Spring 2015

MBA Semester 2
MB0044 - Production and Operation Management
Q1. Write short notes on:
Environmental scanning as a basis for strategic decision making
Tools for implementation of operations
Differentiation strategies as a basis of decision making
Core competencies as a basis of decision making

Environmental scanning as a basis for strategic decision making:

The business environment of any organisation includes the industry, marketplace,
governmental agencies, society, ecology, technology, and others.
Analysis: Organisations should be aware of the business environment in which the firm
exists, and have to compete continually by exhibiting potential for opportunities and threats.
Conclusion: Business decisions are taken after lots of deliberations which involve steps like
data gathering, analysis, and predicting outcomes are called Environmental scanning.
Tools for implementation of operations:
All functions in the organisation including administration, finance, materials, purchase,
marketing, production, logistics, communication, and others can be considered as
operations. To implement operations, we need some tools like Gantt charts, Line balancing
and line of balance, Simulation models, ERP.
Analysis: Gantt charts used for visualizing the work assignments and sequence.
Line balancing to ensure that machining centres are loaded as uniformly as possible to
prevent build up stocks at intermediate stages.
Conclusion: a set of specialized techniques are called tools which are required to use some
process and convert them into outputs usable in the next stage of the value chain.
Differentiation strategies as a basis of decision making:
Differentiation is a process by which a company distinguishes itself from its competitors and
their offerings. The process includes adding a set of differentiators, which are meaningful,
and adds value for the customer.
Analysis: The differentiators have to make the companys offerings (the products and
services) profitable.
To derive a competitive advantage, the study of the processes is important.
Here, we are not considering the situation of an entirely new product but those which are
already contributing to the company revenues.

Conclusion: Decision making is the most crucial management function where its members to
activities which have financial repercussions and affect the functioning of other departments
or divisions.

Core competencies as a basis of decision making

Core processes of an organisation are determined by the core competencies.

Analysis: Each organisation is started by an entrepreneur or a small group of entrepreneurs.
The objective is to use their unique strengths to create and develop an organisation. These
unique strengths are the core-competencies of the organisation.
Four main core processes are the core competency process:
Customer relationship
New product/service development
Supplier relationship
Order fulfilment
Conclusion: Its provides an edge over the competitors who would have to grapple with these
competencies.
Q2. Answer the following questions:
a. What is forecasting?
b. What are the benefits of forecasting?
c. What are the cost implications of forecasting?
d. List the different types of forecasting methods.
a. What is forecasting?: As Heizer and Render said the forecasting is the art and science
of predicting the future events. Forecasting is an art because subjective assessment coupled
with historical and contemporary judgment is required to improve the accuracy of forecasts.
It is a science because a wide variety of numerical methods are used to obtain a number or
several numbers and further analysed using mathematical models to ascertain the accuracy
of forecast.
In most of the cases, forecasting may involve taking historical data and projecting them into
the future with some sort of mathematical model. It may be a subjective or an intuitive
prediction. Many times, the forecasting may even resemble a kind of a wild guess or may
involve extensive data analysis involving several parameters.
b. What are the benefits of forecasting?: Forecasting basically helps to overcome the
uncertainty about the demand and thus provides a workable solution. Without the forecast,
no production function can be taken up. Hence, it can be stated that forecasting helps to:
Improve employee relations
Improve materials management
Get better use of capital and facilities
Improve customer service

c. What are the cost implications of forecasting: Forecasting requires special efforts and
involves inputs from experts which cost a lot to the companies. Well-trained experts and
associations substantially invest in human resources and hence charge their clients for the
service rendered. Thus, forecasting done in-house or carried out externally requires
significant investments. Thus, it can be said that more the efforts put for forecasting, more
will be the cost of forecasting. Because of improved accuracy and better judgment, the
losses that would occur because of poor forecasting would decrease as more efforts are put
in for forecasting. Hence, higher the efforts, lower will be the losses. Because effort is a
direct function of forecasting, this cost goes up with increase in the forecasting efforts. Figure
depicts the forecasting cost implications graphically.

It is to be understood that to keep the total cost of forecasting to a minimum, it is necessary

that the forecasting effort has to be raised up to a level at which certain uncertainty is
acceptable and hence, there is preparedness for some possible loss.
d. List the different types of forecasting methods: The different methods of forecasting
can be classified as follows:
Qualitative methods
Market surveys
Nominal group testing
Historical analysis
Jury of executive opinion
Life cycle analysis
Delphi method
Quantitative methods
Table: Quantitative methods classification
Time series analysis

Moving averages
Exponential moving averages

Causal methods

Regression analysis
Input output model

Box Jenkins method

Trend projections
Fourier series

Leading indicators
Simulations model
Economic models

Q3. Describe the process of value analysis.

Q4. What do you understand by line balancing? What happens if line balance does
not exist?
Q5. Explain the steps to set data in logical order so that the business process may be
defined.

Q6. Describe the post implementation review of a project. Explain the tools that may
be considered for post implementation review.

Remaining answers are available in the full assignments.

For full assignments contact us:

Global Education
Rajdeep: 098662 48187 / 077958 40110
Email: support@smuassignments.com / global.education.smu@gmail.com
Website: www.smuassignments.com
Note: Paid assignments will be in word format without any water mark as per SMUs new
requirement.