PRODUCTION AND

OPERATIONS
MANAGEMENT
PROF. J IYER
PROF. S K BANERJI
The pre-liberalisation scenario
PRODUCTION AND OPERATIONS
MANAGEMENT
 Introduction to concepts
Ø Every organisation, whether product or service provider,
transforms certain inputs into desired outputs
Ø Feedback mechanisms are required to monitor the
performance of the transformation process
Ø Random disturbances, unexpected and sometimes not
planned for, may hamper the transformation process
Ø These disturbances are usually due the external
environment
Ø POM is defined as the design, operation and
improvement of the transformation process which
converts inputs into desired outputs of
products/services



 Basic Transformation
Process
Quality of inputs Quality of outputs
monitored Random monitored
disturbances

Inputs Outputs
Transformation process

Feedback mechanisms
PRODUCTION AND OPERATIONS
MANAGEMENT
The pre-liberalisation scenario
The pre-liberalisation scenario
Liberalisation and after
 The post-liberalisation scenario
• Trade barriers were progressively dismantled
• Import tariffs were drastically reduced and most items
were brought under OGL
• The last 20 years have witnessed extremely good
growth, as unshackled industrial sectors have been
allowed to achieve economies of scale and locate
facilities where economically viable.
• Balanced industrial growth has been enabled through
incentives
• The manufacturing sectors are free to source their
resources-technology, know-how, materials, energy-
more cost-effectively from anywhere in the world
•
The post liberalisation scenario
 Record number of funds….
qForeign investors are engaging
increasingly with India which is now the
10th largest economy in the world
q117 PE and VC funds plan to raise USD
33.5 bn (INR 1.5 trillion), largely for the
infrastructure, energy, technology,
communications and s/ware sectors
(Mint edn dt 18.01.2011)
q60% are India dedicated funds

Recap
 The Customer Needs and Satisfiers

Customer Customer
Organisation
[ Needs ] [ Satisfier (
s )]
 The Closed Loop Of Customer
Satisfaction

ORGANISATION

Satisfier
Needs

Customer
 Five Input/Output Diagrams For Customer Satisfaction

Explicit
Needs forecasts
Customer Identification and Forecasting
Facility

Explicit Resource
forecasts Plans
Analysing and Integrating
Facility

Production /
Resource Operating
Plans Inputs
Supplying
Facility
 Five Input/Output Diagrams For Customer
Satisfaction

Production / Operati Outputs

ng Functions
Transformation Facility

Outputs Satisfie
Distribution Facility r Customer
 Closed Loop – Customer to Customer
t
i ci ts Re
so
x pl cas Pl urce
E re 2 an
Fo Analysing and Integrating Facility s

11 Identification and Forecasting 3 Supplying

Facility Facility
Needs Production
/
Customer Operating
Inputs

i e
i sf
t 5 Distribution 4 Transformation
Sa
rs Facility Facility

Outputs
The marketing and production/operations tasks

Explicit
forecasts
Analysing and
integrating facility

PRODUCTION/OPERATIONS
Identification and
Forecasting facility Resource
plans
needs
MARKETING

consumer Supplying
satisfiers facility

Production/
Distribution facility operating
inputs

Transformation facility
Outputs
 Effects of Separating Marketing and Production
Functions
M a rke tin g Pro d u ctio n

M a rke tin Pro d u ctio n

g

Increasing Decreasing
Viability Viability

M a rke tin g Pro d u ctio n

The Production/Operations Manager’s Tasks
The Production/Operations Manager’s Tasks
The Production/Operations Manager’s Tasks
v PROCESS – Technical and organisational needs of
product, organisation, people
§ Available capacity, available skills, type of
production/operation, layout of Plant & Equipment,
safety, maintenance, target costs
v PROGRAM – Timeline for transfer of products/services
to customer, determining cash flow requirements
§ Time tables for purchase, transfer, maintenance, cash,
storage, transport
v PEOPLE – Intellect, skill sets, expectations vary from
person to person
§ Wages/salaries, safety, work conditions, motivation,
trade unions, education and training
 Duties & Responsibilities of
Production/Operations Managers
 Duties & Responsibilities of
Production/Operations Managers