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Paneer Selvam JAN 2011 Intake

Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

INTRODUCTION

Management is the complete process of handling an operation of the conversion of raw material to a
finish product. In the process of this conversion a management is responsible, and this management
is a group of people assigned with task and responsibilities. A simple diagram of a management can
be like example below:-

Management Flow Diagram

Director

HR R&D
Department Department

Sales &
Production Store
Purchase
Plant Department
Dept.

Each Department that makes up the organization is dependant on each others functions; a
management is a group of people having the same goal and vision in operating a good and services
program (Business). The director is the person who inherits an in idea and works out a process and
with a team decides to produce/manufacture the good via profiting in the returns. In the operation of
the program (business) the above diagram is a basic layout. Some departments can be added in time
as an example and IT department solely in charge of all electrical and electronic functions.
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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

The three distinct areas that are inherited in any business are marketing, finance, and operations; all
other business disciplines fit somewhere under one or more of these areas. Operations management
is the area concerned with the efficiency and effectiveness of the operation in support and
development of the firm's strategic goals. The director of the program (business) assigns managers
and under them he/she operates the programs. Managers carry out the instructions and often need to
feedback to the director for changes and decision makings.

An operation is also an academic field of study that focuses on the effective planning, scheduling,
use, and control of a manufacturing or service firm and their operations. This field is a synthesis of
concepts derived from design engineering, industrial engineering, management information systems,
quality management, production management, inventory management, accounting, and other
functions. To briefly understand operation management each department having their own agenda is
the operation, for example sales & purchasing department needs to make sure the sales or the
marketing of the goods or the services are making the head start for good sales. The also need to
know if the raw materials they are purchasing from their suppliers are cheaper compared to other
suppliers and whether the quality is standard and so forth.

The managers are responsible for with making decisions about product development, process and
layout decisions, site location, and the capacity or volume to be manufactured. These operations
managers have a hand in deciding employee levels e.g. how many workers do we need and when do
we need them, the inventory levels e.g. when should we have materials delivered and should we use
a chase strategy or a level strategy, and the process as how many shifts do they need and etc. If they
need to work overtime or subcontract some work and so forth are the decisions of the plant managers
and this process is also said the operation process. In general managing this chain of communication
in the program is known as the Operation management and it not only ends here.
The idea of an operation in a management can be classified in three important process A. Resource
Inputs, B. Transformation Processes and C. Output of goods and services. Going back management
again is divided with many functional responsibilities, such as a) Operations Management, b) Design
Management, c) Demand Management and d) Money management.

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

Although all this function has further sub-functions which can be classified under two simple
classifications such as: - The Line functions and The Staff functions. Under the line functions the
following four as mentioned above comes to activity, which are Money management, Demand
Management, Design Management, Material Management and Operation management, but under
the staff functions comes the other five functions namely:- Human resource Departments,
Maintenance Department, Public Relations Department, Purchasing department and the Information’s
Departments.

The several definitions for the operation management all coming under one roof:-
A. Overall Business Activity – involves the whole business at large
B. Primary Business Activity – focuses on the inside affairs of the business
C. Functional area – the varies departments
D. The transformation process – moving from resources to final output
E. Job Sequence elements – activities and task of the jobs.

The duties that are handled by the management are simply mentioned in three major areas such as
creating, improving and implementing. Each of this area when looked under a micro scope the
operation management steps in to guide the management in carry out the said task or duties in
general carrying out all these functions is where the operation management comes. To carry out a
project small or mega size an operational team is to assigned, one of the core functions of the team is
to make certain that all other functions are carried out prior to the information’s

The operation team can be lead by one main person following with many other persons forming
together a team. Assuming the task of a simple job sequence running is running in a timely base,
a) 1-10 the first ten days inspecting of work piece .b) 10-20 the next ten days Positioning the work
piece c) 20 – 30 the next ten days drill hole for size d) 30 – 40 the next ten days sand work piece. To
ensure the smooth operations of this process is where the operation management comes in to
manage the accomplishment of the above task.

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 1
How does the organization establish customer requirement?

Three facts are very important for any organization, a) Goals, b) Resources and c) Information’s. In
every organization there is this input and output factor, be it in a raw material manufacturing plant or
even in a finish product manufacturing plant. The only variations in the process are what the
organization produces for the demand that exist or being created. Some demands can be created
and some demand gets stronger over time. The bottom line for both the sectors are the end users
such to be known as customers.
To understand the market and the product’s demand is first understanding the needs of people or so
after called customers. Say rice a raw material produced and harvested in the fields of a farmer. Even
though the same grains that are produced from the farmer but by the time in comes into the market its
branded, tagged and rated. Doing all this, value is being placed on the same grain. The value added
on the grain is the end result of the product and how the demand for the product comes along with
the price differentiation.
What customers want is a very complex issue, to understand the need of customer’s marketers and
researchers spend most of their efforts understanding this factor. Basically when a product has
gained good sales and the sales record plotted on the graph indicates a slow moving or fast moving
tracks. Usually when the organization’s management team using process such as a simple feedback
or survey forms, which may not necessarily provide the right needs and wants of a customer. When
looking from the broad aspect customers must first be segregated into age groups and based on
these concepts, which age group would gain more attention on the product. In some cases if the
product is universal use for all ages such like eye wear or glasses. Such product, have to innovated
so often in shape and texture only then it would stand up for competition, another example of foods
such as Kentucky Fried chicken, in order to suit all ages the management will constantly upgrade
newer product to hold customers.
Understanding customer’s requirement alone is not good enough but to analyze and organize the
fulfillment of the requirements is more important than just knowing the requirements. The process of
understand is by eliciting, documenting, organizing, and tracking changing requirements and
communicating this information.

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 1
How does the organization establish customer requirement?

The management needs to follow some procedures such:-


1. Manage the changes to requirements – Establish and use formal procedures of requirements
and engineer it to ensure that issues are addressed and the appropriate specification and
communication occurs.
2. Identify and track requirements attributes – This provides objective data for better decision
making.
3. Trace requirements – Maintain an information path from source to implementation

Adding more to this requirement the management also needs to processes the following:
 Identifying customer and market requirements
 Identifying and innovating products and services to enter new markets, attract new customers,
and expand relationships with existing customers
 Enabling customers to seek information and customer support, conduct business with you, and
provide feedback
 Determining and deploying the key support requirements for each customer group
 Determining which market customers and markets to pursue
 Using customer, market, and product/service information to improve marketing, build a more
customer-focused culture, and innovate
 Build customer relationships and market share
 Manage customer complaints to resolve them promptly and address the causes of the
complaints.
Some common tips for the understanding and establishing the customer’s requirement can be as
follows: - Listening to each key customer group and market segment across the entire customer life
cycle, to former and potential customers, and to customers of competitors to obtain actionable
information which can be further saved for improvements
Following up with customers on product/service quality, customer support, and transactions to
acquire immediate and actionable feedback with rated charts presented after purchases which would
determine the customer’s satisfaction, their engagement, and their dissatisfaction.
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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 1
How does the organization establish customer requirement?

Using data and information about customer satisfaction, engagement, and dissatisfaction to exceed
their expectations and improve loyalty. Buy obtaining information about the customers’ satisfaction
with your organization, products, services, and support relative to their satisfaction with your
competitors and other organizations providing similar products and services. B. Joseph Pine II, one of
the pioneers of the mass customization concept, recently wrote an insightful article for HBR that
bashed the notion that most organizations are customer-focused. “They focus on markets rather than
on any real, living, breathing individual customer,” he wrote a fresh perspective on what it means to
be truly customer-focused with a list that could be a how-to for understanding what your customers
require:
a.) Every customer deserves to get exactly what he wants at a price he’s willing to pay, and
companies must make that happen in a way that makes them money.
b.) Every customer is his/her own market.
c.) Customers want different offerings at different times under different circumstances.
d.) “Customers don’t want choice,” says Pine. They just want exactly what they want.
e.) Doing only and exactly what each individual customer wants and doing exactly that.

Customers like leadership managements and they will always fall for this quality first rather than the
product, for example a hand-phone, if it is the leader in the market, it will continue to attract new
customers. To understand customer’s requirement, it must be analyzed from many angles of
thoughts, though some may be straight from the books, but more must come from experience. It is
the job of marketers to understand the needs of their customers. In doing so they can develop goods
or services which meet their needs more precisely than their competitors.
The problem is that the process of buying a product is more complex than it might at first appear.
Customers do not usually make purchases without thinking carefully about their requirements.
Wherever there is a choice, decisions are involved, and these may be influenced by constantly
changing motives. The organization that can understand why customers make decisions such as who
buys, what they buy and how they buy will, by catering more closely for customers satisfaction an
their needs, become potentially more successful.
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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 1
How does the organization establish customer requirement?
Total quality management is a commitment to the continuous improvement of work processes with the
goal of satisfying internal and external customers. It’s the customer that matters in TQM; the process is
only the means to satisfying the customer. TQM provides the organizational focus and mind set, as well as
specific tools and techniques, to ensure meeting customer requirements, first time and every time.
Management must make sure that everybody knows their customers, both internal and external. Further,
more it is essential that everybody can "see" the ultimate customer using their products and services.
Employees at all levels of the organization should be given opportunities to observe the customer using
their products and services. All employees should understand how each process used in producing
products and services adds value for the customer.
Quality being the fundamental essence for understanding customer’s requirements must be placed in the
first category and this can be made into a consistent basis as a "Life Cycle" approach. The other aspects
can be the information system. With advance technologies information should be another main factor for
storing all known customers’ requirements and choices. Constantly improving the ISO 9001:2008 would
bring the product to a good standing and confidently meet customer’s requirements.
Dealing effectively with customers is a small fraction in the customer requirement list, this comprises
with the following rules such as the communication skills, greet customers, value customers, ask
them what help they need, listening to them and requesting them to return back. Guest posting can
be a good way to grow your own audience. It can help you build name recognition and authority
status in your niche or industry.
The four plan strategies which come handy are: - A. Confirm customer requirements, such as
listening to question and answers, B. Advise customer of available options such as facilitating
customer’s towards decision-making, C. Inform customer of costs such as which good is better and
cheaper, D. Agree action plan with customer such as delivery time and date.

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

Question 2,
How do customer requirement translate into product/ services?
Understanding who customers are and translating their requirements is a major task performed by
management. In order to tabulate the requirement a good survey and appreciation form need to be
submitted to customers. In understanding the requirements first analyzing the failures such as poor
quality, excessive cost, late to market, superior competition are certain factors that can be useful tools
along with the SWOT analysis that can determine whether the customer requirements are translated
into the product and services. Good Product Planning and services process combines prioritized
customer requirements, customer perceptions, and technical competitive benchmarking into specific
and measurable performance targets.
The results are successful innovative new products, shortened development cycles, and a basis for
continuous improvement. This information is compiled in the form of customer wants/needs then
converted into predictable and measurable targets, typically applying Quality Function Deployment
(QFD) methods and tools. Targets must be defined based on the customer-focused product planning
and therefore always tie product design decisions to the marketplace, Voice of the Customer (VOC)
and business goals.
Quality function deployment or QFD is designed to improve customer’s satisfactions; this process is
divided into two classes modern and tradition quality systems. It concentrates on maximizing
customer satisfaction measured by metrics such as repeat business. QFD also focuses on delivering
value by seeking out spoken and unspoken values and needs translating them into actions, and
designs and communicating it back to the organization.
There are certain principles in serving customer, which are termed as Customer-Servicing principles.
One of which is known as the Kano Model in short it is an expected treatment made for customer on
prompt purposes. The other term also mentioned is “Gemba” the source of voice of customer’s data;
it is here where the management can actually see who are their customers and the problems.
Another principle is known as the Kaizen philosophy, setting goals to improve everyday in every way.
As such by employing Lagniappe: delight customers by providing more than they expect is another
principle. Every successful organization strives to ensure that its internal systems are designed and
implemented to deliver flawless and seamless service to every customer under all conceivable
conditions and circumstances.

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 2,
How do customer requirement translate into product/ services?
The four phases that are involved in the QFD development are a) Product Planning, b) Assembly c)
Process planning and d) Process Quality Control. Each of these categories have job ranks as for
Product planning is the planning a product based on needs and opportunity Assembly is about the
identification of the critical parts of the product and so forth. Though these does not relevantly
attributes the customers relationship to the product, yet sustainably the production contributes to the
customers.
These procedures would come handy for understanding customer’s requirements which are A.
Market Survey B. Bench Marking C. Life Cycle Planning D. Environmental Characterization E.
Modeling and Stimulation. The main theme for customer requirements is the expression and this is
broken into three factors namely as “Explicitly Expressed” (customer specification includes
requirements for reliability performance as a quantitative measure. “Implicitly Expressed”
(specification includes product characteristics that necessitate certain levels of reliability in order to
satisfy them). “Not expressed” (often the case for commercial products. Suppliers must anticipate
needs or position on their products in market place). This is usually carried out with market surveys,
quality function deployment, benchmarking and often this is competitive advantage.
The requirements for the development can be mentioned in two categories namely as a. design and
analysis, under the heading analysis, eight tasks are performed such as, allocations, dormancy
analysis, durability assessments, life cycle planning, modeling and simulation, predictions, thermal
analysis and translations. Under the heading design there are only two defined task such as,
environmental characterization and fault tolerance. Market survey is usually done to determine what
customers want and need in terms of new or improved products, like for instance in my production of
Artificial Human parts, a market survey reveled that customers are interested in new and advance
products and the R&D department is constantly innovating new ideas. These surveys can be carried
out with a prototype model and the feedback can determine the reliability of the product. There are
many factors which lead to high levels of customer satisfaction including: Products and services
which are customer focused and then provide high levels of value for money. Customer service is
about giving personal attention to the needs of individual customers which includes after sales
services. What is clear about customer satisfaction is that customers are most likely to appreciate the
goods and services that they buy if they are made to feel special.
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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 3,
What are operational systems, with activity on arrow/activity on node process?

The first process in the activity planning section is activity definition. This process starts with the WBS
and identifies the activities required to produce the various project deliverables. Activities are viewed
from the perspective of the work packages. Basing on the question, "What activities are required to
satisfy this work package?" The resulting information from this process is used next to organize the
activities into a specific sequence. Table 3.5 shows the inputs, tools, techniques, and outputs for the
activity definition process.

Table 3.5 Activity Definition Inputs, Tools, Techniques, and Outputs

Inputs Tools and Techniques Outputs

Enterprise environmental factors Decomposition Activity list

Organizational process assets Templates Activity attributes

Project scope statement Rolling wave planning Milestone list

Work breakdown structure Expert judgment Requested changes

WBS dictionary Planning component

Project management plan

Sometimes it is difficult to know everything about a product during the manufacturing stage. It is
common to learn more about the product as you work through the product life cycle. This is called
progressive elaboration and it affects the planning process. If you don’t know everything about the
product, you can’t plan the whole project to the level of detail necessary. For large projects, it is
common to plan the entire project at a high level. The project starts with detailed plans in place for the
work packages that are near the beginning of the project. As the time draws near to begin additional
work, the more detailed, low-level plans for those work packages are added to the project plan. The
planning process is revisited multiple times to ensure that the detailed plans contain the latest
information known about the project. This process is called rolling wave planning because the
planning wave always moves to stay ahead of the work execution wave.
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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 3,
What are operational systems, with activity on arrow/activity on node process?
The Operational Activity describes the operations that are normally conducted in the course of
achieving a mission or a business goal. It describes capabilities, operational activities (or tasks), input
and output (I/O) flows between activities, and I/O flows to/from activities that are outside the scope of
the architecture. High- level operational activities should trace to (are decompositions of) a Business
Area, an Internal Line of Business, and/or a Business Sub-Functions.
The next process is that of arranging the activities list from activity definition into a discrete sequence.
Some activities can be accomplished at any time throughout the project. Other activities depend on
input from another activity or are constrained by time or resources. Any requirement that restricts the
start or end time of an activity is a dependency. This process identifies all relationships between
activities and notes restrictions imposed by these relationships. The two methods in realigning the
process of task and duties can be described as the precedence method or activity of node (AoN) and
the arrow diagramming method or activity on arrow (AoA).
There are various boxes or “nodes” which are connected from a beginning to an end with arrows to
depict a logical progression of the dependencies between the schedule activities. Each node is coded
with a letter or number that correlates to an activity on the project schedule.
Typically, an activity-on-node diagram is designed to show which activities must be completed in
order for other activities to commence. This is referred to as “finish-to-start” precedence which is like
one activity must be finished before the next one can start. In the diagram below, activities A and D
must be done so that activity E can begin. It is also possible to create other variations of this type of
diagram. For example, a “start-to-start” diagram is one in which a predecessor activity must simply be
started rather than fully completed in order for the successor activity to be initiated.
Diagram of Task Arrow on Activity Network

A B C

Start D E Finish

F G

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

An activity-on-node diagram can be used to provide a visual representation of the network system of
an entire project schedule. Or, it can be used for any smaller section of the schedule that lends itself
to being represented as having a defined beginning and end. To make it clear and simple and
effective it must be included with critical path schedule activities. The planned start date of each node
may also be listed in the diagram legend in accordance with the project management timeline.
Table for Task Number of days Table for Predecessors
A 3 days B, E
B 3 days -
C 1 day -
D 7 days E
E 5 days A, C
F 4days -
G 3 days -

There are six important tasks in a network, Duration (DR), Early Start (ES), Early Finish (EF), Late
Start (LS), Late Finish (LF), and the slack or float. The forward pass is the early start and early finish
and the backward pass is the late start and late finish. The slack days are days that can be relaxed
without affecting the project, a sample of the node can be as this model ES
D EF

The above network diagram is explained with the forward pass described below:-

3 6 13
3 3 1

A B C Finish
Start
7 12 13
0 7 5 7

D E

4 7
4 3

F G

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

The only critical path is during the early start and the finish time is thirteen days, for the slack time
using the minimum number of days to complete the project is eleven days, and the slack time is
Task A and D can have a slack time of 1day and 6 days but task F has no slack time

3 6 7
3 3 1
1 2 4

A B C Finish
Start
7 12 12
0 7 6 5 1 11
0
D E

4 7
4 0 3 4
F G

The above diagram is only an illustration for the forward pass and backward passes an assumption of
evaluating the slack time. The later study on the activity of node is in some ways different.

This network is an activity on node (AON) network.

Page 13
Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 4,
How are capacity planning, process layout, product /service scheduling, inventory and projects,
managed in your organization?

A simple illustration can describe how my management operates, since I am a one man show in my
business structure yet all duties and task are followed based on the diagram below.

In general my forecasting is based on who know me and my business, being in the business line
manufacturing Artificial Human parts, the competition do exist but the important thing above this is
innovative, how innovative are we. To forecast well, the first question is our reputation must be good,
and we must some times go on lose in order to gain, losing here means, bending some corners with
special discounts for cases recommended by Doctors. Some of the core activities such as business
strategy, operational strategy, planning the operations and the order fulfillments are all almost
combined as one activity.
Since I don’t have any departments I have to run every department, under the business strategy I
focus on customer’s satisfaction, and insist each time a customer leaves my clinic I make sure he or
she takes back a good testimony along with them. Usually I don’t lay tight conditions on pricing as the
job itself is unique and I strive to get the best from the customer. My operational strategy is flexible in
order to suit the time for the job. This also involves flexible working hours.
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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

Under the capacity planning, though in theory, it is often mention as the Master Planning of the
operation, which are classed into three major branches such as the demand management, the
capacity plans and master scheduling.
Demand management and forecasting are very important in the operation as to determine the
marketing structure, key parameters for financial plans and the development programs. This remains
as the major plan or master plan. The four kinds of projections in demand management are as,
associative projection, non-pattern projection, Multi-period pattern projections and historical
projections.
Sales Operation Diagram
Marketing
Inventory Planning
Planning
Constrained

Sales Operation
Planning

Sales
Planning Unconstrained Production
Planning

These sectors contribute towards the overall demand plan for the sales operation planning for a
company that intends to sell. It is heavily impacted by marketing plans and corporate revenue and
profit targets, and it is a significant input into inventory planning that in turn drives the production and
procurement plans. My success depends on the sales through a channel, the success of a marketing
campaign, the replacement of an old product with a new one, or the efficient operation of a production
facility. This under the operational strategy contains the overview of demand management. The two
common factors is accessing the demand and to serve the demand.
There are other operational strategy such as lean Manufacturing and T.P.S whereby large companies
like Toyota employs. Lean manufacturing is about continuous improvement. Lean believes even the
most lean manufacturer can have 30% of waste in their system. So the famous Toyota Production
System or the TPS can also have plenty of room for improvement.

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

Question 5,
With examples explain why and how monitoring and evaluation of operations take place in your
organization?
All operation activities when left unmonitored or evaluated, two dangers can prevail, one forecasting
demand and sales can be effected, two financial breakdowns can occur. The two main reasons
monitoring also prevents loss not only applies to production time but wastage loss. Though my
company as mentioned earlier yet I need to monitor the inventory and evaluate the customers
satisfaction. But in other companies the two processes are done very differently by the mechanism of
tools. Performance monitoring is primarily a management tool performance monitoring involves
the tracking of project outputs and outcomes as indicators of project effectiveness, or the extent
to which the project achieves its stated objectives.. It is akin to a roadmap that provides
information indicating whether the project is on the right road to its intended destination (or
intended impact) and, if not, how to get back on to the right road. Performance monitoring does
not (indeed cannot) tell the project whether it has arrived at its final destination. For this, a
statistically valid control group is required, and few performance monitoring systems include a
valid control group. Performance monitoring tends to focus on outputs and outcomes (the left-
hand side of the causal chain) and on those indicators that are easier to capture and measure on
an on-going basis. Monitoring may not be only focused on performance alone, overall it’s all the
whole involvement of the project by itself from program activities, outputs, outcomes and impacts.
Like performance monitoring, project evaluation tends to focus on the left-hand side of the casual
chain, although often with a heavier emphasis on project activities and the organizational
structures, policies, systems, and day-to-day operations that drive project results. A specific type
of project evaluation is the so-called "process evaluation," which assesses whether the project
was implemented--including the procedures undertaken, the decisions made, and the services
delivered--as intended. By documenting the project's development and operation, the process
evaluation uncovers reasons for successful or unsuccessful performance, and provides
information for potential replication. Some steps that are shown below could be a good guide in
monitoring and evaluating the operation.

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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT

Question 5,
With examples explain why and how monitoring and evaluation of operations take place in your
organization?
The first important steps to review the M & E section reports. The overall picture can be known
whether the following areas need to be corrected. Areas such as a) Project staffs commitments,
b) Monitoring must be an obligation, c) Information provided must be in clear and good quality, d)
Attention must be paid on the monitoring needs, e) Project reviews and evaluations should be
consistent, f) Integration and cooperation between M&E functions and project management must
be smooth process, and the level of participation and qualitative M&E methods should not be
limited.
Monitoring: This type of evaluation is performed while a project is being implemented, with the aim of
improving the project design and functioning while in action. An example given in the World Bank
Technical Paper, Monitoring and Evaluating Urban Development Programs, A Handbook for Program
Managers and Researchers by Michael Bamberger, describes a monitoring study that, by way of
rapid survey, was able to determine that the amount of credit in a micro credit scheme for artisans in
Brazil was too small. The potential beneficiaries were not participating due to the inadequacy of the
loan size for their needs. This information was then used to make some important changes in the
project. Bamberger defines it as: “an internal project activity designed to provide constant feedback
on the progress of a project, the problems it is facing and the efficiency with which it is being
implemented” (Bamberger 1)
Evaluation: An evaluation studies the outcome of a project (changes in income, housing quality,
benefits distribution, cost-effectiveness, etc.) with the aim of informing the design of future projects.
An example from Monitoring and Evaluating Urban Development Programs, A Handbook for Program
Managers and Researchers describes an evaluation of a cooperative program in El Salvador that
determined that the cooperatives improved the lives of the few families involved but did not have a
major impact on overall employment. Bamberger describes evaluation as “mainly used to help in the
selection and design of future projects. Evaluation studies can assess the extent to which the project
produced the intended impacts (increases in income, better housing quality, etc.) and the distribution
of the benefits between different groups, and can evaluate the cost-effectiveness of the project as
compared with other options” (Bamberger 1).
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Paneer Selvam JAN 2011 Intake
Executive MBA Group: WCU-KL-MA

OPERATIONS MANAGEMENT
Question 5,
With examples explain why and how monitoring and evaluation of operations take place in your
organization?
Monitoring and evaluation need not be expensive or complicated, nor do they require specialists or
grand calculations. The complexity and extent of the studies can be adapted to fit the program needs.
The job of the project manager in this process is to point out those areas in need of monitoring or
evaluation. If this is left to the researchers, the studies may tend to be too academic and not as useful
to project management.
Evaluation and monitoring systems can be an effective way to:
Provide constant feedback on the extent to which the projects are achieving their goals.
Identify potential problems at an early stage and propose possible solutions.
Monitor the accessibility of the project to all sectors of the target population.
Monitor the efficiency with which the different components of the project are being implemented and
suggest improvements.
Evaluate the extent to which the project is able to achieve its general objectives.
Provide guidelines for the planning of future projects (Bamberger 4).
Influence sector assistance strategy. Relevant analysis from project and policy evaluation can
highlight the outcomes of previous interventions, and the strengths and weaknesses of their
implementation.
Improve project design. Use of project design tools such as the log frame (logical framework)
results in systematic selection of indicators for monitoring project performance. The process of
selecting indicators for monitoring is a test of the soundness of project objectives and can lead to
improvements in project design.
Incorporate views of stakeholders. Awareness is growing that participation by project beneficiaries
in design and implementation brings greater “ownership” of project objectives and encourages the
sustainability of project benefits. Ownership brings accountability. Objectives should be set and
indicators selected in consultation with stakeholders, so that objectives and targets are jointly
“owned”. The emergence of recorded benefits early on helps reinforce ownership, and early warning
of emerging problems allows action to be taken before costs rise.
Show need for mid-course corrections. A reliable flow of information during implementation
enables managers to keep track of progress and adjust operations to take account of experience.
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