies for achieving these objectives. The t...

Different Types of Production Strategies The different types of production strategies are grouped, listed and explained under following three categories, viz., The types of production strategies under Business Strategies are as follows: Differentiation strategy Cost leadership strategy Market segmentation strategy The production strategies under Competitive Priorities are as follows: Price or cost strategy Quality strategy Delivery strategy Product mix or flexibility strategy Service strategy Eco-friendly products The production strategies under Competitive Advantages are as follows Flexible response strategy Low cost strategy The types of production strategies listed above are discussed as follows: 1. Differentiation strategy Under a differentiation strategy, the company tries to be different and unique from its competitors. It may offer better quality, quantity, pricing, appearance, and after sales-service, when compared to its competitors. It may offer more features...

What is Strategic Planning for Production? Definition The definition of strategic planning for production is quoted below. "Strategic planning for production implies focusing on the alignment of production management within an organization with its corporate and business strategies to gain a strategic advantage." Image Credits © Motion media works . Meaning of Strategic Planning for Production Strategic planning for production is a broad overall planning. It is done before production planning. Strategic planning for production is different from production planning. Strategic planning gives only a broad view whereas production planning gives overall essential details of production. Strategic planning for production is done after considering the latest objectives of the organization and the current environmental conditions. It is a guide for tomorrow's decisions and results. All other production plans are based on this plan. Strategic planning for production coordina...

Modes of Strategic Planning There are three different modes of strategic planning . These are depicted in a diagram, listed and explained as follows: Image Credits © Moon Rodriguez. 1. Entrepreneurial Mode In entrepreneurial mode, strategic planning is done by one person. He takes the full responsibility of planning for the production department. That is, he does production planning on behalf of the production department. He has entrepreneurial skills. That is, he is good in planning , organizing , motivating , etc. He is also a strong and bold leader . 2. Adaptive Mode In adaptive mode, the production managers go on changing his plans according to the changes in the environment. He first makes a big plan, then he breaks it into smaller plans. This is done to adjust with the dynamic environment. Then he tries to combine all these plans to make a strategic production plan. In this method , the production manager is not at peace. He works in a disorganized environment. There...

What is Production Planning? Meaning Production planning means to fix the production goals and to estimate the resources which are required to achieve these goals. It prepares a detailed plan for achieving the production goals economically, efficiently and in time. It forecasts each step in the production process. It forecasts the problems, which may arise in the production process. It tries to remove these problems. It also tries to remove the causes of wastage. Image Credits © Pietroizzo . Production planning provides answers for two major questions, viz., What work should be done? How much time will be taken to perform the work? So, production planning decides the ways and means of production. It shows the direction. It is based on sales forecasting. It is a prerequisite of production control. Definition of Production Planning According to Ray Wild , production planning is defined as follows: "Production Planning is concerned with the determination, acquisition an...

What is Production Forecasting? Definition The definition of production forecasting is quoted in following statement. "Production forecasting is estimating the future demand for products and services and the resources necessary to produce the output.." Image Credits © Steve Pepple . Now let's discuss and understand the meaning of production forecasting. Meaning of Production Forecasting Production forecasting means to estimate the future demand for goods and services. It also estimates the resources which are required to produce those goods and services. These resources include human resources, financial and material resources. So, production forecasting means to estimate the 6M's of management . The production manager first estimates the future market or demand for the companies goods and services. Then he estimates the Men (human resources), Money (financial resources), Materials, Machines and Methods, which will be required to produce those goods and servic...

Steps in Production Forecasting Process Steps in a production forecasting process are depicted in the image below. Image Credits © Moon Rodriguez. The stages or steps in a production forecasting process are listed as follows: Fix the forecasting objectives. Decide what to forecast? Determine the time frame. Collect the data for forecasting. Select the forecasting model Build and test the forecasting model. Prepare the forecasts. Prepare the forecasts. Compare events with the forecasts. Now let's discuss each step of production forecasting process one by one. 1. Fix the forecasting objectives The production manager must first fix the forecasting objectives. That is, he must know exactly why he is doing production forecasting. Forecasting objectives answers the question like, why are we forecasting? Here, the answer to this question may be; we are doing forecasting to help us in marketing planning, or we are doing forecasting to help us in the plant capacity planning,...

Methods Techniques of Production Forecasting Methods or techniques of production forecasting are depicted below. Image Credits © Moon Rodriguez. The models or techniques of production forecasting are listed as follows: Brainstorming technique. Goal oriented forecast technique. Graphic charting technique. Matrix technique. Nominal group technique (NGT). Delphi technique. Simple average technique. Now let's discuss each method or technique of production forecasting. 1. Brainstorming technique Brainstorming technique is used to forecast demand, especially for new products. In this method, many experts sit together and each expert gives his own idea (forecast) and reason for it. One idea leads to many more ideas. The group of experts will develop much more ideas than one person. Based on these ideas, demand can be forecasted. 2. Goal oriented forecast technique In this technique, a goal is first fixed. Then the technological developments which are required for achievin...

What is Production? Definition As per Carl Heyel (16 Feb 1908 - 16 May 2000), "Production is the process of transforming raw materials or purchased components into finished products for sale." Image Credits © Moon Rodriguez. Meaning of Production Production is a process of transforming (converting) inputs (raw-materials) into outputs (finished goods). So, production means the creation of goods and services. It is done to satisfy human wants. Thus, production is a process of transformation. Process of Transformation Image Credits © Moon Rodriguez. The process of transformation is done in the following ways: Disintegration : Here, one input (raw material) is used to produce many types of output. For e.g. Steel (Input) is used to produce many types of outputs like spoons, knives, plates, etc. Integration or Assembly : Here, many inputs are used to produce only one output. For e.g. many different inputs are used to produce a car. Service : Here, the value of the ...

What is Departmentalization? Definition According to Professors Pearce and Robinson , "Departmentalization is the grouping of jobs, processes, and resources into logical units to perform some organizational task." The concept of departmentalization is depicted in the following diagram. Image Credits © Moon Rodriguez. Meaning of Departmentalization In departmentalization, similar activities are grouped together to form various departments. For example , all the activities relating to accounts are grouped together to make the accounts department. Similarly, we have purchase department, production department, sales department, finance department, human resource (HR) department, etc. So, departmentalization is the process of dividing the organization into different departments. It is the process by which an organization expands horizontally. There are many bases or types of departmentalization. A department consists of, head of department, specific functions and staff . T...

What is Product Design? Definition The definition of product design can be stated as follows. "Product design is the translation of intellectual wisdom, requirements of the entrepreneurs , or needs of the consumers, etc. into a specific product." Product design is usually a creative accomplishment of adventurous and experienced professionals. Meaning of Product Design The meaning of product design is depicted in the following diagram. Product design includes Form Design and Functional Design. Form design means the shape and appearance of the product. Functional design means the working of the product. That is, how the product works. It is very important because the product will sell only if it works as expected. Form design is less important because it adds nothing to the product's performance. However, it cannot be ignored because a product will not sell if it doesn't look good and is not appealing to buyers. Product design includes Package designing too. An...

Essential Requirements of a Good Product Design Main or essential requirements of a good product design are depicted below. Image Credits © Moon Rodriguez. The essential requirements of a good product design are listed as follows: Product must optimally perform its main function (task). It must be easy to repair at a low repair cost. It must be very reliable to use. It must follow principles of aesthetics. It must be a durable one. It can be easily produced in large numbers at minimum production cost. It must be simple to produce and use (handle). It must also be compact. Now let's discuss each essential requirement of a good product design. 1. Function The product must be designed in such a way that it optimally performs the main task or function for which it is purchased by a buyer. In other words, the product must satisfy the needs and wants of the consumer. For e.g. The main function of an Air Conditioner (AC) is to provide quick cooling of a room. So, AC must be...