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Explain the concept of Manufacturing Strategy

The present scenario in the manufacturing is that the amount of the capacity fat and the inventory fat present in the supply chains have been reduced a great deal by the various hard efforts put in by the competitive businesses in the last some of the years (nearly a decade). By this, the operational efficiency has also increased handsomely, along with the emergence of the lean and the responsive manufacturing strategy. Both these steps act as critical steps in the arena of competition and are also surely required for achieving the success in this arena.

But a very common observation among the various companies is that for the achievement of the full competitive status, the companies integrate its comprehensive business strategy to the manufacturing strategy. The distribution links with good free – flow are very much necessary for the business efficiency but a very important point to be kept in mind here is that these good, free – flowing distribution links play a very vital role towards the business efficiency, only when they have full support of the manufacturing process, that responds as needed to the changing conditions and factors.

The companies must possess the following in order to create a manufacturing strategy linked to the comprehensive business strategy and the process that is continuously aligned with the current requirements –
1. Applications and the technology for making a connection with the ‘plan – execute – sense – respond – learn’ operations, should be leveraged very intelligently.

2. Link the factory processes, production equipment and the factory systems to the supply chain operations.

Fat includes the inventory, capacity, labor and this fat drains continuously – as a result of this the companies in which the manufacturing capabilities are not able to respond quickly to the variable demands, ultimately become very vulnerable in the nature.

In the scenario existing today, the companies mainly prefer to integrate all of their manufacturing activities and then connect them with the comprehensive business strategy. It has been observed that the companies which are able to lead their peer groups surely show much faster asset velocities. This is called as the Return on Assets (ROA). The ROA can be referred to as the most important and essential performance indicator and also helps in the measurement of the manufacturing effectiveness. ROA is a direct function of the profit margin and the asset turns. There are mainly two types of the asset turns and these can be categorized as follows –

1. Fixed Asset Turns –
a. Refer generally to the machinery and the equipment on the shop floor.

2. Variable Asset Turns –
a. Refer to the inventory impacted by the manufacturing.
b. This inventory can be the raw material (RM), the finished goods (FG) or the work in progress (WIP).

Although a lot is said and some amount has also been done in the field of the manufacturing – but it is not that easy to produce stuff that is near to the real time demand and the driving forces that are responsible for the increase in the variability and ultimately that help in the achievement of the adaptive capabilities can be summarized as follows –

1. Fragmented manufacturing facilities.
2. Mass customization.
3. Shrinking the life – cycles.
4. Response velocity.
5. Zero defect quality.

Meaning of strategy
The concept of the strategy comes from the military, so usually it is said that it has been borrowed from the military and is used in the business.

First of all the strategies, like in the military, in business bridges the gap present between the policy and the tactics. Then both the strategy and the tactics work together and also help in bridging the gap between the ends and the means. Strategy is actually considered as a element present in a four – part structure, first are the ends that are to be obtained, second are the strategies for obtaining them, third are the tactics and the last are the resources.

According to George Steiner (a professor of management and one of the founder members of The California Management Review), a strategy is “that which the top management does and which is of great importance to the organization. Strategy refers to the basic directional decisions that are to the purposes and the missions. Strategy consists of the important actions necessary for the realization of these directions.”
So now strategy can be defined as the term referring to a complex web of thoughts, ideas, insights, experiences, goals, expertise, memories, perceptions and the expectations that are responsible for providing the general guidance for carrying out the specific actions in pursuit of the particular ends.

Key steps towards a Strategic Plan
1. The vision
a. Can be presented as a pen picture of the business in three or more year’s time in terms of its likely physical appearance, size, activities etc.

2. The mission
a. Depicts the nature of a business.
b. Indicates the purposes of the business.

3. The values
a. Governs the operations of the business.
b. Addresses the relationships with the society at large, customers, suppliers, employees, local community and also the other stakeholders.

4. The objectives
a. Decided in terms of the results that are required to be achieved.
b. Can relate to the expectations and the requirements of the entire major stake – holders.

5. The strategies –
a. Acts as the guidelines by which the mission, objectives etc may be achieved.
b. Can cover the business as the whole.
c. Can relate to the primary matters in the key functional areas.

6. The goals –
a. Act as the specific interim or the ultimate time based measurements to be achieved by implementing strategies in pursuit of the company’ s objectives.
b. Should be quantifiable, consistent, realistic, and achievable.
c. Can relate to the factors like market, products, finances, utilization etc.

7. The programs –
a. Set out the implementation plans for the various essential strategies.
b. Should cover resources, objectives, time – scales etc.

Manufacturing Strategy
In general terms, manufacturing strategy can be defined as the set of the co – coordinated objectives and action programmes that are applied to a firms manufacturing function and aimed at securing the medium and long term, sustainable advantage over that firm’s competitors.
Manufacturing strategy generally involves issues like the following –
1. Manufacturing capacity
2. Production facilities
3. Use of the technology
4. Vertical integration
5. Quality
6. Production planning/materials control
7. Organization
8. Personnel

Procedure for the formulation of the manufacturing strategies is
Hill Methodology –

a. Provides a connection between the different levels of the strategy making.
b. The first step involves the understanding of the long term corrective objectives of the organization.
c. The next step involves the development of the marking strategy in order to achieve the corporate objectives.
d. The third step is the translation of the marketing strategy into the ‘competitive factors’ which are further split into the ‘order winners’ and the ‘order qualifiers’.
e. The fourth step is the selection of the manufacturing process.
f. This selection depends on the volume/variety analysis ‘structural feature’.
g. The last step is selecting the ‘infrastructural features’ of the manufacturing process.

What is SWOT Analysis?

SWOT: Key to business strategies
SWOT stands for strengths, weaknesses, opportunities and threats and after building the picture of the company’s past aims and the achievements – SWOT analysis can start its operation in the framing of the business strategy.

1. Strengths
a. Are internal to the organization.
b. Relate to the resources, programs and the organization in the key areas.
c. R and D almost complete.
d. Basis for the strong management team.
e. Key first major customer acquired.
f. Initial product can evolve into range of the offerings.
g. Located near a major centre of the excellence.
h. Well – rounded and managed business.

2. Weaknesses
a. Are internal to the organization.
b. Over – dependent on the borrowings, insufficient cash resources.
c. Board of the directors is too narrow.
d. Lack of the awareness amongst prospective customers.
e. Also relate to the resources, programs and the organization in the key areas.
f. Need to relocate to the larger premises.
g. Absence of the strong sales/marketing expertise.
h. Over – dependence on few key staff.
i. Emerging new technologies may move market in the various new directions.

3. Opportunities
a. Are external to the organization.
b. Market segment is poised for the rapid growth.
c. Export markets offer a great potential.
d. The distribution channels seeking new products.
e. Scope to diversify into the related market segments.

4. Threats
a. Are mostly external to the organization.
b. Major Players may enter the targeted market segment.
c. New technology may make products obsolescent.
d. Economic slow – down could reduce demand.
e. Euro/Yen may move against $.
f. Market may become price sensitive.
g. Market segments growth could attract major competition.

What is Lean Manufacturing?

Lean Manufacturing
Lean Manufacturing can be defined as the manufacturing philosophy, which plays a very vital role in the shortening of the time line between the customer order and the product shipment by eliminating the waste.
Objectives of the Lean Manufacturing can be summarized as follows –
1. To identify the waste elements in a system.
2. To apply value stream analysis to a complex engineering or a manufacturing system.
3. To implement 3 M’s in a complex engineering environment.
4. To be able to identify and then implement the 5 S’s of the lean.

Composition of the Lean Manufacturing can be summarized as –
1. Cells or the flexible assembly lines.
2. Broader jobs, highly skilled workers, proud of product interchangeable parts, even more variety.
3. Excellent quality mandatory.
4. Costs being decreased through the process improvements.
5. Global markets and the competition.

Elements of the Lean Manufacturing are –
1. Waste reduction.
2. Continuous flow.
3. Customer pull.
4. 50, 25, 25 (80, 10, 10) percent gains.

Benefits of the Lean Manufacturing are –
1. 50 % – 80 % reduction in the waste.
2. WIP
3. Inventory
4. Space
5. Personnel
6. Product lead times
7. Travel
8. Quality
9. Costs
10. Delivery

Lean Manufacturing analysis –
1. Value stream
2. Head count
3. WIP
4. Inventory
5. Capacity
6. New business
7. Supply chain

Tools of the Lean Manufacturing are –
1. Waste reduction.
2. Full involvement.
3. Training
4. Learning
5. Cellular mfg
6. Flexible mfg
7. Kaikaku
8. Kaizen
9. 5S
10. Jidoka
11. Poka – yoke
12. Shojimka
13. Teien systems
14. SMED

What is Production Activity Control?

Production activity control can be defined as the process which involves the co – ordination of the manufacturing resources – scheduled and controlled. Production activity control includes the various activities related to the scheduling, releasing and the tracking production orders and schedules and then reporting the materials and the resources used and the results of the production process. Production Activity Control involves the various plans associated with the action, reporting the results achieved and reviving the plans etc.

So it can be said that the Production Activity Control is responsible for the conversion of the plans into the actions by providing a much needed proper guidance.

With the help of the Production Activity Control, one can easily meet the timely completion of the various orders by starting the various operations in time as per the plan. Effective Production Activity Control is also responsible for meeting the delivery commitments. Production Activity Control acts as the modules of the MRP/ERP systems, and involves mainly four procedures – releasing, scheduling, monitoring, updating.

According to McMahon, a simple Production Activity Control architecture consists of the following five building blocks –
1. Scheduler
2. Dispatcher
3. Monitor
4. Mover
5. Producer

Functions of the Production Activity Control
1. Helps in the planning.
2. Helps in the execution of the plan.
3. Ensures availability of the resources.
4. Releases the shop orders.
5. Schedules start and completion dates of the jobs.
6. Collects required information for the shop order.
7. Helps in controlling the operations.
8. Establishes order priority.
9. Maintains order priority.
10. Checks actual performance.
11. Monitors and controls WIP, lead times.
12. Reports work center performance.

Role of the Production Activity Control
1. Manages the shop floor production task.
2. Controls the production work flow.
3. Aims achievement of the production plans.
4. Prepares the schedules.

The Production Activity Control cycle
Tasks of the Production Activity Control are cyclic in the nature as the Production Activity Control involves the execution of the work authorized by the release of the documents like the shop order to the shop. Here the planning is compared with the actual production. Production Activity Control helps in the scheduling jobs.

S.No Information that is required Sources of the information
1. Which products to make MRP system
2. How many of the products to make MRP system
3. Which are the various operations needed to produce the part Routing
4. Time standards Routing
5. Capacity of the work centers Work center data
6. Requirement of the parts/parts list Bill of material
7. No of the jobs in progress Work orders/shop orders

Scheduling and the loading techniques
1. Finite loading –
a. Involves the capacity constraint.
b. Assumes capacity to be finite at any work centre.
c. This type of loading is very realistic in the nature.
d. Planner can know in advance the jobs which can be completed and the jobs which cannot be accommodated.

2. Infinite loading –
a. Assumes the capacity to be finite at any work centre.
b. Capacity constraints are not taken into consideration.
c. Jobs are loaded on the work center without considering the adequacy of the capacity.

3. Forward scheduling –
a. Jobs are scheduled as soon as an order is received.
b. The completion date is evolved by the scheduling of the jobs at the work centers.
c. Due date is ignored while scheduling.
d. Release date is 1st.

4. Backward Scheduling –
a. Jobs are scheduled from end to start.
b. Last operation is scheduled first from the due date.
c. Scheduling continued to be done in the sequence of the operations till all the activities of the jobs are scheduled.
d. Release date is 2nd.

Explain about types of Operations Scheduling

Various types of Operations Scheduling are:
1. Forward operations scheduling –
a. Classified on the basis of the time.
b. All the activities are scheduled from the date of the planned order release.
c. First task of the job is scheduled.
d. Its subsequent task is scheduled on the scheduled completion of the first task.
e. Like this, accordingly all the tasks of the job are scheduled.

2. Backward operations scheduling –
a. Also classified on the basis of the time.
b. Activities are scheduled from the date or the planned receipt date.
c. The last activity is scheduled first.
d. Time of the start of the last task is considered as the time for the start of the previous activity.

Methods used for the operations scheduling
1. Johnson’s two machine algorithm

a. Very effective when the operations sequencing has two machines and the processing time depends on the sequence in which the jobs are loaded.
b. Also used when the company involves a backlog of the orders.
c. Is a very simple process.
d. Also a time saving process.
e. Helps in the determination of the optimal job sequence.

2. Index method
a. Used for the purpose of the loading and also for allocating the different jobs to the different machines.
b. Generally orders are assigned on the basis of the “first come first assigned” method.
c. But does not provide optimum loading.

3. Critical path analysis
a. Helps in the determination of the scheduling of the activities of the projects.
b. Reveals inter – relationships between the different activities of the project.
c. Reflects the uncertainty in the durations estimated for the various activities.

4. Critical ratio scheduling
a. Helps in the establishment and the maintenance of the priorities among the jobs in a factory.
b. Concept of “critical ratios” is used widely.
c. Helps in the expedition of the functions of the PPC.

What are the Inputs of the Operations Scheduling?

1. Performance standards –
a. First and the foremost need of the operations scheduling.
b. Helps the scheduler to find out the machine capacity in order to assign the required machine hours and the man – hours for the various activities.
c. The performance standards play a very important role in the good operations scheduling and this is always possible if the time study or the industrial engineering department exists in the plant.
d. The performance standards for such repetitive jobs are available.
e. And for the new jobs, they can be determined from the tables of the synthetic standards prepared by the department.

2. Unit of the measurement –
a. Means the unit in which the loading and also the scheduling is to be extended.
b. The most commonly used units of measurement in the engineering companies are the man – hours or the machine – hours.

3. Unit of the loading and the scheduling –
a. Means the duration for which the loading and the scheduling should be done.
b. The unit of the loading and the scheduling – scheduled start and the finishing timings – are mainly dependent on the scheduling needs of the company.
c. Scheduling should be done on the daily basis if the company makes promises in days.

4. Effective capacity per work centre –
a. Means the effective hours that can be used for the production on the machine or on the work centre in a week or in a month.
b. Theoretical capacity is equal to the number of the normal working hours of that machine.
c. Some interruptions may occur during the process and some of these interruptions can be summarized as follows –
i. Power failure.
ii. Rework.
iii. Waiting for transport.
iv. Preventive maintenance.
v. Waiting for the inspection.
vi. Tool try – out, jigs and the fixture try – outs.
vii. Operatives’ trade test.
viii. Operators involved in some other activities like the functions, celebrations etc. – leaving the production operations aside.
ix. Machine used for the technical studies.
x. Operator left the work place for the official decision.
xi. Machine breakdown – may be technical or mechanical in the nature.
xii. Operator absence.
xiii. Breakage in the tool.
xiv. Operator training time.
xv. Starting late.
xvi. Early close.
xvii. Over – time.
xviii. Incentive payment collection.

5. Extent of the rush orders –
a. When considering the scheduling process, the rush – orders play a very conclusive role.
b. Never a machine should be subjected to 100 % effective capacity, simply because of the reason that if any rush order comes in, and then the scheduling has to be changed.
c. The various methods used in the accommodation of the rush orders can be summarized as follows –
i. Leaving some capacity unscheduled on each machine per period.
ii. Leaving some in scheduled capacity between the two scheduled jobs.

6. Overlapping of the operations –
a. Means running of a job simultaneously on more than one machine.
b. Occurs in the jobs which involve two or more operations.
c. Reduces the manufacturing cycle time.
d. Reduces the delivery period to the customer.

7. Loading charts
a. These charts specify the work that is to be carried out in each section or the department of the company during the period under the review.
b. Helps in knowing the accumulated load at a given time for a given machine.
c. Helps in the identification of the periods that are available for the allocation in the future to orders needing this machine.

What are the Objectives and Functions of the Operations Scheduling

Objectives of the Operations Scheduling –
1. Making efficient use of the labour.
2. Making best possible use of the equipments that are available for the use.
3. Increasing the profit.
4. Increasing the output.
5. Improving the service level.
6. Maximizing the delivery performance i.e. meeting the delivery dates.
7. Minimizing the inventory.
8. Reducing the manufacturing time.
9. Minimizing the production costs.
10. Minimizing the worker costs.

Functions of the operations scheduling –
1. Allocation of the resources.
2. Shop floor control.
3. Making maximum use of the plant at minimum possible cost.
4. Ensure that the needs of the manpower are optimum.
5. Determination of the sequence of the jobs.
6. Specifying the start and the end time for each job (actively scheduled).
7. Getting quick feedback from the shops regarding the delays and the various interruptions.
8. Possess up – to – date information for the availability of the materials, expected delivery dates etc.
9. Possess up – to – date data on the machine regarding its breakdown, servicing etc.
10. Keep itself abreast of the hiring, dismissals, holidays etc. of the work force.

What is Operations Scheduling?

In the operations management or the production management, this technique of operations scheduling forms a very important part and acts as the back – bone for the performance of the manufacturing or the service organizations. With the help of the operations scheduling, two very important factors or the aspects of the resources within an organization that can be pertained are as follows –

1. Allocating the resources within an organization.
2. Setting up the time – table.

In today’s competitive world, the orders that are placed either from the side of the customer or from the side of the assembly benches – are to be completed on or before the contracted or the promised date. For fulfilling this, operations scheduling plays a very critical and an essential role and completely ensures that these dates are met.

Operations scheduling helps in the confirmation or the revision of the tentative delivery date that has been promised in the original quotation. Sometimes during the operations scheduling of the work order, it may be discovered that the delivery date originally and tentatively promised cannot be met. All this may be due to the several problems like the materials that are required may not be available at that particular time or may not be available immediately. This problem can also occur due to the increased plant loading while the customer is deciding whether or not to award the quoted job to this company.

It has been observed that the operations scheduling has a direct affect on the effectiveness of the production function and this relation was actually explained by Vollman.

According to Vollman, “The priority planning and the shop floor control and the scheduling elements ultimately determine the performance of the production system.”

If the operations scheduling is carried out in an efficient manner, then there occurs a considerable improvement in the performance in the delivery. Also helps in the achievement of the goals that have been set by the company. Efficient operations scheduling playa a very critical part in the reduction of the production lead times.

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