Smu Assigment 0044

Topics: W. Edwards Deming, Taguchi methods, Quality management Pages: 10 (2995 words) Published: February 15, 2013
Master of Business Administration – MBA Semester 2

(Winter/November 2012)

MB 0044 - Production and Operation Management (4 credits)

(Book ID: B1627) ASSIGNMENT- Set 1

|Solutions |

Q1. Explain the basic competitive priorities considered while formulating operations strategy by a firm?

Operation strategy reflects the long – term goals of an organisation in its corporate strategy. To active good results, a clear understanding of the operating advantages and a good cross functional coordination between functional areas of marketing, operating advantages, finance, and human resources departments are required. Operating advantages depend on its process and competitive priorities considered while establishing the capabilities. The basic competitive are:

• Cost
• Quality
• Time
• Flexibility

1: Cost:-
Cost is one of the primary considerations while marketing a product or a service. Being a low cost producer, the product accepted by the consumer offer sustainability and can outperform competitors. Lower price and better quality of a product will ensure higher demand and higher profitability. To estimate the actual cost of production, the operations manager must address labour, materials, scrap generations, overhead, and other initial cost of design and development, etc.

2: Quality:-
Quality is defined by the customer. The operations manager looks into two important aspects namely high performance design and consistent quality. High performance design includes superior features, greater durability, convenience to service, etc where as consistent design measures the frequency with which the product meets its design specifications and performs best.

3: Time:-
Faster delivery time, on-time delivery, and speedy development cycle are the time factors that operations strategy looks into. Faster delivery time is the time lapsed between the customer order and the delivery. On- time delivery is the frequency with which the product is delivered in time. The development speed is the elapsed time from the idea generation up to the final design and production of products.

4: Flexibility:-
Flexibility is the ability to provide a wide variety of products, and it measures how fast the manufactures can convert its process line used for one product to produce another product after making the required changes. The two types of flexibilities are: • Customisation

• Volume flexibility

While customisation is the ability of the firm to satisfy the specific needs of each its customer, the volume flexibility is the ability to accelerate or decelerate the rate of production to handle the fluctuations in demand. For example, the production of fertilisers of different specifications and applications.


a. List the benefits of forecasting.
b. Explain the significance of plant location decision.

a. List the benefits of forecasting:-
Forecasting basically helps to overcome the uncertainty about the demand and thus provides a workable solution. Without the forecast, no production function can be taken up. Hence, it can be stated that forecasting helps to: • Improve employee relations.

• Improve materials management
• Get better use of capital and facilities
• Improvement customer service

b. Explain the significance of plant location decision:-
2. This decision is taken on the basis of number of factors: • Availability of raw materials
• Availability of land (land should also be suitable for establishment of a factory) • Availability of...
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