Lecture Outline 5 Manufacturing Systems (Production and Operations Management) p. 304+

Production of Tangible Goods such a business has three types of inventory: raw materials, work-in-process, and finished goods Use of computers in manufacturing is widespread

Computers in Manufacturing Computer-aided design (CAD) Computer-aided engineering (CAE) –3-D representation of car engine on screen –Simulation of engine’s performance –Performance data gathered Automated control of production machines –Computer control of sawing patterns –Computer control of industrial robots

In More Detail *MC Master Production Schedule –Based on - accepted sales orders Sales forecast Current finished goods inventory Lists #units to be produced each week

Bill of Materials *L A list of raw materials needed to produce one unit of finished product and the quantity of each material Material Requirements Planning (MRP) –With the MPS and BOM, a system can produce time-phased purchase orders for raw materials (main output of MRP)

Capacity Requirements Planning *L What MRP is to materials required CRP is to machines time and worker time required What the bill of materials is to MRP, the Route Sheet is to CRP - shows sequence of required operations and the standard time allowed for each operation (usually person + machine)

Capacity *L How much machine time and worker time do we have? –May need to rent more floor space and / or machines –May need to hire temp workers CRP generates a detailed production schedule It releases manufacturing orders to the production floor

Manufacturing Resource Planning (MRPII) *L Composed of: –Master Production Schedule (tactical) –MRP (tactical / operational) –CRP (tactical / operational) –Shop floor control (operational / tactical) –Quality control (operational / tactical) –Cost allocation (material, labour,overhead) to finished goods – a comprehensive, integrated way of managing manufacturing

Inventory Control *MC In manufacturing, we have: –Raw materials inventory –Work-in-process inventory –Finished goods inventory Systems keep track of quantities and costs of each

Just-In-Time (JIT) Manufacturing *MC Raw materials arrive just when they are needed on the production floor Minimizes inventory Requires complex information systems (operational) May have vendor managed inventory (supplier’s computers tap into our inv. systems)

Computers in Manufacturing SUMMARY: - computer support in manufacturing extensive -we’re concerned with supporting information systems (not drafting or machine control) -Many operational / tactical systems

Operational & Tactical Systems Master Production Scheduling system Material requirements planning system Capacity requirements planning system Detailed Production Schedule Shop floor control (comp. to schedule) Quality control (comp. to quality standards) Cost accounting; inventory control Put together in MRP II (Mfg Resource Planning)

IT Considerations in Mfg. *L Large databases designed for varied and quick retrieval Data capture in variety of ways (incl. sensors, measurement devices, scanning) Connectivity throughout production facilities Both operational and tactical (eg. Shop floor control) Integration with system outside mfg.

Strategic Manufacturing Systems *X Assist top management with –Selecting a plant site –Building a new plant –Designing and laying out a production facility –Assessing technologies to be used in production processes May use both internal and external data

Supply Chain Management Software (SCM) *MC p. 270 Supply chain: flow of materials, services and information from suppliers of merchandise and raw materials through to the organization’s customers –Now: supply network Supply chain management: processes and procedures used to ensure the delivery of goods and services to customers at the lowest cost while providing highest value to the customers

SCM (cont’d) suppliers are gaining access to an organization’s production planning schedules to assure an ability to fulfill orders producing organization is opening its systems to the customer to allow the customer to view inventory and production levels before placing orders