Page 535 - Business Principles and Management

Unit 6

business note before it needs them, it will have to use both space and

money for storage. On the other hand, if the company
can’t get the resources when it needs them, it will have to
delay production and spend money on nonproductive
employee time until the necessary materials arrive.
Many of the quality systems used worldwide Three important activities are part of production plan-
are the direct result of W. Edward Deming’s ning. Inventory management is planning the quantities of
work in Japan after World War II. Today, the materials and supplies needed for production and the
American Society for Quality (ASQ) is the
world’s largest membership organization de- number of finished products required to fill customer
orders. Human resource planning is determining the types
voted to quality. ASQ fosters the concept of
of jobs required for each part of production, the number
Total Quality Management (TQM), in which a
of people needed for each job, and the skills each person
company maintains high quality standards in
will need in order to do the job. Production scheduling is
all aspects of its business. TQM has four pillars:
identifying the steps required in a manufacturing process,
Kaizen: Focus on continuous process im-
the time required to complete each step, and the sequence
provement by measuring repeatable processes.
of the steps. Managers use sophisticated planning systems
Miryokuteki na Hinshitsu: Produce qual-
to develop production schedules. Computers are very
ity above and beyond what the consumer
useful in scheduling production and monitoring progress
expects.
toward meeting production schedules.
Kansei: Link product users to improve-
ments in products.
Miryokuteki Hinshitsu: Expand manage- BUILDING LAYOUT
ment focus to the whole quality system and
A manufacturer must organize its facilities, equipment,
not just the immediate product.
and materials to produce products efficiently. Products
have to move through the building, parts must be added,
and employees must be able to work on the product eas-
ily and safely. The manufacturer must have cost-effective methods for receiving
and storing raw materials, parts, and supplies. Once products are finished, the
manufacturer must store them or load them for shipment.
The type of layout a manufacturer uses depends on the product and the assem-
bly process. For example, one company that builds tractors has a continuous
assembly line that is nearly a mile long. Many of the parts have to be stored long
distances from the place they are needed. The parts are delivered to the assembly
line with overhead conveyor belts and chains.
A small company that builds electric motors delivers all needed parts to
each assembler’s work area. The assembler puts the parts together to finish the
motor. The motor then moves to the shipping area for packaging and storing
for delivery.
A company that manufactures desktop computers organizes its manufactur-
ing employees in teams with their own work areas. Each team orders the parts it
needs and keeps them in easy-to-reach bins around its workspace. The entire
Success tip team works on the assembly, tests each computer to make sure it works, and
packages it for delivery. This procedure allows the company to quickly build a
customized computer for each customer’s order.
In addition to the type of product and the assembly process used, other factors
The American Society for influence the layout of the business. The layout should be designed to make prod-
Quality (ASQ) certifies uct assembly easy and safe. Employees may need areas to test and repair products.
individuals in quality man- Products and people must be able to move around the building. Employees need
agement. A first step in certi- food services and break areas. Other activities that support the manufacturing
fication is becoming a Six process, such as purchasing, information management, training, and administra-
Sigma Greenbelt. This step tive services, require space as well.
requires that you have three For most companies, the layout should be flexible so they can add new machin-
years of work experience and ery and equipment. Also, companies may need to expand the layout as the com-
pass a certification test. pany grows or change it to produce new products.

522