Operations Management is the planning, scheduling
and controlling of activities that transforms inputs by
way of raw materials, capital, machinery, labour,
information and time into outputs in the form of
products and services of higher value than the inputs.
Plant Layout is the physical arrangement of machines,
processing equipment and service departments to have
the best co ordination and efficiency of man machine
and material in a plant.
Principles of Plant Layout…
Factors affecting layout
Types of Industries
Type of production system
Type of product
Volume of product
Use of space / Available floor space
Flow of Work, Material & Personnel
Architecture design of the space
Material flow systems
Operations Process chart
Flow process chart
Types of Plant Layout
Fixed Position Layout
Material handling equipments
Conveyors: Belt, Chain, Roller.
Managing the stock of items kept on hand by an
organisation to be used to meet customer demand.
Types of Inventory
- RM Inventory
- WIP Inventory
- FG Inventory
Functions of Inventory
To meet anticipated demand
To smooth production requirements
To avoid over stocking and under stocking
To avail quantity discounts
To hedge against price fluctuations and seasonal demand.
Concept of EOQ
Meaning of EOQ
Types of cost
Assumptions of EOQ
Selective Inventory Control
Materials Management consists of planning, directing,
co-ordinating and controlling those activities which
are concerned with the materials and inventory
requirements from the point of their inception to the
“Right Material in right quantity at the right time at the
right price from the right source of supply.”
Importance of materials
Accounts for major part of the capital employed
Offers maximum opportunities to reduce costs and
shorten the process time thus increasing profits
Quality of finished products eventually depends on
the quality of the materials used
Materials management encompasses some of the most
prominent areas like Purchasing, Storing, Inventory,
Material Handling, Transportation, Shipping….
Material Procured should be compatible with the
Minimisation of costs (Material, purchase, inventory..)
Maintain the desired quality
Avoid overstocking & stock outs
Increase the inventory turnover
Vendor Management & Vendor Relations
Development of Operations Personnel
Types of procurement
Modes of purchasing materials
Floating the limited inquiry
Co ordination & Co operation
Material never goes out of stock
Material is never too excess than what is required
Material should be easily traceable and available at
beck and call
To protect the stores against theft , damage etc…
Optimum utilisation of cubic space.
Principles of Stores Layout
Optimum utilization of floor space
Adequate floor load
Wide aisles & Gangways
Heavy items to be stored at low levels
Most frequently used items to be stored near issuing
Movement of air, temp, light, materials, humans not to
Water proofing is essential
Adequate security & safety
Adequate material handling equipments
Proper Material tracking & locating systems
Material Issuance & pricing
It refers to the upkeep and protection of plant,
building & machinery and other fixed assets of a firm
which are subject to deterioration due to their use and
exposure to the environment over a period of time.
Maintainance encompasses all those activities
required to keep the physical facilities and equipments
in good working condition and make necessary repairs
when breakdown occurs, so that the system can
perform as intended.
Major areas of Maintainance
Maintenance cost index
Frequency of breakdowns
Down time index
Breakdown Maintenance index
Labour cost of planned Maintainance
Developed by Masaaki Imai
Literal Meaning “Card Bin”
Coined by Taiichi Ohno
It is a scheduling system for Regular and just-in-
time (JIT) production.
Six Sigma ( ) is a process improvement set of tools
and strategies to achieve excellence and perfection.
Developed by Motorola in 1986.
The term borrows its name from the Normal
A six sigma certification is granted to a process which
manufactures products in which 99.99966% Of the
products manufactured are free of defects.
A maximum of 3.4 defects per million are allowed.
The quality of product or service is a customer’s
perception of the degree to which the product or
service meets his or her expectations.
Quality is the performance of the product as per the
commitment made by the producer to the consumer.
Benefits of Quality Control
Reduction in costs
Standardisation or uniformity in products
Reduced Production Bottlenecks & Stoppages
Reduced inspection and Quality Checks
High Customer Satisfaction
Increase in Brand Goodwill & thus higher Sales
Higher Operating efficiency
Sense of pride amongst the Employees
Better utilisation of resources.
Dimensions of Product Quality
Q C TOOLS