IE 305 Production Planning & Control

CH 1 : Introduction

The Concept
Planning: Consideration of all input variables to achieve predetermined output goals; a preproduction activity to determine optimal production schedule, operation sequence, economic batch quantity, etc. Control: Remedial action to prevent variance of output from planned levels; tracking operations to ensure compliance with planned levels
2

Production Planning
Production Planning may be said to be a technique of forecasting 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 four considerations, namely, what work shall be done, how the work shall be done and lastly, when the work shall be done.
3

Production Control
Production control is the process that keeps a watchful eye on the 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 instructions issued.

Why do we need Production Planning and Control?

For Increasing Production Main purpose of
production planning is to arrange inputs. Production control program minimizes idleness of men and machines. It thus helps in raising industrial output.

For coordinating plant activity -In planning

production is carried out in a number of processes and thus activities are synchronized for smooth working.
5

Production Planning Stages

Defining objectives Setting priorities to attain objectives Examining internal & external environments of planned system Determining achievable targets Determining inputs needed to achieve targets

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

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

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
9

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
10

Functions of Production Control

Inventory control: MRP; JIT Time management Quality control Maintenance & Replacement Cost reduction & cost control Dispatch Expediting/Follow-up/Progressing
11

Areas of Production Planning

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
12

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
13

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

14

Elements of Production Planning

Planning Routing Scheduling Dispatching Follow-up and Expediting Inspection
15

1. Planning
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 is created 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.
16

2. Routing
Routing is determining the exact path which will be followed in production. It is the selection of the path from where each unit have to pass before reaching the final stage. The stages from which goods are to pass are decided 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 a particular manufacturing lot.

17

Routing Procedure
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

18

3. Scheduling
Scheduling is the determining of time and date when each operation is to be commenced or completed. The time and date of manufacturing each component is fixed in such a way that assembling for final product is not 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 time necessary to perform the entire series, as routed, making allowances for all factors concerned.
19

Types of Schedules
Master Scheduling It is the breakup of production
requirements. 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 where

production process is continuous. The order of preference for manufacture is also mentioned in the schedule for a systematic production planning.
Detail Operation Scheduling It indicates the time required to perform each and every detailed operations of a given process
20

4. Dispatching
Despatching 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. In the words of JOHN A. SHUBIN Despatches put production in effect by releasing and guiding manufacturing order in the sequence previously determined by route sheets and schedules.

21

Dispatching Procedures
Centralized Dispatching Under this, orders are
directly 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.

22

5. Follow-Up and Expediting

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

Follow up Procedure
Progress may be assessed with the help of routine reports or communication with operating departments. The follow up procedure is used for expediting and checking the progress.
23

6. Inspection
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.

24

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 of individual models in each major product line Material requirements planning (MRP) detailed schedule of raw materials and parts production for models in master schedule Capacity planning planning labor and equipment resources to achieve the master schedule
25

Activities in a Production Planning and Control

26

Benefits of Production Planning & Control

Higher quality Better resource utilization Reduced inventory Reduced manufacturing cycle time Faster delivery Better customer services Lower production costs
27

Benefits (continued)
Lower capital investment Higher customer service Improved sales turnover Improved market share Improved profitability Competitive advantage Flexibility Dependability Lower prices
28

Limitations
Based on Assumptions Production planning and control is based on certain assumptions. In case the assumptions prove correct, the planning and control will go smoothly. But if they go wrong, process of planning and control will go weak. Rigidity Under production planning and control, there is rigidity in the behaviour of employees and it may not help in smoothening flow of work. Difficult for small firms This process is time consuming and therefore not affordable for small firms Costly It is a costly device as its implementation requires separate persons to perform functions of planning, expediting, dispatching etc. Dependence on External Factors External factors like natural calamities, change in technology, government controls etc reduce effectiveness of production planning. 29

Measuring Effectiveness of Production Planning & Control

Delivery Inventory levels Production/Operations Management

30

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 of manufacturing/procurement lead times Adequate plant capacity
31

QUESTIONS?

32