Sub optimisation - operations function, Operation Management

Assignment Help:

Sub optimisation - Operations Function

Another important issue raised by the systems approach is that of sub-optimisation. This is of considerable significance for managers, as it refers to situations where a sub-system is configured such that its performance appears to be optimal, yet the performance of the larger system is prejudiced. A hypothetical example might be a firm comprising several divisions (sub-systems), one of which is responsible for the assembly of final products.

The management of this division decides to reduce operating costs by cutting the stock levels of component parts, and placing replenishment orders for smaller quantities, and more frequently than previously. If this division is supplied by other manufacturing divisions of the firm, they may be obliged to produce in uneconomically small batches: the resulting increases in set-up costs of the supplying divisions may turn out to be greater than the stock-holding savings made by the assembly division. What appears to be optimal for a sub-system (the assembly division in this case) may not be not be optimal for the higher level system (the firm).


Related Discussions:- Sub optimisation - operations function

Simultaneous motion cycle, Simultaneous Motion Cycle: It is sometimes ...

Simultaneous Motion Cycle: It is sometimes  required  to record in  minute  detail the  simultaneous  movement    of the different    parts of  the body  of an  operator  duri

Explain an approach to a business diversity program, Describe an approach t...

Describe an approach to a business diversity program that would pragmatic and ethical

Number of rules for string diagram, There are a number of rules developed a...

There are a number of rules developed and given under three broad headings: 1. Related to the use the Human Body : a. The two hands should beings as well as complete their

How to completed a swot analysis of the company, A team has just completed ...

A team has just completed a SWOT analysis of the company. Briefly state what this analysis should be used for in the context of strategy.

Explain term everybody''s doing it, How common do you think it is for peopl...

How common do you think it is for people to try to justify their conduct by the argument that "Everybody's doing it"? Give examples from your own experience.

Explain type of marketing research, Obtaining data on the number of househo...

Obtaining data on the number of households that buy a particular product is an example of which type of marketing research? Explanatory Exploratory Causal Concrete

Explain violated the confidentiality agreement, Paranzino claims she deposi...

Paranzino claims she deposit $200,000 in a bank but was given a receipt for only $100,000, but she did not notice the mistake until later. She sued the bank, but attended court ord

Explain the relationship between financial forecasting, • Describe the requ...

• Describe the requirements of forecast demand and capacity requirements for financial planning, leading to proper business valuation. • Explain the financial risks to a healthc

Challenges for operations managers - operation strategy, Challenges for Ope...

Challenges for Operations Managers - Operation Strategy Most products have several competitors today - from cars to university degrees. Current market forces appears to sugge

Linear programing, Ask question #Minimum 100 words acceptNas food produces ...

Ask question #Minimum 100 words acceptNas food produces to kinds of popular dark chocolate bars. the banana and coffee. the banana bar costs 0.22 to make and sells of 0.35, where a

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd