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MB0044-Production and Operations Management

Unit-1 Production Management

1

Program : MBA

Semester : II

Subject Code : MB0044

Subject Name : Production and Operations Management

Unit number : 1

Unit Title : Production Management

Lecture Number : 1

Lecture Title : Production Management

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MB0044-Production and Operations Management

Unit-1 Production Management

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Production and Operations Management

Objectives:

After studying this unit, you should be able to:

Define production management

Identify the key elements of product manufacturing

Explain production planning and production control

Explain system productivity and capital productivity

Describe labour productivity and personal productivity

Identify the importance of training

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C o n f i d e n t i a l

MB0044-Production and Operations Management

Unit-1 Production Management

Lecture Outline

Introduction

Production Management Activities

Integrated Production Management

Production Management

Production Planning

Production Control

System Productivity

Capital Productivity

Labour Productivity

Personnel Productivity

Training

Summary

Check Your Learning

Activity

3

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MB0044-Production and Operations Management

Unit-1 Production Management

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Introduction

Production refers to the creation of goods and services for consumption by the society. It involves converting inputs to desired outputs using different conversion or transformation processes. Production management encompasses all those activities that enable conversion of a set of inputs into outputs which are useful to meet the human needs.

The basic steps involved in production management are:

Deciding upon desired outputs

Identifying the inputs

Identifying the conversion process

In this session, you will learn about various functions involved in production

management and their significances.

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Production Management Activities

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Production management involves the following activities:

Production Management

Identification of the requisite materials

Ascertaining the quantities to be

produced

Procuring, Storing, and Transporting the materials inside the

organisation

Formulating the strategies at various levels

Designing flexibility into the

system

Accommodating technological

changes

Taking decisions on production aspects

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The set of interrelated management activities, which are involved in manufacturing certain products, is called as production management. The various functions involved in production are:

Integrated Production Management

Procuring the materials

Moving the material for transformation

Training and deploying the workforce

Implementing the procedures for systematic loading of machines

Maintaining the inventories

Maintaining the machines

Establishing the methods of inspection to ensure quality

Packaging the products for safe distribution and dispatch

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Production Management

Production management typically starts with aggregate planning. The data for this planning comes from the marketing department which forecasts the demand and determines the quantities of various products needed to fulfill the orders. Make or buy decisions have to be taken to meet the varying demands to avoid the deficits or excesses by two well known

Make or Buy decisions

Matching Demand

Level Capacity

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Production Planning

Production Planning

Estimating Routing Scheduling

The functions of production planning are broadly classified into three:

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Production Control

The functions of production control are dispatching and expediting.

Production Control

Dispatching Expediting

Dispatching is concerned with setting production activities in motion which include issuing material release orders and moving materials from work centre to work centre, meeting the requirements of routing and scheduling.

Expediting function ensures that the progress is satisfactory and the path of the production process is cleared of constraints and the workflow is smooth.

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System Productivity

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Productivity is generally expressed as the ratio of outputs to inputs. Enhancement of productivity is achieved by either reducing the inputs for the same output or increasing the output by using the same input. Productivity can be calculated for:

A single operation

A functional unit

A department division

A plant

Quality circles are voluntary groups of employees who develop solutions to various problems with less additional resources

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Unit-1 Production Management

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Capital Productivity

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Capital deployed in plant, machinery, buildings, and the distribution systems as well as working capital are the components of the cost of manufacturing. Demand fluctuations, uncertainties of production owing to breakdowns, and inventories being created drag the productivity down. Therefore, strategies are needed to maximise the utilisation of the funds allotted towards capital. The strategies included are:

Outsourcing strategies

Methods improvement

Balancing of workstations

Quality circles

Rationalisation of packaging methods

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Unit-1 Production Management

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Labour Productivity

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Labour productivity is measured by calculating the number of products per hour for an individual.

There are three steps involved in increasing the labour productivity.

Setting up productivity norms and evaluation of production operations

Reallocation of workers

Balancing operations in assembly line

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Personnel Productivity

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To differentiate the persons who actually work on machines and who do not, but facilitate the operations in other ways, we use the word personnel. The term personnel refers to people who:

Facilitates the operations

Coordinates between various operations

Checks the setups

Verifies that proper jigs and fixtures are provided

Inspects the allocated machines

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MB0044-Production and Operations Management

Unit-1 Production Management

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Training

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The purpose of training is to enhance the performance so that the overall objective of achieving the desired productivity is achieved.

Training programmes enhance motivation, which is an important attribute of a productive employee.

Training also adds value to the workers contribution and thus paves the way for career development.

Entropy hampers the efficiency and training is necessary to maintain even the existing levels of efficiency.

Implementation of TQM and other change management programmes depend on training for their success

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Summary

Production involves converting inputs to desired outputs using different conversion or transformation processes.

The set of interrelated management activities, which are involved in manufacturing certain products, is called as production management.

The functions of production planning are estimating, routing and scheduling.

The functions of production control are dispatching and expediting.

Productivity is generally expressed as the ratio of outputs to inputs.

Capital deployed in plant, machinery, buildings, and the distribution systems as well as working capital are the components of the cost of manufacturing.

Labour productivity is measured by calculating the number of products per hour for an individual.

The purpose of training is to enhance the performance so that the overall objective of achieving the desired productivity is achieved.

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MB0044-Production and Operations Management

Unit-1 Production Management

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Check Your Learning

1. What are the functions of production control?

Ans: The two functions of production control are:

a. Dispatching

b. Expediting

2. List the various strategies of capital productivity.

Ans: The various strategies of capital productivity are:

a. Outsourcing strategies

b. Methods improvement

c. Balancing of workstations

d. Quality circles

e. Rationalisation of packaging methods

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MB0044-Production and Operations Management

Unit-1 Production Management

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Assume that you own a production company. The raw materials and the manpower available in the company are not adequate. However the productivity is expected to be high. In such case which strategy would you implement to attain the expected productivity?

Activity

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