Operations Management

02 Jul

Q.1) Write Short Notes:

a) Lean Production

b) Global Strategies fir Hospitality services

c) Material Requirements Planning

Q.2) Explain Briefly the process Analysis of Manufacturing Process Selection and Design?

Q.3) Define Supply Chain Strategy and Explain its feature and nature?

Q.4) Distinguish between goods and services. What are the challenges faced by Services marketers?

Q.5) Discuss the features and nature of Project Management?

Q.6) Explain in brief the Synchronous Manufacturing and Theory of Constraints?

Q.7) Discuss the essence Quality Management in Focus On six Sigma?

Q.8) What is Aggregate Sales and Operations Planning?

Operations Management

02 Jul


Transformer Replacement at Mountain States Electric Service

 Mountain States Electric Service is an electrical utility company serving several states in the Rocky Mountain region. It is considering replacing some of its equipment at a generating substation and is attempting to decide whether it should replace an older, existing PCB transformer. (PCB is a toxic chemical known formally as polychlorinated biphenyl) Even though the PCB generator meets all current regulations, if on incident occurred, such as a fire, and PCB contamination caused harm either to neighboring businesses or farms or to the environment, the corn- pony would be liable for damages. Recent court cases have shown that simply meeting utility regulations does not relieve a utility of liability if an incident causes harm to others. Also1 courts have been awarding large damages to individuals and businesses harmed by hazardous incidents.

If the utility replaces the PCB transformer, no PC incidents will occur, and the only cost will be that o the transformer, $85,000. Alternatively, if the corn pony decides to keep the existing PCB transformer, then management estimates there is a 50—50 chance of there being a high likelihood of an incident or a low likelihood of an incident. For the case in which there is a high likelihood that an incident will occur, there is a 0.004 probability that a fire will occur sometime during the remaining life of the transformer and a 0.996 probability that no fire will occur. If a fire occurs, there is a 0.20 probability that it will be bad and the utility will incur a very high cost of approximately $90 million for the cleanup, whereas there is a 0.80 probability that the fire will be minor and a cleanup can accomplished at a low cost of approximately $8 million. If no fire occurs, then no cleanup costs will occur. For the case in which there is a low likelihood of an incident occurring, there is a 0.00 1 probability that a fire will occur during the life of the existing transformer and a 0.999 probability that a fire will not occur. If a fire does occur, then the same probabilities exist for the incidence of high and low cleanup costs, as well as the same cleanup costs, as indicated for the previous case. Similarly, if no fire occurs, there is no cleanup cost.

Q.1) Perform a decision-tree analysis of this problem For Mountain States Electric Service and indicate the recommended solution. Is this the decision you believe the company should make? Explain your reasons.



Herding the Patient

Bayside General Hospital is trying to streamline its operations. A problem-solving group consisting of a nurse, a technician, a doctor, an administrator, and a patient is examining outpatient procedures in an effort to speed up the process and make it more cost-effective. Listed here are the steps that a typical patient follows for diagnostic imaging:

  • Patient enters main hospital entrance.
  • Patient takes a number and waifs to be called to registration desk.
  • Patient registers.
  • Patient is taken to diagnostic imaging department.
  • Patient registers at diagnostic imaging reception.
  • Patient sits in department waiting area until dressing area clears.
  • Patient changes in dressing area.
  • Patient waits in dressing area.
  • Patient is token to exam room.
  • Exam is performed.
  • Patient is taken to dressing area.
  • Patient dresses.
  • Patient leaves.


Q.1 Create a process flowchart of the procedure and identify opportunities for improvement.



Streamlining the Refinancing Process

 First National Bank has been swamped with refinancing requests this year. To handle the increased volume, it divided the process into five distinct stages and created departments for each stage.
The process begins with a customer completing a loan application for a loan agent. The loan agent discusses the refinancing options with the customer and performs quick calculations based on customer- reported data to see if the customer qualifies for loan approval. If the numbers work, the customer signs a few papers to allow a credit check and goes home to wait for notification of the loan’s approval.
The customer’s file is then passed on to a loan processor, who requests a credit check, verification of loans or mortgages from other financial institutions, an appraisal of the property, and employment verification. If any problems are encountered, the loan processor goes to the loan agent for advice. If items appear on the credit report that are not on the application or if other agencies have requested the credit report, the customer is required to explain the discrepancies in writing. If the explanation is acceptable, the letter is placed in the customer’s file and the file is sent to the loan agent (and sometimes the bank’s board) for final approval.

The customer receives a letter of loan approval and is asked to call the closing agent to schedule a closing dote and to lock in a loan rate if the customer has not already done so.
The closing agent requests the name of the customer’s attorney to forward the loan packet. The attorney is responsible for arranging a termite inspection, a survey, a title search, and insurance and for preparing the closing papers. The attorney and the closing agent correspond back and forth to verify fees, payment schedules, and payoff amounts.

The loan-servicing specialist makes sure the previous loan is paid off and the new loan is set up properly. After the closing takes place, the bank’s loan-payment specialist takes care of issuing payment books or setting up the automatic drafting of mortgage fees and calculating the exact monthly payments including escrow amounts. The loan- payment specialist also monitors late payment of mortgages.

It is difficult to evaluate the success or failure of the process, since the volume of refinancing requests is so much greater than it has ever been before. However, customer comments solicited by the loan-servicing specialist have been disturbing to management.
Customer Comments:

  • I refinanced with the same bank that held my original loan, thinking erroneously that I could save time and money. You took two months longer processing my loan than the other bank would have, and the money I saved on closing costs was more than eaten up by the extra month’s higher mortgage payments.
  • I just got a call from someone at your bank claiming my mortgage payment was overdue. How can it be overdue when you draft it automatically from my checking account?
  • How come you do everything in writing and through the mail? If you would just call and ask me these questions instead of sending forms for me to fill out, things would go much more quickly.
  • If I haven’t made any additions to my house or property in the past year, you appraised it last year, and you have access to my tax assessment, why bother with another appraisal? You guys just like to pass around the business.
  • I never know who to call for what. You have so many people working on my file. I know I’ve repeated the same thing to a dozen different people.
  • It took so long to get my loan approved that my credit report, appraisal report, and termite inspection ran out. You should pay for the new reports, not me.
  • I drove down to your office in person today to deliver the attorney’s papers, and I hoped to return them with your signature and whatever else you add to the closing packet. The loan specialist said that the closing agent wouldn’t get to my file until the morning of the scheduled closing and that if she hit a snag, the closing could be postponed I’m taking off half a day from work to attend the closing and “rescheduling” is not convenient. I know you have lots of business, but I don’t like being treated this way.
  • I received a letter from one of your loan-payment specialists today, along with a stack of forms to complete specifying how I want to set up my mortgage payments. I signed all these at closing—don’t you read your own work? I’m worried that if I fill them out again you’ll withdraw the payment twice from my account!

Questions: –

1. Create a process flowchart of the refinancing process. Why do you think the bank organized its process this way? What problems have ensued?

2. Examine the process carefully. Which steps create value for the customer? Which steps can be eliminated? Construct a new map showing how the overall process can be improved.



Workout Plus

Workout Plus is a health club that offers a full range of services to its clients.  Recently, two other fitness clubs have opened up in town, threatening Workout’s solvency.  While Workout is tops among serious fitness buffs, it has not attracted a wide spectrum of members.  Shannon Hiller, owner and manager, has decided it’s time for a face lift.  She started the process by sponsoring a week-long “ideathon” among club members.  Nonmembers who frequented an adjacent grocery store were also canvassed for suggestions. Their comments are provided below along with the current facility layout.

Free weights Circuit






 Current layout:


Free Weights



Circuit Training



Aerobics Room

Cardio Machines
  • I don’t feel like strutting through the gym from one end to the other iust to finish my workout.
  • How about a quick 30-minute workout routine for busy folks?
  • I like working out with my friends, but aerobics is not for me. What other group activities are good for cardio?
  • Separate the people who want to gab from the people who want to pump.
  • It’s so confusing with all those machines and weights. You need a novice section that’s not so intimidating.
  • It’s hard to work yourself in when you come from across the gym. ‘d like to see the machines I’ll be using to gauge my time.
  • Circuit training is for wimps. The next thing you know you’ll be stopping and starting the music to tell us when to change machines.
  • We all seem to arrive at the popular machines at once. Can you space us out?
  • I’d like for my kids to get some exercise too while I’m working out.
  • But I don’t wandering all over Place trying to find me.
  • This place is too crowded and disorganized. It’s not fun anymore.
  • The cardio machines fill up too fast on rainy days. Then everything else gets backer up.

You have classes only at busy times. During the day the gym is empty, but you don’t provide many services. I think you’re missing a great opportunity to connect with the not-o-fit at off-peak times.


1. How can Workout update its facility to attract new customers? What additional equipment or services would you suggest? How could something as simple as revising the layout help?

2. It is your job to design a new layout for Workout Plus. Visit a nearby gym to get ideas. Watch the customer flow, unused space, and bottlenecks. What aspects of a process layout do you see? a product layout? cells? Draw a simple diagram of your proposed layout. (You’ll want to be more detailed than the original layout.) How does your layout respond to the comments collected by Shannon?



 Photo Op — Please line Up

 Tech is modernizing its college ID system. Beginning this term, all faculty, staff, and students will be required to carry a “smart” identification card, called a student passport. What makes it smart is a magnetic strip with information on club memberships, library usage, class schedules (for taking exams), restrictions (such as no alcohol), medical insurance, emergency contacts, and medical conditions. If desired, it can also be set up as a debit card to pay fines or purchase items from the bookstore, vending machines, cash machines, copy machines, and several local retailers.
University administrators are excited about the revenue potential and increased control of the passport, but they are not looking forward to the process of issuing approximately 60,000 new cards. If applicants could be processed at the rate of 60 an hour, the entire university could be issued passports in a month’s time (with a little overtime).

The steps in the process and approximate times follow. Steps 1 and 2 must be completed before step 3 can begin. Steps 3 and 4 must precede step 5, and step 5 must be completed before step 6.

Steps in Process Time                                            Approximate

  1. Review application                                     10 seconds for correctness
  2. Verify information and check                 60 seconds for outstanding debt
  3. Process and record payment                   30 seconds
  4. Take photo                                                  20 seconds
  5. Attach photo and laminate                     10 seconds
  6. Magnetize and issue passport               10 seconds

a. Is it possible to process one applicant every minute? Explain.

b. How would you assign tasks to workers in order to process 60 applicants an hour?

c. How many workers are required? How efficient is your line?

Jetaway Industries

Jetway, a small manufacturer of replacement parts for the aircraft industry, had always maintained a simple layout-all like machines were located together.  That way the firm could be as flexible as possible in producing small amounts of the variety of parts its customers required. No one questioned the production arrangement until Chris Munnelly started to work for the company.  Chris was actually hired to upgrade Jetaway’s computer system.  In the process of creating a database of parts produced.  A part routing Matrix for nine of the most popular parts is shown on the facing page, along Jetaway, a small manufacturer of replacement parts with a schematic of the factory layout.
Chris, who was already tired of being a pro-grammer, decided to reorder the matrix and see what he could find.  If he could identify distinct part families, he could reorganize the placement of machines into the cells he had been reading about in his business magazines.  Maybe then someone would notice his management potential.


Q.1) Help Chris gain status in Jateway by creating a cellular layout for the company.  Show your results in a schematic diagram.  Be sure to include the reordered routing matrix.



Moore Housing Contractors

Moore housing on contractors is negotiating a deal with Countryside Realtors to build six houses in a new development. Countryside wants Moore Contractors to start in late winter or early spring when the weather begins to moderate and build through the summer into the fall. The summer months are a busy time for the realty company, and it believes it can sell the houses almost as soon as they are ready—sometimes before. The houses all have similar floor plans and are of approximately equal size; only the exteriors are noticeably different. The completion time is so critical for Countryside Realtors that it is insisting a project management network accompany the contractor’s bid for the job with an estimate of the completion time for a house. The realtor also needs to be able to plan its offerings and marketing for the summer. The realtor wants each house to be completed within 45 days after it is started. If a house is not completed within this time frame, the realtor wants to be able to charge the contractor a penalty. Mary and Sandy Moore, the president and vice president of Moore Housing Contractors, are concerned about the prospect of a penalty. They want to be confident they can meet the deadline for a house before entering into any agreement with a penalty involved. (if there is a reasonable likelihood they cannot finish a house within 45 days, they want to increase their bid to cover potential penalty charges.)
The Moores are experienced home builders, so it was not difficult for them to list the activities involved in building a house or to estimate activity times. However, they made their estimates conservatively and tended to increase their pessimistic estimates to compensate for the possibility of bad weather and variations in their workforce. Following is a list of the activities for building a house and the activity time estimates:

Activity                   Description                          Predecessors                                    Time (Days) 

A          m          b

A               Excavation pour footers               –                                             3             4                6

B               Lay foundation                              a                                             2             3                5

C               Frame and roof                             b                                              2             4                5

D               Lay drain tiles                               b                                              1             2                4

E                Sewer (floor) drains)                  b                                              1             2                3

F                Install insulation                          c                                             2             4                5

G               Pour basement floor                    e                                             2             3                5

H               Rough plumbing pipes               e                                              2             4                7

I                 Install windows                            f                                              1             3                4

J                 Rough electrical wring               f                                              1             2                4

K               Install furnace air                    c, g                                              3             5                8


l                 Exterior brickwork                   i                                               5            6                  10

m               Install plasterboard                 j, h, k                                      6            8                  12

mud plaster

n                Roof shingles flashing                  l                                            2            3                   6

o                Attach gutter, downspouts          n                                            1          2                    5

p                Grading                                          d, o                                        2            3                   7

q                Lay subflooring                             m                                           3            4                   6

r                 Lay driveway, way                        p                                           4            6                   10

s                 Finish carpentry                           q                                            3            5                   12

t                Kitchen cabinetry, sink               q                                              2            4                   8                                           and appliances

u               Bathroom cabinetry, fixtures      q                                             2            3                   6

v               painting (interior and                 t, u                                           4            6                   10


w               Finish wood floors,                      v, s                                           2            5                   8

lay carpet

x                Final electrical,                          v                                                   1            3                   4                                         light fixtures



Q.1) Develop a CPM/PERT network for Moore House Contractors and determine the probability that the contractors can complete a house within 45 days. Does it appear that the Moores might need to increase their bid to compensate for potential penalties?

Q.2) Indicate which project activities Moore Contractors should be particularly diligent to keep on schedule by making sure workers and materials are always available. Also indicate which activities the company might shift workers from as the need arises.



Somerset Furniture Company’s Global Supply Chain

The Somerset Furniture Company was founded in 1 957 in Randolph County, Virginina. It traditionally has manufactured large, medium-priced, ornate residential home wood furniture such as bedroom cabinets and chests of draws, and dining and living room cabinets, tables, and choirs, at its primary manufacturing facility in Randolph County. It employed a marketing strategy of rapidly introducing new product lines every few years. Over time it developed a reputation for high-quality, affordable furniture for a growing U.S. market of homeowners during the last half of the twentieth century. The company was generally considered to be an innovator in furniture manufacturing processes and in applying TQM principles to furniture manufacturing. However, in the mid-i 990s, faced with increasing foreign competition, high labor rates, and diminishing profits, the Somerset Company contracted to outsource several of its furniture product lines to manufacturers in China, simultaneously reducing the size of its own domestic manufacturing facility and labor force. This initially proved to be very successful in reducing costs and increasing profits, and by 2000 Somerset had decided to close its entire manufacturing facility in the United States and out- source all of its manufacturing to suppliers in China. The company set up a global supply chain in which it arranges for shipments of wood from the United States and South America to manufacturing plants in China where the furniture products are produced by hand by Chinese laborers. The Chinese manufacturers are very good at copying the Somerset ornate furniture designs by hand without expensive machinery. The average labor rate for furniture manufacturing in the United States is between $9 and $20 per hour, whereas the average labor rate for furniture manufacturers in China is $2 per day. Finished furniture products are shipped by container ship from Hong Kong or Shanghai to Norfolk, Virginia, where the containers are then transported by truck to Somerset warehouses in Randolph County. Somerset supplies retail furniture stores from this location. All hardware is installed on the furniture at the retail stores in order to reduce the possibility of damage during transport.

The order processing and fulfillment system for Somerset includes a great deal of variability, as does all aspects of the company’s global supply chain. The company processes orders weekly and biweekly. In the United States it takes between 12 and 25 days for the company to develop a purchase order and release it to their Chinese suppliers. This process includes developing a demand forecast, which may take from one to two weeks; converting the forecast to on order fulfillment schedule; and then developing a purchase order. Once the purchase order is processed overseas by the Chinese manufacturer, which may take 10 to 20 days depending on the number of changes made, the manufacturing process requires approximately 60 days. The foreign logistics process requires finished furniture items to be transported from the manufacturing plants to the Chinese ports, which can take up to several weeks depending on trucking availability and schedules. An additional 5 to 10 days is required to arrange for shipping containers and prepare the paperwork for shipping. However, shipments can then wait from one day to a week for enough available containers. There are often too few containers at the ports because large U.S. importers, like “Big W” discount stores in the United States, reserve all the available containers for their continual stream of overseas shipments. Once enough containers are secured, it requires from three to six days to optimally load the containers. The furniture pieces often have odd dimensions that result in partially filled containers. Since 9/li, random security checks of containers can delay shipment another one to three weeks, and smaller companies like Somerset are more likely to be extensively checked than larger shippers like Big W, who the port authorities don’t want upset with delays. The trip overseas to Norfolk requires 28 days. Once in port, one to two weeks are required for a shipment to clear customs and to be loaded onto trucks for transport to Somerset’s warehouse in Randolph County, which takes from one to three days. When a shipment arrives, it can take from one day up to a month to unload a trailer, depending on the urgency to fill store orders from the shipment.

Because of supply chain variability, shipments can be off schedule (i.e., delayed) by as much as 40%. The company prides itself on customer service and fears that late deliveries to its customers would harm its credibility and result in cancelled orders and lost customers. At the same time, keeping excess inventories on hand in its warehouses is very costly, and since Somerset redesigns its product lines so frequently a real problem of product obsolescence arises if products remain in inventory very long. Somerset has also been experiencing quality problems. The Chinese suppliers employ quality auditors who rotate among plants every few weeks to perform quality control tests and monitor the manufacturing process for several days before visiting another plant. However, store and individual customer complaints have forced Somerset to inspect virtually every piece of furniture it receives from overseas before forwarding it to stores. In some instances, customers have complained that tables and chairs creak noisily during use. Somerset subsequently discovered that the creaking was caused by humidity differences between the locations of the Chinese plants and the geographic areas in the United States where their furniture is sold. Replacement parts (like cabinet doors or table legs) are difficult to secure because the Chinese suppliers will only agree to pro- vide replacement parts for the product lines currently in production. However, Somerset provides a one year warranty on its furniture, which means that they often need parts for a product no longer being produced. Even when replacement parts were available, it took too long to get them from the supplier in order to provide timely customer service.

Although Somerset was initially successful at outsourcing its manufacturing process on a limited basis, it has since discovered, as many companies do, that outsourcing can result in a host of supply chain problems, as indicated above.


Q.1) Discuss Somerset’s global supply chain and possible remedies for its supply chain problems, including strategic and tactical changes that might improve the company’s supply chain performance, reduce system variability, and improve quality and customer service. As part of your discussion, determine the product lead time by developing a timeline from the initiation of a purchase order to product delivery.

Operations Management

02 Jul

1. (a) Draw a systems view diagram of any service organization of your choice. Identify its various components. Explain its interdisciplinary nature.

(b) What are the major characteristics of a Production system? Discuss some of its upcoming issues that provide economies in production and efficiency in the performance of the system.

2. (a) Explain with examples, how the TQM concept can integrate design engineering, manufacturing and service.

(b) What are process capability studies? Explain the process capability index with applications to a real life example.

3. (a) Compare traditional process planning with Computer Aided Process Planning (CAPP). Also explain a generative CAPP system.

(b) Explain the objectives of Total Productive maintenance. Give its importance. Also comment on the concept of TPM promotion.

4. (a) Why is forecasting required in operations management ? Discuss the concept of forecast error as applied to different conditions.

(b) How are quantitative models of forecasting different from qualitative models ? Discuss in detail time-series model as used for forecasting.

5. (a) What is facility planning ? Explain with examples different types of layouts as used in manufacturing organisations.

(b) Discuss work measurement as a process to establish task time. Explain the various techniques for developing time standards.

6. (a) Explain just in time manufacturing with the help of examples. Discuss its advantages and disadvantages.

 (b) For an independent demand inventory model, derive the equation for Economic Order Quantity. List all assumptions.

7. Write short notes on the following:

(a) OPT

(b) Break even analysis

(c) Lean manufacturing

(d) Kanban system

(e) Line of Balance for Production Control

(f) Purpose of aggregate plans.

Operations Management

02 Jul


Bloomsday Outfitters produces T-shirts for road races. They need to acquire some new stamping machines to produce 30,000 good T-shirts per month. Their plant operates 200 hours per month, but the new machines will be used for T-shirts only 60 percent of the time and the output usually includes 5 percent that are “seconds” and unusable. The stamping operation takes 1 minute per T-shirt, and the stamping machines are expected to have 90 percent efficiency considering adjustments, changeover of patterns, and unavoidable downtime. How many stamping machines are required?



In the table given below the Distribution Manager is expected to service these DCs as per the demands placed. If the actual sales after completing week one is as follows, what would be the quantities that would need amendment as far as Distribution Manager is concerned to service for week two and onwards?

After week one the actual sales to Forecasted sales for week one ratio is as under: Mumbai did 80 % of forecast, Lucknow did 75 % of forecast Kolkata did 60 % of week one forecast Chennai did 125 % of forecast and Delhi did 150 % of week one forecast

  Mumbai Chennai Lucknow Delhi Kolkata
Op Bal 120 350 270 250 350
Safety Stocks 60 125 150 100 200
Min Order Qty 80 200 200 100 300
Lead time wks 1 2 3 2 3
Transit         300
Sales Forecast          
Week 1 50 100 150 50 100
Week 2 35 75 100 75 150
Week 3 55 125 150 80 200
Week 4 65 100 200 55 135
Week 5 80 200 300 75 125
Week 6 125 150 200 80 165
Week 7 50 100 100 90 200

Note: Kolkata will receive transit stocks in week 2.



After working for 30 years, Ramjee Somjee Dutt opted for VRS and started a courier company and did very well in the first four years. He was now looking for expansion of his business and decided to venture into Road transportation business between Chennai and Mumbai and Mumbai and Delhi as he felt that he could do well on this line. However before taking a final decision he hires your Management Consultant firm formed by yourself. He has requested you to work out the Price to quote his clients for these two routes considering the costs involved. He expects to earn a minimum profit of Rs 1000 per day per truck after meeting all expenses. Your analysis of market conditions tell you the following:

Vehicle cost Rs 7 lacs Depreciation 15 % Maintenance costs per day Rs 150 Drivers monthly Salary Rs 5000 : Attendants monthly salary Rs 3000 . Misc expenses Rs 200 per day. Driver allowance is Rs 125 per day and attendant gets Rs 75. Diesel cost per liter is Rs 25 and the vehicle gives an average mileage of 4 km to a liter. The Financial institutions offer loans at 10 % interest pa, which Ramjee has been negotiating. It has been observed that on an average the vehicle covers 400 km per day. The distance between Mumbai to Delhi is 1500 km and Mumbai to Chennai is 1350 km. The driver gets rest day in Mumbai only for one day after they return from any trip.



A company is operating in two unrelated businesses. The first one is making common salt, which is sold in one-kilogram consumer packs. The second business is making readymade garments. The owner of the businesses has decided to implement Materials Requirement Planning (MRP) in one of the two businesses, which is likely to give him greater benefit. Assuming that the current turnover and profits of both the units are comparable, compare the relative benefits and limitations of Materials Requirement Planning (MRP) for these two businesses.



A Manufacturer of motorcycles buys spark plugs at Rs.15 each. Now he wishes to manufacture the plugs in his own factory. The estimated cost for the manufacture of spark plugs is around Rs.50,000=00 and the variable cost comes to Rs.5 per spark plug. The Production Manager advises the Manufacturer that the factory should go for manufacturing instead of procuring them from the open market.

List out reasons for the decision of the Production Manager backed up by the necessary data.

Operation Management

02 Jul

1. How would operations strategy for a service industry be different if any from that for a manufacturing industry? (It’s an example & explains)

2. Consider the following two mutually exclusive projects. The net cash flows are given below:





0 – Rs. 1,00,000 – Rs. 1,00,000/-
1 + Rs. 30,000 + Rs. 15,000/-
2 + Rs. 35,000 + Rs. 17,500/-
3 + Rs. 40,000 + Rs. 20,000/-
4 + Rs. 45,000 + Rs. 22,500/-
5   + Rs. 25,000/-
6   + Rs. 27,500/-
7   + Rs. 30,000/-
8   + Rs. 32,500/-


If the desired rate of return is 10% which project should be chosen?

3. What are the levels of aggregation in forecasting for a manufacturing organization? How should this hierarchy of forecasts be linked and used?

4. How would forecasting be useful for operations in a BPO (Business processes outsourcing) unit? What factors may be important for this industry? Discuss.

5. A good work study should be followed by good supervision for getting good results. Explain with an example.

6. What is job evaluation? Can it be alternatively used as job ranking? How does one ensure that job evaluation evaluates the job and not the man? Explain with examples?

7. What is the impact of technology on jobs? What are the similarities between job enlargement & job rotation? Discuss the importance of training in the content of job redesign? Explain with examples?

8. What is internet connectivity? How is it important in to days business would with respect to materials requirement planning & purchasing? Explain with examples?

9. Would a project management organization be different from an organization for regular manufacturing in what ways? Examples.

10. How project evaluation different from project appraisal? Explain with examples.

Operation Management

02 Jul

Q1. Suzan has a part-time “cottage-industry” producing seasonal plywood yard ornaments for resale at local craft fairs and bazaars. She currently works a total of 4 hours per day to produce 10 ornaments. a. What is her productivity? b. She thinks that by redesigning the ornaments and switching from use of a wood glue to a hot-glue gun she can increase her production to 20 ornaments per day. What is her new productivity? c. What is her percentage increase (or decrease) in productivity?

Q2. Ahmet grows domatoes in his 100 by 100 meters garden. He then sells the crop at the local farmer’s market. Two summers ago, he was able to produce and sell 1200 kgs of tomatoes. Last summer, he tried a new fertilizer that promised a 20% increase in yield. He harvested 1350 kgs. Did the fertilizer live up to its promise?

Q3. A company has asked YOU to evaluate the firm’s productivity by comparing this year’s performance with last year’s. The following data are available:


______________Last Year This Year OUTPUT 10 500 units 12 100 units Labour Hours 12 000 13 200 Utilities 7 600 MU 8 250 MU Capital 83 000 MU 88 000 MU Has the company improved its PRODUCTIVITY during the past year?


Q4. A firm cleans chemical tank cars in the Bay Gazimagusa area. With standard equipment, the firm typically cleaned 60 chemical tank cars per month. They utilized 10 gallons of solvent, and two employees worked 20 days per month, 6 hours a day. The company decided to switch to a larger cleaning machine. Last February, they cleaned 60 tank cars in only 15 days. They utilized 12 gallons of solvent, and two employees worked 6 hours a day. a. What was their productivity with the standard equipment? b. What is their productivity with the larger machine? c. What is the change in productivity?

Q5. Serra’s Ceramics spent 3 000 MU on a new kiln last year, in the belief that it would cut energy usage 25 % over the old kiln. This kiln is an oven that turns “greenware” into finished pottery. Serra is concerned that the new kiln requires extra labour hours for its operation. Serra wants to check the energy saving of the new oven, and also to look over other measures of their productivity to see if the change really was beneficial. Serra has the following data to work with: Last Year This Year Production (finished units) 4000 4000 Greenware (pounds) 5000 5000 Labour (hrs) 350 375 Capital (MU) 15000 18000 Energy (kWh) 3000 2600 Were the modifications BENEFICIAL?

Q6. Ahmet Uslu makes wooden boxes in which to ship motorcycles. Ahmet and his three employees invest 40 hours per day making the 120 boxes. a. What is their productivity? b. Ahmet and his employees have discussed redesigning the process to improve efficiency. If they can increase the rate to 125 per day, what would be their new productivity? c. What would be their increase in productivity?

Q7. Magusa Metal Works produces cast bronze valves on an assembly line. On a recent day, 160 valves were produced during an 8-hour shift. Calculate the productivity of the line.

Q8. Kleen Karpet cleaned 65 rugs in April, consuming the following resources: Labour: 520 hours at 13 MU/hour Solvent: 110 litres at 5 MU/litre Machine Rental: 20 days at 50 MU/day a. What is the labour productivity? b. What is the multifactor productivity?

Operation Management

02 Jul

Answer the following question.

Q1. List the types of quality costs.

Q2. What is production/operations?’

Q3. What are the major decision areas in P/OM?

Q4. Explain the difference between total and partial productivity.

Q5. Contrast the world class view with the traditional view in quality control.

Q6. Describe total quality management (TQM).

Q7. Describe briefly the “Delphi Method”.

Q8. What is the logic of Taguchi methods?

Operations Management

28 Jun

Q1) Explain the concept Six Sigma. Bring out the significance of Six Sigma in Quality Management?

Q2) Define Project Management and explain its nature and features?                     

Q3) What is Process Analysis? Explain the steps in Manufacturing Process Selection and Design?

Q4) Enumerate and explain the Theory of Constraints?                   

Q5) Write short notes:               

a) Inventory Control

b) Operations Scheduling

c) Aggregate Sales and Operations Planning

Q6) Explain the following concept:                      

 1) Product Design                 

 2) Strategic Capacity Management               

 3) Lean Productions              

Q7) Define Material Requirements Planning. Discuss its various components?                   

Q8) What is Supply Chain Strategy? Discuss its characteristics?           

Operation Management

28 Jun


Ram Dubey recently purchased a chain of dry cleaners in North Uttar Pradesh. Although the business is making a modest profit now, Ram suspects that if he invests in a new press, he could recognize a substantial increase in profits. The new press costs $ 15,400 to purchase and install and can press 40 shirts an hour or 320 per day. Ram estimates that with the new press, it will cost $ 0.25 to launder and press each shirt, customers are charged $ 1.10 per shirt.

Q1) How many shirts will Ram have to press to break even?

Q2) So far Ram’s workload has varied from 50 to 200 shirts a day. How long would it take to break even on the new press at the low demand estimate? At the high demand estimate?

Q3) If Ram cuts his price to $ 0.99 a shirt, he expects to be able to stabilize his customer base at 250 shirts per day. How long would it take to break even at the reduced price of $ 0.99?

Q4) Should Ram cut his price and buy the new press?



The Peachtree Airport in Atlanta serves light aircraft. It has a single runway and one air traffic controller to land planes. It takes an airplane and minutes to land and clear the runway (exponentially distributed) planes arrive at the airport at the rate of 5 per hour (Poisson distributed).

Q1) Determine the average number of planes that will stack up waiting to land?

Q2) Find the average time a plane must wait in line before it can lead?

Q3) Calculate the average time it takes a plane to clear the runway once it has notified the airport that it is in the vicinity and wants to land?

Q4) The FAA has a rule that an air traffic controller can, on the average, land planes a maximum of 45 minutes out of every hour. There must be 15 minutes of idle time available to relieve the tension. Will this airport have to hire an extra air traffic controller?



During the past few years the legislature has severely reduced funding for State University. In reaction, the administration at State has significantly raised tution each year for the past 5 years.

A bargain five years ago, State is now considered an expensive State-supported University. Some parents and students now question the value of a state education and applications for admission have declined. Since a portion of State educational funding is based on a formula tied to enrollments, State has maintained its enrollment levels by going deeper into its applicant pool and accepting less qualified students.

On top of these problems, an increase in the college age population is expected in this decade key members of the State legislature have told the University administration that State will be expected to absorb additional students during this decade. However, because of the economic outlook and the budget situation, State should not expect any funding increases for additional facilities, classrooms, dormitory rooms, or faculty. The University already has a classroom deficit in excess of 25% and class sizes are above the average of their Peer Institutions.

The President of the University MrShekhar, established several task forces consisting of faculty and administrations to address these problems. These groups made a number of recommendations, including the implementation of Total Quality Management (TQM) practices and more in depth focused planning.

Q1) Discuss the general terms how forecasting might be used for planning to address these specific problems?

Q2) Explain the role of forecasting in initiating a TQM approach?

Q3) What are the types of forecasting methods that might be used?

Q4) Describe the Delphi method for forecasting?



The Aurora Electronics company has been receiving a lot of customer complaints and returns of a front loading VCR that it manufacturers. When a videotape is pushed into the loading mechanism, it can stick inside with the door open, the recorder cannot run, and it is difficult to get the tape out. Consumers will try to pull the tape out with their fingers or pry the tape out with an object such as knife, pencil or screw driver or hurting themselves.

Q1) What are the different costs of poor quality and costs of quality assurance that might be associated with this quality problem?

Q2) Explain the term quality?

Q3) Discuss the dimensions of quality for manufacturing products?

Q4) Discuss the dimensions of quality for services?

Operations Management

27 Jun

1. What is continuous improvement (CI)? What are the major tools for this philosophy?

2. What is the logic of Taguchi methods?

3. Describe briefly the steps to develop a forecasting system.

4. Regression and correlation are both termed “causal” methods of forecasting. Explain how they are similar in this respect and also how they are different.

5. Define the terms “Qualitative Methods”, “Trend Analysis Method (Time Series Method), and “Causal Forecast”. Describe the uses of them.

6. What do you see as the main problem with qualitative (judgmental) forecasts? Are they ever better than “objective” methods?

7. Describe total quality management (TQM).

8. Explain the process of collaborative planning? How is available to promise involved?