Entrepreneurship - Q2 -Unit 3 Optimizing Operations

Facility designing:

A crucial aspect of planning is selecting a suitable facility layout design. A facility layout is the arrangement of workers, machines, and equipment a company needs to produce the desired output. A good facility layout can help a business save time and reduce costs by minimizing waste of resources. Manufacturing businesses generally use three types of layouts: process, product, and fixed position. In the case of a process layout, groups of machines carry out specific functions. For example, a manufacturing plant might have a separate set of machines for shearing, milling, drilling, and packing a product. Thus, each department performs a specific task in the production process. In a product layout, also known as the assembly line, the manufacturing process follows a set sequence. Each stage in the sequence assembles the product to its finished state. Therefore, a new part adds to the product at each stage. Generally, automobile manufacturers use this type of layout. It helps manufacture cars in large quantities. In the case of a fixed position layout, the position of the product remains "fixed." Machines, tools, equipment, and labor move toward the product. The product thus remains at the center, while its components move toward it from different directions. Businesses that manufacture heavy products, such as ships and aircrafts, use this type of layout.

Project Management Tools

As mentioned earlier, the organizing function includes project management. Most manufacturing businesses use three project management tools to schedule and manage activities. These three tools include the Critical Path Method (CPM), Program Evaluation and Review Technique (PERT), and Gantt Charts. Let's look at how each of these tools aid in project management. Critical Path Method (CPM) A project involves a number of activities. Some of these activities are independent. They do not affect other activities. Employees can carry out such "parallel activities" simultaneously. On the contrary, some activities are dependent on each other. In other words, such activities follow a sequence. The second activity cannot begin before the completion of the first activity. Such "sequential activities" help operations managers arrive at the critical path. The critical path is a sequence of activities, the completion of which takes the longest time. By calculating the critical path, managers can schedule and manage all activities to make sure that the project reaches completion on time. You will get a better idea of this technique with the help of an example.

intro

In this lesson, you'll explain the scope of operations management and describe the four functions of operations management in manufacturing businesses. You'll also describe methods to improve productivity. Additionally, you'll describe project management tools, such as the Critical Path Method (CPM), the Program Evaluation and Review Technique (PERT), and Gantt Charts. You'll also differentiate between manufacturing products and providing services. Finally, you'll describe methods to schedule and manage services.

Planning

Now, let's learn the four functions of operations management in manufacturing businesses. A manufacturing business's primary goal is to convert raw materials into finished goods. Operations managers thus need to create a plan to carry out the manufacturing process. The planning function further divides into the following three subfunctions: Production planning: Under this aspect of planning, operations managers decide the objectives of the production department. They determine the type of product that the business plans to offer customers. They also take input on the product design from the sales and marketing team. Further, operations managers calculate the amount of output that the business needs to manufacture.

The Scope of Operations Management

Operations management is an important aspect of manufacturing and service businesses. Both types of businesses need certain inputs in order to provide an output. Your business's "output" could be in the form of a finished product or a service. First, let's understand the scope of operations management in the manufacturing industry. The operations manager of a manufacturing company is responsible for improving the company's productivity. The only way to bring about such improvement is to utilize the company's resources optimally. Operations managers need to carry out certain functions to make the best possible use of the available resources. The four common functions of management—planning, organizing, staffing, and controlling—also apply to operations management. A business can maximize the efficiency of its operations only by employing these functions.

Program Evaluation and Review Technique (PERT)

PERT is similar to CPM. However, PERT goes a step beyond CPM in order to consider various possibilities. As you learned earlier, CPM calculates a single critical path in the project. PERT calculates three different durations for the completion of an activity. These three types include optimistic time, most likely time (critical path), and pessimistic time. Optimistic time: Optimistic time is the shortest duration an activity or process might take. Therefore, managers can be "optimistic" and decide to complete the project in this duration. Most likely time: Most likely time is the duration an activity or process is "most likely" to take. It refers to the critical path you came across in the case of the CPM. Pessimistic time: Pessimistic time refers to the time an activity or process might take in the "worst case scenario." PERT considers this duration so that operations managers can plan keeping a bad situation in mind.

staffing

Staffing: In the absence of this function, operations managers cannot delegate work to employees. Staffing includes recruiting and selecting the right employees. This function focuses on the business's human resources, who carry out various tasks. Staffing is important because it involves hiring individuals who fit specific job descriptions. Under this function, operations managers also need to guide employees with respect to their tasks.

Conversion process:

This aspect includes the machinery and equipment required for manufacturing. Operations managers determine the cost, number, and capacity of machines needed to convert the input into the planned output.

Organizing

This management function plays a major role in improving efficiency in manufacturing companies. Organizing includes designing jobs and allocating work to employees. Operations managers assign work and targets according to an employee's field of specialization. Division of labor is an important part of the organizing function. This function includes dividing a large task into smaller tasks and assigning the tasks to the right employees. Therefore, the organizing function defines the roles and responsibilities of employees and sets targets. The most important part of organizing is project management. A project includes several tasks and activities. Operations managers apply their knowledge and skills. They ensure that these activities meet the project's standards and deadlines.

controlling

_Hiring the right people and assigning the right tasks to them is not enough to maximize operations. Operations managers need to monitor and control the tasks that employees perform. Controlling tasks includes setting performance objectives and standards for the employees. If performance standards or measurements are in place, managers can check the progress of an employee's work. If an employee's performance deviates from the standards, managers can take the necessary corrective action. Managers carry out this function by comparing the actual performance with the expected performance_