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Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
Production & Operations Management
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Production & Operations Management

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  • 1. Assignment onProduction & Operations Management submitted by Harikrishnan S. Happy V.S. Honey V.S. Job Thomas Yasser Bukari Group II Semester – 4 MBA (PT) 2012 submitted to Dr. Manoj Edward SCHOOL OF MANAGEMENT STUDIESCochin University of Science and Technology Cochin, Kerala PIN 682022
  • 2. May 2012 2
  • 3. 01. Explain in detail work / method studyWork Study is the systematic examination of the methods of carrying on activities so as toimprove the effective use of resources and to set up standards of performance for theactivities being carried out. Method Work Higher study measurement productivity Work studyMethod study is the collection of techniques used to examine work - what is done and how itis done - so that there is systematic analysis of all the elements, factors, resources andrelationships affecting the efficiency and effectiveness of the work being studied.Human factors influencing work study Managemen t Work study specialist Supervisors WorkersWork study and the ManagementImportance of management must be establishedGaining the management support Make the management feel that it is not their fault. Make the management understand the purpose and techniques of work study.Work Study and the SupervisorThe importance of the supervisor: Supervisor is the person mostly affected by work study. Work study is a personal challenge for supervisor. Fear of taking away the responsibilities influences the work study.Work Study and the WorkerWork study improves industrial relations: Workers feel that the management cares for them. Workers discover that there are managers who highly understand their job. The feeling of confidence in workers improves. 3
  • 4. Workers are more able to carry out their jobs.Method study Select the job to be studied Record by collecting data or by direct observation Examine by Challenging purpose, place, sequence, and method of work Develop new methods drawing on contributions of those concerned Evaluate results of different alternative solutions Define new method and present it Install new method and train persons in applying it Maintain and establish control proceduresAlthough this linear representation shows the underlying simplicity of method study, inpractice the process is much more one of iteration around the above steps with eachdominating at a different stage of the investigation.The process often starts with a quick, rough overview in which preliminary data are collectedand examined, before subsequent passes provide and handle more comprehensive and moredetailed data to obtain and analyze a more complete picture. 4
  • 5. 02. Explain in detail time studyTime study is a tested method of work measurement for setting standard time for carrying outa specified work. The aim of time study is to establish a time for a qualified worker toperform specified work under stated conditions and at a defined rate of working.Conditions in time study: • the practitioner (observer) must be fully qualified to carry out Time Study, • the person performing the task must be fully trained and experienced in the work, • the work must be clearly defined and the method of doing the work must be effective • the working conditions must be clearly definedEssentials for establishing a basic time for specified work are rating and timingTimingThe observer records the actual time taken to do the element or operation. This usually is incentiminutes (0.01 min.) and is recorded, using a stop-watch or computerized study board.Rating When someone is doing work his/her way of working will vary throughout the workingperiod and will be different from others doing the same work. This is due to differing speedsof movement, effort, dexterity and consistency. Thus, the time taken for one person to do thework may not be the same as that for others and may or may not be reasonable anyway. Thepurpose of rating is to adjust the actual time to a standardized basic time that is appropriateand at a defined level of performance. Rating is on a scale with 100 as its standard rating.Basic timeBasic time is the standardised time for carrying out an element of work at standard rating.Steps in Time study 1. Define and document the standard method. 2. Divide the task into work elements. 3. Time the work elements to obtain the observed time for the task. 4. Evaluate the worker’s pace relative to standard performance (performance rating), to determine the normal time. 5. Apply an allowance to the normal time to compute the standard time.ApplicationTime study is often used when • there are repetitive work cycles of short to long duration, • wide variety of dissimilar work is performed, or • process control elements constitute a part of the cycle. 03. Explain inventory management in independent demand items 5
  • 6. Inventory management is the process of efficiently overseeing the constant flow of units intoand out of an existing inventory. This process usually involves controlling the transfer in ofunits in order to prevent the inventory from becoming too high, or dwindling to levels thatcould put the operation of the company into jeopardy.Inventory is a stock of materials and products used to facilitate production or to satisfycustomer demand. Types of inventory include:1. Raw Materials (including component parts)2. Work-In-Process3. Maintenance/Repair/Operating Supply (MRO)4. Finished GoodsReasons for holding inventories include:1. To maintain independence of operations by de-coupling successive production processes (buffer inventory).2. To cover anticipated changes in demand and supply (anticipation stock, as used, for example, in aggregate production planning to meet anticipated customer demand).3. To allow flexibility in production scheduling4. To protect against uncertainties in supply, demand, and lead time (safety stock) and avoid shortages (stockouts).5. To guard against inflation and price increases.6. To permit operations to continue smoothly.Independent DemandAn inventory of an item is said to be falling into the category of independent demand is notused to meet a production schedule.Examples of independent demand: finished goods; retail and distributor inventories; serviceinventories; maintenance, repair, and operating (MRO) inventories. MRO includes fuels,repair parts, office supplies, cleaning suppliesIndependent demands for inventories are based on confirmed Customer orders, forecasts,estimates and past historical data.Inventory Management techniques• Fixed order quantity method• Fixed order Period system• ABC analysisFixed Order Quantity System -When the Order Point (OP) is reached, order is placed. Fixed order quantity system is knownas the 2 bin system. • Economic Order Quantity Model (EOQ) • EOQ for Production Lots • EOQ with Quantity Discounts • Models with uncertain demand during lead time 6
  • 7. Fixed Order Period System -The inventory is ordered at “fixed time intervals.” Order enough materials to bring theinventory to a predetermined level.ABC analysisABC inventory analysis divides inventory items into 3 categories: A items usually account for at least 60% of annual usage and should be controlled most closely B items require a moderate level of control. A and B items should account for at least 80% of annual usage. C items require less control than other items. These items are those with the least usage that were not classified as A and B items Dependent and Independent Demand: Types of Inventory Dependent demand: Independent demand: used to meet a not used to meet a production schedule production schedule in manufacturing Manufacturer Service Company Raw materials Finished goods Retail or Component parts distributor MRO inventories Work-in-process Service (WIP) inventories MRO 7
  • 8. 04. Explain in inventory management in dependent demand itemsIf the demand for inventory of an item is dependant upon another item, such demands arecategorized as dependant demand.Raw materials and component inventories are dependant upon the demand for FinishedGoods and hence can be called as Dependant demand inventories.Managing Raw Material Inventories is far more complicated than managing Finished GoodsInventory. This involves analyzing and co-coordinating delivery capacity, lead times anddelivery schedules of all raw material suppliers, coupled with the logistical processes andtransit timelines involved in transportation and warehousing of raw materials before they areready to be supplied to the production shop floor. Raw material management also involvesperiodic review of the inventory holding, inventory counting and audits, followed by detailedanalysis of the reports leading to financial and management decisions. The questions requiredto be answered in inventory management are: How much quantity of materials should be ordered? When the order is to be placed? Finished Independent product Demand Component 1 Raw material 1 Dependent Component 2 Raw material 2 Demand Raw material 3Inventory Management techniques• Master production schedule (MPS)• Material requirements planning (MRP)• MRP II• Just in Time (JIT)Master production schedule (MPS) 8
  • 9. A master production schedule (MPS) is a plan in respect of production, staffing, inventory,etc. to produce individual commodities in each time period. Time-phased plan specifyinghow many and when the firm plans to build each end item. Aggregate Plan (product groups) MPS (specific items)The MPS translates the business plan, including forecast demand, into a production planusing planned orders in a true multi-level optional component scheduling environment. UsingMPS helps avoid shortages, costly expediting, last minute scheduling, and inefficientallocation of resources. Working with MPS allows businesses to consolidate planned parts,produce master schedules and forecasts for any level of the Bill of Material (BOM) for anytype of part.Example for mater production schedule for product ADemand management Dates 2/5/12 3/5/12 4/5/12 5/5/12 7/5/12Monthly demand for product A 4000Working days in month 23MPS daily demand for product A 174 174 174 174 174MPS issues: • Width of the time bucket • Planning horizon • Rolling plan • Time fencing (frozen, moderately firm or flexible) • Schedule freezingMaterial requirements planning (MRP) INPUTS OUTPUTS Service parts Inventory order forecast transaction data Inventory status file Materials Order changes requirement Planned order planning (MRP) schedule Master production schedule Planning reports Performance report Bills of Exception materials file reports 9
  • 10. Material requirements planning (MRP) is a production planning and inventory control systemused to manage manufacturing processes. Based on a master production schedule, a materialrequirements planning (MRP) system:  Creates schedules identifying the specific parts and materials required to produce end items  Determines exact numbers needed  Determines the dates when orders for those materials should be released, based on lead timesApproaches to processing MRP • Net change approach: Only products that were active since last review are processed. • Regenerative approach: All products are processed irrespective their activity status.Gross to net logic in MRP Net requirements = Gross requirements + allocated inventory + safety stock – stock in hand + back ordersLot sizing in MRP  Economic order quantity  Lot – for – lot  Period – order – quantityMRP II  Goal: plan and monitor all resources of a manufacturing firm (closed loop): • Manufacturing • Marketing • Finance • Engineering • Shop-floor control  Simulation capability of the manufacturing system Closed loop MRP Production planning Master production scheduling Material requirement planning Capacity requirement planning FEEDBACK No FEEDBACK Realistic? Yes Execute 10 Capacity plan Material plan
  • 11. Just in TimeJust-in-time (JIT) purchasing is the purchase of goods or materials such that a deliveryimmediately precedes demand or use. Companies moving toward JIT purchasing argue thatthe cost of carrying inventories (in EOQ model) has been dramatically underestimated in thepast. The cost of placing a purchase order (in EOQ model) is also being re-evaluated.Three factors are causing sizable reduction in the cost of placing a purchase order1. Companies increasingly are establishing long-run purchasing arrangements.2. Companies are using electronic links, such as the Internet, to place purchase orders3. Companies are increasing the use of purchase order cardsJust-in-time (JIT) production systems take a “demand pull” approach in which goods are onlymanufactured to satisfy customer orders.Major features1. Organizing production in manufacturing cells2. Hiring and retaining multi-skilled workers3. Emphasizing total quality management4. Reducing manufacturing lead time and setup time5. Building strong supplier relationships 11
  • 12. 05. Write short note on EOQEconomic order quantity (EOQ) is the order quantity that minimizes total inventory holdingcosts and ordering costs. It is one of the oldest classical production scheduling models. Thepurpose of the EOQ model is to find that quantity to be ordered which minimizes the totalvariable costs of inventory. Total variable costs are usually computed on an annual basis andinclude two components, the costs of ordering and cost of holding the inventory.Annual ordering cost is the number of orders placed times the marginal or incremental costincurred per order. This incremental cost includes several components such as the costs ofpreparing the purchase order, paying the vendors invoice, and inspecting and handling thematerial when it arrives. It is difficult to estimate these components precisely. The EOQ isnot very much sensitive to errors in inputs.The holding costs used in the EOQ should also be marginal in nature. Holding costs includeinsurance, taxes, and storage charges, such as depreciation or the cost of leasing awarehouse. The holding cost also includes the risk that inventory will spoil or becomeobsolete before it can be used. Annual holding costs are usually computed as a fraction ofaverage inventory value.EOQ applies only when demand for a product is constant over the year and each new order isdelivered in full when inventory reaches zero. There is a fixed cost for each order placed,regardless of the number of units ordered. There is also a cost for each unit held in storage,sometimes expressed as a percentage of the purchase cost of the item.The optimal number of units to order is to be determined so that we minimize the total costassociated with the purchase, delivery and storage of the product. The required parameters tothe solution are the total demand for the year, the purchase cost for each item, the fixed costto place the order and the storage cost for each item per year Total cost Annual cost Holding cost Ordering cost EOQ Order quantity Total Cost = purchase cost + ordering cost + holding costUnderlying assumptions 1. The ordering cost is constant. 2. The rate of demand is known, and spread evenly throughout the year. 3. The lead time is fixed. 12
  • 13. 4. The purchase price of the item is constant i.e. no discount is available 5. The replenishment is made instantaneously; the whole batch is delivered at once. 6. Only one product is involved.EOQ Formula Total Cost = purchase cost + ordering cost + holding costPurchase cost: This is the variable cost of goodsOrdering cost: This is the cost of placing ordersHolding cost: the average quantity in stock (between fully replenished and empty) is Q/2 D= Annual demand (units) Total cost = D C + S x (D/Q) + (Q/2) x I x C C= Cost per unit ($) Q= Order quantity (units) S= Fixed Cost per order ($) Take the 1st derivative: I = Holding cost (%) H= Holding cost ($) = I x C d(TC)/d(Q) = (I x C) / 2 - (D x S) / Q² To optimize: set d(TC)/d(Q) = 0 Number of Orders =D/Q DS/ Q² = IC / 2 Ordering costs ($) = S x (D / Q) EQ²/DS = 2 / IC Average inventory units = Q/2 Q²= (DS x 2 )/ IC ($) = (Q / 2) x C Cost to carry average inventory = (Q / 2) x I x C Holding cost ($) = (Q /2) x H Purchase cost ($) =DCEOQ is the function of annual demand (D), cost per order (S) and holding cost (H or IC) 13
  • 14. 06. Write short note on EOQ with quantity discountQuantity discounts are the price reductions designed to induce large orders. The goal of thebuyer is to select the order quantity that will minimize the total cost.Economic order quantity (EOQ) is the order quantity that minimizes total inventory holdingcosts and ordering costs. It is one of the oldest classical production scheduling models. Thepurpose of the EOQ model is to find that quantity to be ordered which minimizes the totalvariable costs of inventory. Total variable costs are usually computed on an annual basis andinclude two components, the costs of ordering and cost of holding the inventory. Total Cost = purchase cost + ordering cost + holding costThe EOQ with quantity discount is worked out in two stepsStep 1: Calculate EOQ. If this amount can be purchased at the lowest price, you have found the quantity that minimizes the equation. If not, proceed to step 2.Step 2: Compare total cost at the EOQ quantity with total costs at each price break above the EOQ..Example Total cost Rage 1 Rage 2 Rage 3 Cost per unit = C1 Cost per unit = C2 Cost per unit = C3 TC3 TC1 TC2 EOQ of EOQ of EOQ of Range 1 Range 2 Range 3 Reorder quantity TC1 = D C1 + S (D/Q) + (Q/2) (I C1) TC2 = D C2 + S (D/Q) + (Q/2) (I C2) TC3 = D C3 + S (D/Q) + (Q/2) (I C3) TC2< TC1< TC3 Hence, select ‘EOQ of range 2’ as reorder quantity 14
  • 15. 07. Write short note on safety stockSafety stock (also called buffer stock) is a term used by logisticians to describe a level ofextra stock that is maintained to mitigate risk of stock outs (shortfall in raw material orpackaging) due to uncertainties in supply and demand. Adequate safety stock levels permitbusiness operations to proceed according to their plans.Production with and without safety stockProduction without safety stock Production with safety stock(a) Normal production Quantity Max order level Quantity Max order level Reorder level Reorder level Safety stock Time Lead Time Time Lead Time(b) Unexpected increased production at or beyond reorder level (during lead time) Quantity Quantity Max order level Max order level Reorder level Reorder level Safety stock Time Lead Time Time Lead Time Production continued utilizing safety stock No productionA low level of safety stock can lead to a stock out. On the other hand a high level of safetystock unnecessarily ties up capital. Therefore we need to determine the optimum level ofsafety stock, which should neither be low nor high. 15
  • 16. Cost of safety stockSafety stock involves two types of costs: 1. Carrying cost of safety stock (CC) 2. Stock out cost (SC)Carrying cost of safety stock is inversely proportional to stock out cost. Research shows thatthe total cost of safety stock is minimum only when Carrying cost of safety stock = stock out costReducing safety stockSafety stock is used as a buffer to protect organizations from stock outs caused by inaccurateplanning or poor schedule adherence by suppliers. As such, its cost (in both material andmanagement) is often seen as a drain on financial resources that results in reductioninitiatives. In addition, time sensitive goods such as food, drink, and other perishable itemscould spoil and go to waste if held as safety stock for too long. Various methods exist toreduce safety stock; these include better use of technology, increased collaboration withsuppliers, and more accurate forecasting. In a lean supply environment, lead times arereduced, which can help minimize safety stock levels thus reducing the likelihood and impactof stock outs. Due to the cost of safety stock, many organizations opt for a service level ledsafety stock calculation; for example, a 95% service level could result in stock outs, but is ata level that is satisfactory to the company. The lower the service level, the lower therequirement for safety stock. 16
  • 17. 08. Write short note on MRP (material requirement planning)Material Requirements Planning (MRP) is a computer-based production planning andinventory control system. MRP is concerned with both production scheduling and inventorycontrol. It is a material control system that attempts to keep adequate inventory levels toassure that required materials are available when needed. MRP is applicable in situations ofmultiple items with complex bills of materials. MRP is not useful for job shops or forcontinuous processes that are tightly linked.The major objectives of an MRP system are:1. Ensure the availability of materials, components, and products for planned production and for customer delivery.2. Maintain the lowest possible level of inventory3. Plan manufacturing activities, delivery schedules, and purchasing activities.MRP is especially suited to manufacturing settings where the demand of many of thecomponents and subassemblies depend on the demands of items that face external demands.Demand for end items is independent. In contrast, demand for components used tomanufacture end items depend on the demands for the end items. The distinctions betweenindependent and dependent demands are important in classifying inventory items and indeveloping systems to manage items within each demand classification.The three major inputs of an MRP system are the master production schedule, the productstructure records, and the inventory status records. Without these basic inputs the MRPsystem cannot function. The demand for end items is scheduled over a number of timeperiods and recorded on a master production schedule (MPS). The master productionschedule expresses how much of each item is wanted and when it is wanted. The MPS isdeveloped from forecasts and customer orders for end items, safety stock requirements, andinternal orders. MRP takes the master schedule for end items and translates it into individualtime-phased component requirements. The product structure records, also known as bill ofmaterial records (BOM), contain information on every item or assembly required to produceend items. Information on each item, such as part number, description, quantity per assembly,next higher assembly, lead times, and quantity per end item, must be available.The inventory status records contain the status of all items in inventory, including on handinventory and scheduled receipts. These records must be kept up to date, with each receipt,dis-bursement, or withdrawal documented to maintain record integrity. MRP will determinefrom the master production schedule and the product structure records the gross componentrequirements; the gross component requirements will be reduced by the available inventoryas indicated in the inventory status records.Dealing with Uncertainty in MRPThere are several sources of uncertainty that we have ignored so far. These includeuncertainty in the quantity demanded (forecast errors) and the quantity supplied (yieldlosses), and uncertainty in the timing of demand and the timing of supply (random leadtimes). Many MRP systems cope with uncertainty by inflating lead times (inducing safetytime), by expediting orders, and by shifting priorities of shop and vendor orders. Another 17
  • 18. way of protecting against uncertainty is to carry safety stock for end items with randomdemand, and to carry safety stock of items produced at bottleneck operations.Shortcomings of MRPCapacityMRP expects the lead time to be constant regardless of how much work has been releasedinto the Production system, so it is implicitly assuming infinite capacity. This cancreate problems when production levels are at or near capacity. One way to address thisproblem is to make sure that the MPS is capacity feasible. Rough-cut capacity planning(RCCP) attempts to do this by checking the capacity of a few critical resources. RCCPmakes use of the bill of resources (BOR) for each item on the MPS. The BOR specifies thenumber of hours required at each critical resource to build a particular end item and itscomponents, and then aggregates the number of hours required at each critical resource overthe end items in the MPS. RCCP then checks whether the available resources are enough tocover the MPS on each time bucket. Notice that RCCP does not perform time offsets, so thecalculation of the number of hours required has to be done with time buckets that are largeenough so that parts and their components can all be completed within a single time bucket.This usually makes RCCP an optimistic estimation of what can be done. Advanced MRPsystems provide more detailed capacity analysis proposing alternative production scheduleswhen the current plan is not feasible.Long Lead TimesThere are many pressures to increase planned lead times in an MRP system. MRPuses constant lead times when, in fact, actual lead times vary considerably. Tocompensate, planners typically choose pessimistic estimates. Long lead times lead to largework-in-process (WIP) inventories.NervousnessMRP is typically applied in a rolling horizon basis. As customer orders firm up, and forecastsbecome better, a new MPS is fed to MRP which produces updated planned order releases thatmay be very different form the original. Even small changes in the MPS can result in largechanges in planned order releases. A small decrease in demand causes a formerly feasibleMRP plan to become infeasible. 18
  • 19. 09. Explain in detail production planning and control processProduction Planning is a process to develop tactical plans based on setting the overall levelof manufacturing output (production plan) and other activities to best satisfy the currentplanned levels of sales (sales plan or forecasts), while meeting general business objectives ofprofitability, productivity, competitive customer lead times, and so on, as expressed in theoverall business plan. The sales and production capabilities are compared, and a businessstrategy that includes a sales plan, a production plan, budgets, pro forma financial statements,and supporting plans for materials and workforce requirements, and so on, is developed. Oneof its primary purposes is to establish production rates that will achieve management’sobjective of satisfying customer demand by maintaining, raising, or lowering inventories orbacklogs, while usually attempting to keep the workforce relatively stable. Because this planaffects many company functions, it is normally prepared with information from marketingand coordinated with the functions of manufacturing, sales, engineering, finance, materials,and so on.Advanced Planning and Scheduling (APS)APS is the techniques that deal with analysis and planning of logistics and manufacturingduring short, intermediate and long-term time periods. APS describes any computer programthat uses advanced mathematical algorithms or logic to perform optimization or simulation onfinite capacity scheduling, sourcing, capital planning, resource planning, forecasting, demandmanagement, and others. These techniques simultaneously consider a range of constraintsand business rules to provide real-time planning and scheduling, decision support, available-to-promise, and capable-to-promise capabilities. APS often generates and evaluates multiplescenarios. Management then selects one scenario to use as the “official plan.”Components of APS • Demand Planning, • Production Planning, • Production Scheduling, • Distribution Planning, and • Transportation Planning.Production planning is the function of establishing an overall level of output, called theproduction plan. The process also includes any other activities needed to satisfy currentplanned levels of sales, while meeting the firms general objectives regarding profit,productivity, lead times, and customer satisfaction, as expressed in the overall business plan.The production schedule is derived from the production plan; it is a plan that authorized theoperations function to produce a certain quantity of an item within a specified time frame. Ina large firm, the production schedule is drawn in the production planning department. 19
  • 20. 10. Explain in detail MPS (master production scheduling)A Master Production Schedule or MPS is the plan that a company has developed forproduction, inventory, staffing, etc. It sets the quantity of each end item to be completed ineach week of a short-range planning horizon. A Master Production Schedule is the master ofall schedules. It is a plan for future production of end items.Process in MPS system INPUTS OUTPUTS Forecast Demand Production Costs Amounts to be Produced Inventory Costs Staffing Levels Customer Orders Quantity Available to Promise Inventory Levels MPS Projected Available Balance Supply Lot Size Production Lead Time CapacityThe Master Production Schedule gives production, planning, purchasing, and topmanagement the information needed to plan and control the manufacturing operation. Theapplication ties overall business planning and forecasting to detail operations through theMaster Production Schedule. The Master Production Schedule will drive detailed materialand production requirements in the Material Requirements Planning module.The master production schedule (MPS) is a link between the firm’s broad strategies andtactical plans that enables the firm to achieve its goals. The MPS provides essentialinformation for functional areas such as operations, marketing, and finance. In thissupplement, we discuss the master production scheduling process, the need for functionalcoordination, the way to develop an MPS, the information that an MPS provides to assist innegotiating delivery dates, and the managerial considerations for establishing and stabilizingthe MPS.By using several variables as inputs the MPS will generate a set of outputs used for decisionmaking. Inputs may include forecast demand, production costs, inventory costs, customerorders, inventory levels, supply, lot size, production lead time, and capacity. Inputs may beautomatically generated by an ERP system that links a sales department with a productiondepartment. For instance, when the sales department records a sale, the forecast demandmay be automatically shifted to meet the new demand. Inputs may also be inputtedmanually from forecasts that have also been calculated manually. Outputs may includeamounts to be produced, staffing levels, quantity available to promise, and projectedavailable balance. Outputs may be used to create a Material Requirements Planning (MRP)schedule. 20
  • 21. 11. Explain in detail short term scheduling process and techniquesScheduling is an important tool for manufacturing and engineering, where it can have amajor impact on the productivity of a process. In manufacturing, the purpose of schedulingis to minimize the production time and costs, by telling a production facility when to make,with which staff, and on which equipment. Production scheduling aims to maximize theefficiency of the operation and reduce costs.Production scheduling tools greatly outperform older manual scheduling methods. Theseprovide the production scheduler with powerful graphical interfaces which can be used tovisually optimize real-time work loads in various stages of production, and patternrecognition allows the software to automatically create scheduling opportunities whichmight not be apparent without this view into the data. For example, an airline might wish tominimize the number of airport gates required for its aircraft, in order to reduce costs, andscheduling software can allow the planners to see how this can be done, by analyzing timetables, aircraft usage, or the flow of passengers.Short term scheduling concerns with the allocation of CPU time to processes in order tomeet some pre-defined system performance objectives. The definition of these objectives(scheduling policy) is an overall system design issue, and determines the ``character of theoperating system from the users (i.e. the buyers) point of view, giving rise to the traditionaldistinctions among ``multi-purpose, time shared, ``batch production, ``real-time systems,and so on.The main types of scheduling process and techniques include: Work centre loading Job sequencingWork centre loadingWork centre loading is the assignment of jobs to work or processing centers. The operationmanagers assign the job to work centres so that cost, idle time or completion is kept tominimum. The forms of work centre loading are Oriented to capacity Assign the specific job to work centresJob sequencingJob sequencing is the arrangement of task required to be carried out sequentially. Priorityrules for the job sequencing are derived based on the assumption that job setup cost andtime is independent of process time. Job time include setup and processing time. Priorityrules aim at minimizing completion time, number of jobs in a system and job lateness.Rules establish maximum facility utilization. ************** 21

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