Transformation Process Objectives of Operation Management Productivity is defined as the measure of

The transformation process includes technology 1. Production: Taking into reference, the efficiency of factors of production in converting
and skill which convert inputs to outputs. It adds production aspect, the primary objectives of inputs into useful outputs. In simple words, it is
value in the form of products or services. The operations management are explained briefly as the relation between output and input. The
transformation process may be in the form of follows: *The design includes design of services higher the ratio between output and input the
material processing; information processing or and products, process design and location, higher will be the productivity level which
customer processing. All manufacturing firm layout and flow. *The deliver includes supply indicates higher level of productivity
carry out material processing. They transform network management, capacity management, improvements. Factor Affecting
raw material to finished goods. Other types of inventory management, planning and control Productivity 1.Internal Factors:Factors
organization like market research companies, and lean synchronization. *The develop includes that are under the control of management or
universities or consultants carry out the quality management and operations individual enterprise are known as internal
information processing. The other types of improvement. *The direct involves formulating factors. Internal factors play a very significant
production carry out the customer processing operations strategy which includes broad plan. role in improving productivity of an
like hair dressers, hospitals, public transport, *policies in utilizing the resources of the firm in organization.Internal factors are also known as
hotels, etc. The nature of manufacturing order to achieve organizational goals. micro-productivity factors. Internal factors are
transformation process depends on the type of 2. Performance: We can view the objectives further classified into following two groups.
production system, size of production and of operations management taking into i.Hard Factors: *Products: Product
nature of output. The transformation processes consideration the performance perspectives affecting productivity relates the extent to
are frequently changing with the development of enlisted as follows: *Cost refers to doing thing which the product meets output requirement.
new equipments and technologies. The manually cheaply. The companies aim to produce goods Product must be of "use value" and affordable
operated machines in early 1960s are changed to and services at a cost which makes them able to by the customer. So product may be required
automatic and now electronic technologies are pricing appropriately in the market with a to re-design to improve its "use value". *Plant
prevailing in production system. Transformation return. *Quality refers to doing things right. and equipment: The plant and equipment is
process that are not environmental friendly like The companies aim to satisfy customers by another important hard factor influencing
producing excessive sound, light, noise, gases, providing error-free goods and services which productivity of any organization. Unless and
waste are getting more attention from are fit for their purposes. 3. People and group until the adequate plant and machinery are
government and consumers. The products of of people: We can also view the objectives of installed, it is impossible to increase
those manufacturing units are even restricted in operations management in a broader way that is productivity compared to other similar
international trade by various tariff and non- taking into consideration of stakeholders. organizations of industry.*Technological
tariff barrier. The growth of consumerism in Stakeholders refer to people and group of people innovations: Technological innovations are
developed and developing countries may even who have interest in the operation and who may other important hard factors that impact
subject to impose sanctions or refuse these be influenced by or productivity. Innovations like automation and

Product Development Process *Phase 1. Operations Strategy as a Competitive Core Functions

Planning: The planning activity is often referred Weapon: A company that wishes to be world. Core functions refer to the business functions
to as "phase one" since it precedes the project class must realize the fact that ability to that are critical and closely related to a firm's
approval and launch of the actual product compete in the marketplace depends on strategy. Majority of organizations have three
development process. This phase begins with development of operations strategy that core functions:*Marketing and sales:
corporate strategy and includes assessment of matches the mission to serve customer. In this Marketing and sales function generates customer
technology developments and market connection, operations strategy is often used as requests for product and services of the
objectives. The output of the planning phase is the most potent competitive weapon. *Cost organization via communication in markets.
the project mission statement, which specifies or price:The first dimensions related to *Product/service development function:
the target market for the product, business operations strategy is the cost or price. A Product/service development functions create
goals, key assumptions, and constraints. company must be able to make the product or new and modified products to generate future
*Phase 2. Concept development: In this deliver service cheap. Although, ability to customer requests.*Operations function:
phase, the needs of the target market are produce at low cost may not be decisive always, Operations functions fulfil the customers'
identified, alternative product concepts are it certainly is a defining dimensions. *Quality request.
generated and evaluated, and one or more :Quality dimension is related to the ability of Supporting Functions
concepts are selected for further development firm to produce in accordance with Supporting functions are those set of functions
and testing. A concept is a description of the specification and without error. As per this, an that enables the core function to operate
form, function, and features of a product and is organization must make a great product or effectively. The major supporting functions in an
usually accompanied by a set of specifications, deliver a great service. Quality of a product or organizations are: *Accounting and finance
an analysis of competitive products, and an service is governed by two major
economic justification of the project. *Phase characteristics: *Design quality: Design quality
3. System-level design: The system-level design as the word itself suggest is related to the design
phase includes the definition of the product of a products or service. *Process quality: Reorder point (ROP) is the level of stock at
architecture and the decomposition of the Process quality is concerned reliability of the which order should be placed for delivery
product into subsystems and components. The product or services. *Speed: Speed associated before depleting the inventory level to the zero,
final assembly scheme (which we discuss later with delivery of product or service is another so that we can get supply just before being
in the chapter) for the production system is critical dimension. Speed refers to the ability of stock out.
usually defined during this phase as well. The doing things quickly in response to customer
output of this phase usually includes a demand. This dimension focuses on delivering Quality control refers to the systematic
geometric layout of the product, a functional the product or service quickly. control of those variables encountered in a
specification of each of the product's *Dependability:Dependability refers to the manufacturing proces. which affect the
subsystems, and a preliminary process flow ability of firm in supplying product or services excellence of the end product. Such variables
diagram for the final assembly process. *Phase in accordance with promises made to result from the application of materials, men,
4. Design detail: This phase includes the customers. This dimension focuses on machines and manufacturing conditions.
complete specification of the geometry, delivering the products and services when
materials, and tolerances of all the unique parts promised. *Flexibility:Flexibility refers to the
JIT is a production system whereby inputs are
in the product and the identification of all the ability of a company to change operations as
delivered to the production process just as they
standard parts to be purchased from suppliers. well as offer a wide variety of: *products to its
are needed.
A process plan is established, and tooling is customers. In this regard, flexibility comprises
of four key aspects. *Ability of firm to change
the volume of production as per the demand.
information technology help to increase the influence the operations activities. The primary environmental unfriendly products or services in
existing productivity level of organizations.. stakeholder includes customers, employees, their countries.
*Material and energy: Material and energy shareholders, suppliers, society, etc. Here Thus, the selection of appropriate, efficient and
is another important hard factors that affect employees are internal while others are external environmentally friendly production technology
productivity. Attempt to reduce the use of to the organizations. Each of these stakeholders is necessary for sustainable production of goods
material and energy is vital tr improving has different opinions on the operations and services.
productivity. 2.External Factors :External activities.4.Customer service: The primary
factors are those factors, which are beyond the objective of operation management is to utilize
control of management or individual the resources of the organizations, to create such
enterprises. They affect organizations Types of Inventory: *Cycle inventory:
products or services that satisfy the needs of the
productivity level but organization cannot The portions of total inventory that varies
consumers by providing "right things at the right directly with lot size is called cycle inventory.
control them. *Structural Adjustment price, right price and right time". *Anticipation inventories: Inventory used
:Structural adjustment refers to the change in 5.Resource utilization: To make the best to absorb uneven rates of demand or supply
an economy that is needed in order to make it possible use of the organization's resources to which the production/operations system often
more competitive. These changes associated satisfy the wants of the consumers is another face, is referred to as anticipation inventory.
with social, economic, political, demographic important perspective of operation *Pipeline or transit inventory: When
aspects of nation directly influence national and management. inventories are moved between the various
industrial productivity. *Natural Resources short elements of the supply chain i.e. between
:Natural resources like human resource, land, The Duality states that every linear suppliers, distributors, manufacturers,
energy, raw material, etc. are important for programming problem has another linear
wholesalers, retailers and the end customers,
improving productivity at international, programming problem related to it and thus
these are called pipe line or transit inventory.
national, industry and firm level. Access to can be derived from it.
*Decoupling (or work in process)
these natural resources and their efficient and
effective utilization affects the productivity in a inventory: The concept of the decoupling
Capacity planning is the act of balancing
positive way. *Government and inventories is to decouple or disengage different
available resources to satisfy customer demand parts of the production system. *Safety or
Infrastructure:National and organizational or project capacity needs.
productivity is directly affected by buffer inventory: Safety inventory are held
governmental policies, strategies and programs. to protect against the uncertainties of demand
general procedure in facility locating:* and supply.
The underlying factors under government and Identify Dominant Location Factors *Evaluate
infrastructures are as follows: *Practices of Location Alternatives*Quantitative Analysis
government agencies *Transportation and
communication*Power supply

function: Accounting and finance functions *Ability of a firm to change the time taken to designed for each part to be fabricated within
provide the evidence to help organization in produce product.*Ability to change product the production system. The output of this phase
economicdecision making and manage the and service mix. *Ability to innovate. is the drawings or compute files describing the
financial resources efficiently and effectively to geometry of each part and its production
meet the organizations goals and objectives. Facility layout means the disposition of the tooling, the specifications of purchased parts,
*Human resource function: Human various facilities (equipments, materials, human and the process plans for the fabrication and
resource functions recruit and develop the resources) and utilities of the plant within the assembly of the product. *Phase 5. Testing
workforce level along with their welfare and area of the site (location decision) selected and refinement: The testing and refinement
quality of work life. *Information previously. Types of Layout *Process phase involves the construction and evaluation
technology function: Information Layout: Process layout is characterized by of multiple preproduction versions of the
technology functions help the organizatior keeping similar machines or similar operation at product. Early prototypes are usually built with
record the information and disseminate in order one location (place). This is also called parts with the same geometry and material
to provide provision of systems for design, functional layout because machine are arranged properties as the production version of the
planning and control and improvement. according to their function. *Product product but not necessarily fabricated with the
*Engineering function: Engineering Layout: It is also known as line layout. It actual processes to be used in production.
functions help organization in analyzing the new implies that various operations on the raw Prototypes are tested to determine whether the
technology option in transformation process and material are performed on sequence and the product will work as designed and whether the
many others in order to enable core function machines are placed along the product flow product satisfies customer needs. *Phase 6.
operate effectively. line. *Combination Layout: Combinations Production ramp-up: In the production ramp-
of process and product layout are usually used up phase, the product is made using the
to acquire the advantage of both layouts. A intended production system. The purpose of
combination layout is possible where an item is the ramp-up is to train the workforce and to
Six Sigma is a disciplined, data-driven work out any remaining problems in the
being made in different type and sizes. *Fixed
approach and methodology for eliminating production processes. Products produced
Position Layout: In other types of layout
defects in any process from manufacturing to during production ramp-up are sometimes
discussed earlier, the product moves past
transactional and from product to service. supplied to preferred customers and are
stationary production equipment, where as in
this case the reverse applies; men and carefully evaluated to identify any remaining
Statistical Process Control :The use of equipment are moved to the material, which flaws. The transition from production ramp-up
Control chart as statistical techniques for remain at one place and product is completed at to ongoing production is usually gradual.
process control is called Statistical Process that place where the material lies. *Cellular
Control. The use of sampling inspection plan layout: Cellular layout is an attempt to bring
for Product Control is called Statistical Product some order to the complexity of flow of
Control. Both statistical product control and materials, information or customers. This is
statistical process control are called Statistical shop-within-a-shop concept which will display
Quality Control. Types of Statistic Quality similar goods in order to satisfy the needs of a
Control (SQC):*Product control or particular type of customer.
acceptance sampling and *Process control