IE 305 CH 1 Introduction

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IE 305

Production Planning & Control

CH 1 : Introduction

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The Concept

Planning: Consideration of all input variablesto achieve predetermined output goals; a pre-production activity to determine optimal

production schedule, operation sequence,economic batch quantity, etc.

Control: Remedial action to prevent varianceof output from planned levels; trackingoperations to ensure compliance with plannedlevels

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Production Planning may be said to be a technique offorecasting ahead every step in the long process of

production, taking them at right time and in the right

degree and trying to complete operations at the

maximum efficiency

In the words of Kimball and Kimball Jr

The planning of industrial operations involves fourconsiderations, namely, what work shall be done, how

the work shall be done and lastly, when the work shall

be done.

Production Planning

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Production control is the process that keeps a watchful eye onthe production flow and size of resources along with the

location, of any deviation from the present action and to

arrange for the prompt adjustment so that the production

may run according to the original or revised schedule

In the words of Henry Fayol

Production control refers to ensuring that all which occurs

is in accordance with the rules established and instructionsissued.

Production Control

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For Increasing Production Main purpose ofproduction planning is to arrange inputs.

Production control program minimizes idleness of

men and machines. It thus helps in raisingindustrial output.

For coordinating plant activity -In planningproduction is carried out in a number of processes

and thus activities are synchronized for smooth

working.

Why do we need Production Planning and

Control?

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Production Planning Stages

Defining objectives

Setting priorities to attain objectives

Examining internal & external environments ofplanned system

Determining achievable targets

Determining inputs needed to achieve targets

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Objectives

Effectiveness: goods to fulfill customers

needs

Maximizing output: maximum output with

minimum input

Quality control: Product/service quality meets

planned quality specifications

Minimize throughput time

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Objectives (continued)

Capacity: full utilization of men & machines

Minimize cost: minimum cost of production

Maintaining inventory: optimal inventory Flexibility: flexibility in production operations

Coordination: between men & machines

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Objectives (continued)

Capacity: plan for current & future needs

Reduce bottlenecks: solve production

problems early

Maximize profit: minimize cost

Production schedules: as per plan

Routes & schedules: to optimize use of men,material & machinery

Maintain performance: maintain standards

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Functions of Production Planning

Product selection & design

Process selection & planning

Facility location

Facility layout & materials handling

Capacity planning

Systems & procedures

Estimating quantity/costs of production, men

Routing operation sequence

Job scheduling & loading

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Functions of Production Control

Inventory control: MRP; JIT

Time management

Quality control Maintenance & Replacement

Cost reduction & cost control

Dispatch Expediting/Follow-up/Progressing

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Preparation of production budget

Devising manufacturing methods and sequence of

operations

Deciding type of machines and equipment

Preparation of operation sheets and instruction

cards

Estimating men, machine and material

requirements Undertaking time and motion studies

Preparing master schedules

Areas of Production Planning

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Phases in Production Planning &

Control System

Planning: Pre-planning product planning &

development; demand forecasting; resource

planning; facilities planning; plant location &

layout

Active planning quantity planning;

product mix; routing; scheduling; material

planning; process planning; capacity planning;tool planning

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Phases (continued)

Action phase: execution dispatching;

progress function

Control phase; status reporting; material

control; tool control; inventory control; quality

control; labour output control; cost control

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Planning

Routing

Scheduling

Dispatching

Follow-up and Expediting Inspection

Elements of Production Planning

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It is the first element of production planning and

control. Planning is deciding in advance what is

to be done in future. An organizational set up iscreated to prepare plans and policies. Various

charts, manuals and production budgets are also

prepared. Planning provides a sound base for

control. A separate department is set up for this

work.

1. Planning

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Routing is determining the exact path which will befollowed in production. It is the selection of the pathfrom where each unit have to pass before reaching thefinal stage. The stages from which goods are to pass aredecided in this process.

In the words of ALFORD and BEATY

Routing is the specification of the flow sequence of

operations and processes to be followed in producing aparticular manufacturing lot.

2. Routing

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Deciding what part to be made or purchased

Determining Materials required

Determining Manufacturing Operations and

Sequences

Determining of Lot Sizes

Determining of Scrap Factors

Analysis of Cost of the Product Preparation of Production Control Forms

Routing Procedure

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Scheduling is the determining of time and date when

each operation is to be commenced or completed. Thetime and date of manufacturing each component isfixed in such a way that assembling for final product isnot delayed in any way.

In the words of KIMBALL and KIMBALL

The determination of the time that should be

required to perform each operation and also the timenecessary to perform the entire series, as routed,

making allowances for all factors concerned.

3. Scheduling

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Master Scheduling It is the breakup of productionrequirements. It is the start of scheduling. It is prepared

by keeping in view the order or likely sales order in near

future.

Manufacturing Scheduling

It is used whereproduction process is continuous. The order of

preference for manufacture is also mentioned in the

schedule for a systematic production planning.

Detail Operation SchedulingIt indicates the timerequired to perform each and every detailed operations

of a given process

Types of Schedules

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Despatching refers to the process of actually ordering thework to be done. It involves putting the plan into effectby issuing orders. It is concerned with starting theprocess and operation on the basis of route sheets andschedule charts.

In the words of JOHN A. SHUBIN

Despatches put production in effect by releasing and

guiding manufacturing order in the sequencepreviously determined by route sheets and schedules.

4. Dispatching

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Centralized Dispatching Under this, orders aredirectly issued to workmen and machines. It helps in

exercising effective control.

Decentralized Dispatching

Under this procedure

all work orders are issued to the foreman or dispatch

clerk of the department or section. It suffers from

difficulties in achieving co-ordination among different

departments.

Dispatching Procedures

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Follow up or expediting is that branch of productioncontrol procedure which regulates the progress ofmaterials and part through the production process.

Follow up Procedure

Progress may be assessed with the help of routine reports

or communication with operating departments. Thefollow up procedure is used for expediting and checkingthe progress.

5. Follow-Up and Expediting

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Inspection is the process of ensuring whether theproducts 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 sothat pre-determined standards of quality are achieved.

Inspection ensures the maintenance of pre-determinedquality of products.

6. Inspection

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Activities in Production Planning

Aggregate production planning planning the

production output levels for major product lines Must be coordinated with product design,

production, marketing, and sales

Master production planning specific schedule

(master production schedule) of the quantities ofindividual models in each major product line

Material requirements planning (MRP) detailedschedule of raw materials and parts production for

models in master schedule Capacity planning planning labor and equipment

resources to achieve the master schedule

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Activities in a Production Planning and Control

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Benefits of Production Planning &

Control

Higher quality

Better resource utilization

Reduced inventory Reduced manufacturing cycle time

Faster delivery

Better customer services

Lower production costs

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Benefits (continued)

Lower capital investment

Higher customer service

Improved sales turnover

Improved market share Improved profitability

Competitive advantage

Flexibility

Dependability

Lower prices

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Based on Assumptions Production planning and control is

based on certain assumptions. In case the assumptions provecorrect, the planning and control will go smoothly. But if they

go wrong, process of planning and control will go weak.

RigidityUnder production planning and control, there is

rigidity in the behaviour of employees and it may not help insmoothening flow of work.

Difficult for small firmsThis process is time consuming andtherefore not affordable for small firms

CostlyIt is a costly device as its implementation requiresseparate persons to perform functions of planning, expediting,dispatching etc.

Dependence on External FactorsExternal factors like naturalcalamities, change in technology, government controls etc

reduce effectiveness of production planning.

Limitations

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Measuring Effectiveness of

Production Planning & Control

Delivery

Inventory levels

Production/Operations Management

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Requirements for Effective Production

Planning & Control

Sound organizational structure

Delegation of authority

Reliable, up-to-date feedback

Standardization Trained people

Flexibility to adapt

Appropriate management policies

Accurate assessment ofmanufacturing/procurement lead times

Adequate plant capacity

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QUESTIONS?

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Documents

IE 305 CH 1 Introduction