PB602 : OPERATION MANAGEMENT

LECTURER : PUAN SITI MARIAM BINTI SAMAT

CHAPTER 6 : SOURCE ACQUISITION AND OPERATION CONTROL

MOHAMAD RADHZI BIN A RAHMAN

16BPM12F2002

MOHAMMAD IZUAR BIN MAZLAN

16BPM12F2005

AZRUL FAZLI BIN MAT SAID

16BPM12F2009

MUHAMMAD ADIEB AZRAI BIN ISLAKHUDDIN

16BPM12F2010

What is Source Acquisition ??

Acquisition source is a process to create the demand for raw materials,
labor, capital rising and other factors of production are needed. This source
of demand comes from sales and sales forecasts for previous year.

What is Operation Control

Operation Control is also know as the control of production of goods and
services that will be produce for the firm.

Two Important Aspects

(a) Operation Aspects

Refers to aspects of management of firms, such as planning,
implementation,
and monitoring.
(b)

Transformation of operation control

Refers to control of exchange of raw materials or components to finished

installation for
the goods or services produced to meet the specifications.

Function of department involved

Purchasing department
Responsible for the firm to deal with matters relating to the
purchase of raw
materials, factory equipment, share parts,
machinery, and all the materials
needed to produce products.
The purpose of purchasing:
(a) Identify the goods / services required
(b) To develop, evaluate, and identify the best supplier , price and
delivery of goods and services.

Importance of Purchasing Departments

Cost of materials give a major impact to firm profitability
If the cost of good is high, prices should be reasonable to put
a profit and compete with competitors.
The use of automation in production
A firm can use the advanced machinery and tools, a most
recent or modern. This article seeks to add functionality and
can be delivered to user who are looking for innovation of the
goods with reasonable price and good quality.
Introduction of JIT production
This method can develop linkages between manufacturers
and suppliers. Manufacturers produce goods or service at the
time scheduled. It seeks to avoid deceived customers and
have to wait too long to get the products.
Increasing in global competition
Increasing in global competition seeks to increasing
competition with foreign markets. By advertise products to

1.

The Function of Purchasing

Department
To store suppliers current and new database

Record all the old and new information in a file for future use as
reference
2. Choose the best suppliers
Helping the manufacturers in order not to be fooled by the tricks of the
supplier and
seeks to foster cooperation between manufacturers and
suppliers.
3. Deal a contract with suppliers
Manufacturers made an agreement with the supplier. For example,
made an agreement with the supplier to distribute the goods at the end
of the month and payment is made after that.
4. Acting as intermediary between suppliers and the company
Linked to other firms by the suplier

Purchasing method applied by Purchasing

Department

There are 2 methods of purchasing made by the purchasing department :

1. Centralized/single supplier
The materials purchased from one supplier only. Materials purchased
are on the same standard and there are advantages and disadvantages
for organizations when dealing to one supplier only.
2. Decentralization/multiple supplier
Materials required purchased from various suppliers. Materials
submitted will have
some differences because supplied by different
suppliers, but still at a level needed
by the purchasing department.
There are advantages and disadvantages for
organization when dealing
with various suppliers.

The Function of Receiving Department

Receiving Department has responsibility for the receipt of goods, the
delivery of suppliers and equipment, and the inventory control of all
equipment. Receiving Department activities include receiving, shipping,
and inventory control functions.
The function of receiving department is to unload and unpack incoming
materials, check quantities receive against the shippers packing list,
identify goods received with descriptions on the purchase order, prepare a
receiving report, notify the purchasing department of descriptions
discovered, arrange for inspection when necessary, notify the traffic
department of any damage in transit and rout accepted materials to the
appropriate factory location

The Function of Inventory Department

Inventory is an idle stock of physical goods that contain economic value,
and are held in various forms by an organization in its custody awaiting
packing, processing, transformations, use or sale in a future point of time.
Inventory is often the largest item in the current assets category, and
must be accurately counted and valued at the end of each accounting
period to determine a companys profit or loss.

THE PROCESS TO OBTAIN

INPUT
Material specification
Detail description of materials to be purchase suac as colour,size,number,version
and model and other information.

Purchasing instructions
The department that use the materials gives purchasing order
Information on materials to be purchased ,quantity ,delivery date and the
amount charged and approval manger who approved the purchase.

Request for quatation

Tge request quatation prepared by purchasing deparment.involves
discount,payment terms ,delivery date.

Purchase order
Most important purchasing and the basic of authority to the supplier for produce
goods and services and the buyer must make payment

COMPLETE OUTPUT CONTROLLING

SYSTEM

Information about the type ,quantity and date of completion of good is

determined

Expenses for the production process has been allocated

The production factors required already available for scheduling tasks

purposes

The schedule of start and completion dates are provided for each type
of activity

Authorization and direction provided to staff who are involved in the

production process

The progress of production are determined and reported to top

management

Action will be taken if the current report does not go as planned

Finite
loading
Approach actually scheduled in
detail using the setup anf run time
required for each order.
Done by each resource at every
moment during the working days

Infinite
loading
LOADING
OCCURS WHEN WORK IS ASSUGNED TO A

INFINITE

WORK CENTER SIMPLY BASED ON EHAT IS NEEDED OVER

TIME .
FORWORD

SCHEDULING : STARTS THE SCHEDULE AS SOON

AS THE JOB REQUIREMENTS ARE KNOWN.
USED

IN A VARIETY OF ORGANIZATION SUCH AS

HOSPITALS ,CLINICS ,RESTAURANTS AND MACHINE TOOLS .
IN

THESE FACILITIES ,JOB IS PERFORMED TO CUSTOMERS

ORDER AND DELIVERY IS OFTEN REQUESTED AS SOON AS
POSSIBLE.
BACKWARD

SCHEDULING
:
BEGIN
THE
DATE,SCHEDULING IS THE FINAL OPERATION FIRST.
USED

DUE

IN MANY MANUFACTURING ENVIROMENTS.AS WELL

SERVICES ENVIROMENTS.CATERING A BANQUET.

Provides for order

made ,tools and labor
to work center

Control the production

activites consisted of
reviewing he current
work statuds

Scheduling
and
operations
control
Provide instructuion
to start work

Determine the order of

work according to
priorities

Method used in the works

schedule
First
Slack
time

come
first
served

Shortest
operating
time

Start
dates

Due
dates

Provide order
What
should be
produced

To whom
the goods
should be
delivered

How
many
quantity
should be
produced

The evaluation technique in

development of control orders
Reduce the
number
supplier

Sharing
information

Communicate
effectively and
efficiently

Involving
supplier in the
early stages of
discussion

Monitoring and
supporting

Question 1
One of important aspect that emphasized in ensuring the process of a
product or service can be carried out smoothly is operation control. As an
operations officer. You are required to explain about operation control of
management based on the following areas.

1.

Explains the meaning of operations control

Operation control is also known as the control of production of goods

and services
that will be produce for the firm.
2.

State the purpose of operational control implemented

Indeed to ensure that available resources are used efficiently and

effectively by
the firm to meet consumer demand.

3.

Describe two important aspect of operational management

Operation aspect
Refer to aspects of management of firm such as planning,
implementation and
monitoring. Instruction is important to ensure smooth operations and
control.

Transformation of operational control

Refer to exchange of raw material or components to finished product
installation for
the goods or services produce to meet the specification.