...Strategic Capacity Management - Operations Management Review Notes Capacity is the ability to hold, receive, store, or accommodate. In a business sense, it is viewed as the amount of output that a system is capable of achieving over a specific period of time. Strategic capacity planning has as its objective, to determine the overall capacity level of capital-intensive resources - facilities, equipment, and overall labor force size - that best supports the company's long-range competitive strategy. Capacity utilization rate = Capacity used Best operating level Capacity used – rate of output actually achieved Best operating level – capacity for which the process was designed Economies of scale Signifies that as production volumes increase, the average cost per unit decreases. The experience curve As plants produce more units, they gain experience in their production methods, which in turn, results in reducing the per unit costs of production in a predictable manner. Capacity flexibility Capacity flexibility means having the ability to rapidly increase or decrease production levels or to shift production capacity quickly from one product or service to another. Such flexibility is achieved through flexible plants, processes, and workers, as well as through strategies that use the capacity of other operations. Issues to be considered in adding capacity are: -maintaining system balance -frequency of capacity additions -the use of external...
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...[pic] [pic] Concepts in Product Design : □ Research & Development □ Reverse Engineering □ Computer Aided Design (CAD) □ Manufacturability □ Robust Design □ Modular Design □ Standardization □ Concurrent Engineering □ Product Life Cycle Concepts in Process Design : □ Types of Processes 1. Continuous Process 2. Semi-continuous (Repetitive/Assembly) Process 3. Intermittent Process a. Batch Process b. Job Shop 4. Projects Process Innovations : Various process innovations, which have changed our life-style: □ Worldwide search and free connectivity of individuals through net surfing. □ ATM = Automated Teller Machine = Any Time Money = All Time Banking □ Customer’s token number display-boards on cash-counters. □ Net-banking & Share-trading through net. □ Issue of Insurance policy through net. □ Auctions, Biddings & Purchases through Credit-cards. □ Laptops & Pen-drives to carry & transfer information. □ Issue of any destination ticket from any railway station & window & Issue of reservation tickets through internet from home with availability of reservation & location details of trains & flights. □ Verification of Insurance cover by police during road checking, to confirm the current policy of the vehicle through SMS to IRDA controlled Global server. □ Use of escalators in Malls, to facilitate free movement...
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...The definition of a waiting line is a list of consumers who continues to wait to pay for a specific service from a restaurant or other service facilities. The way I see it understanding waiting lines and figuring out how to manage them is one of the most important areas in operation management. In companies or in private life, there are instances of procedures which generates waiting lines or queues. The reason why these waiting lines occur is for the present services facility is inadequate to provide service at that instance. As an examples when people travel by airplanes, I have personal involvements with numerous types of waiting lines or queues. To buy tickets for a movie, I normally have to stand in line at movie theater ticket office. When I arrive at an airport most of the time I stand in line to check baggage, then I stand in line again to get a seat assignment. After that I line up again for the TSA security checkpoint and the again for the last time when waiting to board the plane to scan the boarding passes. I also wait when I am inside the plane, I wait for those ahead of me to take their seats. And finally, we may wait for baggage to arrive and then for ground transportation. I think this quote is very important and says a lot about waiting lines. “Perhaps the biggest influence on our feelings about lines, though, has to do with our perception of fairness. When it comes to lines, the universally acknowledged standard is first come first served: any deviation is, to...
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...OPERATIONS MANAGEMENT Chapter 5: Strategic Capacity Planning Learning Objective: You should be able to: 1. Summarize the importance of capacity planning 2. Discuss ways of defining and measuring capacity 3. Describe the determinants of effective capacity 4. Discuss the major considerations related to developing capacity alternatives 5. Briefly describe approaches that are useful for evaluating capacity alternatives Capacity Planning Capacity 1. The upper limit or ceiling on the load that an operating unit can handle 2. Capacity needs include Equipment Space Employee skills Capacity Planning Questions Key Questions: 1. What kind of capacity is needed? 2. How much is needed to match demand? 3. When is it needed? Related Questions: 1. How much will it cost? 2. What are the potential benefits and risks? 3. Are there sustainability issues? 4. Should capacity be changed all at once, or through several smaller changes 5. Can the supply chain handle the necessary changes? 6. Capacity Design capacity Maximum output rate or service capacity an operation, process, or facility is designed for Effective capacity Design capacity minus allowances such as personal time, maintenance, and scrap Actual output Rate of output actually achieved--cannot exceed effective capacity. Defining and Measuring Capacity Measure capacity in units that do not require updating Why is measuring capacity in dollars problematic? Two useful...
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...problems of the restaurant and provide recommendations based on an analysis of feasible alternatives. Based on the analysis it was discovered that customer demand had been increasing due to the Village at Blue Mountain ski resort experiencing high occupancy rates during the summer and winter. Because Sunset Grill had not forecasted the high demand of customers during weekends, and thus not adjusted the staff, the ordering process was delayed and created queues of up to 25 minutes. By performing an assessment of the restaurant’s operations, staffing, and facility capacity, it was concluded that main problem is related to understaffing and insufficient facility capacity. Background Sunset’s competitive advantage is its location and pricing, as breakfast options in the vicinity are scarce and high priced. Nonetheless, the franchise is experiencing operational issues due mainly to insufficient staff and seating capacity...
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...Generic approaches to service system design production-line approach routine services can be delivered through this approach, services are provided in a controlled environment to ensure consistent quality and efficiency of operation. a service taking this approach could gain a competitive advantage with a cost leadership strategy. this approach attempts to translate a successful manufacturing concept into the service sector. limited discretionary action of personnel a feature that contributes to the production line approach's success. standardization and quality (defined as consistency in meeting specifications) are the hallmarks of a production line. for standardized routine service, consistency in service performance would be valued by customers. because of this, employees have little power to make decisions in producing a product or service and the customer can thus expect identical service at any location of a particular operation. division of labor a feature that contributes to the production line approach's success. the production-line approach suggests that the total job be broken down into groups of simple tasks. task grouping permits the specialization of labor skills, and the division of labor allows one to pay only for the skill that's required to perform the task. this raises criticisms of many service jobs being min-wage, dead end, and low-skill jobs. substitution of technology for people a feature that contributes to the production line approach's success...
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...Developing business in the brewing industry as thousands of tradition, always face of intense competition from existing competitors as well as new entrants. In additional, any manufacturers have difficult in expending production capacities and resources. This report aims to recommend how to continue growing business without compromising on quality in high competitive market and limited production capacities and resources. After four year growth in volume, from 6,000 cases in 2008 to 200,000 cases in 2012, the 961 volume of beer sold increased dozens of times. The various products of 961 beer have presented and its retailers network have expanded to variety channel such as bars, restaurants and local supermarkets, even it opened a beer pub by the company. This pub has been an exciting successful case and also has given hints for next periods. However, the company faced of limited capacity for the production of larger volumes while the team operated in small volume and even a new bottling machine had to be ordered. The company had strategically become one of biggest Lebanese brewing company and had prepared for huge competition from Almaza who is also local company dominated the Lebanese market. In additional, by being acquired by Heineken in 2002, this closet competitor took on hand many advantages in technology, experiences, alternative famous brand from the No. 1 worldwide brewing corporation. While the company has built all things from zero. Its largest early customer group...
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...Political Competency Name Institution Lessons learned about Political Competency from the Documentary, Shameless Propaganda (2013) Political competency is viewed as the capacity to understand what an individual can or cannot control when to take action, which is going against your motive and who you require on your side to push your motive ahead. Political competency relates to having knowledge of how to map the political terrain, get others on your area and lead coalitions. More often than not, political competency is not viewed as a critical core competence that is required by all politicians or leaders within an organization. The documentary “Shameless Propaganda” gives insights of the art of political competence that took place in Canada between 1939 and 1945 (“National Film Board of Canada,” 2014). When you ask fruitful pioneers how they get things going, they'll converse with you about conceptualizing, support, authority, market investigation, and arranging, however they'll infrequently expound on the unending normal micro-legislative issues they participate in. Legislative issues are by all accounts an unthinkable subject in authoritative life-the elephant in the initiative parlor that nobody examines or concedes is there (Golubeva, 2013). Political competence is not fiendishness by result of authoritative life. Being political, in its most appealing light, is being mindful of the hobbies of others, discovering zones of shared view, bringing others on board, and...
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...of transfers from EROW ? 2. Examine the Actual and Budgeted Fixed Costs of Exhibit 2. Show the calculations used to derive actual and budget: a. Standard b. Cost Adjustments (HINT: the cost adjustment hinges on the answer to question 1b) c. Volume Variance 3. As Choquette, what evidence would you present to the Polysar Board of Directors during the upcoming performance review of NASA Rubber Division. Pay particular attention to questions that may be raised concerning the accuracy and meaning of volume variances. 4. In light of the current compensation plan, what sales and production strategy is Henderson (EROW Division) likely to choose? What would Choquette (NASA Division) prefer? 5. Suppose EROW is operating at capacity and would like to purchase additional rubber. If EROW could buy the rubber from an external source (and not have to purchase it from NASA) , what is the most that EROW would be willing to pay (per tonne)? 6. Compare the profitability (per tonne) of EROW and NASA. How should the company schedule production to insure the highest level of profits to the Rubber Group in...
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...individuals who are working and have sustained injuries on or off the job, a key focus of rehabilitation is restoration of work capacity. Rehabilitation programs that are funded by government or private insurers often have an explicit goal of returning the injured party to previous or comparable levels of employment. In such cases, it is important to identify required job tasks and expected performance levels. Such information creates targeted outcomes for the rehabilitation program. The overall rehabilitation process is guided by the job analysis through a process wherein assessed levels of current functional capacity are compared to the required job performance demands (Loisel et al. 2001). Identified gaps between worker capacity and job demands are then addressed through restorative programs and/or job modification. Work transition planning In rehabilitation the job analysis is used to provide information to match the injured worker with tasks that can be safely performed on initial resumption of duties following an absence or time away from regular duties. The job analysis information serves as the foundation for a graduated work resumption process that optimizes productivity and compliments the rehabilitation program and injury recovery. Regular review of the job analysis is used to identify job demands that are suitable to the worker's capacities throughout the recovery process until the worker resumes the pre-injury job or reaches an optimal level of performance in a...
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...MGT 415 WEEK 5 ASSIGNMENT FINAL PAPER A+ Graded Tutorial Available At: http://hwsoloutions.com/?product=mgt-415-week-5-assignment-final-paper Visit Our website: http://hwsoloutions.com/ Product Description PRODUCT DESCRIPTION MGT 415 Week 5 Assignment Final Paper, Organization and Structure in a Business Setting The circulation focus is an indispensable piece of any association. A DC (Distribution Center) works as a cost focus and does not can produce any benefit all alone’s. The building is given an apportioned plan for the year and is in charge of staying inside the parameters of that funding. Numerous distinctive elements can influence a building’s capacity to effectively meet that funding and gainfulness is one of the greatest ones. Gainfulness clearly drives the quantity of containers that are transformed and the more that are prepared, the better that is for the monetary allowance. Wage hours are additionally specifically affected by benefit. In the event that every colleague has high gainfulness, it will take less wage hours to achieve the volumes than the financial backing considers. There can likewise be a drawback of high gainfulness, as well. The quicker a group ventures to every part of the more potential there is for inefficiencies and wounds. These can really nullify any of the monetary profits acknowledged from the higher profit of the group by adding extra wage hours to settle quality issues and added expenses identified with lost work hours. The...
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...It is learnt that the management is in the process of finalizing the VISION of PSPCL and one of the mission identified is to "attain 10,000 MW Power Generation in the state by 2020". Presently, the total installed capacity of share is 4878 MW and PS has signed PPAs with private companies setting up plants at Goindwal Sahib (540MW), Talwandi Sabo(1980 MW), Rajpura (1400 MW)and with NTPC (2640 MW with PSPCL share of 1320 MW). So the total installed capacity in the state by the end of 2014-15 is expected to be 9118 MW. In addition, has signed MOUs with private companies for setting up thermal plants in the state of more than 5000 MW capacity. In addition, presently P has allocation of 1840 MW from central sector plants which is expected to cross 470 MW in the next 5 years. As there is no difference between the powers contracted on long term basis with plants set up outside the state either by central sector or private sector companies and the PPAs signed for procurement of power with private companies setting up plants in the state so mission appears to have been secured well before 2015 without investing even a penny in any project. The question is what will be doing in the next 5 years whereas generation is concerned? In the past, the management of repeatedly argued in favour of setting up plants under state sector and has mentioned it many a times that "setting up of thermal plants in the state sector is in the interest of the state" but surprisingly this commitment...
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...Amsterdam MBA Operations & Supply Chain Management Bayonne Packaging, Inc. HBS brief case 4420 March 5, 2013 Gulcin Askin Michelle Donovan Kivanc Ozuolmez Peter Tempelman 1 The answers in this report relate to the questions given in the document ‘Case 1: Bayonne Packaging, Inc.’ Question 1: Operations Performance of Bayonne Packaging 1A. How would you define the Operations Strategy of Bayonne Packaging? The operations strategy of a company is the prioritization of the five key performance measures: cost, quality, speed, dependability and flexibility. The president of Bayonne Packaging, Inc. indicates that the problems of the company are: they have incurred their first losses since 2001, there are complaints about quality and they are delivering late more often. The other department managers, except for the absent Finishing department manager, also indicate to the new vice president of operations that they have problems in their departments that relate to the performance measures dependability, quality and speed. Based on the priorities given by the key personnel of Bayonne Packaging we have determined the operations strategy of Bayonne Packaging to be as follows (key performance measures in descending order of importance: 1. Dependability 2. Quality 3. Speed 4. Costs 5. Flexibility 1B. How can Bayonne Packaging, Inc.’s Operations & Supply Chain performance be quantified? Per Key Performance Measure we have determined the following ways to...
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...point of view of Wegmans Food Market’s management. II. Time Frame The case happened during the maturity of Wegmans Food Market. III. SWOT (Strength, Weaknesses, Opportunities, and Threats) Analysis Strengths 1. Wegmans Food Market is a well-known premier grocery chain as it offers high product quality and excellent service to customers. 2. It is positioned in good locations in United States where it does its business. 3. It offers variety of products and extended additional features wherein customers can choose from. 4. The company's produce department employs specialized way of transferring produce to reduce bruising 5. It maintains a strict control on its suppliers considering the quality and timeliness of deliveries. 6. It involves the coordination of departments in verification of inventory count. 7. It has good people who are well-trained, knowledgeable, and committed to the organization. 8. It continues to adopt technological processes and systems to maintain its competitiveness. Weaknesses 1. Because of too much emphasis on satisfying customers, high cost of improving the products and service is somehow overlooked. 2. Some of the stores in Wegmans have improper capacity distribution. Take for example, the floral and card shop wherein capacity for floral shop is smaller than the latter, but considering that floral shop has more products on display, it must have capacity greater than the card shop. 3. In...
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...PRODUCTION MANAGEMENT IN A GLOBAL ECONOMY MODULE III CAPACITYPLANNING ACTIVITY Submitted By: GROUP II BAUISTA, April Jasmine P. DE GUZMAN, Alyssa Nicolle V. NGUDDO, Maria Lovella C. RETRATO, Denver A. ROJAS, Genwilma Monica L. Submitted to: Dr. Maria Monica Costales University of the Cordilleras, 2nd Trimester SY 2013-14 8 November 2013 Capacity Planning Techniques A. Determining Capacity Requirements In determining capacity requirements, we must address the demands for individual product lines, individual plant capacities, and allocation of production throughout the plant network. Typically this is done according to the following steps: 1. Use forecasting techniques to forecast sales for individual products within each product line. 2. Calculate equipment and labor requirements to meet product line forecasts. 3. Project labor and equipment availabilities over the planning horizon. Often the firm then decides on some capacity cushions that will be maintained between the projected requirements and the actual capacity. A capacity cushion is an amount in excess of the expected demand. Positive Capacity Cushion: If the expected annual demand on a facility is $10 million in products per year and the design capacity is $12 million per year, it has a 20% capacity cushion (2/10). A 20% capacity cushion equates to an 83% utilization rate (100%/120%). Negative Capacity Cushion: when a firm’s design capacity is less than the capacity to meet its...
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