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Operation management and decision making - Essay Example

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Operation management and decision making

This is an area of some uncertainty in the capacity planning process. Hitachi Ltd is one of the companies used capacity management as the main tool to plan and control its production processes and improve performance.
Hitachi Ltd. is a global leader on the electronic market specialized in Electronic Devices, Power & Industrial Systems, Digital Media & Consumer Products, High Functional Materials & Components, Logistics and Financial Services. The paper and analysis will concentrate only on one sphere of its activity: Electronic Devices. These are represented by the following types of products: power tools, measurements tools, electronic devices, semiconductors, etc. A special attention will be given to one product, semiconductors. In this segment, the efforts of executives to improve the management process have resulted in an influx of technological advances. Semiconductors are manufactured in Japan and Asia (Hitachi semiconductors 2008).
For Hitachi Ltd, capacity planning is not visionary or futuristic thinking, but an example of process versus substance. Capacity management for semiconductors is the process that creates a balance between what is desired and what is possible. Capacity management enables managers to distinguish truly important decisions from less important ones and to build a strategic agenda. It is a process that deals with interdepartmental issues and allows the organization to develop synergy among functional components. It is a process that helps managers deal with turbulent, complex, and influential environments. It helps to identify critical success factors or key result areas, to avoid incremental thinking, and to effectively deal with change. The main products for semiconductors are Interlayer Dielectric Materials, High Heat resistance Photopolymers, die bonding paste, different types of bonding films, Epoxy Molding Compounds, liquid encapsulants, a high heat resistant coating. The product purity is strongly affected by many upstream variations (Hitachi semiconductors 2008). Local engineering systems help stabilize the columns to insure that the product meets minimum market specifications. These variations result in higher energy consumption and lower production capacity. At times, large variations disrupt the column operation to such an extent that it is necessary to shut down and restart. The fundamental source of such variation is easily traced to variations in the rates and concentrations of the many feeds that are pumped to the tank farm. In this case, as a recycle facility, it is not practical to negotiate with the suppliers for more consistency in the raw materials. There is little choice but to take the recycled acid as it comes, variation and all. There is a possibility, however, of reducing the magnitude of the problem by modifying the process and control system designs to be less sensitive to such unavoidable upstream variations. The plumbing of the tank is changed to make better use of the capacity of the inventory to reduce the magnitude and the frequency of the variations seen by the columns (Chase & Jacobs 2003).
The main outputs are power semiconductors (high voltage, diodes), semiconductors for communication systems, and SDRAM for electronic technology (Hitachi semiconductors 2008).. "Improvements in production and inventory control translate ...Show more


Every company relies on its internal resources and capabilities aimed to support and improve market position and profitability. The key success factor is the unity of strategy and strategic experience employed and developed to counter a widespread error. Capacity management helps organizations to plan and control resources…
Author : lebert
Operation management and decision making essay example
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