Unit 08 Production

Unit 08 Production 1a Discussion 1. What particular skills do you think production and operations managers require? Production and operations managers should presumably be interested in making products or providing services rather than simply making money. They usually need a lot of technical knowledge (about manufacturing processes) and mathematical abilities. Even in these days of increasing automation, good human relations skills are also a clear advantage. 2. What do you think the objectives of a production department usually are?

The objectives of the production department are usually to produce a specific product, on schedule, at minimum cost. But there may be other criteria, such as concentrating on quality and product reliability; producing the maximum possible volume of output; fully utilizing the plant or the work force; reducing lead time; generating the maximum return on assets; ensuring flexibility for product or volume changes, and so on. Some of these objectives are clearly incompatible, and most companies have to choose among price, quality, and flexibility. There is an elementary trade-off between low cost and quality, and another between low cost and the flexibility to customize products or to deliver in a very short lead time.

1b Vocabulary: These are some basic words used in relation to industrial production. Match them up with the definitions below. Capacity, component, inventory, lead time, location, outsourcing or contracting out, plant, subcontractor 1. Any company that provides goods or services for another one: subcontractor 2. Any of the pieces or parts that make up a product, machine, etc.: component 3. Buying products or processed materials from other companies rather than manufacturing them: outsourcing or contracting out 4. The (maximum) rate of output that can be achieved from a production process: capacity 5. The buildings, machines, equipment and other facilities used in the production process: plant 6. The geographical situation of a factory or other facility: location 7. The stock of any item or resource used in an organization (including raw materials, parts, supplies, work in process and finished products): inventory 8. The time needed to perform an activity (i.e. to manufacture or deliver something): lead time 1e Comprehension According to the text, are the following sentences TRUE or FALSE? If they are false, say why. 1. T In JIT, products are ‘pulled’ through the manufacturing process from the end, rather than ‘pushed’ through from the beginning. (Each section of the production process makes the necessary quantity of the necessary units at the necessary time – which is when it is required by the next stage of the manufacturing process, or by distributors or customers. 2. F JIT originated in American manufacturing. (Ohno mentioned American retailing) 3. F JIT encourages production workers to exceed their production targets. (Quite the contrary: it encourages them to produce exactly the amount required) 4. T Companies using the JIT system and outsourcing many of their components are highly dependent on their subcontractors. (…if a single subcontractor fails to deliver a component on time, the whole production process is sabotaged) 5. F In a JIT system, a delivery of defective components can be replaced from the reserve inventory (There is virtually no inventory) 6. T JIT depends on harmonious partnerships between a company and its suppliers (…the Japanese industrial system relies on mutual trust and long-term relationships.) 7. T Japanese production systems generally speed up the entire manufacturing process. (This avoids all the waiting and moving time involved in sending half-finished items from one department to another… JIT… should ensure that there is no waste… from idle workers waiting for parts.) 8. F JIT leads to economies of scale. (The Japanese also prefer small, specialized production plants with a limited capacity… very small production runs are possible. 9. T JIT production – manufacturing only when a customer places an order – does not encourage innovation or the creation of demand. (This is not mentioned in the text, but follows logically from the concept of JIT, as business students should be able to understand. In fact it was one of my students who suggested this as a disadvantage of JIT since I wrote the first edition!)

2a Discussion 1. When consumers talk about quality, what different aspects or criteria do they have in mind? How would you define quality in relation to the following? A fast-food snack, a restaurant meal, a tennis club, a small car (US automobile), a raincoat, hi-fi equipment Fast-food customers are usually looking for speed of service, relatively low prices, reasonable food, and consistency – an identical product in all fast-food chain’s outlets. A restaurant meal usually takes more time, but the service should not be too slow. The food is