Reference no: EM131071820

Operations Planning and Control - Referral coursework

A report to address the questions given at the end of the two cases.

Your report should include an introduction, main body and conclusion using appropriate headings and sub-headings.

There are two case studies to this assignment. Each should have its own sub-structure. Use tables and figures where appropriate in support of your discussion. The length of the report should be no more than 3,000 words.

The report should make reference to relevant external reading to support your discussion and arguments.

The relevant calculation process performed on Excel and the project plan(s) produced using MS project should be printed out and attached as appendices and referred to in the main text if applicable.

PART 1: FROZEN PEAS

Introduction

John Lincoln was the manager of a factory which was designed to produce a range of frozen vegetables. Despite John's many years of production management experience, the pea processing operation had always been his greatest headache during the summer season. The weather had been good this year, which meant that the harvesting period had been short, putting pressure on the factory, which only had a limited daily processing capacity.

The previous year had turned out to be an exceptionally long harvesting period of 65 days, which was relatively easy to cope with. However, this year's season, because of the reasonable good weather, had shrunk to a more typical 44 days, which meant a pressure in getting about the same tonnage of peas through the factory in the much shorter period compared to last year.

John had frequently discussed with the Crop Planning Manager, Dave Ronson, the possibility of extending the pea growing season to lessen the pressure on the factory but it was difficult to make any further changes. As Dave explained:

'Well, unfortunately you can't plan the weather! Certainly, we do influence when the peas should be ready for vining (picking) by using the best possible planning to ensure that the harvest is spread out over as long a time as possible. You know as well as I do, that the distribution of harvest times can be manipulated; for example, by using selected south and north fields, different varieties of seed, and planting at different altitudes above sea level. We have continuously worked to make this planning better, and to have better cooperation with the growers. We have managed to get them to agree on a target growing plan period of 44 days instead of 36, which is the normal contract period for growers supplying other factories. But there is a limit to how much we can extend the season - the peas will simply not grow over a longer period, and I believe we have reached the limit. The yields are also different, depending on the harvesting period. For the first and last quarter of the period the yield is only around 3.5 tonnes per hectare, whereas in the middle the yield is as much as 6 tonnes per hectare. The growers are naturally more interested in having their main harvest in the middle, for obvious economic reasons.'

John Lincoln is concerned about how to plan and control the factory production process in order for it to response to the harvest period effectively in terms of cost of production and quality of products.

Suppliers: the pea growers

The farmers that supply the factory are members of trading groups, which mutually own equipment and hire personnel for the vining pea season. The factory closely cooperates with these farmer groups. In cooperation with growers, a sowing plan and a harvesting plan are prepared each year, these detail the number of hectares and tonnes to be harvested every day during the season. The planned daily intake figures over this season are given in the table in the appendix.

Transportation to and arrival at the factory control room

The time for the beginning of harvesting to arriving at the factory should be below 90 minutes. To maintain the quality of product, the peas have to be processed when arriving the factory and the process completed within two hours. When the lorries arrive at the factory, they first stop at the control room for a quality check, to see if the load will be accepted. If the load is accepted, the lorry then empties the peas into hoppers. At this stage, the peas are measured in "dirty tonnes". The expression simply means that the peas are delivered as they are without being cleaned. They are cleaned when they come to the factory, and go into processing. Daily figures of actual intake of peas over this season in dirty tonnes are given in the table in the appendix along with the planned intake figures.

The factory

There are three main stages in the factory production process: tipping of the lorries of peas, feeding of the lines for cleaning/blanching, and freezing. Tipping equipment is simply and cheap and therefore capacity has never been a problem. The main pressure could be either on the production lines for cleaning/blanching or the production lines for freezing. The factory operates 24 hours daily for the harvest period.

Once the lorries have been emptied into the hoppers, the peas are conveyed in segregated batches into one of three production lines in the factory. According to the control room manager, the maximum planned input is 12 tonnes/hour dirty feed for Lines 1 and 3, and 10 tonnes/hour for Line 2. The peas go into bulk feeders and up on to the weighing belt, and then to the 'pod and stick machine' to take out stones, pods, small lumps of earth, and other unwanted materials. When processing peas, approximately 10 percent of tonnage is removed in transforming dirty peas to clean, and around 10 percent is lost when transforming clean to frozen. The segregation of batches is critical, to maintain traceability and to ensure that different grades are not inadvertently mixed.

The peas then go into small hoppers known as 'scacos' which hold a small buffer of inventory to smooth out the flow, and then to collecting points, from there they are transported in water, pumped along pipes. These lead directly to the water or steam blanchers, where the peas are heated in approximately 90 seconds to 98 degrees Celsius. After the blanching, there is a cooling down process and quality check, where the content of starch can be sampled.

The peas are then pumped in water to the freezer house, where there are three freezers, freezer 1, freeze 2 and freezer 3, with maximum outputs of 10, 7.5 and 10 frozen tonnes per hour respectively. The peas flow continuously into the freezers and are collected at the end into bulk pallet containers, each of about one tonne capacity. The output of frozen peas is weighed and labelled, allowing traceability of each harvested batch, before being transported into the cold store by fork-lift truck.

Due to the line processing and the need of segregating batches, it is common that only part loads through the production lines. As long as there are peas in processing, even with less than a full load, the process will not be considered as waiting for product (WFP). The actual daily outputs over the season are given in the table in the appendix along with the pea daily intake figures.

Hygienic and other maintenance and downtimes

In order to operate under hygienic conditions and to operate the freezers at as near to maximum capacity as possible, the freezers are scheduled to be regularly defrosted, completely cleaned out and sterilised. The details of the six days' cycle are given in table 1 below. It takes 8 hours for each freezer to be defrosted, cleaned and sterilised.

Day	Freezers defrosted
1	3 and 2
2	Nil
3	1 and 2
4	3
5	2
6	1

Table 1  Typical 'hygiene' cycle schedule for freezers

Breakdowns are dealt with by the Process Manager. Unplanned engineering downtime can arise because of mechanical, electrical, or other technical problems. Time is planned for preventative maintenance, in order to keep the equipment in optimal condition to cope with the pressure of the harvest. The recorded downtimes for cleaning and blanching lines over this season are given in table 2 below.

Downtimes	Hours Lost
Engineering	83.59
WFP (waiting for product)	125.97
Production problems	39.97
Total unplanned downtime	249.53
Planned hygiene	82.30
Planned maintenance	158.40
Total planned downtime	240.70
Total recorded downtime	490.23

Table 2  Actual recorded downtimes for cleaning/blanching lines over this season

Planned maintenance of the freezers is carried out during the hygiene downtime described above. Because the freezers are effectively coupled to the cleaning/blanching lines, the unplanned downtimes are the same.

Additional points

In the case of line processing, the design capacity is defined as the maximum outputs for each stage if production lines are working at 24 hours per day non-stop; the effective capacity is defined as the outputs where only planned downtimes are required; the actual capacity is the outputs where planned and unplanned downtimes are considered.

Appendix

Actual and Planned Intakes of Peas in Dirty Tonnes and Outputs in Frozen Tonnes

Date	Actual Intake	Planned Intake	Actual Outputs
28-Jun	36	50	29
29-Jun	70	50	57
30-Jun	169	150	137
01-Jul	295	300	239
02-Jul	394	400	319
03-Jul	427	400	346
04-Jul	562	500	455
05-Jul	661	500	535
06-Jul	613	500	497
07-Jul	590	500	478
08-Jul	565	500	458
09-Jul	559	500	453
10-Jul	466	500	377
11-Jul	464	500	376
12-Jul	486	500	394
13-Jul	568	550	460
14-Jul	543	550	440
15-Jul	496	550	402
16-Jul	524	550	424
17-Jul	633	550	513
18-Jul	596	550	483
19-Jul	548	550	444
20-Jul	433	550	351
21-Jul	408	550	330
22-Jul	401	500	325
23-Jul	418	550	339
24-Jul	220	550	178
25-Jul	379	550	307
26-Jul	451	550	365
27-Jul	560	500	454
28-Jul	609	500	493
29-Jul	460	500	373
30-Jul	496	500	402
31-Jul	438	500	355
01-Aug	558	500	452
02-Aug	600	500	486
03-Aug	626	500	507
04-Aug	527	500	427
05-Aug	428	300	347
06-Aug	273	300	221
07-Aug	148	150	120
08-Aug	122	100	99
09-Aug	46	50	37
10-Aug	17	50	14
Total	18883	18950	15298

QUESTIONS-

1. Analyse and calculate the average daily capacities (designed, effective and actual) for the two main stages of the factory production process: cleaning/blanching and freezing, measured by outputs either in dirty or frozen tonnes whichever is applicable. Based on your analysis and calculations, identify the bottleneck stage for the factory production process and explain why.

2. Produce a graph or graphs to show the actual and planned intakes of peas in dirty tonnes and output in frozen tonnes. Compare these to the capacities in question 1, identify issues and discuss how the plan can be improved for the next year.

3. Explain the concepts of utilisation and efficiency. Calculate the average utilisation and efficiency for each of these two main stages in the factory production process over the season. Analyse the utilisation and efficiency further, such as maximum or minimum daily utilisation/efficiency achieved for the season. Based on your calculations, discuss the factory production efficiency in both planning and control stages for this year. Could any improvements have been made?

4. Do you think that John Lincoln's desire to extend the pea harvest period is the best strategy for the overall operation? Support your answer.

PART 2: The ASAD Computer Centre Project

Four well established Bedfordshire automotive suppliers have found themselves subject to rapidly increasing demand for volume and variety of their products at the same time. This has followed a long period of industrial recession and rationalisation which has led to shortage of staff and equipment in a number of key support areas. Discussions between employees of the four companies attending a management workshop at a local university established common limitations and weaknesses in information processing and technology areas which could hamper the ability of the companies to take advantages of improved trading conditions. These limitations particularly related to the need for, availability of and access to more specialised 'custom' computing software for innovative design and development work on one hand; and to wider access to and use of 'commercial package' software for accounting and stock control on the other.

Following informal discussions, representatives of the companies each approached their senior managers to see if any improvement in facilities and skill training were possible in the short term. Responses were all positive to the need and value of enhanced capability, but in every case the scale of initial estimates for equipment and labour suggested that adequate improvements would be difficult to achieve in the short term and more studies and information were needed.

Discussions, concerning possible loss of new business, difficulties in efficiently processing escalating orders in the companies, and considerations of possible equipment and facilities etc, had continued for several weeks after the individual approaches, before a proposal for a combined study for the four companies was considered. The view that a comprehensive capability could be generated in the short term which would cover all core and specialised needs of the companies was attractive to them. It led to their organising talks between the senior managers of their organisations. As in all such cases, top management's support and enthusiasm, coupled by the obvious caution of avoiding undue risk and expenditure, led to immediate and high pressures for accurate feasibility and project planning. This was essential if any company was to proceed further in the consortium.

Prime driving force for the project to go ahead was immediately identified by the senior managers, i.e. the advanced information technologies had to be of real value and would have to be operational before the end of the financial year (the end of March). Now it is the 29th Sept. 2003. Giving three days' preparation for the project to start at the 2nd October, the project duration will be exactly 26 weeks. This coincides with the first production of a new model from a major OEM to which all the suppliers are heavily committed by contract. If this date could not be met for the change over, extra staff and maintenance would have to be taken on at considerable cost to cope with increasing work loads using outdated equipment and software. Such costs would in turn limit funds available for the equipment and software to be updated at a later time as an obvious spiral effect.

A useful positive observation was made that at the site of one particular supplier, an area had just become vacant with some additional office space. It is believed that this could be brought back into commission for the centre with some low cost renovation and repairs. The owner company offered to write these off and this acted as a trigger to the others to begin feasibility in earnest.

The Initial Plan and Network

The list of items in the appendix was initially drawn up to cover core activities as a start to planning. It is to be used for preparing a network for the project, and for more detailed discussions of resourcing and risk. The following points apply to the items:

a) Before anything else can be done, a 5 week project planning and feasibility study is necessary. It should start on the 2nd October, 2003, a few days from now. Assuming a favourable outcome, staff can be engaged and the acquisition of the computers can proceed. The feasibility should of course consider what the company departments ideally require for future business in relation to what can currently be achieved, what problems are observed, and what new hardware and software are available.

b) The computers will take 4 weeks to delivery from placing the order. One week is first allowed for preparing the details of the order and sending it to the selected manufacturers. After placing the order, the site for the computers can be prepared - which will take 4 weeks. Installing the computers should take a week.

c) Staff required will comprise systems analysts, programmers, operators and data preparation staff. Data preparation staff require 4 weeks for recruitment and 3 weeks for training. They must be available before the changeover to the new computer system, the final stage of which will take 2 weeks. It will take 6 weeks to recruit operators and a further 3 weeks to train them. They must be available to test the programs and this will occupy a fortnight after the installation of the computer (offices for the staff are available).

d) 8 weeks are required to recruit programmers followed by 4 weeks training. Once the systems analysis and design has been completed they will need 4 weeks to write core programs. It will take 8 weeks to recruit experienced systems analysts for the 7 week task of systems analysis and design.

Appendix 

The ASAD Computer Centre Project-List of Activities (not in any particular order)

1. Install Computer

2. Recruit Programmers

3. Recruit Data Preparation Staff

4. Train Operators

5. Change over

6. Computer Delivery

7. Project Planning and Feasibility Study

8. Train Data Preparation Staff

9. Test Programs

10. Train Programmers

11. Write Programs

12. Prepare Site

13. Place Order

14. Recruit System Analyst

15. Do Analysis and Design

16. Recruit Operators

QUESTIONS       

5. With reference to the logic and time data supplied in 'The initial Plan and Network' and activity list in the appendix, identify immediately preceding activities for the activities involved (please provide these in a table format in your report).  Produce an initial project plan (Network Diagram) using MS Project software (please provide the print out of the network diagram.

6. Perform a time analysis to indicate the critical path and show whether the changeover to the new system can be completed in 26 weeks.

7. You are now advised that the delivery of the computer will take 6 weeks, and the recruitment of the programmers will take 10 weeks. Discuss the direct and indirect impact of these changes on the project plan you produced. (You may use MS project to produce modified network diagrams if necessary).

8. In addition to the changes mentioned in question 7, the time allowed for System Analysis and Design, and Program Writing could be reduced by recruiting extra part time consultants in addition to the current ones. The possible reduction and associated costs by weeks are given:

Systems Analysis and design: A reduction of 1, 2, and 3 weeks would cost                                                                                                                         £350, £650 or £950 respectively

Writing Programs:                  A reduction of 1 or 2 weeks would cost £500 or                                                                                                                      £900 respectively

The cost of delaying the project after week 26 is £1,000 per week. Is it now possible to plan the project in 26 weeks? What action do you recommend?

9. What factors have been considered when the plan had been produced? Discus other factors which should also be considered in order to achieve the success of the project besides the ones you have already considered, using the case materials and through the external reading on project management.

Attachment:- Assignment.rar