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MUST Production and Operation

English section

Final Exam. ±· Two Hours

· Management ·------

Ql. Provide short definition (30 marks)

1- Concurrent engineering and Delayed differentiation 2- Design capacity, Effective capacity and actual capacity 3- Standardization and Mass customization 4- Product reliability and Reverse engineering 5- CAD

Q2. Choose between True and False and justify vour answer (20 marks)

1. Basic research and applied research are done with the objective of achieving commercial applications.

2. In situations where multiple products are produced, the capacity can be measured in output rate capacity .

.., 1>.?.~-:-~~·T.t~ standby.facilities is the only way of expanding long-range capacity. 4. There is no difference between economies of scale and diseconomies of scale.

Q3. Answer the followint: (40 marks)

i. Suppose that a company produced 1728 fans in one month using 4 workers of 8 hours each. The hourly wage is ~and the material cost is·$ !@)er fan. Overhead is charged monthly at the rate of $ 432_9 plus 25% of labor cost. The selling price ---....... .. /

lS $70. __ ./ . · ---mred: Calculate MFP (multifactor productivity)

ii. Use the following data about the actual sales for company X to:

Forecast sales for period (10) using each of these methods: a. Na'lve b. Simple moving average (n=4) c. Weighted moving aver.age if you have the following weights:

• 0.4 for the most recent period~ then • 0.3 for the next most recent, then • 0.2 for the next most recent, then • 0.1 for the next most recent.

d. Exponential smoothing [forecast for period (9)=12 and a.=0.4]

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1

iii. Calculate the number of machines required given the following data

I Product I Annual Demand r Processing time/unit (hrs) I I (units)

·-·--· 1 400 5 J 2 300 8 ·] 3 700 2

Annual working days 300 days, 3 shifts/day and 8 hrs/shift

iv. Y h ou ave e o owm~ a a Design 1 I Annual fixed cost 27000000 I

Unit variable cost 2.5 I Unit price 4 ----1------

th fi II d t 1 Design 2 1

16000000 -~ 3 I

--4- I _____ __.)

a) How much is the breakeven point for the tv,ro alternatives. b) At what production level the two alternative designs are indifferent. c) Which alternative design you prefer for the next three years if you know that the

expected demand for the next 3 years (2013-2015) is 15000000,20000000, and 24000000 respectively.

GOOD LUCK Nora Abdel Rahman

2

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POl\ I 'Revision on chapters 1 and 2

Q.l True or False: 1- The operations function involves the conversion of inputs into outputs. 2- :\number of Japanese manufacturers have dl:vclopcd and rdined management

practices that have improved quality and productivity. / 3- The operations functions exist in mo.nufacturing industry only. ' 4- Operations manager is responsible for design decisions only. .. 5- The operation functions exist in 1ii1l):~_that arc se~!_<:_~..Q_!js;I~~~d. , 6- Using the quantitative methods ofOR in decision making was a focal point of

scientific management. -< 7- Cost reduction is one of the recent trends in POM. : 8- POM functions works independently from the other functions in business

organizations. ~< 9- Location choice decision is an example of system operations decisions. 10- Operations management involves both system design and system operation

decisions .. _..-- · · --------

11- Bolh inputs and outputs are more' uniform for an operation that provides services than the ones providing goods. . \ ---

12- The three primary functions of a firm are financial management, operations management and accounting. ..' · .

13- Fredrick W. Taylor is~nerally credited for introducing the moving assembly line.

14- The principle activity in all production operations is to convert inputs into outputs that satisfy consumer wants. ,_,-"'

15~ Human efforts, teclmology, raw materials, information and time arc all examples of the necessary inputs to operations. "_.--"'

16-The elements ofthe transformation process include the production system, equipment facilities, employee motivation and skills.

17- Outputs of the operations may be classified as goods, raw materials and profits. 18- System design includes managing personnel. inventory m'1gcmcnt, scheduling

project management and quality assurance. 19- The operation of the production system includes capacity, location, layout and

equipment acquisition decisions. 20- According to the Pareto principle, a relatively few factors are very' important in

-··achieving an objective or problem solving. 21- T'>vo recent trends in POM are flexibility and specialization. ," 22- POM includes planning, coordinating and controlling to creo:te goods or services. 23- The scientific _management era brought widespread change to management of

factories. _,...-

,U~Distinctive competencies are abiiilies possessed hy an orgnnizJtion tbt gives it a ~ comp~titivc edge.

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_,_3./How does the difference between mJilufacturing and Services organization affect the operations management activities?

_.-t .......... bperations interface with other supporting functions. , , : · :,s-:- The impact of scientific management on the management of factories. ·~ ..

6- The impact of Japanese managerial philosophy. _ ~ . ,Y'Identify the three major fun~tional areas of business organizations and briefly

describe how they interrelate. ,.~ ·, . ' \ s..-/Contrast system design and system operations. ,: ~ , 1- j

~-9"!" Give five important differences between manufacturing-and service operations. _././

Q. 3 Give Examples: _.....[. pifferentiating features of production systems according to type of operations. _2.;; ..... -Jmportant differences between manufacturing and services organization. _,3- ··system design and system operations decisions. __ 4.. Types of operations. · ·. , - · · •.. :;::--Standardized goods and standardized services. ~Factors that affect productivity.

7- Reasons for poor performance. @Environmental factors. ~The different 'vvays that organization can compete. ,......Hf-Recent and important trends in POM: ·: !... ' · -••

;@The external and internal' environmental factors.

Q. 4 Dra\v and Label: _......-1-; Comprehensive productive system. c h ( r ) .......-r-Operations interface with other supportingTunctions .. _ . , CD The planning hierarchy in organizations.

Q. 5 Compare: _!/System design and system operation decisions.

' ~··1

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Chapter Two

Q 1: Explain Briefly: 1. Factors affect productivity. 2. Environmental Factors. 3. Different ways organizations can compete with. 4. Key steps toward improving pro_ductivity. 5. Reasons for organizatin's poor performance.

Q2: True or False (Justify your answer within 3lines): I. The hierarchy of planning and decision making is: mission,

organizational strategy, tactics and operational decisions.

•

2. Labor productivity is one example of a multifact()r productivity measurements.

3. New strategies ofbusiness organizations have tended to emphasize cost nrinimization.

4. Develop productivity measure for all operations is one of the key steps toward improving productivity.

5. Tracking prQductivity measures overtime enables managers to judge organizational performance.

6. Numerous factors affect productivity among them is cost or price. · 7. Among the main reasons for poor competitiveness in global market

is failure to recognize the threats posed by foreign competitors. 8. Productivity can generally be improved by getting people to work

harder. 9. Distinctive competencies are abilities possessed by an organization

- that give it a competitive edge. lO.To formulate a strategy we need to study the distinctive abilities of

organization. ll.To formulate a strategy we need to carry SWAT analysis.

Q3: Complete: 1. Key steps toward improving productivity .....

Q4: Give examples: 1. The key ways that organization compete. 2. External and internal environmental factors. 3. Distinctive competencies.

\ '\ .

. · ...

. Q1- THE WEEKLY OUTPUT OFF ABRICATION PROCESS IS 700 UNIT , THE STANDARD SELLING PRICE IS 150 L.E PER UNIT. ASSUME THE NUMBERS OF WORKERS ARE 15 EACH WORKER WORK 50 HOURS A WEEK AND HOURLY WAGE OF 18 L.E MATERIAL COST IS 50 L.E PER UNIT & . OVERHEAD CHARGED AT THE RATE OF 3200 L.E PLUS 10% OF LABOUR COST.

COl\1PUTE: A- LABOUR PRODUCTMTY. B- TOTAL PRODUCTIVITY.

Q2- THE WEEKLY OUTPUT OFF ABRICA TION PROCESS IS SHOWN BELOW TOGETHER WITH DATA FOR LABOUR AND MATERIAL INPUTS. THE STANDARD SELLING PRICE IS 200 L.E PER UNIT. OVERHEAD IS CHARGED AT THE RATE OF 100 L.E PLUS 50% TllviES DIRECT LABOUR COST. ASSUME A 40 HOUR WEEK & AN HOURLY WAGE OF 20 L.E . MATERIAL COAST IS 10 L.E PER LINEAR FEET.

2

WHAT IS THE AVERAGE MULTIF ACTOR PRODUCTIVITY? WHAT IS THE PRODUCTIVITY GROWTH?

4 0 7 3200

Q.3 Problems:

. I. The foJJowing table represents the student No. <)f coiJegc of business administration.

I Period 1995 1996 1997 1998 1999 2000 . .t 2001 I Student 60 80 120 100 150 250 , '>n(' I ·-~·, 1 No.

Required:

1-Prepare the forecast for the period 1999 - 2002 using weighted moving average with the following weight (40 %, 300/o, 20%, 10%). 2- Compute the error using MAD.

Q3: Problems:

1) A F (A-F)

Period Student Method Forecast Error

no.

1995 60

1996 80

1997 120

1998 100

1999 150 40 30 20 98 100x-+ 120x-+80x-= . 100 100 100

98 52

2000 250 (150x40%)+(100x30°!0) 122 128

+(120x20o/o)+(SOx10%)

2001 200 (250x40% )+( 150~30%) 177 23

+( 100x20% )+( 120x10%}

2002 (200x 40

}+(250x::0

) 195 --

I&~ 100 .

20 10 +(150x-)+{100x-) = 195

# 100 100 '\::!:1 52+128+23

= 67.67 ·':1~'~ Average= 3 '~l'~.

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MAD

--

3. Monthly sales for a five month period were as follows:

.------------- -· -· .....---------------' Month Sales (units) May ___ --------1-1_5_0 _______ _ June 180 ------------· ··- ·-·· ~-------·--------···· July 200 ---------· ----· -- ----------August 180

1----""'--. ------- ·--·--------September 220

'--·-···---·-------~-----

Forecast October sales voluine using each of the following: 1- Simple moving average where N=4. 2- Weighted moving average 60%, 30%, I 0%. 3- Exponential smoothing with a=0.7, assuming avgust forecast 200 . . ............ ·--········· .. ,. "'·'·''-· ·--~--.. ----·· -- ----~-- _____ , _________ _._,_ ·------

3)a) Month Sales Method

May 150

June 180

July 200

August 180

September 220

October 220+180+200+180/4

b)

October 220x~180x~200x 10

100 100 100

= 200+0. 7[180-200] = 186

Fsep= 186

. -Foct= Fsep + a[Asep- Fsep]

= 150+0. 7[220-186)

Fact= 209.8

Forecast

195

188

Error

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2. The following table representc; the student No. registered for MBA at AMI durinV-the last six terms. . o .------ ···-

Period 1 lt2 3 4 5 6 Student 20 18 25 22 25 30 No.

--- -- .... --- ·--- -- ... -- -- ..

'··

Forecast Student No. for period 5 and 6 using: 1-:Simple moving average where N=J. 2- Weighted moving Averag({70%, 20%, 10%. ~ -Compute the error using MAll

.. -. ~~----·-······-·--·-- .. ____ , __ ------------ .. -~--- ------ --··· ··-···-------...

2)a)

Period Student Method

no. ~ 1 20 ,,~ f • 2 18 ,,~· t1 3 25 I ~ i E-'/ 4 22 Jj ~~ 5 25 (22+25+18)+3 L ~ •/ 6 30 (22+25+25}+3 ~

b)

Period Student Method '

no.

5 25 22x70% + 25x20% + 18x10%=

6 30 25x70% + 22x20% + 25x10%=

Forecast Error MAD

21.67 3.33 --24 6 --

Forecast Error MAD

22.2 2.8 --24.2 5.8 --

4. The following table presents the number of goals scored by El Ahly Club in Egyptian league during the last five years.

l!:E__ ::8_~j~~9~ -~ ~ ~~0~== r¥Q~~~~=:: ~~Q2 __ -:] Forecast the number of goals expected to be scored in year 200 I -· :wen using:

1- Simple moving average where N-=2. 2- Weighted moving average 50%, 30%, 20%. 3- Exponential smoothing with a:::D. 7 .

. 4- Compute error using MAD.

Period No. of goals

'1998 40

1999 45

2000 50

2001 42

2002 48

2003

Answer

S.M.A WMV

n = 2 SO%, 30%, 20%

(50+45)+2=47.5 {50x50%)+(45x30%)

{42+50)+2 =46

(48+42)+2 =45

+(40x20%)= 46.5

(42x50%)+(50x30%)

+(45x20%) =45

{48x50%)+(42x30%)

+(50x20%) =46.6

5'. The following table shows the No. of goals scored by the rising Egyptian

footballer star ~~am ~ido) per s~on: ~------_T -~ _ __ _ ]

it -cts ___ is_ _____ L=-~r~~~-- ~~~- -~J~~ -~--: __ : A-Prepare a forecast for the season's No. 4, 5 and 6 using the weighted movmg average 50%,30%,20%.

B- Which method do you recommend to prepare to forecast period 7? I) Simple moving average where N-""'2. 2) Weighted moving average 50%, 30%, 20%. 3) Which method do you recommend to forecast for period 7 using MAD.

Period No. of goals

1 15

2 18

3 16

4 18

5 22

6 20

7

WMA

( 16x50% )+( 18x30%)

+(15x20%)= 16.4

(18x50%)+(16x30%)

+(18x20%) =17.4

(22x50%)+(18x30%)

+(16x20%) =19.6

So we will get (W.M.A) = 20.2

S.M.A WMV

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20+22 = 21 (20x50%)+(22x30%) 2

+(18x20%) =20.2

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Q.5 1. The weekly output of a fabrication process is 400 units. The standard selling price

is 125 L.E per unit. Assume the number of workers is 15 each work 40 hours a week and hourly wage of 18 L.E. Material cost is 50 L.E per unit and overhead charged at the rate of2000 L.E.

Compute: 1- Labor Productivity 2- Total Productivity

2. The Weekly output of a fabrication process is 400 units. The standard selling price is 125 L.E per unit. Assume the number of workers are I 5 each work 40 hours a week and hourly wage of 18 L.E. Material cost is 50 L.E per unit and overhead charged at the rate of2000 L.E plus 10% of labor cost.

Compute: 1- Labor Productivity 2- Total Pl·oductivity

3. The Weekly output of a fabrication process is shown below together with data for labor and material inputs. The standard selling price is $125 per unit. Overhead is charged at the rate of$ 150 plus 5 times direct labor cost. Assume a 40 hour week and. an hQurly wage of $16. Material cost is $10 per I in ear foot.

Whati~ th~ avuage multifacto•· productivity?

Week Output Number of workers

1 392 5 -

2 408 6 ··-

4. The manager of a carpet store is trying to determine optimal installation crew size. He has tried various crew sizes with the result shown below.

Which crew size do you recommend?

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Question l:

BUS 103 E

FALL 2013/2014

REVISlON

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. . . ~ Briefly explain the term operations management . _ _ , _

\ ·~Why is it important to match supply and demand? If a ~anager believes t.~at supply,and demand. will not

be equal, what. actions caul~ the manager take to increase .the probability ofachievrng' a match?

' ~· . . ', VBriell)l explain Phases ofl'foductritisign and Develojnnenr

~ _ , ~riefly eXplain The reasons-of maklri·l~~tion declsi_ons

tl) ~hat are some- of the factors that you will consider in choosing- ~ location if you were to open a I . . . .

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_ <:!J- \/Explain- bri~fly th~ diffe~n.t sou~es ~f ideas'?· .__. .

7. What ~ ~e advantag~.$ and ~~sadvan~ges of. "~~~~- of a standa,rdiied

_ servic, and a stimd~~iZed. gQO#·: .• ~hilt are ~he· elements. of a good:~ forecast'!-

. 9; Dra"' and ~plain the stage$ th~~roduct or c_p '"_-tl llliih?-9 I 0. What is a forecaSI? And Why is torc=ca~;a

i--- · · J;k~~~lain brieflY ~:pe~_~f}udgQlental )

_ - -~(~~irt-btlefly: th~?actiyiti~s of.produ~t- ice _ -_ ~- . _ ..

··''. ~~~; hriefti ~s c~mization•and clarify by gi>inS llll~J<am~le . ·-· .: .. ·; •.···

p-£:Jih!eltion 2 :

.~· Draw

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, ( ~~Draw the '-U .

process of a hospital: f "') T ...::. -

I~ c__S ~ . L:J~'> CJ ~g of the three basic funr.:tior:ts uf any organizati<?n.

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· · 'Question 3 :

Calculate

/A company that makes shopping carts for supermarkets has recently purchased some new equipment

that reduces the labor content of t~eeded to produce the shopping cart . Before· buying the

new equipment. the company use~ 5 worke~ who produced an average 80 c _rtslh~~r. Workers

receiv~nd machine cost ~'-\'a~ With the new equipm'ent, it was ossible to

transfer one of the workers to another department. an ecfi.i-ipil;ent cost mcreased b _ $1 0/hour hile

output increased by~ - WL ""-·---

2.

a. Compute labor productivity 8 and @bu~ ing the new equipment. Use

carts/worker/hour as the measure oflahor productivity ~

b. Co~pute the multifactor productivity hdore and after buying the new equipment. Use carts/$

cost( labor + equipment) as the ml.!asurc

c. Comment on the change of pruducLivit~·

Factor

Labor Cost

Material Cost -1-----:-..;.?==!=======7-===

· Supplier Base

g relocation. There are two alternatives under consideration: either

~lo<:ate in Alexandria. Locating in Cairo will n:sult in paying 100,000 L.E

30 L.E variable costfunit. Locating in Alexandria will result in paying .!.50,QOO

~L.E variable cost/unit. Identify the range of output for which each

superior ( i.e, has the lo'hest total cost)

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2 33,600 I

--·---::-----+---~-:------1 7 i 470

3 32,200 ----~----

7 460

~e demand for. laptops for the last 5 periods is as 1011<>~ s: Period Deman_'t p.;'-~ cr-J

1 42 '\..:.

2 40

3 43

4 40

5 41 .. • Compute the forecasting of period 4 to

~- Moving average with n=3

following h!chniques: • b. Weighted moving average using the weights (60%, 40%)

/ d .

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Chapter 1

Introduction to Operations Management

I What is operations?

- The part of a business organization that is responsible for producing goods or services

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How can we define operations

- The management of systems or and/or provide services 1ta

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What are the Basic Functions of

What do you Chain? Or define the Supply Chain?

a sequence of activities and organizations involved in producing and delivering a good or service

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~ The sequence begins with the basic suppliers of raw materials and extends all the way to the final customer

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Measurements taken at various points in the transformation process

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Control

The comparison of feedback against previously established standards to determine if corrective action is needed.

What do you know about the

• The difference between or price of outputs

(Value added = Cost of inputs-

• In non-profit organizations the val value to society ( true --,f..,. I,_,.., I'IIIOC'+inn 1'1'1 , .. ·~ \

e of outputs is measured by the prices for those goods or services

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1) Products are typically neither purely service- nor purely goods-based. 2) It can range from primarily goods with little service to primarily service with

few goods


3

VIP Question (why Manufacturing and Service Organizations differ chiefly) or choose or true or false Q?

Because manufacturing is goods-oriented and service is act-oriented .

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Compare between production of goods and provision of services? UIIU~ f'IIIIIIU\A oJ Jl.jA.JI ~~ l:f

that transform inputs into outputs

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I Define the three Categories of Business Processes?


Uppermanagement

processes

Operational processes

Supporting processes

4

• These govern the operation of the entire organization. (EX. organ. Strategy)

• These are core processes that make up the value stream. (Ex. Purchasing, Marketing)

• These support (Ex. IT, HR,

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I Talk about the sources of Process Variation?

There are 4 sources of variation:-

Variety of goods or services being offered t'Jta ~~ c.:at....=...tl J ~~ e.Jl:l

Structural variation in demand ~~~~l~'il

Random variation

The greater the variety of goods and services offered, the greater the variation in production or service requirements.

1. These are generally predictable. 2. They are important for capacity

that is present in

1. Variation that has identifiable sources.

2. These variations are caused by defective inputs, incorrect work methods and so on ••

3. This type of variation can be reduced, or eliminated, by analysis and corrective action.

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I Variations can be disruptive to operations and supply chain processes. Explain?

Variations can be disruptive to operations and supply chain processes. They may result in additional costs, delays and shortages, poor quality, and inefficient work systems.

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Forecasting: weather, seat demand for

capacity planning: too few or too many

conditions

hurl\rofits

----FaciHties and .• ..,. .. _ ........ .._: important in aL ....... :._.: -.Uorti"~ ''Se of workers and equipment

Motivating and

routine maintenance

as food and beverages, pillows and

I in flying and maintenance operations

ng employees in all phases of operation

Deciding where to locate facilities

I What do you know about the role of Operations Manager?

1. The Operations Function consists of all activities directly related to producing goods or providing services. (Define the operations function)

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2. A primary function of the operations manager is to guide the system by decision making.

~ System Design Decisions ~ System Operation Decisions

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Compare between the System Design Decisions (or define question)?

System Design Decisions

System Design involves u~~::a ...... UII.

- System Capacity - Facility location - Facility layout (arrangement of

equipment's) Product a

- System - Management of personnel

pment

- Inventory management and control - Scheduling - Project management - Quality assurance

f~' ~ l!at.;t.;i • f\l:allt ~ l!at.;t.;i •

- These decisions are generally tactical and operational - Operations managers spend more time on system operation decision than

any other decision area


8

o They still have a vital stake in system design

WHY lEARN ABOUT OPERATIONS MANAGEMENT?

.ldi 0,. I jill This is because every aspect of Business affects or is affected by operations.

Operations and sales are the two line functions in a business organization. All other function_s-accounting, finance, marketing, IT, and so On-support the two line functions

Talk about Finance and Operation Ma •=-aiPm,PnT

and Operation) and (Marketing and Operation )

Finance and operations • • Fimmce iind operations managell\l(lt personnel _._, ··---information and expertise insud~luitiPc ~s

1. Budgeting. Budgets must be period requirements.

' .2. Economic analysis of investment proposals. Evaluation of alternative :<investments in and equipment requires inputs from both operations and

finance people. . ...

nding of operations and the amount and and even critical when funds are tight ••

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Marketing and Operation

Marketing can provide valuable insights on what competitors are doing and supply information on customers preferences so that design will know the kinds of products and features needed

Draw the Operations interfaces with a

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9

Operations can supply information on capacities and judge the manufacturability of design, in addition to whether new equipments or skills will be needed.

ng functions?

What do you know about Decision Making?

Or what are the typical operations decisions include?

•

•

•


10

• Typical operations decisions include:

When will each resource be needed? When should the work be scheduled? When should materials and other

ies be ordered? Where will the work be done? How will the product or service be designed? How will the work be done? How will resources be allocated? Who will do the work?

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Talk about

• Modeling i • Model-an

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used by all decision makers ~r-r•nn of reality; a simplification of something.

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What are the Common features of models?

• They are simplifications of real-life phenomena


11

• They omit unimportant details of the real-life systems they mimic so that attention can be focused on the most important aspects of the real-life system

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I What are the Types of Models?

Physical Models

• Look like their real-life cou

Schematic Models

• Look less likt! their

Mathematical Models •

• Do not look at'tfi

Talk about Understand

• Keys to successfully using a model in decision making

"".a.•n•'.a."ll·~ and used?

el's assumptions and limitations?

• Models nerally easier to use and less expensive than dealing with the real system

• Increase understanding of the problem

• Enable managers to analyze "What if?" questions

• Serve as a consistent tool for evaluation and provide a standardized format for analyzing a problem

• Enable users to bring the power of mathematics to bear on a problem.


12

I Define with examples the Quantitative Methods?

A decision making approach that frequently seeks to obtain a mathematically optimal solution

- Linear programming

- Queuing techniques

- Inventory models

- Project models

- Forecasting techniques

Statistical models •

~~ Jl-~1 ~I~~~ J~l

Talk about Model Limitations?

expense of .. -.--w•••a1.11rtiiii •• •• ....... ·• ~....;..~~' ~

• Models may be incorrectly nd the resul misinterpreted

wtc~es,prE~ad availability of sophisticated, ••a,..,.;;;u in the hands of un-informed-user5~-

- . ·~·!!!lft+~·l!!l good decisions.

Trade-Offs?

use metrics to manage and control operations

• Profits

• Costs

• Productivity

• Forecast accuracy


13

Analysis of Trade-Offs

- A trade-off is giving up one thing in return for something else

• Carrying more inventory (an expense) in order to achieve a greater level of customer service

I Talk about Degree of Customization? o9-\.;ill

Relative to other standardized products and services customized products:

./ Tend to be more labor intensive

./ Tend to be more time consuming

./ Tend to require more highly-skilled peopl ·/ rend to require more flexible equipm ./ Have much lower volume of output ./ Have higher price tags

•!• A few factors account for a high rrence of some event(s) 1l

•!• The critical few factors should the highest priority rnr'lrDII"'T that is appropriately applied to all areas and levels of

I What do you know about the systems approach?

• The systems approach - Emphasizes interrelationships among subsystems


14

- Main theme is that the whole is greater than the sum of its parts - The output and objectives of the organization take precedence over

those of any one subsystem

~ Answer is (true)

They are~

1. Industrial Revolution

2. Scientific Management

3. Human Relations Movement

4. Decision Models and Management Science

5. Influence

1. Industrial Revolution

Pre-Industrial Revolution

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o Craft production -System in which highly skilled workers use simple, flexible tools to produce small quantities of customized goods

o Began in England in the 1770s


15

o Division of labor- Adam Smith, 1776 o Management theory and practice did not advance appreciably

during this period Scientific Management

• Movement was led by Frederick Winslow Taylor

Henry Gantt

- Believed in a "science of management'' based on observation, measurement, analysis and improvement of work methods, and economic incentives

- Management is responsible for planning, carefully selecting and training workers, finding the best perform each job, achieving cooperate between ma and and separating management activities

- Emphasis was on maximizing

scheduling system and of non-monetary rewards for

Harrington Emerson Taylor's ideas to organization structure

Henry Ford

movement emphasized the importance of the in job design

Influence of Japanese Manufacturers

• Refined and developed management practices that increased productivity

- Credited with fueling the "quality revolution

- Just-in-Time production

I Mention the Key Trends and Issues in Business ?

• E-Business & E-Commerce


16

• Management of Technology

• Globalization

• Management of Supply Chains

• Outsourcing

• Agility

• Ethical Behavior

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What are the Elements of Supply Chain M .J 111111~ !'+"

Forecasting

Design

Suppliers

Location Logistics

customers

,r:at'ma customer wants, , and time to market

matching supply and demand

controlling quality, scheduling work

meeting demand requirements while managing costs

evaluating potential suppliers, supporting the needs of operations on purchased goods and services

monitoring supplier quality, on-time delivery, and flexibility; maintaining supplier relations

determin the location of facilities deciding how to best move information and materials


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17

Chapter2

Talk about Competitiveness?

• Competitiveness:

- How effectively an organization meets the wants and needs of customers relative to others that offer similar goods or services

- Organizations compete through some marketing and operations functions

• What do customers want? • • How can these customer .ds

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What is the main idea in Identifying

mbination of their

The main idea is to achieve a perfect match between those wants and needs and the organization' and

inform potential customers about features of their products or attract buyers

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How can Businesses Compete? ulS_;.JJI ~~ ;;;! '51JI

Businesses Compete Using Operations like:-

1) Product and service design 2) Cost 3} Location


18

4) Quality 5) Quick response 6) Flexibility 7) Inventory management 8) Supply chain management 9) Service 10) Managers and workers

Why Some Organizations Fail?

1. NPglecting operations strategy 2. Failing to take advantage of strengths and 3. Failing to recognize competitive threat~ 4. Too much emphasis in product and senlrfe

improvement .. 5. Neglecting investments in 6. Failing to establish good internal 7. Failing to consider customer

What are the Hierarchical Planning? And explain each step ?


[ )

1) Mission:

19

Mission

Tactics

Functional

Strategies .. '

Goals

The reason for an organization's existen

•

nization

ld answer the question of "What

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20

What do you know about McDonald's Mission Statement?

.bii 09-ljill

• McDonald's brand mission is to "be our customers' favorite place and way to eat."

• Our worldwide operations have been aligned around a global strategy called the Plan to win centering on the five basics of an exceptional customer experience -- People, Products, Place, Price and Promotion.

• we are committed to improving our operations and enhancing our customers' experience

2) Goals: 1. Provide detail 2. 3. Goals serve as 4. The

.. ~

mission zational destinations

organizational strategies

:i~-. ~.

Olj~~ •

~~~i~ .~JUIJ

serves as the basis for organizational goals often relate to how an organization wants to be ral public, and by its employees, suppliers and


21

3) Strategies: Strategy

1. A plan for achieving organizational goals 2. Strategies are the road maps for reaching the organizational destinations

~, .. , ~..):&:A:M.

3. Organizations have tow strategies are : ( or

Organizational strategies:

···-~.-·--·--.--:.· ..... '-"··--.......:.......

c···c--1~·''0\"it:!ra!i·-sr~ategies tilat relate to th~l.,n:

orgamzat1on 1l

2. Support the achievement of organization goa'ls and mission

4) Tactics:

to each of the and that support

of the organizational strategy

• ~_,JI ~I ulA..a:il .. I • Lf ,..- E

1) The methods and actions taken to accomplish strategies 2) They are more specific than strategies 3) Tactics provide guidance and direction for carrying out actual operations 4) Tactics is the 11how to" part of the process


22

( 5) Operations: J

~ The actual "doing'' part of the process

I Define or explain the Core Competencies?

Core Competencies

~ The special attributes or abilities that give an organization a competitive edge

)o> To be effective core competencies and

Complete the following: 'fA 1. Effective formulatllh

-2. Successful strategy formulation also requires taking into - nd

:----"1

rs

qualifiers and Order winners?

stomers perceive as minimum standards of acceptability to be considered as a potential purchase

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Why Environmental Scanning is necessa

Order winners Characteristics of an organization's goods or services that cause it to be perceived as better than the competition ui ~ ~ ~' ~lA~I .,i ~~ ~~ ~.JA!l Ull.ll o.- ~i lf,li ~ lf.:l! )il:


23

• Environmental Scanning is necessary to identify

- Internal Factors

• Strengths and Weaknesses

- External Factors

• Opportunities and Threats

Compare between Key External Factors and Key Internal Factors?

i~ flllltiiiii\A .bii ~

Key External Factors:

1) Economic conditions include the gene economy, inflation, interest rates, tax Ills a

2) Political conditions include 1Anrable or toward business ,- -

3) Legal environment include Gov. e restrictions, labor law, etc. ~

4) Technoloav this can include that rate at which product innovations are occurring

1. !1.Yl.lHml..tm:~

and strength of competitors

brand loyalty, potential for growth

2. EllJ';llJ1~Jm~~Uln~lh includes capacities, location, age and cost to maintain or replace

3. Financial resources: includes cash flows, access to additional funding's .. etc.

4. Customers: loyalty, existing relationships, and understanding of wants and needs are imp.

5. Products and services: includes the potential for new P&S

6. Technology: includes ability to integrate technology


24

7. Supo/iers: includes supplier relationship, dependability of suppliers, quality

I Define the organization strategy?

The organization strategy provides the overall direction for the organization. It is broad in scope covering the entire organization.

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I Operations strategy is narrower in scope. Explain?

1. Dealing primarily with the operations 2.' Operations strategy relates to

resources, quality, costs, and lead

Talk about Strategic OM Decision Areas

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lity, and environmental issues

Capacity

Process selection and layout

Work design

Location

Quality

flexibility

flexibility, skill level needed, capacity

Quality of work life, employee safety, productivity

Costs, visibility

Ability to meet or exceed customer expectations


25

Inventory Costs, shortages

Maintenance Costs, equipment reliability, productivity

Scheduling Flexibility, efficiency

Supply chains Costs, quality, agility, shortages, vendor relations

Projects Costs, new· products, services, or operating systems

Quafity~ba:;ed strategy:

•

:-•. ~ ...,. ~ ';'" . ,-.-r- •, • "= ,.., .,. , ... _..;_

reputation

- Desire to catch with com.l'tion

ntain an existing image of high quality

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• Time-based strategies:

- Strategies that focus on the reduction of time needed to accomplish tasks

• It is believed that by reducing time, costs are lower, quality is higher, productivity is higher, time-to-market is faster, and customer service is improved


26

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• Areas where organizations have achieved time reductions:

- Planning time: ex. Time needed to react to a competitive threat, to develop strategies and select tactics

- Product/service design time: the time needed to develop and market new or redesigned P or S

- Processing time: the time needed services

Changeover time:. the time nee"' to type of product or service to another • - Delivery time: time to fill

- Response time for compl complaints

or employee

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I What do you know about Agile Operations?

A strategic approach for competitive advantage that emphasizes the use of flexibility to adapt and prosper in an environment of change

• Involves the blending of several core competencies:

- Cost

C2rAbook/harnedsalah2020 01284164340

27

- Quality

- Reliability

- Flexibility

th~ir vicinn :and strategy and

- Develop objectives

Uls:UI.

oJ,HJI.

taJ~'ll-.. 'JJ.)411 -

!:lit'l'"'"~ can use to clarify in1Aaction

for each objective

the various perspectives

business processes

• Learning and growth

- Monitor results

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28

• The balanced scorecard suggests that perspectives, and to develop metrics, to each of these perspectiv\i

1. Learning and growth: This corporate cultural attitudes re improvement.

~I· .. ,.~1 •

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from four it relative

training and I and corporate self-

2. Internal business orocesses: M n tt'laper.spective-aUow the managers to know how well their business is running, and whether its products a customer requirements (the mission).

3. Customer: mer focus and customer satisfaction in for satisfaction, customers should be

customers and the kinds of processes for uct or service to those customer groups

4. rate funding data will always be a priority, and ""T"""""r necessary to provide it .

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29

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~~lute.~!

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I Define the Productivity?

• A measure of the effective use of resources, usually expressed as the ratio of output to input

" Productivity measures are useful for:

•

- Tracking an operating unit's no•-tn••n

f'I.W....'il c:;.. (J.tll:!La •

:J o~ ~ ~l:U"'/1 ~IJ:i •

.JA c)&-~I o.b.J J.IJI ~ -

Jl ~ ~~~~~ll. J.IJI c)&- ~I -

standards of living

manufacturing jobs with lower productivity difficult to maintain high standards of living

to the competition leads to competitive

profit effects

• For an industry, high relative productivity makes it less likely it will be supplanted by foreign industry

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~~c)t~u~

~I ~ ~Ui &.»- ~l cjJ): UUAJI ~l ~~I ~l:U"'/1 •

.;~'JI ~)IJ ~I -


30

I Why Service sector productivity is difficult to measure and manage?

• because

- It involves intellectual activities

- It has a high degree of variability

1. Methods 2. Quality 3. capital 4. Technology

YoJIJI.J !JM~ ~I &- ~l..~l eUd ~W! I:SL41

~I ~"'I~ ~~~ 4-JI •

Develop productivity measures for all

· 2. Look at the system as a whole in deciding which operations are most critical

3.

4.

6.

a =it:G:!.m:g(!S productivity improvement

with efficiency

~~ ~ ~U..~I J:HIJ:i ~J , '

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tljia.. uiJA.l ~J • t

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~~~ y!JJ IJM~ • '\

&,.liS~ ~U..~I 6H J:Ui:i 'i


31

~hapter~

Forecasting

I Define the Forecasting?

• Forecast- a statement about the future value of a variable of interest

- We make forecasts about such things as weather, demand, and resource availability

f'~ ul..S .J o.llWl•Jt:ii·!Wll ~I ~ ~~ ,JI ~~ (-J C,.P ~J'+ ~ '":'4Ja l:! ~\djiJI ~,jl ~1.S L.f... JJI.JSll jlji ~ .J ~I ~'iJA.A .J c~J ~ c~J ~\djiJI

What are the important of forecasts?

1. Expected level· of demand

The level of demand may be a funeon of trend or seasonal variation 1l

2. Degree of Accuracy

Related to the potential size of forecast error

,JI ~\djiJI ~ l.bi.ll ~ ~ U. ~Jll ~JJ

Services to offer equipment to have

3. Where to locate •••• etc.

r-··:.•• .· :.· .. ··~·.:.. ;;,:_ -• ~~ • •' .'• .·

E.I.Jli .J ~~I ti.Jli c~J c~JAll ~ ~ [lAA ~~I f"I..Wll ~I (.)J..J:!JAll J£:.~ UWI J oJ~,JA ~~ ~IJA.All ,J ~I ~ .t..;l U.N. oJ~ ,J ~l..tJ.i.ll t I,Jli ,J ~~,J.)I.ll

2: Help Managers plan the use of the system:

~ involves short and intermediate range plans such as 1. Planning inventory 2. Workforce levels 3. Purchasing and production


32

4. Budgeting 5. scheduling

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I What are the Common Features to All Forecasts?

Jljl uta!_;; .JI ulS~ ~\dji ~"lS ,.1~ u\djill ei..Jll JS ~ ~~ CJ.A u4o~ ta..,JJ. ~ ••• ,JI ••• .JI

1. Techniques assume that the same unntr.•r•u in the oast will continue to exist in the

existed

2. Forecasts are not perfect 3. Forecasts for groups of items are for individual

items ._

4. Forecast accuracy decreas.s . • WI · te.. ~ • ( ~u-..'il,t ji, ~ v- -· ,.a:J • • •

increases ~\djUI ul ~~ J.JI . '

JJi;,.tJI Jl.~'l ( ~~ ~ l...iiJ ~ ~\djill • y ~~~ ~tdjill u,.. UJ Jil .J U&.W:.I 4.:!J.;ill utdjill • f

• time is needed to respond to the information in a

./ shou accurate: degree of accuracy should be stated

./ should be reliable; it should work consistently

./ should be expressed in meaningful units (ex. $ or units)

./ should be in writing

./ technique should be simple to understand and use

./ should be cost effective

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33

t.. lf.:!i .;S~ fJ~ ui.J: ii'l .J uld,:UI ~ ~~ ~ ., ~J uld,:UI UJS:i ul ~ ./ uld,:UI o~ ¥b .JI ~~ ~ ""

.# OM,jli uld,:UI ~ u~ ~ 'eiiJts; ~ u.- .ota.i ~J uld,:UI UJS:i fJi ./ ~ (.)oi&Sali.J .ota.i .J I~~~ A'J' ·<:' ~J UJS:i fj~ ~

What are the Steps in the Forecasting Process?

• 1. Determine the purpose of the forecas~ 2. Establish a time horizon 1l S.:· se;-=:"1. i1 forecasting techni. 4. Obtain, clean, and analyze 5. Make the forecast

Put true or

should be an important forecasting technique selection criterion ( true )

2) It is important to provide an indication of the extent to which the forecast might deviate from the value of the variable that actually occurs ( true )

3) Forecasters want to minimize forecast errors ( true )

Forecast errors should not be monitored, __ ___..(f=a=ls=e~) =it-=s.:.:.ho=u=l=d-=b=e~m.:.:.o=n=i=to=r-=e=d

I Complete the following:

• Error= ....... (-) ......... . ~ Answer: Actual - Forecast


34

• If errors fall beyond acceptable bounds ••••.•••••• ~ Answer: corrective action may be necessarv

• MAD weights all errors evenly= •••••••••••• ~ Answer:

MAD= :L!Actua~- Forecas~j n

• MSE weights errors according to their sq )> Answer:

})Actu~-Forecast,Y MSE=~----------

n-1

• MAPE weights errors accor~ to ~Answer: 1&

~ jActu~ -Forecast, I 0

, LJ'-----'-------'-'-X 1 0

MAPE= Actu~ n

• More ~ Answer: les

in the average determines •••••••••

• The most recent values in a time series are given ••••••• in computing a forecast

~ Answer: more weight

• Slope and intercept can be estimated from •......

~ Answer: historical data

• The trend adjusted forecast consists of two components are ••••••. and •......

~ Answer : Smoothed error and Trend factor


35

I Mention the Forecasting Approaches? Or compare Question ?

• Qualitative Forecasting

- Qualitative techniques consist mainly of subjective inputs. They permit the inclusion of soft information such as:

• Human factors

• Personal opinions

- These factors are difficult, or impossible to quantify

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• Quantitative Forecasting '

- Quantitative technicilles •• 'U,,. • ..,,o data or the development use causal variables to

- These techniques rely on

nlo,t't'll'l•n of historical rnn.l"'r that attempt to

~luldjUI

,.~ ut.dji lHi ~ ~~ uldfill ul UAa ~ t....a c.::d.i.J.A - "'"-. ~ J • ~ .tJ

~ Judgmental Forecasts

Time-Series Forecasts

Associative models

Forecasts that use subjective inputs such as opinions from consumer surveys, sales staff, managers, executives, and experts

~p.:.ll uldjill

,.,~, J c)J,J.!J..o.ll J u~l ~JA J ,m,;. ntll ,.,) Jl. ~'j ~J.A f~ ultlji


Judgmental forecasts include 4 things:-

Executive opinions

Sales force opinions:

Consumer surveys

Delphi method:

» Time-Series Forecasts

36

a small group of upper-level managers may meet and collectively develop a forecast

members of sale staff or customer service staff are often good sources of information because of their direct

in complete a

each

• Time Series Forecasts attempt to project past experience into the future

- Time-series - a time-ordered sequence of observations taken at regular time intervals (hourly, daily, weekly, annually)

• Assume that future values of the time-series can be estimated from past values of the time-series


37

~I~~ ~WI~~ tJ~ ~jll ~l~!itdjill ~Jb.. •

JS) l .t;;;, ~j ~!ilji.i ~ ~!i~l ~~~!i~l O.t cijll~!i.JAi ~ • 4l•Jll ~I • (~J '-:P ~'J ~J:I '~'-

~ • Associative models

Use equations that consist of one or more explanatory variables that can be used to predict demand. For ex. Demand for paint might be related to variables such as price, amount spent on advertising, characteristics of the paint such as its drying time or ease of cleanup

'D'Wll r: jlAl

~!i'i Jta...ll tol~l

. • Trend:

a long term upward or downward populations shift

• to the calendar or time of day.

more than 1 year.

Ex. Economic, I, and agricultural conditions

• Irregular variations:

Caused by unusual circumstances, not reflective of typical behavior such as severe weather conditions

• Random variation:

Residual variations after all other behaviors are accounted for


.~1

38

~ u~I.J ~.lll ..>J .. .i'i :~ .l!.tu"tf.all ~ ~~ as~ .JI ~~ ~~~ LS~I ~ :o~')tl

~lh..ll :~ -~~~ u.e ci.J .JI ~,.ji:UI ~ ~'ll i~ ~JWI~!.t~'il :~,J-4ll

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~~~ ~'il :J (S..)i.'ll~!.t\.p.jl.wll JS JJI.J lJi:hll~!.t~'il l.;i~l ~

What do you know about Naive Forecast and

~11.1\..bi. ~ '".•.Ca•~uWu~ .) .J .J \,;"-~ v-- (..J • • ..

Naive Forecast

'1. Uses a single previous value of a time eAriiAC!'!ill

2. The forecast for a time peria is equal 3. Can be used when: 1l - The time series is stable

- There is seasonality

Averaging

2. Averaging technia\U!S 3. They can ha

4. -=-=~

a series tends to vary about an average riations in the data

or gradual changes in the level of a series


39

I Define Moving Average?

~I&- u'l ~I~ dw..ll c.;J. ~ U.JoW~.J ~ c.r~ l:! ~Jibll ~J 4:!l+]l ~.»11 ~us lf.=..;J.

Technique that averages a number of the most recent actual values in generating a forecast

n .I At-i

Ft=MAt=~z -=--1 n-

where '6 . F1 =Forecast for time perioc'ft

. d .• MA1 = n peno movit1l ge

A1_1 =Actualvaluein • _

n =Number of periods the movmg average

What happen available?

the forecast is updated by adding the oldest and then recomputing the the

Ft =wnAt-n +wn-IAt-(n-1) + ... +wiAt-1

where w

1 =weight for period t, w

1_1

=weight for period t -I, etc.

A1

=the actual value for period t, A1_1

=the actual value for period t-1


40

I Define the Exponential Smoothing?

• A weighted averaging method that is based on the previous forecast plus a percentage of the forecast error

Ft =Ft-l +a(At-l-Ft-1) where F1 =Forecast for period t

F1_1

=Forecast for the previous

a= Smoothing constant A

1_1 =Actualdemandorsal

1 What do u know about Focus

- Some companies use tnr&l.,.!:

performance" basis 1l

What do you

• Apply several tor1ecastir1g methods to the last several periods

•

of historical data

ighest accuracy is used to make the ng period

ata on which to base a forecast are not available for new

• Predictions are based on rates of product adoption and usage spread from other established products

• Take into account facts such as

- Market potential

- Attention from mass media

- Word-of-mouth


41

I What do you know about Linear Trend?

• A simple data plot can reveal the existence and nature of a trend

• Linear trend equation

F, =a+bt

where

F, = Forecast for period t

a= Value ofF, att = 0

b = Slope of the line

t = Specified number of time periods from t = 0

Estimating slope and intercept

where

T AI<:+! = S1 + r, where

S1 = Previous smoothed error

T, = Current trend estimate

TAl;+! =SI +T; S1 =TAJ;+a(4-TAJ;) r; = r;_l + P(T AI;-T AJ;_l - r;_l)

• Alpha and beta are smoothing constants


42

• Trend-adjusted exponential smoothing has the ability to respond to changes in trend

I Talk about Techniques for Seasonality ?

• Seasonality is expressed in terms of the amount that actual values deviate from the average value of a series

• Models of seasonality

- Additive

• Seasonality is expressed as a subtracted from the time-seri incorporate seasonality

- Multiplicative

• Seasonality is trend) amou series in order to

What do you know about Seasonal

of the average (or ply the value of a

used in the multiplicative seasonally model

in order to get a clearer picture of the nonseasonal components of the data series

• Divide each data point by its seasonal relative

- To incorporate seasonality in a forecast

• Obtain trend estimates for desired periods using a trend equation

• Add seasonality by multiplying these trend estimates by the corresponding seasonal relative


43

I Talk about the Techniques for Cycles?

• Cycles are similar to seasonal variations but are of longer duration

• Explanatory approach

- Search for another variable that relates to, and leads, the variable of interest

• Housing starts precede demand for products and services directly related to construction of new homes

• If a high correlation can be variable, it can develop an relationship, enabling

- Home values may b size, location, numb

· • Associative .. 1/!!o,..,. .... ,,..

equation that summa

hnlmet and property of bathrooms

on the development of an effe-of predictor variables

- Predictor variables - variables that can be used to the variable of interest

fitting a line to a set of data points

!2ress1cm - the simplest form of regression that r relationship between two variables

e object of simple linear regression is to obtain an equation of a straight line that minimizes the sum of squared vertical deviations from the line (i.e., the least squares criterion)


Yc =a+bx

where

Yc = Predicted(dependent) variable

x = Predicted (independent) variable

b = Slope of the line

44

a= Value of Yc whenx= O(i.e., the height of the line at they intercept)

and

b= n:Lxy-LXLY nLx2 -{Lx}

""y-b""x - -a = LJ LJ or y-bx

n where

n = Number of paired observations

How we can use Standard error of

• Standard error of estimate

- A measure of the scatter of points around a regression line

where

y = the value of each data point

n = number of data points

rl\lj~IU small, the predictions using the be more accurate than if the standard

I Mention what you know about Correlation Coefficient?

• Correlation

- A measure of the strength and direction of relationship between two variables


45

- Ranges between -1.00 and +1.00

• I, square of the correlation coefficient

- A measure of the percentage of variability in the values of y that is "explained" by the independent variable

- Ranges between 0 and 1.00

Simple Linear Regression Assumptions?

2. Devaiations around the aVt•,ge.. distributed

· ·. 3. Predictions are made only within

Issues to consider:

• ·Always a linear relationships is appropriate

as an independent variable in a multiple regression

• A small correlation may indicate that other variables are important

I Compare between Reactive approach and Proactive approach

• Reactive approach

- View forecasts as probable future demand

- React to meet that demand

• Proactive approach


62

- Seeks to actively influence demand

• Advertising

• Pricing

• Product/service modifications

- Generally requires either and explanatory model or

a subjective assessment of on demand


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~ The weekly output of a fabrication process is(@ units .. The standard selling,J:!rice is 1~ L.-E per unit. Assbme the numbers of V\J)rkers artt-:f~~ach vyorker -vvork 40 hours a week.

otc~nd- hourly w~g,e .of Jj.· L.E~ Mrtteri3:-l.cost is ~0 ~.E :Qer unit·& - . ' -.... :&211!? .. ----

_gyw=ltea.d.. charged at the'rate of ~O~OL.E I?.tqs 1 Oo/o of labour cost. - ~ .::•oG~-t- It'/, L· c -~ -. --

- . I ___ _ ,:__L ct'{o ., J:_ ! __ <~£.~: _, -. - . - L , '2

£..!lllrr!!k:. l) Labour prodpctivity4 . ~ : ·-c L;, ' "' '

11

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'-· ---·-2CcY\ 7 .. c1C:o<1 -\: \Q:n'Coe> ~0-~ i·l_:r~~~~--~~._:_-__ _ ___ _ re,L. . ~~ ~· The weekly ~utput 'ora: fabrication pro_ces_s is shovv11 r/

below tog~ther \VIth data for.labor & rnater1altnputs. The standard selling pr~ce is~er unit. Ov~rhead -is charged at the rate of$ 1_50 plus 50% tin1es directJabor ~ost. Assurne a

~0.hour vveek 9z. an ho~trly~of$16}\1aterial cost is $~0 per linear feet.· h-.5 ~ ~;·,::L/ML ~- · ! ? ·· · ~-

___ ·'VVhat9s thrc averagfe multifa~tor roductivit ?e-lp_., ,,lhat9s the productivit~y Growth? lifil

-~ - - .~ffP ~-~------------------- ---· r·--~----- ---- ··--- :·--- ---- ---.----.-- --·--·· -----· .· ·:- ....

1 Week [?utputj No. of. I o:rk r--~ ~

MateriaUfeet /-·--..

~ ·;-------.. --~{)i~ 392- ~~~p- -------:--·-------- U/)~~2720 'X \0

V(2_ ...... _. ~2---~--j-~:~-~~3 -~-~--0 _ ------6-yl-l~'lit, - ~f{-2790-£\~ ..-r-~~ l (__"'_ . ( 1 i <~ ·I ·,

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. _·.' (i)~ '

~3__;_ 'WVIhticlhl cll"ew sft:z:~ dl(]} ymrn re1::ommenrll?

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0 i

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I Lo~~tfton ~Qycear A --

AU~xD I) 4,.,500,000 t\ f ~

6 of Oct 2,500,000 -;" .. •.

(1:; I;: .j J _.;..___

--+--~-~~-----~Qye~----. -_. 20

---·---------' 40

10th of Ramadan 2,000,000 .,.

c.__ l' '-'-' 90

- ------. --·-

j ~G G? _;_ Soo oc-~c_) <;S-= } \o,S /1~ Using the folhr~ving factoJrs :rating, d~termftne wlldch

location a!te:rnatfrve should be choseJru?

DFactor I

3-Neighborhood in~ome

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62

P d . . Output

__. ro uctivtty = ._ Input

__.:,, ·a1 Output Ouput 'tA .. Parti Measures= (or)= (o~

Single Input 1l Labor

1l

• MultifactoMeasures= Output (or)= MultipldnputS

( , Output 'Labor+-Capitalt-Energy

4. Productivity

M 1 . ~ p od . . Output JL u t11actor r uctlvtty = ----~----- Labor+ Material+ Overhead


47

- Units produced: 5,000 - Standard price: $35/unit - Labor input: 500 hours - Cost of labor of $25/hour - Cost of materials: $5,000 - Cost of overhead: 2x labor cost

What is the multifactor productivity?

~lui#

• lWI ~ ,..l.u OJ-I • ..,----.-

• Multifactor Productivi~ ~.-------

~~~~~~ - Units produced: 5,000 - Sta rd price: $35/unit - La

~ut put ~.1lt... Ul llAI ~ x ~~ ui~,Jll J$. = u~~~

put = number of units (x) unite price

fl\S ~ J output Y utt Ul oJS ul# Output = number of units (x) unite price

Output = 5000 unit (x) 35$ per unit = 175000 $

Facebook/har

48

JJ ·u Lab ~ ,.. • t.__ ~ p lJ= .J or ()4:1 ut'"T' • ,.

Labor = labor input (x) Cost of labor hours

Labor = 500 Hours (x) 25 per hour=12500 $

material= cost of material·= 5000$ Jl cs~ .J

overhead = cost of overhead = 2 X

overhead ~ ~.Jiabor Overhead = 2 (x) ... ,.~'"\L.':

multifactor productivity = (1

Example: Labor hour in 2006. In

Multifactor productivity = 4.11

assembly line was 25 units per I"'TT~nTu was 23 units per hour. What

~•,•un-h from 2006 to 2007?

Solution: of units = 25/per hour in 2006 of units = 23/per hour in 2007

Productive growth=??

P d t. .ty G wth Current productivity- Previous productivity

1 000, ro~M ro = x ro

Previous productivity

J~ ~ .J Y • • v ~ ~I ~I ~I ~current productivity ~ ~ ~.J 2006 ~ ~I ~t,..JI ~I ~ previous productivity

... u_,jWI~~~~

Productivity Growth = 23 -

25 x 100% = -8%

25


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bus 103 final 2014

Law