Role of information system in operation control

 It integrates information on virtually an instantaneous basis

 Data are readily available for reporting

 It provides effective planning and control

 Tools & Techniques
 Inventory planning and Control
Economic Order Quantity (EOQ): Is the size of the
order which minimizes total annual cost of carrying inventory
and cost of ordering.

Qe = 2 DS
H
Qe = Economic Order Quantity
D = Demand per year
S = Setup cost
H = Inventory holding (carrying) cost per item per year
 Tools & Techniques
Just In Time Inventory System: It is the cost reduction
measure. In this system, the supplier delivers the
components and the parts to the production line “just in
time” to be assembled. This method is also known as Zero
inventory and Stockless production.
JIT system much depends upon
1. The quality of parts
2. Dependable relationships and smooth cooperation with
suppliers
3. The suppliers should be located near the company, with
dependable transportation available
 Tools & Techniques
Outsourcing:
This means that products and operations are contracted to
outside vendors that have expertise in a particular area.
Reasons for outsourcing:
 To reduce the cost by saving on personnel benefits

 Reassign employees to other task that are more important

 To maintain competitiveness

 To gain access to the best sources available world wide

 To share risk with its suppliers

 Tools & Techniques
Operation Research: Is the application of scientific methods to
the study of alternatives in a problem situation, with a
view to obtaining a quantitative basis for arriving at a best
solution.
Value Engineering: It consists of analyzing the operations of
the product or service, estimating the value of each
operation, and attempting to improve that operation by
trying to keep costs low at each step or part.
Steps involved in value engineering
1. Divide the product in to parts & operations
2. Identify the costs for each part & operation
3. Identify the relative value of the contribution of each part
to the final unit or product
4. Find new approach for those items which appear to have a
high cost and low value.
 Tools & Techniques
Work Simplification:
Is the process of obtaining the participation of workers in
simplifying their work. Training session are conducted to teach
concepts and principles of techniques such as time and motion
studies, workflow analyses, and the layout of the work situation
Quality Circles:
It is a group of people from the same organizational area, who
meet regularly to solve problems they experience at work.
Members are trained in solving problems, in applying
statistical quality control, and in working in groups.
 Tools & Techniques
Total Quality Management:
It involves the organization’s long term commitment to the continuous
improvement of quality throughout the organization, and with the
active participation of all members at all levels to meet and exceed
customers’ expectations.
It also involves
 Require a careful analysis of the customers’ needs

 Assessment of the degree to which these needs are currently met

 Fill the gap between current and the desired situation

 Cooperation of suppliers

 Involvement of top management

 Free flow of information- vertically, horizontally, and diagonally

 Tools & Techniques
Lean Manufacturing:
This method aims to gain competencies through using fewer
workers, having shorter development time, lower
inventories, fewer suppliers, less production space, and less
investment to produce more models.
Differences between traditional and lean management:
Traditional management Lean management
Sporadic and inconsistent improvement Continuous improvement
(Kaizen) with strategic
Satisfied with “good enough” Aims at zero defects
High inventory acceptable Just-in-time inventory system
“Me” management “we” or Team management
Workers are the cause of poor qlty Responsibility lies on everyone
 Tools & Techniques
Computer Aided Techniques
CAD/ CAM’s
It help engineers design products much more quickly than
they could with the traditional paper-and-pencil approach.
Manufacturing automation protocol (MAP):
Is a network of machines and various office devices. MAP is a
sophisticated extension of local area networks (LANs)
 BUREAUCRATIC AND CLAN CONTROL

BUREAUCRATIC: Is charecterised by the wide use of rules

and regulations, policies, procedures and formal authority.

CLAN CONTROL: Is based on norms, shared values,

expected behavior, and other cultural variables.