RV College of Engineering®, Bengaluru

(Autonomous Institution affiliated to VTU, Belagavi)

Department of Industrial Engineering &

Management

IM352IA – Operations Management

(2024)
Laboratory Manual
(Autonomous Scheme 2022)

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 1
 RV College of Engineering®, Bengaluru
(Autonomous Institution affiliated to VTU, Belagavi)
Department of Industrial Engineering &
Management

Laboratory Certificate

This is to certify that Mr. / Ms…………………………………… has

satisfactorily completed the course of Experiments in Operations Management

Laboratory prescribed by the Department during the year 2024-2025.

Name of the Candidate: ……………………………………

USN: ………………………………

Semester: V

Marks
Maximum Obtained Marks in words

50

Signature of the staff in-charge Head of the Department

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 2
 RV College of Engineering®, Bengaluru – 59
(Autonomous Institution affiliated to VTU, Belagavi )
Department of Industrial Engineering and Management
VISION
Imparting innovation and value based education in Industrial Engineering and Management
for steering organizations to global standards with an emphasis on sustainable and inclusive
development.
MISSION
 To impart scientific knowledge, engineering and managerial skills for driving
organizations to global excellence.
 To promote a culture of training, consultancy, research and entrepreneurship interventions
among the students.
 To institute collaborative academic and research exchange programs with national and
globally renowned academia, industries and other organizations.
 To establish and nurture centers of excellence in the niche areas of Industrial and Systems
Engineering.

Program Educational Objectives (PEOs)

Graduates of Industrial Engineering and Management program, will:

I. Conceive, design, implement and operate integrated systems, focus on appropriate
measures of performance at strategic, tactical and operational levels.
II. Develop competency to adapt to changing roles for achieving organizational excellence.
III. Design and develop sustainable technologies and solutions for betterment of society.
IV. Pursue entrepreneurial venture with a focus on creativity and innovation for developing
newer products, processes and systems.

Program Outcomes (POs)

Engineering Graduates will be able to:
1. PO1: Engineering Knowledge: Apply knowledge of mathematics, natural science,
computing, engineering fundamentals and an engineering specialization respectively to
develop to the solution of complex engineering problems.
2. PO2: Problem Analysis: Identify, formulate, review research literature and analyze
complex engineering problems reaching substantiated conclusions with consideration for
sustainable development.
3. PO3: Design/Development of Solutions: Design creative solutions for complex
engineering problems and design/develop systems/components/processes to meet
identified needs with consideration for the public health and safety, whole-life cost, net
zero carbon, culture, society and environment as required.
4. PO4: Conduct Investigations of Complex Problems: Conduct investigations of complex
engineering problems using research-based knowledge including design of experiments,
modelling, analysis & interpretation of data to provide valid conclusions.
5. PO5: Engineering Tool Usage: Create, select and apply appropriate techniques, resources
and modern engineering & IT tools, including prediction and modelling recognizing their
limitations to solve complex engineering problems.

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 3
6. PO6: The Engineer and The World: Analyze and evaluate societal and environmental
aspects while solving complex engineering problems for its impact on sustainability with
reference to economy, health, safety, legal framework, culture and environment.
7. PO7: Ethics: Apply ethical principles and commit to professional ethics, human values,
diversity and inclusion; adhere to national & international laws.
8. PO8: Individual and Collaborative Team work: Function effectively as an individual, and
as a member or leader in diverse/multi-disciplinary teams.
9. PO9: Communication: Communicate effectively and inclusively within the community
and society at large, such as being able to comprehend and write effective reports and
design documentation, make effective presentations considering cultural, language, and
learning differences
10. PO10: Project Management and Finance: Apply knowledge and understanding of
engineering management principles and economic decision-making and apply these to
one’s own work, as a member and leader in a team, and to manage projects and in
multidisciplinary environments.
11. PO11: Life-Long Learning: Recognize the need for, and have the preparation and ability
for i) independent and life-long learning ii) adaptability to new and emerging
technologies and iii) critical thinking in the broadest context of technological change.

PROGRAM SPECIFIC OUTCOMES (PSO)

Engineering Graduates of IEM will be able to:

1. Design, develop, implement and improve integrated systems that include people,
materials, information, equipment and energy.
2. Apply statistical and simulation tools, optimization and meta heuristics techniques for
analysis of various systems leading to better decision making.
3. Demonstrate the engineering relationships between the management tasks of planning,
organization, leadership, control, and the human element in various sectors of economy.

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 4
 OPERATIONS MANAGEMENT
(Theory+ Practical)
Course Code : IM352IA CIE : 100 + 50 Marks
Credits: L:T:P : 3:0:1 SEE : 100 + 50 Marks
Total Hours : 45L + 30P SEE Duration : 03 + 03 Hours
UNIT-I 09 Hrs
Using operations to create value: Role of operations in an organization, a process view, a supply
chain view, operations strategy, competitive priorities and capabilities, fourth Industrial revolution,
decision making models.
UNIT-II 09 Hrs
Process strategy: Process structure in services, process structure in manufacturing, process strategy
decisions, strategic fit, strategies for change.
Planning capacity: Planning long term capacity, planning timing and sizing strategies, a systematic
approach to long term capacity decisions.
UNIT-III 09 Hrs
Forecasting Demand: The role of forecasting, characteristics of forecasts, components of a forecast
and forecasting methods, basic approach to demand forecasting, time series, measures of forecast
error, selecting the best smoothing constant, role of IT in forecasting, risk management in forecasting,
big data and the forecasting process.
UNIT-IV 09 Hrs
Managing process constraints: the theory of constraints, managing bottlenecks in service and
manufacturing processes, applying the theory of constraints to product mix decisions, managing
constraints in line processes
Efficient resource planning: Material requirements planning, master production scheduling, MRP
explosion, enterprise resource planning, resource planning for service providers.
UNIT-V 09 Hrs
Scheduling: Introduction, Single machine Scheduling, Shortest Processing time (SPT), Rule to
minimize mean flow time, earlier due date (EDD), Rule to minimize, Maximum lateness. Minimizing
makespan,
Flow shop scheduling: Johnson’s Rule, CDS Heuristic.
Job shop scheduling: Types of schedules, schedule generation. Two jobs and M machines
scheduling, bottleneck scheduling.
OPERATIONS MANAGEMENT LABORATORY
 Break-Even Analysis
 Demand Forecasting
 Capacity planning
 Aggregate Planning using Linear Programming
 Production planning and scheduling
 Analyzing dependent demand inventory situations and generating reports using MRP Module.
 Preparation of Bill of Materials.
 MRP Run- Generation of planned order release report.
 Creation of Purchase order for the item.
 Creation of Production order for the item

Course Outcomes: After completing the course, the students will be able to
CO1 Explain the concept and scope of operations management in a business context
CO2 Recognize the role of Operations management among various business functions and its role
in the organizations’ strategic planning and gaining competitive advantage
CO3 Analyze and assess the appropriateness and applicability of a range of operations management
systems/models in decision making.
CO4 Evaluate a selection of frameworks used in the design and delivery of operations
Reference Books
1. Lee J Karjewski and Larry P Ritzman, Manoj Malhotra, Operations Management – Processes

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 5
 and Supply Chain, Pearson Education Asia, 13th Edn, 2021, ISBN-13: 9780136860631
2. R. Paneerselvam, Production and Operations Management, PHI, 3rd Edn, 2012, ISBN-13: 978-
8120345553
3. B. Mahadevan, Operations Management – Theory and Practice, PHI, 2015, 3rd Edn, ISBN-13:
978-9332547520
4. Sunil Chopra & Peter Meindl, “Supply Chain Management - Strategy, Planning & Operation”
Pearson Education Asia, 2006, 3rd Edition. ISBN-13: 978-0131730427

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 6
 RV College of Engineering®, Bengaluru – 59
(Autonomous Institution affiliated to VTU, Belagavi)
Department of Industrial Engineering and Management

OPERATIONS MANAGEMENT (IM352IA)

UNIT-VI (Laboratory Work)
SCHEME OF CONDUCT AND EVALUATION
CLASS: V SEMESTER CIE MARKS (Max): 50
YEAR: 2024-2025 SEE MARKS (Max): 50
SEE (Time Duration): 3hrs

Ex. TITLE S/W Package No. of Marks Bloom’s Course

No. Used Classes Class Taxonomy Outcomes
work / Level(L) (CO)
Test
1. Break-Even Analysis 1 20 L4, L5 CO3
2. Demand Forecasting using
moving average and
2 30 L4, L5 CO3
Exponential smoothing
methods MS EXCEL
3. Aggregate Planning using
1 20 L4, L5 CO3
Linear Programming
4. Production planning and
1 20 L4, L5 CO3
scheduling
5. Preparation of Bill of CO3,
1 20 L1,L2,L4
Materials. CO5
6. Creation of Purchase order
1 20 L4, L5 CO3, CO5
for the item.
7. Creation of sales order for
1 20 L4, L5 CO3, CO5
the item. Ofbiz
8. MRP Run- Generation of
planned order release report 1 20 L4, L5 CO3, CO5

Test 1 30
200
TOTAL

EVALUATION SCHEME:
CIE (Max Marks: 50) = Total Marks / 4 Total Marks =

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 7
 Particulars of the Experiments Performed

Contents

Sl. Page Marks Signature

Date EXPERIMENTS
No. No. Obtained of Staff
Break-Even Analysis
1.
Demand Forecasting using moving average and
2. Exponential smoothing methods
Aggregate Planning using Linear Programming
3.
Production planning and scheduling
4.
Preparation of Bill of Materials.
5.
Creation of Purchase order for the item.
6.
Creation of sales order for the item.
7.
MRP Run- Generation of planned order
8. release report

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 8
General Instructions

 The Students are required to strictly follow the scheme of conduction of the exercises.
 The Students are hereby advised to prepare for the exercises well in advance and the timing
of the lab slots are to be effectively utilized for the design and analysis aspects of the
exercises.
 The Students are required to bring in their Blue Books duly complete in all respects, without
which the students will not be allowed to do the exercises in the lab.
 Submission of Lab Records complete in all respects is to be done in the next subsequent Lab
Class.
 Students must maintain strict academic discipline in the laboratory.
 Use of external hard disks (thumb drives) in the lab without prior permission of the Lab-in-
charge will be viewed very seriously.
 CIE Marks will be awarded based on design, analysis, and report generation.
 Open ended and Demo exercises are considered only for CIE marks and not for SEE.

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering®. 9
 Exercise No.1
Break even Analysis

Aim: To calculate the break-even point and create a break even chart.

Software used: MS-Excel

Theory:
Break-even analysis is a tool for evaluating the profit potential of a business model and for
evaluating various pricing strategies. The break-even level or break-even point (BEP) represents
the sales amount—in either unit or revenue terms—that is required to cover total costs (both
fixed and variable). Total profit at the break-even point is zero. Break-even is only possible if a
firm’s prices are higher than its variable costs per unit. The break-even point (BEP) is the point
at which total cost and total revenue are equal: there is no net loss or gain, and one has "broken
even."

The main purpose of break-even analysis is to determine the minimum output that must be
exceeded in order to make profit. It also is a rough indicator of the earnings impact of a
marketing activity.

The break-even point is one of the simplest yet least used analytical tools in management. It
helps to provide a dynamic view of the relationships between sales, costs, and profits. For
example, expressing break-even sales as a percentage of actual sales can give managers a
chance to understand when to expect to break even (by linking the percent to when in the
week/month this percent of sales might occur).

Problem:

A product at the Jennings Company enjoyed reasonable sales volumes, but its contributions to
profits were disappointing. Last year, 17500 units were produced and sold. The selling price is
Rs 22/- per unit, unit variable cost is Rs 18/-, and Fixed cost is Rs 80000/-.

a) What is the break-even quantity for this product?

b) Management believes that sales can be increased by 30% or that unit variable cost can be
reduced to 85% of its current level. Which alternative lead to higher contributions to
profits, assuming that each is equally costly to implement?

Solution:

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 10
Result:

Conclusion:

Scheme of Evaluation:

Particulars Marks Marks obtained

Conceptual Understanding 04
Problem Solving 08
Result and Conclusion 04
Viva Voce 04
Total Marks 20
Signature of the Faculty in-charge/s

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 11
 Exercise No.2:
Demand Forecasting

Aim: To forecast the demand using various time series forecasting methods and comparison of
the results

Software used: MS-Excel

Forecasting methods are classified into following four types

1. Qualitative
2. Time series
3. Casual and
4. Simulation

Times Series Forecasting Methods

The goal of any forecasting method is to predict the systematic component of demand and
estimate the random component. In its most general form, the systematic components of demand
data contain a level, a trend, and a seasonal factor. The equation for calculating the systematic
component may take a variety of forms, as shown below.

 Multiplicative: Systematic component = level x trend x seasonal factor

 Additive: Systematic component = level + trend + seasonal factor
 Mixed: Systematic component = (level + trend) x seasonal factor

The specific form of the systematic component applicable to a given forecast depends on the
nature of demand.

We begin by defining a few terms:

Lt = Estimate of level at the end of period t
Tt = Estimate of trend at the end of period t
St = Estimate of seasonal factor for period t
Ft = Forecast of demand for period t (made in period t -1 or earlier)
Dt = Actual demand observed in period t
Et = Forecast error in period t

Forecast Error

As long as observed errors are within historical error estimates, firms can continue to use their
current forecasting method. If a firm observes an error that is well beyond historical estimates,
this finding may indicate that the forecasting method it is using is no longer appropriate. If all of
a firm’s forecasts trend to consistently over – or underestimate demand, this may be another
signal that the firms should change its forecasting method.

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 12
Forecast error for period t is given by Et, where the following holds:
Et = Ft – Dt

That is, the error in period t is the difference between the forecast for period t and the actual
demand in period t. It is important that a manager estimate the error of a forecast made at least as
far in advance as the lead time required for the manager to take whatever action the forecast is to
be used for. For example, if a forecast will be used to determine an order size and the supplier’s
lead time is six months, a manager should estimate the error for a forecast made six months
before demand arises. In a situation with a six month lead time, there is no point in estimating
errors for a forecast made one month in advance.

One measure of forecast error is the mean squared error (MSE), where the following holds:

The MSE can be related to the various of the forecast error. In effect, we estimate that the
random component of demand has mean of 0 and a variance of MSE.

Define the absolute deviation in period t, At to be the absolute value of the error in period t; that
is,

Define the mean absolute deviation (MAD) to be the average of the absolute deviation over all
periods, as expressed by

The MAD can be used to estimate the standard deviation of the random component assuming
that the random component is normally distributed. In this case the standard deviation of the
random component is as follows:
 = 1.25 MAD

We then estimate that the mean of the random component is 0 and the standard deviation of the
random component of demand is .

The Mean Absolute Percentage Error (MAPE) is the average absolute error as a percentage of
demand and is given by

To determine whether a forecast method consistently over- or underestimates demand, we can

use the sum of forecast errors to evaluate the bias, where the following holds:

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 13
The bias will fluctuate around 0 if the error is truly random and not biased one way or the other.
Ideally, if we plot all the errors, the slope of the best straight line passing through should be 0.
The tracking signal (TS) is the ratio of the bias and the MAD and is given as follows:

If the TS at any period is outside the range 6, this is a signal that the forecast is biased and is
either under forecasting (TS below -6) or over forecasting (TS above +6). In this case, a firm
may decide to choose a new forecasting method. One instance in which a large negative TS will
result is when demand has a growth trend and the manager is using a forecasting method such as
moving average. Because trend is not included, the average of historical demand will always be
lower than future demand. The negative TS will detect that the forecasting method consistently
underestimates demand and alert the manager.

Problem:
Year 1 2 3 4 5 6 7 8 9 10 11
Demand 7 9 5 9 13 8 12 13 9 11 7

a. Plot the above data on a graph. Do you observe any trend, cycles or random variations?
b. Starting in year 4 and going to year 12, forecast the demand using 3-year moving average. Plot
the graph
c. Starting in year 4 and going to year 12, forecast the demand using 3-year moving average with
weights 0.1, 0.3 and 0.6 using 0.6 for the most recent year. Plot the graph
d. Develop a forecast for years 2 through 12 using exponential smoothing with α=0.4.
e. Calculate error measures (Bias, MAD, MSE) for each of the above forecasts. Using this
information, decide which forecasting method is best.

Solution:

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 14
Result:

Conclusion:

Scheme of Evaluation:

Particulars Marks Marks obtained

Conceptual Understanding 04
Problem Solving 08
Result and Conclusion 04
Viva Voce 04
Total Marks 20
Signature of the Faculty in-charge/s

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 15
 Exercise No.3:
Aggregate Planning

Aim: To develop a production plan using chase and level strategy.

Software used: MS-Excel

Theory:
Aggregate planning involves translating business plans into broad labor and output plans for the
intermediate term. Its objective is to minimize the cost of resources required to meet the demand
over that period. To achieve this, it is necessary for the planner to consider various decision
alternatives. The two basic types of decision alternatives are reactive and aggressive.

Reactive alternatives admit forecasted demand as a given and try to fulfill it by introducing
modifications in the work force levels, overtime, vacation schedules, inventory levels,
subcontracting, under time, and planned backlogs On the other hand, aggressive alternatives try
to modify the demand in order to adapt it to the firm's resources by means of promotional
campaigns, price incentives, complementary products, etc. This kind of alternative tends to be
the responsibility of the marketing manager.

Assuming that the effect of aggressive alternatives has already been incorporated into the
demand forecasts, the planner will have to focus on reactive alternatives. Therefore, he/she will
have to establish a planning strategy which selects the best options. A possible way to achieve
this is by starting up with both chase and level strategies and then moving later on into a mixed
strategy.

Chase strategy
This strategy adjusts production rates to match the demand requirements period by period. In
order to achieve this objective, the planner cannot make use of the anticipation inventory, or
under time. Therefore, he/she has to use other options such as hiring and laying off workers,
overtime, and subcontracting. This approach has the advantage of low inventory investment and
backlogs, although it has some disadvantages, such as the potential alienation of the work force
and the loss of productivity and lower quality because of the constant churn in the work force.

Level strategy
This strategy either keeps a constant output rate or work force level over the planning horizon.
To achieve this, and contrary to the previous strategy, it can use the anticipation inventory and/or
under time. The main advantages are level output rates and a stable work force at the expense of
increased inventory investment, under time, overtime, and backlogs. Obviously, between these
two strategies there is a range of possible strategies and the planner should find the best mixed
strategy to improve the solution obtained by the two previous strategies.

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 16
To do so, the planner will have to answer certain questions:
1) Should inventories be used to absorb changes in demand?
2) Should changes in demand be accommodated by varying the size of the work force?
3) Should overtime and under time be used to absorb changes in demand?
4) Should subcontracting be used?

Despite the many possibilities this approach offers, it makes aggregate planning much more
complicated due to the large number of alternative plans.

Problem
The planning department of a company is faced with determining the aggregate plan for a
product family over the next seven months. In this plan, the company wants to determine the
number of workers needed each month, the number of regular and overtime hours required, the
number of units to be produced and subcontracted, and the total cost associated with the plan.
The table below presents the demand forecast and other relevant parameters.

Period 1 2 3 4 5 6 7
Demand 3000 6000 2000 1500 4000 5500 8500
Beginning Inventory 2500
Costs Cost / Unit Beginning Workforce 18
Regular Time Labor Cost(Rs.) 9.60 Labor Standard (units/worker) 250
Overtime/Subcontracting(Rs.) 14.40
Inventory Holding Cost(Rs.) 5.00
Backorders (Rs.) 7.50
Hiring(Rs.) 500.00
Layoff (Rs.) 750.00
Develop a production plan using chase and level strategy

Solution:

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 17
Result:

Conclusion:

Scheme of Evaluation:

Particulars Marks Marks obtained

Conceptual Understanding 04
Problem Solving 08
Result and Conclusion 04
Viva Voce 04
Total Marks 20
Signature of the Faculty in-charge/s

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 18
 Exercise No.4:
Production Planning and Scheduling
The goals of production planning can be stated simply as: determining which products to
produce, when to produce them, and how much of each to produce. However, the task of
achieving these goals is not so simple. The volume and timing of product output must fit in
with the resource constraints of labour and materials availability, machine capacity and
cost competitiveness. For a production plan to be effective, it must meet its demand
obligations on time and at low cost. While production planning is concerned with
determining output levels, capacity planning establishes whether there are sufficient
resources to meet the planned output. If production capacity is less than output
requirements, then the production plan is not feasible.

Very few organisations produce a single product at a fixed demand rate. The term
‘aggregate capacity planning’ is used when management has to decide how best to allocate
resources in order to meet variable demand forecasts. The situation is further complicated
if the company manufactures several products, all of which are competing for the same
scarce resources. An aggregate plan combines the appropriate resources into general, or
overall, terms. It translates an output plan into resource requirements, giving a general
indication of how much resource capacity will be needed to meet each order. If the
company does not have the overall capacity to meet its customer demand, it can overcome
this situation in several ways. Extra part-time staff can be hired, overtime or extra shifts
can be scheduled, or the company can subcontract with other organisations to fill the
shortfall. While output plans specify what products are needed, these general
specifications must be converted into practical operations that can be implemented on the
shop floor. Customer orders are initially aggregated to establish whether there are
sufficient resources available. Detailed scheduling, usually referred to as master
production scheduling (MPS), then refines the overall terms of aggregate planning into
specific order details about capacities, demand, and materials availability. Start and finish
dates for each customer order are determined. The order’s progress is then tracked through
the various manufacturing processes to ensure that it is completed on time.

Problem:
Projected sales (’000s) for the Gizmo Company’s main product over the next four months
are shown in the table below.

Month 1 2 3 4
Demand (’000s) 5 6 9 5

Gizmo has a production capacity of 4,000 items per month which can be extended to 7,000
per month by utilising overtime. However, overtime adds £80 to the normal cost of
producing 1000 items. Inventory of the finished goods can be stored indefinitely but incurs
monthly holding costs of £20 per 1000 units. Normal labour costs are £300 per 1000 items.
The Gizmo Company currently has 5000 items in stock. The company would like to find a
production schedule that will minimise the total overtime production and inventory storage
costs over the next four months. The transportation method of linear programming can be
used in aggregate planning and production scheduling to allocate resources to meet sales
forecasts. The Gizmo Company has therefore decided to set up the problem as a
transportation model and solve it using Excel’s Solver. The supply sources are now the

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 19
monthly on-hand stock and the labour shifts, both regular and overtime. The destinations
are the monthly sales forecasts.
The supply constraints are 5000 (current inventory), 4000 (regular shift), and 3000
overtime shift). The overtime requirements for each month, which the user enters into cell
range C13:F21 are calculated from the following equation,
Overtime = Demand − On-hand inventory − Regular production capacity
To ensure that production follows a logical monthly pattern, enter very large values (e.g.,
9999) wherever appropriate. For example, month 1 can only utilise items produced in the
first month while month 2 can only utilise items produced in the first two months, etc.
Note that the holding costs for month 1 are zero and then increase by £20 for each
subsequent month. The production scheduling model obtained a minimum cost of £6440.
All regular shifts are fully utilised. Note that the first month’s unused production run of
4000 has been carried over into the second and third months (see cells D27 and E27). To
meet monthly demand, overtime was required in months 3 and 4, in which 3000 and 1000
extra items were produced respectively.

Solution:

Result:

Conclusion:

Scheme of Evaluation:

Particulars Marks Marks obtained

Conceptual Understanding 04
Problem Solving 08
Result and Conclusion 04
Viva Voce 04
Total Marks 20
Signature of the Faculty in-charge/s

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 20
 Exercise No.5:
Preparation of Bill of Material

Aim: To prepare the bill of material for a given product.

Software used: Ofbiz

Theory:

Prepare a bill of material (BOM) for a product and print final report showing the BOM and the
levels (while selecting the product, at least three levels should be available).correct specifications
and units of measurement (UOM) for each of the component/sub-assembly/assembly to be
specified.

Flow Chart
A. Add an Item or Product
A1. Navigate to ‘CATALOG’ application using the ‘APPLICATIONS
A2. Click on create a new product button
A3. Enter the Product Id, select the product type and click on create button
A4. The product is created. Other attributes and relationships can be set using various
links in the top menu

B. Creating associations between products

B1. In the CATALOG application, add a product, select the product type as ‘Finished
Product’
B2. Also add sub components. Select the product type as ‘Sub Assembly’
B3. From the catalog manager main screen, look up the newly created product and click
on Edit Product button
B4. Click on the ‘Associations’ link in the edit product screen
B5. In the product association screen let, the product id is pre filled. Enter the name of
the product to which the association needs to be made in the field ‘Product Id To’
(Tyre in this case). Select the type of association as ‘Engineering Bill of Materials’,
enter the number of Tyre needed to make a single wheel assembly. Click on create
button
B6. Similarly create association for other sub components. Once completed the
associations are displayed as below
B7. Now navigate to ‘Manufacturing’ application using ‘Applications
link from top menu
B8. Click on ‘Bill of Materials’ in the left menu.
B9. Click on the ‘Product’ link. Component of the assembly and the quantity required
will be displayed
B10. Select Advance Settings and enter required details
B11. Click on the BOM simulation link in the top menu and fill in the following details
B12. The BOM simulation is displayed

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 21
Product Tree Structure

Result:

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 22
Conclusion:

Scheme of Evaluation:

Particulars Marks Marks obtained

Conceptual Understanding 04
Problem Solving 08
Result and Conclusion 04
Viva Voce 04
Total Marks 20
Signature of the Faculty in-charge/s

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 23
 Exercise No.6:
Creation of Purchase order for the items
Aim: To create a Purchase order for the given product.

Software used: Ofbiz

Flow Chart
A. Creating a Purchase Order from Order Manager
A1.
A2. Click on ‘ORDER ENTRY’ link in left menu.
A3. In the initiate order entry screen, fill in the Shipping agreement , shipping date (not
mandatory) and click continue
A4. Search for the product using the ‘Product Look Up’ , select a product , enter the
quantity required and click ‘Add to Order’ button
A5. Check if the item was successfully added in the order Items screen let which is
displayed in the same screen. After verifying click on ‘Finalize Order’ link
A6. The ‘Shipping Agreement’ details (if any) are displayed. Click on continue link
A7. The shipping destination which is the warehouse address is displayed. Click on
‘Continue’ link
A8. Enter any notes/comments if needed for the PO shipping. Additional shipping
instructions by way of shipping options can be selected in case PO contains multiple
order items. Click on ‘Continue’
A9. Select the default option and click continue
A10. Review the PO details and make necessary changes (using the order items, order
terms etc links) in case you would like to modify before the final step of PO creation.
If everything is fine click on ‘Create Order’ linkA11. Order confirmation report is
generated
A11. PO number details, link to view the PDF version of the PO, approve or cancel PO
links are some of the important details displayed

B. Approve a Purchase Order

B1. Navigate to ‘ORDER MANAGER’ applications using the
nk from the top menu
B2. Click in ‘Order List’ link in left menu
B3. Select the order type as ‘Purchase Order’ and select relevant status of the PO and
click find button
B4. List of PO based on the search criteria is displayed. Click on the Order # to update
the PO
B5. Details of the PO (summary, contact information of the supplier or vendor, payment
information, shipment information, order items, notes) displayed. Click on the
‘Approve Order’ link to approve the PO
B6. The status of the PO is now approved. The PO can be henceforth either put on hold
or cancelled based on the need
B7. To complete the shipment click on the ‘Quick Drop Shipment’ button in the
‘Shipping Information’ screen let. This action will result in creation of shipment id
and also invoice will be created in the ‘Accounting’ module
B8. Verify the invoice by navigating to Accounting Manager using the link

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 24
 select ‘Invoice Type’ as Purchase Invoice and click find
B9. A purchase invoice should be created for the above approved PO. Verify that the
amount of the PO and invoice should be matching. Click on the Invoice Id to verify
the details
B10. Invoice details will be displayed which includes, summary of invoice, current status,
applied payments, item details

C. Receive inventory
C1.
link in top menu
C2. Click on Facilities in left menu, select the facility id as ‘Web Store Warehouse’ and
click submit
C3. Verify the Quantity on Hand for sub assembly by clicking on ‘Inventory Items’ link
in top menu and make a search on ‘Product Id’
C4. Now click on ‘Receive Inventory’ link and select the relevant PO using the look up.
Click on ‘Receive Products’ button. Select the related shipment and click ‘Receive
Shipment’ button
C5. Verify the PO details and click on ‘Receive Selected Products’ button
C6. The PO items are received and inventory updated accordingly
C7. Verify the inventory again to check the latest quantity on hand by performing above
mentioned step 3
C8. Verify the QOH and Quantity to Promise by following the manual ‘View Inventory
status’

D. View Inventory status

D1.
MANAGER’ link in the top menu
D2. Select the facility Id in the drop down (Web Store Warehouse in this example) and
click ‘Submit’ button. Main attributes of the facility is displayed. Click on
‘Inventory’ link
D3. Default Search screen is displayed
D4. Click on ‘Find’ button with the default values, products and their inventory details
are displayed in the results screen

Result:

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 25
Conclusion:

Scheme of Evaluation:

Particulars Marks Marks obtained

Conceptual Understanding 04
Problem Solving 08
Result and Conclusion 04
Viva Voce 04
Total Marks 20
Signature of the Faculty in-charge/s

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 26
 Exercise No.7:
Creation of Sales Order from E-Commerce website
Aim: To create the sales order from e-commerce website for a given product.

Software used: Ofbiz

Procedure for creating sales order from E-commerce website

A1. Invoke e-commerce website by typing this URL

http://132.147.2.132:8080/ecommerce/control/main
A2. Create customer login for ecommerce website
A3. Click on create new account
A4. Enter all relevant details and click on save
A5. Select a product from the catalog and add to cart followed by view cart
A6. Select the product in shopping cart and enter required quantity followed by check out
A7. Select shipping address and click on next
A8. Select mode of transport mode and click on next
A9. Select payment mode and click on continue to final order
A10. Click on submit order
A11. Order confirmation report is generated

Result :

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 27
Conclusion:

Scheme of Evaluation:

Particulars Marks Marks obtained

Conceptual Understanding 04
Problem Solving 08
Result and Conclusion 04
Viva Voce 04
Total Marks 20
Signature of the Faculty in-charge/s

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 28
 Exercise No.8:
MRP Run- Generation of planned order release report
Aim: To Generate a planned order release report for a given product.

Software used: Ofbiz

Procedure for carrying out MRP run

1) Individual products should be created in the Catalog module.
2) Facility should be associated to individual products along with details of minimum
quantity that should be present in the inventory, minimum reorder quantity.
3) Add a supplier to the product
4) Product Associations should be created
5) Create a back order for product in the e-commerce application and approve the order using
‘Order Manager’.
6)
menu
7) Click on ‘MRP’ in left menu to bring up the MRP log screen.
8) Click on ‘Run MRP’ link and fill in the details and submit.
9) Once submitted, click on ‘MRP Log’ link. The MRP run triggered in the previous step will
be logged as ‘Pending’ in the log.
10) Refresh the screen by clicking on the MRP Log link, to check if the run was completed.
Once the run is completed, the status of the job changes to ‘Finished’
11) Click on the ‘Find’ button to see the MRP recommendation for the entire Web Store
Warehouse. Alternatively you can enter the product ID and check the MRP
recommendation for the specified product
12) The MRP recommendation should be visible. Similarly you can query MRP
recommendation for each sub assembly to find material requirements. You can see the
sales order number for the product chosen
13) Navigate to ‘Order Manager’ and click on ‘Requirements’ link and find all requirements.

Creation of Purchase Order based on MRP Run

1. Click on ‘Approve Requirements’ link.
2. Click on ‘Find Approved Requirements by Supplier’ link. The requirement approved
in the previous step should be visible. Select the ‘Bill to Party’ and ‘Facility Id’ and
click on prepare order button to raise a purchase order
3. Verify the order quantity and enter name of purchase order and click on Purchase
Order Quick Entry button
4. Verify the order details and if everything is fine click ‘Create Order’ link.

Result:

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 29
Conclusion :

Scheme of Evaluation:

Particulars Marks Marks obtained

Conceptual Understanding 04
Problem Solving 08
Result and Conclusion 04
Viva Voce 04
Total Marks 20
Signature of the Faculty in-charge/s

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 30
Demonstrative Viva Questions
1. Define operations management
2. Distinguish between manufacturing and service operations
3. Define strategic planning
4. What is qualitative forecasting?
5. What is Break-even Analysis?
6. Define capacity planning.
7. List the various models used in decision making related to capacity planning
8. Define forecasting. Explain the importance of forecasting in operations management.
9. What is Delphi Technique?
10. Compare inventory systems for independent and dependent demand
11. What is Forward Scheduling and Back scheduling methods and state its relevance in
the shop floor control
12. List a few priority rules used in sequencing
13. What is CPFR?
14. List any four basic patterns of most demand time series
15. What is MRP-I?
16. What is MRP-II?
17. What is ERP?
18. List a few commercially available ERP packages.
19. List a few Quantitative forecasting models used in Industries
20. Define finite capacity planning.
21. What is supermarket as it is used in MRP?
22. Why is lot sizing important in MRP?
23. What are the advantages and disadvantages of ERP system?
24. What is meant by closed loop MRP?
25. What is the difference between demand chase and level capacity strategy in aggregate
planning?
26. What is master production schedule?
27. Distinguish between single machine scheduling and flow shop scheduling.
28. List the 3 techniques used for designing process.
29. What is MTO, MTS, ETO, ATO strategies?
30. State the difference between line and batch process

Lab Manual developed by Dept. of Industrial Engineering and Management, R.V. College of Engineering. 31