Learn about decision-making, process layouts, and automation in manufacturing with this business management review.

In this review we will discuss about OPMAN and below are the summaries point:- The text covers various concepts related to decision-making and process design in operations management. It explains the differences between various types of layouts, such as fixed-position, product, process, job shop, and cellular manufacturing layouts. The text also discusses decision-making under certainty, uncertainty, and risk, and introduces concepts such as expected value, maximax, maximin, regret, and the expected value of perfect information.

BLACKBOARD REVIEW – OPMAN
Statement incorrect - Working forward
through the decision tree, the expected
monetary value of each event mode is
computed by first weighting possible payoffs
by their change occurrence
Statement incorrect – The maximax
approach is a pessimistic strategy
Fixed-position Layout - Type of layout in
which workers, materials, and equipment
are moved to the product as needed
Sub-optimization - result of individual
departments making the best decisions for
their own areas.
Online Banking – example of automated
services
Not common to product layout – ability to
adjust to changes in demand
Job Shop – processing system tend to
produce the most product variety
Maximin – worst payoff for each alternative
and choosing the alternative with the “best
worst”
Process control – computer-aided
manufacturing refers to the use of
computers
Repetitive production – operation likely to
see, at most, only minor variations in the
product or service being produced using the
same process and the same equipment
Laplace – average payoff for each alternative
and choosing with the highest average in the
approach
Concept of the expected value of perfect
information – expected value of perfect
information means knowing in advance
what state of nature will occur
Bounded rationality – limit imposed on
decision-making by costs, time and
technology
Continuous – type of processing system
would gasoline be produce from crude oil
Decision Tree – not an approach from
decision-making under certainty
Statement incorrect – Bounded rationality
refers to the limits imposed on decision-
making because of costs, human abilities,
time, technology, and/or availability of
information
Job Shop – estimation of cost generally most
difficult when this process has been chosen
Flexible manufacturing system – group of
machines supervisory computer control,
automatic material handling and possibly
robot
Process – type of layout which features
departments or other functional groupings
in which similar activities are performed
Line Balancing – process of assigning tasks to
workstations in such a way that the
workstations have approximately equal time
requirements
Flexibility is not always the best choice –
should recognize when an operation
strategy for process selection

Job shop tends to be small scale and flexible,
while continuous processes tend to be large-
scale and inflexible
Cellular manufacturing layout – group of
equipment by the operations needed to
perform similar work for part families
Repetitive – estimation of costs is generally
most difficult when this process has been
chosen
Decision Tree – a schematic representation
of alternative
Part families – cellular layouts are
associated
Likelihood of possible future events is
unknown – characterized decision-making
under uncertainty.
Regret – difference between a given payoff
and the best payoff for a state of nature
Flexible manufacturing system – more fully
automated version of cellular manufacturing
Layout design – use workers and space
efficiently
Cost minimization – not considered an
important factor in real layout design
Statement is correct – expected value of
perfect information represents the
maximum amount a company should be
willing to pay for any information about
events, no matter how good it is
Significantly lower fixed costs – benefits of
flexible manufacturing systems
Maximax – determine the best possible
payoff
Equation of EVPI – Expected payoff under
certainty – expected payoff under risk
Minimum possible cycle time – longest task
time
Payoff table – tabular presentation that
shows the outcome for each decision
alternative under the various possible states
of nature
Lower unit cost – not true about process
layouts when they are compared to product
layout
Certainty – relevant parameters such as
costs, capacity, and demand have known
values
Consumer satisfaction surveys – computer-
integrated manufacturing integrates all of
the ff except with manufacturing
Statement incorrect – maximin approach
involves choosing the alternative w/ the
highest payoff
Receive Feedback – not a step of the
decision process
Daily Capacity of a product layout formula –
operating time divided by cycle time
Key aspects of the process selection
challenge – capital intensity; process
flexibility
Line Balancing – task of deciding how to
assign work to specific stations
Not characteristic of layout decision in
system design – usually well received by
operatives personnel

Automation – substitution of machinery
that has sensing and control devices for
human labor
Maximum Cycle time – daily operating time
divided by desired output
Laser Technology – used in surgical
procedures is an example of technological
advances in process
Continuous – used for highly standardized
products
Risk Neutral – expected monetary value
approach is most appropriate when a
decision maker
Subcontracting – not a process type
commonly considered in making products or
delivering services