Ent300 module09

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Ent300 module09

  1. 1. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANModule 9THE OPERATIONS PLAN Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  2. 2. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANLEARNING OUTCOMESAt the end of the module, students should be ableto: understand the concept of operations function in business understand the topics that are included in an operations plan prepare an operations plan for their proposed project Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  3. 3. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANINTRODUCTION Operation is one of an important function in a business organization Managing operations is crucial to make sure that the business is able to produce product or deliver services according to the specification, quality and time specified by the customer Operations management can be defined as the process of marshalling business input to transform them into output in the form of product or services Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  4. 4. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANComponents in an operations systemThe components of an operations system that isinvolved in the transformation of business input intooutput comprises of the following:  Business Input  Transformation Process  Output  Feedback  External Environment Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  5. 5. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANSchematic Diagram of an Operations SystemThe components of an operations system can be portrayed inthe schematic diagram as shown below: External Environment Factors Input Transformation Output Transformation Process Process Feedback Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  6. 6. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANOPERATIONS PLAN The operations plan is the one of the section that is included in the business plan This section will demonstrate the operational aspect of the business that is crucial(penting) in transforming the business input(capital, wrong material) into output The operations plan will ensure the business is able to produce the product or to provide the services that the business had planned in the marketing plan Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  7. 7. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANThe operations plan comprises of the following topics: Process Planning Operations Layout Production Planning Material Planning Machine and Equipment Planning Manpower Planning Overheads Requirement Location Plan Business and Operations Hours License, Permits and Regulations Required Operations Budget Implementation Schedule Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  8. 8. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANPROCESS PLANNING Process planning involve the identification of the step-by-step processes from beginning to end in making the product or in providing the services For manufacturing business, the processes involved will be explained clearly such as the activity involved, its duration and the equipment used For service business, the process planning will explain all the steps that should be taken from start to finish to provide the service(xnmpk, xgne machine) to the customer Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  9. 9. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANPROCESS PLANNING (cont.) The step by step processes can be illustrated using diagram such as a flow chart or a process chart The process chart will use symbols that are universally recognized in the operations management field These symbols are also used in the job activity chart to show a worker’s activity Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  10. 10. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Symbols Used in the Process ChartSymbol Activity Description Operation Activity that modify, transform or give added value to the input Transportation Movement of materials or goods from one place to another Inspection Activity that measure the standard or quality Delay Process is delayed because in process materials are waiting for next activity Storage Finished product or goods are stored in the storage area or warehouse Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  11. 11. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Flow Chart for the Production of Mixed Fruits Jelly Transfer the fruits from the store to the production area Check the quality of the fruits and segregate the bad fruits Clean the fruits under running water Put the fruits into the fruit chopper for chopping process Put the chopped fruits into the boiler for steaming process Use electric ladle to stir the fruit until the fruits change into pulp Add ten parts of water into the mixture Boil the mixture for 90 minutes Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin© Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  12. 12. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Activity Chart for Web Designing Services Greet the client Invite the client into the discussion room Get the relevant information from the client Brief the client about terms and conditions Get the agreement from the client regarding terms and condition Send the client to the door Work on the design of the web Make a presentation to the client Get the feedback from the client Make the amendment accordingly Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin© Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  13. 13. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANOPERATIONS LAYOUT Illustrate the layout of the operations Layout refers to the arrangement of machine, equipment, workers and other facilities used in the operations The layout must be design in such a way that the production of goods and services can be done smoothly and efficiently There are three types of layout: o Layout based on process o Layout based on product o Layout based on marketing Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  14. 14. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANTypes of LayoutLayout based on product This type of layout is suitable for a business that has product focus or continuous flow production The design of this layout is made according to the sequence of activities to product the product Example of a business that have this kind of layout is a food processing factory Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  15. 15. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANTypes of Layout (cont.)Layout based on process This layout is suitable for a business that produce several products using similar processes This type of layout is design based on the similarity of processes where by machine and equipment that perform similar function will be grouped together Example of business with this type of layout is a steel workshop and a tailor store Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  16. 16. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANTypes of Layout (cont.)Layout based on marketing This layout is designed with an intention to maximized the area available to display goods Examples of layout based on marketing can be observed in the retail business such as book store or departmental store Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  17. 17. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Example of Layout Based on Product Office Filling AreaFinishedGoods SteamingStorage Fruits Chopper Fruits Cleaning AreaReceivingArea Washing Area Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  18. 18. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Example of Layout Based on Process OfficeMilling GrindingMachine Machine Drilling Machine Tool Storage Room Area Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin© Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  19. 19. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Example of Layout Based on Marketing Frozen FoodPastry Products Store Aisle Aisle Aisle Cashier Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  20. 20. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Example of Layout in a Restaurant Counter Food Store Cashier Kitchen Dining AreaToilet Beverages Food Display Counter Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  21. 21. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANPRODUCTION PLANNING It is important to make sure that the business is able to produce output or to provide services that is enough to fulfill the expected market demand or sales This can be achieved by having a good production planning In production planning, the business will determine how much output to produce for a certain period of time such as in a day, a week or a month The business may need the information from the marketing plan, e.g. average sales forecast Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  22. 22. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANExample of calculation for output per dayAverage sales forecast per month = RM 25,200.00Price per unit = RM 15.00Number of output per month = RM 25,200.00 RM 15.00 = 1,680 unitsIf the number of working days per month is 24 daysThe amount of output to be produced per day is:= 1,680 units 24 days= 70 units per day Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  23. 23. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANMATERIAL PLANNING Material planning is done to determine the type and amount of raw materials need for the production Material planning involved four steps: o Identify and list down the raw materials required o Prepare the Bills of Materials o Calculate the quantity of raw material required o Identify the suppliers of raw materials Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  24. 24. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANIdentify and list down the raw materials required Usually in manufacturing business, the raw materials used is easily identified For example, to manufacture pencils, raw materials needed are hollow wood, lead, eraser, metal band, paint, glue and packaging box In case of retail business, the raw materials is known as goods. The business need to estimate the amount of initial goods to be purchased to start the business operation Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  25. 25. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANPrepare the bills of materials The bills of materials will contains a complete list of materials, parts or components and the amount needed to produce a unit of product To prepare the bill of material, the entrepreneur must understand the design of the product This bill of material is important information for purchasing activities Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  26. 26. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANExample of Bills of Materials To produce a unit of pencil, the bills of materials is as follows: Product No. Description Specification Quantity 101 Half hollow wood 17 cm long 2 102 Lead 17 cm long 1 1.5mm diameter 103 Eraser 0.75 cm long 1 6mm diameter 104 Metal band 2 cm long 1 105 Paint 0.5 ml 1 106 Glue 0.5 ml 1 Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  27. 27. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANExamples of Materials Requirement Schedule Material Quantity Safety Total Material Price / Total price Stock Requirement unit (RM) (RM)Flour 50 Kg 5 kg 55 1.2 66Sugar 50 Kg 5kg 55 2.8 154Eggs 200 units 20 220 0.15 33Corn Syrup 100 Liter 10 110 3 330Margarine 100 Kg 10 110 2 220Total 803 Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  28. 28. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANMACHINE & EQUIPMENT PLANNINGSteps to determine machine and equipmentrequirement:1. List out all machine and equipment required base on the process flow chart or process plan2. Determine the amount of machine and equipment required based on the venture capacity requirement3. Identify the suppliers that are reliable in term of price and after sale services Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  29. 29. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANFactors to be considered in purchasing machineand equipment• Price• Quality and reliability• Availability of spare parts• Break down maintenance facility• Technology & user friendly• Supplier reputation• After sale services Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  30. 30. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANExamples of Machine & Equipment RequisitionPlanning ScheduleNo. Machine Quantity Price / Unit Total (RM) Price (RM) 1. Mixer 1 2000 2000 2. Cutter 2 1000 2000 3. Cash Register 1 1500 1500 Total 5500 Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  31. 31. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANSteps to determine quantity for machine &equipment1. Determine the planned rate of production per day2. Determine the standard production time per unit for the planned machine3. Determine the machine productive time: Operation hours – (Setting up time + Down Time)4. Calculate the amount of machine required using the formula given in the next slide Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  32. 32. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANFormula To Calculate the amount of machinerequire:No. of Planned Rate of Production per day StandardMachine = X ProductionRequired Machine Productive Time per day Time / Unit Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  33. 33. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANMANPOWER PLANNINGSteps to determine the amount of direct laborrequired by the venture:1. Determine the planned rate of production per day for the particular section of job2. Determine the standard time for a worker to produce one unit of product or to complete a particular job3. Determine workers productive hours: Working hours per day – rest time or workers idling time4. Calculate the amount of direct labor required Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  34. 34. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Formula To Calculate the amount of direct labor requiredNo. of Planned Rate of Production per day Worker StandardWorker = X Production Time / Worker Productive Time per dayRequired Unit Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  35. 35. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Example of Direct Labour Planning ScheduleNo Position No. of Salary/ EPF Socso Total Staff Month (RM) (RM) (RM) Required (RM) 13 % 2%1 Operation 1 2000.00 260.00 2260.00 Manager2 Total Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  36. 36. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANOVERHEADS REQUIREMENT Determine the overheads that are required in the operations Overheads refers to requirements other than direct raw materials and direct labour Examples of overheads are indirect labour costs(charity), indirect material, insurance, maintenance and utilities Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  37. 37. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANLOCATION PLAN The entrepreneur has to make decision which premise is the best for the business to operate Choice of location is important because it will affect: •Sales revenue •Business operation cost •Long term investment Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  38. 38. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANFactors that Influence the Choice of Location1. MANUFACTURING ACTIVITY – Priority should be given to the cost factors – In manufacturing cost saving would contribute to profit2. SERVICE ACTIVITY – In service priority should be given to distance from market or customers. – Distance from customers will influence sales revenue – In service business cost saving may not contribute to sales revenue – Increase in revenue will contribute to increase in profit Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  39. 39. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANFactors to be considered for Choice of Location**• Distance from raw • Local Government material / suppliers Policy• Labor supply • Security• Transportation • Facility for expansion• Price of Land or and business rentals development• Infrastructure• Climate(cuaca) Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  40. 40. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANBUSINESS AND OPERATIONS HOURS** Business hours refer to the time the business is open to the customers Operation hours refer to the hours the workers have to work. For manufacturing, usually the business will operate on 8-hours per shift. Thus the entrepreneur will only decide whether the business will runs for one shift or more. This will depends upon the planning for production Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  41. 41. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANBUSINESS AND OPERATIONS HOURS (cont.) For service business, the entrepreneur will has to state the business hours in terms of days and hours For example, a restaurant may open to the customer from 7 a.m. to 10 p.m. every day However, the operations hours for the workers will be different The working hours may be from 5 a.m. to 12.a.m The entrepreneur may have 2 shifts for the workers; the first shift will starts from 5 a.m. to 3 p.m. and the second shift starts from 3p.m. to 12 a.m. Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  42. 42. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANLICENSE, PERMITS and REGULATIONS Find out and list down all the license/permits/ regulations that are required to operate the business Identify which agency is responsible to approve the particular license/permit For example, a restaurant among others will need the following license/permit/regulations: o License for signboard o Permits for emigrant workers o Typhoid injection for the workers(kdai mkan)(utk ksihatan) Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  43. 43. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANOPERATIONS BUDGET The business need to estimate the budget for the operations activities The operations budget can be categorized into: • Fixed asset expenditure • Monthly expenses • Other expenses This operation budget is important because it will be one of the input to prepare the financial plan Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  44. 44. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANOPERATIONS BUDGET (cont.)•Fixed Asset Expenditure o Refers to the investment on long term assets used in the operations to produce the product or services o Examples are the purchase of machines and equipment•Monthly Expenses o Refers to the payment made every month in the operations department o Examples are wages for workers and raw materials purchased Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  45. 45. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANOPERATIONS BUDGET (cont.)•Other Expenses o These are expenses that are made and could not be categorized as fixed asset expenditure or monthly expenses o Examples are deposits and insurance Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  46. 46. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Example of Operations BudgetItem Fixed Asset Monthly Other Expenses ExpensesMachine and Equipment RM 35,500Factory Renovation RM 45,000Raw Materials RM 20,000Wages + EPF + SOCSO RM 6,500Utilities RM 600Factory Rent RM 3,000Deposit for rent RM 6,000Deposit for utilities RM 1,000Total RM 80,500 RM 30,100 RM 7,000 Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  47. 47. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANIMPLEMENTATION SCHEDULE Implementation scheduling involves sequencing and allotting time to all project activities To prepare implementation schedule, entrepreneurs has to decide how long each activity and compute the requirement on people and other resources Scheduling normally use Gantt Chart which is a planning chart used to schedule resources and allocate time Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  48. 48. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLANThe Importance of Project SchedulingProject scheduling serves several purposes: 1. It shows the relationship of each activity to others and to the whole project 2. It identifies the precedence relationship among activities 3. It encourages the setting of realistic time and cost estimate for each activity 4. It helps make better use of people, money and material by identifying critical bottlenecks in the project Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  49. 49. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN Example of Project Implementation Schedule Activities Deadlines DurationsIncorporation of business Jan – Mac 2009 3 monthsApplication for permits and Jan – April 2009 4 monthslicenseSearching for business Feb – Mac 2009 3 monthspremiseRenovation of premise April 2009 1 monthProcurement of machines and April – June 2009 3 monthsraw materialRecruitment of labours June 2009 1 monthInstallation of machines June 2009 1 month Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin © Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008
  50. 50. ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP THE OPERATIONS PLAN END OF MODULE 9 Nawawi Hj. Mohd Jan, Rahimah Sarmidy & Sodri Ariffin© Entrepreneurship Department, Faculty of Business Management, Universiti Teknologi MARA 2008

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