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2-24 and 2-26 Operations Management

So a project team often includes people who dont

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Unformatted text preview: project team often includes people who don’t usually work together – sometimes from different organizations and across multiple geographies. The development of software for an improved business process, the construction of a building or bridge, the relief effort after a natural disaster, the expansion of sales into a new geographic market — all are projects. And all must be expertly managed to deliver the on-time, on-budget results, learning and integration that organizations need. Project management, then, is the application of knowledge, skills and techniques to execute projects effectively and efficiently. It’s a strategic competency for organizations, enabling them to tie project results to business goals — and thus, better compete in their markets. Project management processes fall into five groups: •Initiating •Planning •Executing •Monitoring and Controlling •Closing http://www.pmi.org/About-Us/About-Us-What-is-Project-Management.aspx Scheduling Project Scheduling PERT / CPM Involves finding out the critical path and ensuring that activities in that sequence do not get delayed; Manufacture Throughput time – Time to produce an unit of output Capacity – Units of output in the unit of time Cycle time = 1 / Capacity Inventory The amount and number of raw material, parts, and finished products that a company has in its possession; Raw material, components, WIP, finished goods Costs of maintaining inventory Ordering costs Setup costs Holding costs Stockout costs Systems for Managing Inventory Systems Independent Demand Systems Economic Order Quantity (EOQ) EOQ = SQRT (2xDxO/H) D is demand O is ordering cost per order H is holding cost per unit Dependent Demand Systems Just in time Minimizes holding costs, including actual wear and tear and Minimizes the cost of financing inventory the MRP/ERP Computer software based schedule MRP, ERP and beyond MRP, Materials Requirement Planning A computer-based production management system computer-based that uses sales forecasts to make sure that needed parts and materials are available at the right time and place; place; Enterprise Resource Planning A software solution that addresses enterprise needs software taking the process view of the organization to meet the organizational goals tightly integrating all functions of an enterprise. of Take-Aways Take-Aways Operations management refers to the set of activities by Operations which an enterprise transforms resources into the products and services it offers; products Important concepts that have affected the development of Important operations management are: operations Economies of scale and mass production The service economy The quality and productivity revolution and lean production Operations management comprises: Location Layout Quality management Scheduling (including MRP and ERP techn...
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