OPC - Lecture

8/3/2019 OPC - Lecture

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Operations Planning and Control


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PRODUCTION/OPERATION

PLANNING &CONTROL

PRODUCTION/OPERATIONPLANNING

PRODUCTION/OPERATION

CONTROL

Interrelated functions, often treated as one


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Activities of OPC

Operations planning pre-operations

[Operations implementation]

Operations control during operations and

post operations


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Operations/Production Planning

Pre operation activity

Essential prerequisite to production &

production control

Planning all activities from what to produce,

to product delivery

5W-1H on production/operation


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OperationsPlanning

Productplanning

Processplanning


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Product planning

(A company designing their product andmaking)

What to produce?

Market requirements, market surveySales forecast

Value engineering

Product design

Bill of Materials (BOM)


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Process Planning

How to produce?

Planning of Production ProcessOrganization of

production system?


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OUTPUT

INPUTS

FACILITYCAPAITL

ENERGY

LABOR

MATERIAL

ELEMENTS OR SUBSYSTEMS

OBJECTIVES

Production/Operation System


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OPN IINV

Q C D

INSPOPN II OPN III

Q C D

Q C DQ C DQ C DR/M

Machines, tools, drawings, instruments, utilities

HR

PARTS

OUTSOURCING


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Tooth powder can

End component oval shaped body

Seamed body

shoulder neck

crimped shoulder

Oval powder can


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Store

Trim

Print

Slit

endsBody

maker shoulders necks

end seame

r crimping

Pack Pack

Tin plates Inks coatings &

consumables


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Roller

bearings

Outerrace

Innerrace

Cages Rollers


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Coldforging

EN31Steel wire

Coil

Heattreatment

Grinding

Superfinishing

ROLLERS


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Turning

EN31Steel bars

Heattreatment

Grinding

Superfinishing

OUTERRACES


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Turning

EN31Steel bars

Heattreatment

Grinding

Superfinishing

INNERRACES


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Punch-ing

EN31Steel

sheets

CAGES


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ROLLERSOUTERRACES

INNERRACES

ASSEMBLY

CAGES


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Organization of production systemObjectives?, outputs?, elements?, inputs?

Objectives

What to make? Quality standards

How much to make? Quantity

When to deliver? Lead-time


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Outputs to meet objectives as aboveInputs

Raw materials Bought out parts

Human skills

Utilities


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Subsystems or elements of production Equipment

Layout

Material handling

Nature of operations Sequence of operations

Standard times

Utilities


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Factors influencing production planning

Volume & variety - Nature of the production

system

Product process matrix

Nature of the production process

Mass production?

Batch production?Job shop?

One off?


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Objectives of production planning

To provide an effective and efficientphysical system for production

On the basis of sales forecast and itsengineering analysis for high quality and cost

effective production

Estimate resource requirements

Estimate when and where they are required


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Make arrangements to meet production

targets with flexibility to meet marketdynamics


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Procedure for production planning

1.Demand forecast2.Specification of production requirement

Demand Vs Capacity (equipment & labour)

Process of production, sequence, route etcOutsourcing

Delivery schedule

Production scheduleProcurement schedule


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Setting production rate

Sales requirement and resultant work load

on the operations Daily production?

Capacity of production lines?

Manpower requirement?

Shifts planning?

Overtime?


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Production/Operations control

Post production planning, during productionand post production

Functions of production control

(importance, role)

1. Ensuring Quality, Quantity and Delivery of

parts, subassemblies and products (majorassemblies)


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2. Feed back to management on productionactivity, C/CA/PA taken

3. Maintain high level of productivity, effectiveutilization of resources

4. Ensure minimum cost and high customer

service


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Benefits of production/operation control

Profitability through

1. Balanced inventory levels of R/M, WIP,F/G inventory cost reduction

2. Effective utilization of equipment, tooling,

manpower, manufacturing and storagespace - productivity

3. Reduction in setup costs lead-time &cost reduction

4. Reduction scrap & rework costs costreduction


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Competitive advantage

1. Reliable delivery to customers

2. Shorter customer lead-time

3. Pricing flexibility through lower productioncosts

4. Orderly planning & control for marketing ofnew products


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Elements of production control

1.Control of planning availability of sales

information, BOM etc. on time2.Control of materials procurement

schedules

3.Control of tooling

tools & dies readiness4.Control of manufacturing capacity

utilization of equipment capacity

5.Control of activities issuing orders andschedules

6.Control of quantity at every stage


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7. Control of materials handling materialmovement on the floor

8. Control of due dates - monitoring ofschedules

9. Control of information on C/CA/PA for

future plan


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Elements of production control system

A system is a set of documented procedures1. Preparation of Production orders what?

2. To set Lead time for production

3. To monitor and control production job

card system, registers


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4. To record machine utilization, indirect

labour utilization, scrap and rework toimprove productivity production

report, scrap report

5. An information system for collecting andprocessing and display of the data


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Factors determining production controlprocedures

Nature of production Complexity of operations

1. Number of parts in the final product

2. Number of sub assemblies3. Number of operations in each part

4. Sequence of operations

5. Variations in output rates of the machines6. Customers orders with specific deliverydates, customers order schedule

7. Small lot orders


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Magnitude of operations

Time required for the operation

Distance of material movement


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Operations Planning & Control

Making a plan to organize inputs and runsubsystems to meet organizational objectives

and

Taking C/CA/PA to ensure that the planremains focused on objectives


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Role of OPC is to deliver customers

expectations

1. OPC as a system

Set measurable objectives

Identify subsystemsDocument procedures

2. Performing OPC functions

3. Maintain records


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Objectives of the company & role of OPC

Expectation - customer

Objective - supplier

What does a customer expect?

1. Reliable yet reasonable delivery

commitment

2. To be advised in case of delays

3. To be helped when he/she is in difficulty

4. Consistent good quality of products

5. Competitive rates


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Objectives of OPC

The broad objectives

1.To contribute in fulfilling corporate

objectives and objectives of operations

management

2.To help in setting up standards for future

3.To increase efficiency of operations

4.To increase productivity


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Specific objectives

1. Reliable yet reasonable delivery

commitment

Procurement Plan

Resources, available? To be procured?

Interaction with materials management


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Production Plan

Capacity committed, uncommitted

Tools availability

Maintenance schedules Any outsourcing?

Delivery commitment based on above to bereliable yet reasonable


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2. To be advised in case of delays

Monitor the plan efficiently

Do C/CA/PA on deviations

When delays are beyond control keep the

customer informed Major breakdown of equipment

Accidents

Strike

Acts of God


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Take full stock of the situation

convince the customer and reschedule

the delivery

3. To be helped when he/she is in difficulty

When another vendor fails

When customer has rush orders

OPC should keep some spare capacityas this is normal


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Accommodate the customer without

sacrificing regular orders

4. Consistent good quality of products

Resource planning

Planning equipment as per process

capability

Being committed to quality


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5. Competitive rates

Lower the price offered to the customer,

higher is the order volume!

But never at the cost of profit!

Cost reduction areas

Time waste is most difficult to correct

because it doesnt litter the floor!

Henry Ford

Waiting time operator, material, tool


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Hunting time operator hunting for variety

of items! Stalling delaying tactics by workers to

avoid starting a new job

Interrupted workloads planning


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Overtime due to bad planning

i. Commitment of unrealistic delivery dates

ii. Acceptance of too many rush orders

iii. Delays in materials receipt

iv. Machine break downs due to frequent

postponing of scheduled maintenance

v. Manpower problems

poor manpowerplan


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Unproductive time of machines - Material

handling problems Higher Overhead costs effective OPC

releases supervisory resources for value

adding work

Inventory investments (blocked capital)

Lowered morale

frequent stoppage of

operations due to bad planning

Role of OPC (Importance of OPC)


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Role of OPC (Importance of OPC)


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OPC is a staff function

Its role is advisory in achieving goals of right

quality, quantity and delivery It gives quantities of groups of major

assemblies (products), subassemblies and

parts in time frame OPC is an interface between marketing

requirements, production requirements and

materials requirements OPC is the brain of the operations function


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OPC provides decision makingsupport at three levels

Level I: fit aligns all resources to fit

the requirements

Level II: sustainability

developsustainability in market, competitiveadvantage

Level III: risk guard against impact ofuncertainty


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Scope of Operation Planning & control

Areas where OPC decisions are made

1.Materials: procurement planning Purchasing

Inspection

Storage Inventory control

Standardization

Variety reduction Value analysis

2 M th d


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2. Methods:

Process plan sequence

Tooling plan for tools, jigs & fixtures3. Machines and equipment

Relevant areas are

Facilities planning Replacement policy

Maintenance policy

Maintenance schedules Tools manufacture maintenance

4. Manpower: skills, numbers, shifts

R i d i i h fl f k


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5.Routing: determining the flow of work

Processing steps m/c 1, m/c 2, m/c 3

Materials handlingTemporary storage locations

6. Estimating: establishing operations times

for workers and machines

7. Loading and scheduling:

Allocation of jobs to machines as per routingand estimation to get maximum utilization

Fixing delivery dates (calendar)

8 Di t hi


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8. Dispatching:

Release of shop orders to commit raw

materials Authorizing usage of resources by

operations

Making plan operational

9. Expediting:

Chasing, follow up

10. Inspection:

To maintain quality of product

To evaluate the process and labour

11 E l i


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11. Evaluating:

Evaluation of performance of machines,

labour, process for management action Performance improvement

12. Cost control:

Wastage reduction

Value analysis

Inventory control

Resource utilization


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OPC makes what kind of decisions?

What to produce? product planning

Where to produce? facility planning

When to produce? schedules

Who will produce? man power plan

How to produce? process plan

How much to produce? production plan

O i ti f OPC f ti


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Organization of OPC function

Factors which determine the OS

1. Status of the OPC in a company

(i) if the nature of the work is repetitive

and number of workmen is small, line staffwould handle the OPC directly

(ii) if the equipment is laid out as per

sequence and machine capacities aresame, OPC is a sub-function of

Operations


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(iii) if the product variety is very large and a

batch system is followed, OPC should be

an independent function in par with other

functions

2. The degree of centralization Centralized OPC is handled by staff

specialists Line staff is free from planning activities

But line staff are deprived of using theirexperience and skills in planning

Sho ld be considered hen prod ct


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Should be considered when productvariety is large and planning process is

complex

A decentralized OPC is handled by linestaff

Line staff contribute their expertise

Suitable if planning is less complex2. The internal structure

The functions assigned to OPC


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R i t f ff ti OPC t


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Requirements of effective OPC system

1.computerized, fully integrated system

2. Quick response3. Effective, efficient and economic

4. User friendly easy to operate

5. Flexible in the light of businessenvironment

6. Ability to highlight variations as they occur

7. There must be minimum corrective actions8. It must be proactive

9. Result oriented

H d OPC tt t t t th


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How does OPC attempts to meet the

objectives?

Three stages in functions of OPC

Stage I: Planning functions

Stage II: OperationsStage III: Control function

Measuring effectiveness of OPC


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Measuring effectiveness of OPC

Delivery

OTD (number of orders delivered on timeagainst number of orders delivered

Inventory management, Inventory levels

Average inventory held annually Value of obsolete inventory

Non moving items

Surplus inventory

Inventory turn over ratio

P d i / i


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Production/operations management

Planned production Vs actual

Number of overtime hours

Machine utilization ratio


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Functions of OPC

1. Order preparation

Preparation of work order to operations

department

i. Samples, drawing or sketches

ii. Engineering specifications

iii. Sequence of operations

2 M t i l t l


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2. Materials control

Job card preparation and issue

i. Right material for the job

ii. Material consumption at every stage of

operationiii. Scrap generation

3. Process planning

4. Tools control

Record of available tools

Tool life


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5. Scheduling

Preparing a time schedule for the process to

meet commitment to customer

6. Dispatching

Preparing documentation to authorize use of

material

7. Progressing

8. Expediting


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Optional functions of OPC

1. Cost estimation (costing dept or IndustrialEngg. dept)

2. Work measurement (Industrial Engg.

dept)3. Sub contracting (materials management)

4. Capacity planning (Engineering dept)

5. Demand forecasting (Sales dept)

OPC - Lecture

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Transcript of OPC - Lecture