PRODUCTION PLANNING AND

CONROL

Submitted by Reshma Babu

Roll no.: 42

ContentProductionProduction PlanningProduction controlProduction Planning and controlObjectivesImportanceLimitationElementsRefernces

ProductionProduction is concerned with transforming

raw material into finished product with the help of energy, capital, manpower and machinery.

The aim of a good production policy is to achieve maximum output with minimum input.

Production policies and procedures are concerned with production planning and control.

Production objectives

Production PlanningMeaning: Production planning involves management

decisions on the resources that the firm will require for its manufacturing operations and the selection of these resources to produce the desired goods at the appropriate time and at the least possible cost.

Definition:According to Ray Wild, production planning is

defined as follows:“Production Planning is concerned with the

determination, acquisition and arrangement of all facilities necessary for future operations.”

Objectives of Production Planning1. Effective utilization of resources2. Steady flow of production3. Estimate resources4. Ensure optimum inventory5. Coordinate activities of departments6. Minimize wastage of raw materials7. Improper the labor productivity8. Help to capture the market9. Provide a better work environment10. Facilitate quality improvement11. Result in consumer satisfaction12. Reduce the production costs.

Functions of Production PlanningProduct selection & designProcess selection & planningFacility locationFacility layout & materials handlingCapacity planningSystems & proceduresEstimating quantity/costs of production, menRouting operation sequence Job scheduling & loading

Production ControlMeaning:Production control guides and directs flow of

production so that products are manufactured in a best way and conform to a planned schedule and are of the right quality. Control facilitates the task of manufacturing and sees that every theme goes as per the plan.

Definition:“ Production control is the art and science of

ensuring that all which occurs is in accordance with the rules established and the instructions issued”.—Henry Fayol

Objectives of Production Control1. To ensure that various inputs are available

in required quantity and quality2. To organize production schedule in

conformity with the demand forecasts.3. Resources used in best possible manner –

cost of production is minimized and delivery date is maintained.

4. To ensure regular and timely supply of raw material in prescribed quality and quantity to avoid delays in production.

5. To perform inspection and use quality control techniques.

6. Proper co-ordination of operation of various sections/department responsible for production.

Functions of Production Control•Inventory control: MRP; JIT•Time management•Quality control•Maintenance & replacement•Cost reduction & cost control•Dispatch•Expediting/Follow-up/ Progressing

Production Planning and Control

Meaning: Production planning and control is

concerned with directing production along the lines set by the planning department.

Definition:"Production planning and control is the co-

ordination of series of functions according to a plan which will economically utilize the plant facilities and regulate the orderly movement of goods through the entire manufacturing cycle from the procurement of all materials to the shipping of finished goods at a predetermined rate."

-CHARLES A. KOEPKE

Production planning and control can be defined as “the process of planning or deciding on the resources the firm will require for its future manufacturing operations and of allocating and time scheduling these resources to produce the desired products on time at the least total cost”.

Three stages in Production Planning and Control function are:

Planning - Choosing the best course of action among several alternatives.Operation- Execution as per planControl- Maintaining the performance by companies the actual results with performance standards set and taking appropriate corrective action if necessary to reduce variance.

Objectives of Production Planning and Control1. To deliver quality goods in required quantities to the

customer in the required delivery schedule to achieve maximum customer satisfaction and minimum possible cost.

2. To ensure maximum utilization of all resources3. To ensure production of quality products4. To minimize the product through-put time or

production/manufacturing cycle time5. To maintain optimum inventory levels.6. To maintain flexibility in manufacturing operation.7. To coordinate between labor and machines and

various supporting departments8. To plan for plant capacities for future requirements9. To remove bottle neck at all stages of production and

to solve problems related to production10. To ensure effective cost reduction and cost control.

Requirements for Effective Production Planning and Control

•Sound organizational structure•Delegation of authority•Reliable, up-to-date feedback•Standardization •Trained people•Flexibility to adapt•Appropriate management policies•Accurate assessment of manufacturing/ procurement lead times•Adequate plant capacity.

Need and Importance of production planning and control

1. For increasing production2. For co-coordinating plant

activity3. For cost control4. For rationalization of production

activities5. Consumers

Benefits of Production planning & Control

•Higher quality•Better resource utilization•Reduced inventory•Reduced manufacturing cycle time•Faster delivery•Better customer services•Lower production costs

Benefits(continued)Lower capital investmentHigher customer serviceImproved sales turnoverImproved market shareImproved profitabilityCompetitive advantageFlexibilityDependabilityLower price.

Limitations of Production Planning and Control

1. Based on assumptions2. Rigidity3. Difficult for small firms4. Costly5. Dependence on external factors

Techniques or Elements of Production Planning and Control

Planning

First and most important elementRefers to deciding in advance what is to

be done in future.Anticipates possible difficultiesSeparate dept- responsible for the

preparation of policies and plansControl devices also decided in advance-

activities are carried on properly.If production planning defective, then

control defective.

Routing “Routing may be defined as the selection of paths

or routes over which each piece is to travel in being transformed from raw material into finished product”.—Kimball and Kimball Jr.

It determines what work will be done on a product and how it will be done.

Routing procedure involves the following different activities:(1) An analysis of the article to determine what to make and what to buy.(2) To determine the quality and type of material (3) Determining the manufacturing operations and their sequence.(4) A determination of lot sizes (5) Determination of scrap factors (6) an analysis of cost of the article

Scheduling Scheduling is the determining of time and date

when each operation is to be commenced and completed. It includes the scheduling of materials, machines and all other requisites of production.

“The determination of the time that should be required to perform each operation and also the time necessary to perform the entire series as routed, making allowance for all factors concerned.”—Kimball and Kimball Jr.

“Work Scheduling consists of the assignment of starting and completion times for the various operations to be performed.”—James C. Lundy

Types of schedules

Master scheduling: Scheduling starts with the master schedule. This schedule is prepared by keeping in view the order or likely sales order in near future. Master scheduling is the breakup of production requirements. This may be prepared for a week, a fortnight, a month etc. No definite pattern may be suggested for master schedules because these may differ from industry to industry.

Operation scheduling: Manufacturing or operation scheduling is used where production process is continuous. When same product is produced repeatedly or comparatively small numbers of products are required then operation schedules are useful. The name and number of the product and the quantity to be produced in a given time are required to prepare a manufacturing schedule.

Detail operation scheduling: It indicated the time required to perform each and every detailed operations of a given machine or process.

Dispatching

• Dispatching refers to the process of actually ordering the work to be done. It involves putting the plan into effect by issuing orders. It is concerned with starting the process and operation on the basis of route sheets and schedule charts.• “Dispatches put production in effect by releasing and guiding manufacturing order in the sequence previously determined by route sheets and schedules.” - John A. Shubin

Procedure or steps followed in dispatching

1. Moving of materials from process to process.

2. Assigning of work to machines.3. Issuing of tools to production departments.4. Issuing of job orders.5. Recording of time taken.6. Ensuring necessary changes.7. Having proper liaison with routing

Following up

Follow up or expediting is that branch of production control procedure which regulates the progress of materials and part through the production process".

The function of follow-up is carried by ‘follow-up men’. These men act as intermediaries between various departments bringing about co-ordination between them. ‘Follow-up men’ are also referred as expeditors, ‘go-betweens’, ‘stock chasers’ and ‘progress-men’ etc.

Generally production is assumed to progress as expected. But there may be differences which may arise due to the following reasons:

1. Materials may be delivered late or may not be delivered at all.

2. Associated departments may have fallen behind in their own production.

3. There may be excessive absenteeism on the part of the worker.

4. The customer may insist on changing the specification or delivery date.

5. Machines may break down.6. There may be errors in drawings.7. There may be too many rejections due to

poor material quality.

Inspection •In the words of Kimball and Kimball Jr. “Inspection is the art of comparing materials, product or performance with established standards.”• Inspection is the process of ensuring whether the products manufactured are of requisite quality or not.•Inspection is undertaken both of products and inputs.•It is carried on at various levels of production process so that pre-determined standards of quality are achieved.•Inspection ensures the maintenance of pre-determined quality of products.

Corrective measuresCorrective action may involve any of those

activities of adjusting the route, rescheduling of work, changing the workloads, repairs and maintenance of machinery or equipment, control over inventories, poor performance of the employees.

Certain personnel decisions like training, transfer, demotion etc. may have to be taken.

Alternative methods may be suggested to handle peak loads.

Conclusion

•Smooth working process•Sales maximization•Profit maximization•Consumers satisfaction•Continuous flow of production and distribution

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6. Seetharama L. Narasiimhan, Dennis W. McLeavey, Peter J. Billington, 1995, “production planning and inventory control, second edition.

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Thank you