Business w08 Producing Goods And Services @1

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Week 8

Prod ucing
and Se rvices
Go ods

Jakarta, Novem
ber 2007

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id


What Does Production Mean Today?

• The concept of production means services as well as
goods.
• The key difference between production and services
operations is the customer's involvement in the latter.
• Customers are involved in all kinds of production because
electronic communications are key components in winning
and keeping customers.



Services… Goods…

• are performed • are made
• are intangible • are tangible
• are unstorable • are storable
• 29.7% of GDP (US)
• 50.3% of GDP (US)



The Growth of Global Operations

• Global competition has made production a faster-paced,
more complex activity.
• New technologies make machines that run cleaner, faster
and safer and that operate on a global scale.
• With the Internet, producers of both services and goods
can integrate their production with those of far-off suppliers
and customers.



What is utility ?

“A product’s ability to satisfy a human want.”
Four kinds:
– Time
– Place
– Possession/ Ownership
– Form



What is Operations
(or Production) Management

Systematic direction and control of the processes
that transform resources into finished products
that create value for and provide benefits
to customers



Resource Transformation Process



What are Operations (or Production) Managers?

Managers responsible for ensuring that operations
processes create value and provide benefits



Operations Processes

• Operations process is a set of methods and technologies
used in the production of a good or a service

– Goods classification is based on whether an operations
process combines resources or breaks them into
component parts
– Services classification is based on the extent of customer
contact required



Goods-Manufacturing Processes :
Analytic vs. Synthetic Processes

• Analytic process breaks down resources into components

• Synthetic process combines raw materials to produce a
finished product



Service Processes: Extent of Customer Contact

• High-contact system is an operation in which the
customer is part of the system during service delivery



• Low-contact system is an operation in which the
customer need not be a part of the system to receive the
service



Differences between
Service and Manufacturing Operations

• Focus on Performance
• Focus on Process and Outcome
• Focus on Service Characteristics
– Intangibility
– Customization
– Unstorability
• Focus on the Customer-Service Link
– E-Commerce: The “Virtual Presence” of the Customer
• Focus on Service Quality Considerations



Operations Planning

• Managers from many departments contribute to decisions
about operations.
• The business plan and forecasts developed by top
managers guide operations planning.
– Forecast is a facet of a long-range
production plan that predicts
future demand



Operations Planning and Control



What is Capacity ?

Amount of a product that a company can produce
under normal working conditions



Capacity Planning

• Capacity Planning for Producing Goods
– Capacity planning for goods means ensuring that a
firm’s capacity slightly exceeds normal demand for its
product.

• Capacity Planning for Producing Services
– In low-contact processes, maintaining inventory lets
managers set capacity at the level of average
demand.
– In high-contact processes, managers must plan
capacity to meet peak demand.



Location Planning

• Location Planning for Producing Goods
– Location decisions are influenced by proximity to raw
materials and markets, availability of labor, energy
and transportation costs and other factors.
• Location Planning for Producing Services
– Low-contact services can be located near resource
supplies, labor or transportation outlets.
– High-contact services must locate near the
customers who participate in the system.



Layout Planning for Producing Goods

Layout must be planned for three types of space:
1. Productive facilities
2. Nonproductive facilities
3. Support facilities



Layout Planning for Producing Goods

• Process layout groups equipment and people according to
function
• Cellular layout works well when a family of products
follows a fixed flow path
• Product layout is set up to make one type of product in a
fixed sequence and is arranged according to its
production requirements
– Assembly line is a product layout in which a product
moves step-by-step through a plant on conveyer
belts or other equipment until it is completed



Layouts for Producing Goods



Other Developments in Layout Flexibility

• U-shaped product line is a product layout in which
machines and workers are placed in a narrow U shape
rather than a straight line

• Flexible Manufacturing System (FMS) is a production
system in which a single factory uses automation to
produce a wide variety of products



Layout Planning for Producing Services

• In a low-contact system, the facility should be arranged to
enhance the performing of the service.
• In a high-contact system, the facility should be arranged
to meet customer needs.



Layout of a Typical Piccadilly Cafeteria



What is Quality ?

The American Society for Quality defines quality
as the combination of “characteristics of a product
or service that bear on its ability to satisfy stated
or implied needs.”



Methods Planning

• Methods Improvement in Goods
– Process flowchart is a diagram included in a detailed
description of methods
• Methods Improvement in Services
– Service flow analysis shows the flow of processes
that make up a given service
– Designing to Control Employee Discretion in Services
– Design for Customer Contact in Services



Service Flow Analysis



Operations Scheduling

• Scheduling Goods Operations
– Master production schedule
shows which products will be
produced, when production will
take place and what resources
will be used

• Scheduling Service Operations
– In low-contact services, work scheduling may be based
either on desired completion dates or on the time of order
arrivals.
– In high-contact services, the customer must be
accommodated as part of the system and its processes.



Tools for Scheduling Service Operations

• Gantt chart diagrams steps to be performed and specifies
the time required to complete each step



Tools for Scheduling Service Operations

• PERT chart breaks down large projects into steps and
specifies the time required to perform each one



What is Operation Control ?

Process of monitoring production performance by
comparing results with plans



What is Follow-Up ?

Production control activity for ensuring
that production decisions are being implemented



Materials Management

• Materials management allows managers not only to
control but also to plan and organize materials flow
– Standardization is the use of standard and uniform
components in the production process



Major Areas in Material Management

1. Transportation includes the means of transporting
resources to the manufacturer and finished goods to
buyers
2. Warehousing is the storage of both incoming materials for
production and finished goods for distribution to
customers
3. Inventory control includes the receiving, storing, handling
and counting of all raw materials, partly finished goods
and finished goods
4. Purchasing is the acquisition of the raw materials and
services that a firm needs to produce its products



Purchasing Processes

• Holding costs are costs of keeping extra supplies or
inventory on hand

• Opportunity costs are additional earnings that the
company must pass up because funds are tied up in
inventory

• Lead time is the gap between the customer’s order
placement and the seller’s shipment

• Supplier selection is the process of deciding which
suppliers to buy from



Tools for Operations Process Control

• Worker Training
• Lean Production Systems:
Just-in-Operations
– Just-in-Time (JIT) Production
• Material Requirements Planning
– Bill of Materials
– Manufacturing Resource Planning (MRP II)



What is Quality Control

Management of the production process designed to
manufacture goods or supply services that meet specific
quality standards



thank you


Business w08 Producing Goods And Services @1

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Mehr von univ

Mehr von univ (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Business w08 Producing Goods And Services @1