MBA 510C

OPERATIONS MANAGEMENT
SPRING QUARTER 2002
PROFESSOR: OFFICE HOURS: COURSE ROOM: Peter Haug Monday, Tuesday, and Thursday 1600 - 1700 and by Appointment PH 244 (various times, see course schedule) OFFICE: Parks Hall 349 PHONE: 360.650.4807 (Work) 360.650.9740 (Home) EMAIL: [Link]@[Link]

SECTION 1: COURSE CONTENT AND STRUCTURE

1.1 - TEXTBOOK AND REQUIRED MATERIALS REQUIRED: Richard B. Chase, Nicholas J. Aquilano, and F. Robert Jacobs. Production and Operations Management. Ninth Edition. Boston: Irwin McGraw-Hill, 2001. Eliyahu Goldratt and Jeff Cox. The Goal: A Process of Ongoing Improvement. Croton-onHudson: North River Press, 1992. 1.2 - COURSE OBJECTIVES, LEARNING OUTCOMES, AND ASSESSMENT This course provides an introduction to the topics and mathematical techniques for solving problems in the design, planning, and controlling of manufacturing and service operations and quality. It concentrates on the technological issues of business activities and presents a systematic study of managerial and mathematical techniques for making goods and services. The course also enhances your understanding of global issues related to the management of operations. Specifically, the course develops your knowledge of manufacturing resources planning and provides knowledge on forecasting, production planning, master scheduling, material requirements planning, capacity planning, world class manufacturing principles, and continuous improvement. Your comprehension of these topics is reinforced through a competitive team simulation entitled the Production and Operations Simulation (POSIM). In achieving these objectives and serving you as a student customer, I will endeavor to establish an educational process that effectively and efficiently provides the product characteristics (structure, content, and knowledge) necessary to develop your awareness of the significance, principles, and terminology of the functional area of production and operations management. It will cover global and technological issues in the management of world-class operations. The table below integrates the learning outcome expected from this course with its corresponding assessment method. Each assessment technique is structured to determine whether a specific outcome has been accomplished.

Objectives/Learning Outcomes
Knowledge of manufacturing resources planning concepts and mathematical techniques Comprehension of lean manufacturing principles Understanding of project management techniques Ability to apply manufacturing resource planning principles and techniques Understanding of industrial applications of operations management principles Development of team management skills Development of oral and written communication skills Computer software and technology for operations management

Assessment Methods
Examination, In-Class and Example Assignment Problems Examination and In-Class Assignment Examination Production and Operations Simulation (POSIM) Problems and Team Exercise Examination questions on Video Presentations and Guest Speaker(s), Guest Speaker Participation POSIM Team Exercise Individual Class Participation, POSIM Team Exercise Computer sessions using Excel spreadsheet applications

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1.3 PEDGAGOGICAL PHILOSOPHY AND EXPECTATIONS Operations management represents a major functional area within any manufacturing or service business, and this course will provide you with the fundamental principles for managing operations planning and control systems. It is hoped that you will find these operations topics, techniques, and terminology stimulating and relevant to your education and future business careers. The classroom environment will involve lectures, case discussions, problems, and computer sessions for the team-based simulation, and I shall endeavour to create a relaxed and open environment for your participation in the classroom. I shall encourage you to provide examples from your own readings and experiences on operations management topics, and hopefully, you will feel comfortable to approach me with any issues or problems that you are confronting in the course. I expect you to be prepared for class and to actively participate in class discussions and supporting your team during the Production and Operations Management Simulation. 1.4 - TEXTBOOK READINGS The sequence of topics and the reading assignments for those topics are stated in the course outline. Students should read and comprehend the chapter assignments prior to the lecture for that topic. The Chase, Aquilano, and Jacobs textbook consists of chapters outlining the conceptual framework for the lecture topics, but my lectures are compiled from numerous textbooks, articles, and personal observations of regional manufacturing firms. The Chase, Aquilano, and Jacobs text is intended to provide you with an overview of the topics and is not a replacement for attending and actively participating in the lectures. The Goldratt and Cox text The Goal is a realistic, though fictional account of Alex Rogo and his team efforts to implement new manufacturing principles in the Bearington factory of the Unico Company. It is an exciting, non-technical narrative that has been recommended by many business and manufacturing managers as required reading for students. Finally, the Workbook provides you with the overheads and problem assignments, and you are also provided space for additional notes and comments. In conclusion, you should: 1. Read the assigned pages in Chase, Aquilano, and Jacobs as described in the course outline 2. Start reading the Goldratt and Cox The Goal immediately; 3. Have the PowerPoint lectures available for every lecture 1.5 - EXAMPLE PROBLEM ASSIGNMENTS There are two forms of problem assignments: 1) two required Production and Operations Simulation (POSIM) team problems; and 2) individual example problems. I will announce in class when specific individual example problem assignments are due, and the details of the assigned problems. The POSIM team assignments represent problems directly related to the simulation exercise, and each team must submit a maximum one page description of the problem solution with any figures or tables showing computations or spreadsheet calculations also included on this one page. The due dates for these assignments are shown in the course outline, and these team problems permit your team to coordinate and organize its activities while developing extensive knowledge and preparation for the Production and Operations Simulation exercise that will be conducted during the in class sessions. The individual example assignments are not collected or graded, but they represent a highly visible form of class participation, as I shall call upon several individuals to present their example problem solutions during class. You should always be prepared to respond to questions on these problems. In solving example problems, you can use either: 1) manual computations; or 2) computer software packages, such as Microsoft Excel. The software programs and manuals are available in the computer laboratory in Parks Hall 210 (360.650.3406). However, you should be aware that in-class examinations will require you to employ manual calculations; so do not rely simply on the computer software for solving problems. 1.6 TEAM EXERCISE: PRODUCTION AND OPERATIONS SIMULATION (POSIM) During the middle part of the course, several class periods will be partially dedicated to teams of 3 students competing in the Production and Operations Simulation (POSIM) exercise. Team preferences will be solicited and used in the final assignment of students to simulation teams, and these teams will participate together throughout the simulation exercise. Information on the operations environment and concepts necessary for conducting the simulation are provided in the Production and Operations Simulation sections on the Internet or I: drive. Each team member should carefully review and understand the simulation scenario and responsibilities, and in order to encourage early preparation, specific team problems related to the Production and Operations Simulation exercise are assigned and due as indicated in the course outline. Moreover, questions on the simulation exercise will be asked on the Midterm and Final Examinations. Concerning attendance, the university catalog (see page 32) clearly states the reasons for which a leave of absence may be

granted from a class, and a student must follow these guidelines strictly in order not to be penalized for missing a class during the POSIM exercise.

The Written POSIM Analysis should be a maximum of two pages, divided between one page (double-spaced) for content and one page for exhibits. Each team completes and submits only one final Written POSIM Analysis. Your written analysis on the POSIM exercise is due as shown in the timetable schedule of classes, and the structure of the written analysis must be, as follows: Page 1) summary describing team strategy and profit and loss performance and discussion of the lessons learned in the simulation and its relationship to the concepts presented in the lecture and readings, and Page 2) the Exhibits Page should include: a) one figure showing actual and forecasted values for the end items stating the Mean Absolute Percentage Error (MAPE) between the actual end item demands and your original demand forecasts (calculated at the end of period 24), and b) a second figure displaying each period's profit and your cumulative profit over the period of the production and operations simulation exercise. Finally, 2 Peer Evaluation forms will be provided to each team to assess the contribution and dedication of each team member during the simulation exercise. These peer evaluations are a critical component to your total exercise grade and should be completed carefully by the entire team. The first peer evaluation form must be submitted with the Order Release Form for period 25 and reflects the team's evaluation of each member's contribution to the forecasting, production planning, and master scheduling assignments. Your individual evaluation rating on this form will be used to adjust your grade on the POSIM assignments. The second peer evaluation individual ratings will be used to adjust your team cumulative profit performance and written analysis grade. Finally, the team's second peer evaluation form must be submitted with your team's final Written POSIM Analysis. NOTE: Failure to read and understand the Production/Operations Simulation exercise prior to class will result in your inability to contribute to your team, enjoy the exercise, and achieve a satisfactory grade. 1.7 - INDIVIDUAL CLASS PARTICIPATION Classroom participation is a major determinant of your grade in this course. I shall establish a seating chart during the second week of classes in order to grade participation as well as to get to know your names. I acknowledge and record using a 100-point scale (usually ranging from 100 to 80) during the course of the quarter a student's participation concerning the following classroom activities: 1. 2. 3. 4. 5. 6. 7. A voluntary and reasoned response to a question that I pose to either a specific individual or to the entire class. Failure to respond with an answer demonstrates a lack of preparation and participation. A willingness to ask logical questions that either clarifies or extends the concepts under discussion. Freely entering into case or example problem discussions to make a valid point, provide a different perspective, or respond to other student's questions or comments. Volunteering to present your team or individual example problem solutions to the class through either discussion or representation on the board. Regular attendance at class meetings. If you are unable to attend class, please let me know, if possible, ahead of time so I can acknowledge the reason(s) for your absence. Use of office hours to obtain clarification about concepts and problems. If you have any problems in the course, please come and see me during office hours or arrange for an appointment. Courteous and attentive behavior during class through the exhibition of interest and regard for the professor and your colleagues. Arriving late to class or disruptive talking during class indicate a lack of responsibility and concern for the classroom environment and your fellow students.

Remember that participation is not an act of opening yourself up for criticism but a sharing of your intelligence, ideas, and knowledge. Many students are hesitant to enter into classroom discussions, but since your future careers will require you to establish good verbal communication skills, it is best to overcome your inhibitions now in a more relaxed and controlled environment. I expect and strongly encourage you to ask questions during the lectures so that I can better serve and understand your educational needs and concerns. NOTE: Attendance will be taken randomly on occasion to monitor your participation in the course and will affect your participation grade.

If you have any questions on classroom participation, please do not hesitate to ask me for further clarification or how you are doing during the course. 1.8 - EXAMINATIONS

There will be one examination during the course (final examination) as scheduled in the Course Outline. The final examination is mandatory and weighted 35%. The exam will emphasize the topics discussed in the lecture and textbook readings and problems. The exam will be short answer, essay, and problems, and they will cover the cumulative material up to the date of the exam. Since the amount of material covered in the course is extensive, the examination will involve a randomly selected subset of the total cumulative material. For final examination, you will be allowed one 5" by 8" note card (both sides) for formulas and notes, a single sheet of scrap paper for computations, and a calculator. 1.9 - STUDENT ADVISORY COUNCIL (SAC) During the second week of classes, I shall ask for two volunteers for the Student Advisory Council (SAC). I take teaching and my effectiveness in establishing and providing an enjoyable and positive learning experience very seriously, and this Council provides me with a mechanism for receiving feedback from you during the quarter. This Council will meet periodically with the class and then with me to discuss questions, such as: How are the other students progressing in the course? Are there any problems so far? What have the students found as strengths and weaknesses? You can always approach me about problems you are having, but also please feel free to offer constructive comments to a member of the Student Advisory Council. This Council will sometimes meet with the entire class as well as dividing the class into smaller groups for more extensive interaction and input. 1.10 - GRADING POINTS AND DISTRIBUTION Course grades are based upon the final distribution of total points; no letter grades are assigned to individual assignments or exams. Final course grades will be assigned based upon the following distribution: Individual Participation........................................ 20% Class Participation 15% Guest Speaker Participation 5% POSIM Simulation Exercise.. 35% Forecasting Assignment.5% Production Planning Assignment..5% Cumulative Profit Performance.. 20% Team Analysis.... ..5% Guest Speaker/Plant Tour.... ..10% Final Examination..................................................... 35% TOTAL.................................................................... 100%

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1.11 - FINAL SUGGESTIONS AND COMMENT This course outline is a detailed description of the topics and responsibilities of the professor and students. If you have any additional questions or issues concerning the course, please feel free to bring these up at any time during the academic term. I shall endeavor to the best of my ability to treat you fairly and respect your insights and comments in a responsible and courteous manner. Some final summary recommendations are: 1. Before each class, read and review the relevant chapters, overhead transparencies, or POSIM workbook sections so you have an idea of the lecture or class structure and content. I shall provide an outline on the board before each class to indicate the sequence of events and topics for the day. Please use 1) my regular office hours; 2) call me at my office 360.650.4807 or home 360.650.9740; or 3) Email: [Link]@[Link] whenever you have a problem or need help with a topic or assignment. Office hours have been structured to provide additional help outside class, and I trust that you will feel comfortable in utilizing this time reserved for you. If office hours are not convenient, please see me about setting up an appointment at a mutually agreeable time for additional help. During the lectures, I shall attempt to detect when confusion exists or material has not been presented well, but please stop me as soon as you have any problems. I am confident that you are not alone in the possibility of failing to comprehend a topic, and I encourage you to help me realize when clarity in the lecture is lacking.

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1.12 - TENTATIVE MBA 510C OPERATIONS MANAGEMENT COURSE OUTLINE

Session
1. Thurs 27 June 1000-1150 2. Thurs 27 June 1400-1550

Topics
Introduction Forecasting and Aggregate Production

Objectives
Course Organization, Structure of Topics, and Operations Principles Review forecasting concepts and trend and seasonal forecasting time series models

Readings

Assignments

Chase, Aquilano, and Jacobs, Chapter 2 (Operations Strategy); Managerial Briefing (Enterprise Resource Planning Systems), pages 420-430; Chapter 11 (Forecasting), pages 433-441; 447-450 Chase, Aquilano, and Jacobs, Chapter 12 (Aggregate Planning), pages 481497; Chapter 13 (Inventory Control), pages 511-520 Chase, Aquilano, and Jacobs, Chapter 14 (Material Requirements Planning), pages 549-574

Organization of Teams

3. Tues, 2 July 1000-1150

Aggregate Planning and Inventory Master Production and Material Requirements Project Management Project Management

Review aggregate planning techniques and inventory control models. Forecasting assignment computer session Review Material Requirements Planning and forecasting assignment computer sessions

Computer Session Parks Hall 210: 1100-1150

4. Tues, 2 July 1400-1550

Computer Session Parks Hall 210: 1500-1550 DUE: Team Forecasting Assignment

5. Tues, 9 July 1000-1150 6. Tues, 9 July 1400-1550

Cover the principles of managing projects and production planning assignment computer session Discuss the critical path method for scheduling projects

Chase, Aquilano, and Jacobs, Chapter 3 (Project Management), pages 57-64 Chase, Aquilano, and Jacobs, Chapter 3 (Project Management), pages 64-72 DUE: Team Production Planning Assignment Computer Sessions Parks Hall 210: 15001550 DUE: MPS Order Release for Period 25 POSIM Simulation Session for Periods 25-28 Parks Hall 210: 1500-1550 Bates Abrasives, Burlington, Washington POSIM Simulation Session for Periods 28-30 Parks Hall 210: 1500-1550 POSIM Simulation Session for Periods 31-33 Parks Hall 210: 1100-1150 POSIM Simulation Session for Periods 34-36 Parks Hall 210: 1500-1550 COURSE EVALUATIONS

7. Thurs, 11 July 1000-1150 8. Thurs, 11 July 1400-1550

Project Management Lean Manufacturing Systems

Discuss program evaluation and review technique and time-cost tradeoff and POSIM simulation The basic principles of lean manufacturing through eight wastes, kaizen, the Five Ss

Chase, Aquilano, and Jacobs, Chapter 3 (Project Management), pages 64-78 Chase, Aquilano, and Jacobs, Chapter 10 (Just-In-Time and Lean Systems), pages 393-411

9. Tues, 16 July 1000-1150 10. Tues, 16 July 1400-1550

Guest Speaker Lean Manufacturing Systems

Paul Anderson, President, Bates Abrasives, Burlington Lean manufacturing principles through value stream mapping, takt, time, and continuous flow

Lessons in Managing Your Career and Owning Your Own Business Chase, Aquilano, and Jacobs, Chapter 10 (Just-In-Time and Lean Systems), pages 393-411

11. Thurs, 18 July 1000-1150

Synchronous Production and Continuous Improvement Synchronous Production and Continuous Improvement

Principles of Theory of Constraints

(1) Chapter 20 (Synchronous Manufacturing and Theory of Constraints), pp. 788-824 (2) Eliyahu Goldratt and Jeff Cox, The Goal, pages 1-89. Eliyahu Goldratt and Jeff Cox, The Goal, pages 90-351

12. Thurs, 18 July 1400-1550

Principles of Theory of Constraints and Bottleneck Management

Session
13. Tuesday

Topics
23 July

Objectives
FINAL EXAMINATION

Readings
PLACE: PH 244

Assignments
POSIM Written Analysis Due

SECTION 2: POLICIES OF MBA 510C OPERATIONS MANAGEMENT

A course outline is essentially a contract outlining my responsibilities in terms of the lecture organization and content and your responsibilities on readings, assignments, and examinations. However, numerous areas of concern are not defined by simply stating general course objectives and organization. The following sections highlight additional policies that I have constructed to clarify any confusion in the details of the course and my teaching duties. Hopefully, these guidelines will improve your enjoyment and education in operations management. 2.1 - BACKGROUND ON OPERATIONS MANAGEMENT Production and Operations Management is a subject that combines the qualitative and quantitative aspects of business decisions and education. While the topic area may have minor appeal to you in your future career plans, the majority of U.S. manufacturing and service organizations are emphasizing the operations management function and demanding that managerial personnel comprehend the major significance of operations in the competitive success and strategies of the company. Failure by American managers to fully understand and appreciate the operations management function has contributed to the declining global competitiveness of U.S. businesses. You will be required to learn and apply mathematical and team approaches to operations problems, but do not forget that your future success as a manager depends not only on knowing these methods but incorporating your experience and judgment on qualitative variables when making decisions. Your prospects in passing this course and gaining a solid knowledge base will require skills in intellectual abstraction, comprehension of mathematical and statistical techniques, commitment and dedication to team performance, and intense though and study. You should consider this course a major component of your MBA and professional development, and one that will provide you with the techniques and terminology required to become an effective entrepreneur or company manager. 2.2 - STUDENTS INCORRECTLY ENROLLED OR NOT ENROLLED IN A SECTION Please note that the following policy is followed towards students not correctly enrolled or not enrolled in a section: It is the responsibility of each student to make sure that he/she is attending the correct section in which he/she is officially enrolled. If the student makes an error on this point, the professor will not acknowledge work performed in a class section for which the student is not officially enrolled. 2.3 - CLASS ATTENDANCE AND PARTICIPATION It is the student's responsibility to attend every class and when absent to obtain any missed information from fellow students. Any announcements made in class are assumed to have been disseminated to the entire class. Please be aware that verbal or written announcements in class may supersede information or deadlines stated in the course outline. If you are unable to attend class, please inform me in advance so I will know why you are not present for the lecture or topic discussion. NOTE: My lecture notes are not available for student use or copy. 2.4- EXAMPLE PROBLEM OR WRITTEN ASSIGNMENTS I expect that any written assignments that are submitted to me have been written in grammatically correct and properly spelled English. Therefore, please be very careful with the content and the presentation of material that you submit. All assignments must be done on standard sized paper (8.5" by 11"), and any computer printouts or tables must also be on standard sized paper and annotated (descriptions provided of computations and variables). Assignments must be clearly written and presented. Poorly written or presented papers will not be accepted. As future managers, you should strive for excellence in both your verbal and written work. 2.5 - LATE ASSIGNMENTS Due dates for assignments are provided in the course outline or by myself during class. Plan to submit completed assignments by these due dates. A late assignment will receive a substantial reduction (20 Points) in the graded score. 2.6 - EXAMINATION The date of the examination is given in the course outline. The format of the exams is problem solving, essay, and short answer. All material covered in lectures, required text readings, problem assignments, handouts, case studies, and

assumed previous mathematical and statistical knowledge are subject material for the examinations. Logical extensions from these materials may also be included on the examinations.

Examinations in this course are long and difficult. You will have one hour and fifty minutes for the examinations. You may have trouble answering every question, but remember that all students have the same amount of time for the exam. So please allocate your time carefully and attempt to answer as many questions as possible. Examinations will be returned to students and reviewed the class period immediately following the exam date unless I announce otherwise. Please attend this class period when I shall go over the exam in detail. I will not go over an exam with you privately because you missed the exam review class. NOTE: Examinations are not to be kept and must be returned at the end of the exam review class. However, you are welcome to review your exam and the solutions during regular office hours.

You must attend all exams at the appointed hour on the scheduled date. No early or late examinations will be given. 2.7 - FINAL EXAMINATION The final examination will be one hour and fifty minutes long and will be comprehensive (covering the readings, lectures, and case material of the entire course). Failure to show up for the final exam will result in an "F" grade for the entire course. The University Catalog clearly states on page 34 that: "A student who fails to take a final examination without making prior arrangements acceptable to the instructor receives a failing grade for the course". Students may not petition for early final examinations. Please inform family, friends, and employers that the university does not allow for early final examinations and that you will be required to attend the exam at the appointed date and time. 2.8 - COURSE GRADES Grades will be assigned based on total points relative to the rest of the class. Plus (+) and minus (-) grades may be assigned when the student is in the upper or lower ends of the grade bracket. The exact score will vary from class to class. Typically, the mean grade is a "B-" or slightly better depending on the class. "A" grades are only given to students who truly excel above the normal level, while "D" and "F" grades are given to those students who performed significantly below the class average. There is no extra credit work available or allowed for this course. NOTE: Final grades are not posted at the end of the quarter. If you wish your exam and course grade early, please provide me with a self-addressed, stamped postcard at the time of the final examination. 2.9 - INCOMPLETES You should allocate your time so that all assignments and exams are finished for this class. Incompletes are only given in extreme emergency situations. As the University Catalog states on pages 34-35: "The grade of K (incomplete) may be assigned under all grading systems. It may be assigned only upon request of the student and agreement of the course instructor. Normally it is given only to a student who has been in attendance and has been doing passing work until the final two weeks of the quarter when extenuating circumstances beyond his or her control make it impossible to complete course requirements on schedule". The procedure for obtaining and completing an incomplete is also contained in the University Catalog on page 35.

2.10 - ACADEMIC HONESTY AND HONOR CODE As mature adults, it is expected that you have established a level of honesty, integrity, and honor that eliminates even the remote possibility of cheating on an examination and/or written assignments. The policies, definition, and procedures for academic dishonesty are clearly described in the University Catalog on page 346-347. Academic dishonesty or cheating consists of, but is not limited to the following set of conditions: 1. Unauthorized possession of examination material. 2. Possession of information sheets beyond the allowed note card(s).

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3. Copying during examinations. 4. Looking directly at another student's examination. 5. Plagiarism or copying of assignments. The immediate consequences of cheating are listed in the university catalog. These are: an automatic "F" for the exam or an "F" for the entire course. Cheating is wrong and will not be tolerated. Please try to maintain your academic standing, your character, and your reputation by not cheating. 2.11 - OFFICE HOURS I take teaching, research, and industry interactions very seriously and like you, I require sufficient time to prepare class lectures and materials and to advance my research projects. If office hours are not practical because of your schedule, and you have a major concern, please contact me about setting up an appointment. 2.12 - FINAL COMMENT After reading the course outline and policies, I assume that if you stay registered in the course that you have agreed to abide by and follow the procedures and policies stated above. If you see any problems with examination times or other policies, please consider withdrawing from this section and enrolling in another section. My effort here is to eliminate any uncertainty that you might have on my decisions during the course and to provide you with a solid framework of understanding for the course. I will try to challenge and expand your thinking and knowledge in this course while also making it enjoyable; it is my sincere effort to provide a classroom environment that respects you as a student customer while increasing your business skills and knowledge. I hope that you will attend regularly and act professionally in meeting your responsibilities.

GOOD LUCK IN THE COURSE AND WITH YOUR MBA STUDIES

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MBA 510B
Operations Management
PowerPoint Slides, Lectures, and Problem Examples
Professor Peter Haug

Winter 2000

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MBA 510B
Operations Management
PowerPoint Slides, Lectures, and Problem Examples
Professor Peter Haug

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Winter 2000

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MBA 510B
Operations Management
PowerPoint Slides, Lectures, and Problem Examples
Professor Peter Haug

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Winter 2000