By the end of the chapter the student should be able to:
(i) outline the importance of IT in operations management
(ii) discuss the various uses of IT in operations management
Information and communication technologies (ICT) are one of the most important enablers of effective operations management. As electronic business gain importance, new opportunities exist, and the wide spread use of internet is increasing the interest for the information technologies. ICT tools are a source of competitive power for many companies. operations management, time and opportunities to get information on time is very important. Accurate and timely information will enable the organization to increase service level and as a result decrease the costs and lead times Along with this, many companies are offering information technologies based services to their customers in order to gain competitive edge and sustain long term relationships with them. Firms utilize ICT in the following ways in operations management:
Uses of IT in operations management
Machining centers: they not only provide automatic control of a machine but carry out au tomatic tooling changes as well. For example, a single machine may be equipped with a shuttle system of two worktables that can be rolled into and out of the machine. While work is being done at one table, the next part is mounted on the second table. When machining on the first table is complete, it is moved out of the way and the second part is moved into position. Numerically controlled (NC) machines: these are under the control of a digital computer. Feedback control loops determine the position of the machine tooling during the work, constantly compare the actual location with the programmed location, and correct as needed. This eliminates time lost during setups, and applies to both high-volume, standardized types of products as well as low-volume, customized products. Industrial robots: these are substitutes for human manipulation and other highly repetitive functions. A robot is a reprogrammable machine with multiple functions that can move devices
through specialized motions to perform any number of tasks. It is essentially a mechanized arm that can be fitted with a variety of hand like fingers or grippers, vacuum cups, or a tool such as a wrench. Robots are capable of performing many factory operations ranging from machining processes to simple assembly
Computer-aided design and manufacturing (CAD/CAM): uses a computer to integrate component design and processing instructions. In current CAD/CAM systems, when the design is finalized, the link to CAM is made by producing the manufacturing instructions. Because of the efficiency of CAD/CAM systems, design and manufacture of small lots can be both fast and low in cost. Even though CAD/CAM systems are usually limited to larger companies because of the high initial cost, they do increase productivity and quality dramatically. More alternative designs can be produced, and the specifications can be more exact. Updates can be more readily made, and cost estimates more easily drawn. In addition, computer-aided process planning (CAPP) can shorten and, in some cases, even eliminate traditional process planning. Flexible manufacturing system (FMS): Actually refers to a number of systems that differ in the degree of mechanization, automated transfer, and computer control and are sufficiently flexible to produce a wide variety of products. A flexible manufacturing module is a numerically controlled (NC) machine supported with a parts inventory, a tool changer, and a pallet changer.
A flexible manufacturing cell consists of several flexible manufacturing modules organized according to the particular product‟s requirements. A flexible manufacturing group is a combination of flexible manufacturing modules and cells located in the same manufacturing area and joined by a materials handling system, such as an automated guided vehicle (AGV). A flexible production system consists of flexible manufacturing groups that connect different manufacturing areas, such as fabrication, machining, and assembly. A flexible manufacturing line is a series of dedicated machines connected by AGVs, robots, conveyors, or some other type
of automated transfer device.
Computer-integrated manufacturing (CIM): this approach integrates all aspects of production into one automated system. Design, testing, fabrication, assembly, inspection, and materials handling may all have automated functions within the area. However, in most companies,
communication between departments still flows by means of paperwork. In CIM, these islands of automation are integrated, thus eliminating the need for the paperwork. A computer links all sectors together, resulting in more efficiency, less paperwork, and less personnel expense. Islands of automation: Refer to the transition from conventional manufacturing to the automated factory. Typical islands of automation include numerically controlled machine tools, robots, automated storage/retrieval systems, and machining centers.
Bar-coding: abar-code is a readable representation of information by a computer. Originally, information on barcodes was stored in the widths and spacing of written parallel lines, but nowadays, they come in different patterns of dots, concentric circles, and text codes.
Barcodes can be read by optical scanners called barcode readers or scanner. Barcodes are widely used to implement automatic data capture systems that improve the speed and accuracy of computer data entry. Bar-coding accelerates the flow of products and information
throughout the business. Barcoding may be used in counting raw materials and finished goods inventories, automatic sorting of cartons and bins on conveyor belts and palletizers, production reporting, automatic warehouse applications, including receiving, put away picking and shipping, package tracking, access control and lot tracking.
Radio Frequency Identification (RFID): An RFID tag contains a silicon chip that carries an identification number and an antenna able to transmit the number to a reading device. This means improved inventory management and replenishment and replenishment practices, which in turn, result in a reduction of interrupted production or lost sales due to being out of stock. RFID enables bulk read where many tags can be read in a short space of time a typical read rate is hundreds of tags per second, the tags can be read over a very long range many hundreds of metres in the case of specialized tags. RFID tags are durable because they can be ripped, soiled and performance is not impaired. They can do bulk reading in a short space of time. All these importance enhance performance.
Enterprise Resource Planning (ERP): ERP is a business management system that, supported by multi-module application software that incorporates all departments or functions of the organization. While MRP allows manufacturers to track supplies, work-in-progress and the output of finished goods to meet sales order, ERP is applicable to all organizations and allow managers from all functions or departments to have an understanding of what is or is not taking place throughout the organization. Most of ERP systems are designed around a number of modules, each of which can be standalone or combined with others. The modules in the ERP system are finance, marketing, procurement, manufacturing, supplier management and human resource among other modules. ERP system plays a vital role in improving performance. There is faster inventory turnover because the manufacturers and distributors may increase inventory
turns reduce inventory costs. There is improved customer service, in many cases, and ERP system can increase the production to a higher rate by providing the required products at the required place within the required time thus achieving customer expectation and satisfaction. ERP facilitates better inventory accuracy with fewer audits thus, reducing the need for physical audits. It also reduces the set-up time by ensuring coordination of people, tools and machinery together with efficient use of equipment and minimizing downtime by virtue of efficient maintenance. ERP software leads to high quality work with strong manufacturing components, proactively pinpoints quality issues, providing the information required to increase production levels reduce wastes or rework
Material Resource planning (MRP): This is a technique that assists in the detailed planning of production and its characteristics are that; it is geared specifically to assembly operations, it is a dependent demand technique and it is a computer based information system. The aim of MRP is to make available either purchased or company manufacturing assemblies just before they are required by the next stage of production or for delivery. It enables orders to be tracked throughout the entire manufacturing process and assist purchasing and control
departments to move the right supplies at the right time to manufacturing or distribution points Distribution Requirements Planning (DRP): Distribution requirements planning (DRP) is scheduling technique the controls inventory control and applies MRP principles to distribution inventories It can also be considered as a method of handling replenishment of the stock in an organization.
DRP is useful for both manufacturing organizations, such as car manufactures that sell their car via several distribution points, such as regional and local distributors, and purely merchandising organizations, such as supermarkets
Review questions
(i) outline the importance of IT in operations management
(ii) describe the main uses of IT in operations management
Ohno, T. 1988 Toyota Production System: Beyond Large-Scale Production, Productivity Press.
Russell, R.S & Taylor, B.W 2009, Operations Management: Along the Supply Chain, 6 th edn, John
Wiley & Sons Ltd, New York.
Shingo, S 1989, A Study of Toyota Production System, Productivity Press.
Slack, N; Chambers, S; Johnston, R 2010, Operations Management, 6 th edn, Pearson Education
Limited, Harlow

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