Week 1 Lecture 1

1. Week 1 Lecture 1 Production Planning and Control Engr. Abdul Aleem

2. PRODUCTION PlANNING Production planning is a pre-production function performed to match the production capacity with the essential market demand in the most feasible manner. It consist of 1-Production & 2- Planning

3. PRODUCTION CONTROL Production control It follows other functions of production & helps to determine the performance of an organization.

4. OBJECTIVES OF PRODUCTION PLANNING To meet the demand of the product effectively & maintain the balance between different production activities. The best possible utilization of available resources. To operate the plant at a predetermined level of efficiency. To utilize production facilities to the maximum for getting the minimum operating costs & meeting delivery schedules. To assist workers engaged in production activities for making right & greater earnings. To equip management for tackling any difficulty, which may arise later on in the achieving of production target.

5. FUNCTIONs OF PRODUCTION PLANNING Production selection & design – this helps the selection of most suitable product that fulfills market demand. It also ensures that design of the product is according to customer requirements. Process selection & planning – this helps to choose right technology, equipments, machines, material handling systems, automation involved in production of product. Facility location – this helps to minimize the costs such as production & distribution costs. Facility location & materials handling– this helps to material transfer & processing of product in the most efficient manner through the shortest possible distance with minimum time wages. Capacity planning – decides about how much resource should be kept to meet current market demand. Procedure planning – specifies production procedure to be practiced for obtaining the desire output at optimum cost.

6. STEPS INVOLVED IN PP • Determination of target (past experience/ budget/manpower/production capacity). • Collection & interpretation of information (raw material availability/new technology / regulations). • Developing plan (deciding batch size/ procedure/process/lead time). • Putting plan into operations (execution). • Follow up action (controlling to correct deviation if any).

8. PRODUCTIION PLANNING hierarchy Long Term (Capacity Planning) Capital Intensive in nature- This deals with Strategic and business issue. In the long term we deal with those issue which help us to create demand for our products and generating sufficient revenue for the company.- Reflect in process choice and equipment selection. Since selection of equipment and facilities require lot of investment and decision is irreversible, one should pay utmost care keeping in mind customer requirements. Medium Term (Aggregate Planning)- How demand can be met from existing facilities and resources. Here we are trying to utilizing our existing resources (manpower, machine, facilities etc) to satisfy the market demand

9. Short Term (operational Planning)- In short term we monitoring the production activities on day to day basis and compare the output against the plan and take corrective action.Master Production Schedule (MPS) - Is a statement of how many finished items are to be produced and when they are to be produced.Material Requirement Planning (MRP) - System that uses net demand from the MPS and explodes it using the bill of materials (BOM).

10. Organizational structure of PPC department • It differ from organization to organization • FACTORY HEAD • PRODUCTION MANAGER • PRODUCTION SUPERVISOR SKILLED WORKER • QC/QA MANAGER • MAINTAINANCE MANAGER

11. Production Control To execute the Production plans & to attain the company objectives production manager needs to check the work progress & correct the deviations between actual performance & planned standards or requirements of customers. Controlling is the process that measures the existing performance of an organization & guides it towards predetermined objectives. It means Production Control is essentially the control of quantity in manufacturing of the required quality.

12. FUNCTIONS OF PRODN CONTROL • Inventory control – Helps determine the optimal inventory levels, components, parts, tools, spares in order to ensure their availability with minimum capital investment. (JIT) • Time management – Helps to ensure whether the manufacturing of product is according to schedule. • Quality control – Helps ensures that the services & products produced by company meet the declared quality standards with minimum cost.

13. FUNCTIONS OF PRODN CONTROL Cont….. • Maintenance & replacement – Helps select the optimal maintenance policy to ensure or availability of equipments& machines, includes – preventive inspection, planned lubrication, periodic cleaning, planned replacement of parts etc. • Cost reduction & cost control • Dispatching – Moving of RM among various operations, collecting fixtures & tools from stores and issuing them to concern department, issuing route cards etc. • Follow up or progressing.

14. ADVANTAGES OF PRODN CONTROL TO MANAGEMENT • Prodn control aims to make right quantity & quality of product, accessible to customers at right time & at minimum cost. • Investment in inventories & finished stock can be kept minimum. • The firm can capture market share by producing goods at lowest cost & best quality & may result in large amount of sales. • The amount of profit will be higher. • The firm can compete in the market with low cost prodn & higher profits.

15. Techniques of production planning & control

16. Routing – is selection of path or route over which each piece is to travel in being transformed from RM into FG. Scheduling – It involves establishing the amount of work to be done & the time when each element of work will start. Determine most feasible sequence of operations. Dispatching – is concerned with the issue of orders to shop floor, instructions, tools are provided, job cards & work force. Guiding & controlling the material & operations in processing on the basis of route sheet & shedule Follow up – to see whether the work is being carried on according to planning & orders & instructions issued. Inspection – To check the process or quality Correction – Making correction or initiating necessary action to ensure desired output.

17. OBJECTIVES OF PRODN PLANNING & CONTROL • Effectiveness – ensures right kind of goods to fulfill the customer requirement. • Maximizing output – ensures the prodn of maximum goods & resources in minimum output. • Quality control – ensures quality of goods/services meet the quality specification. • Minimizing theoutput time – ensures reducing delays, waiting time & ideal time. • Capacity utilization – ensures manpower/machine is fully utilized. • Maintain inventory level – ensures optimal level of stock. • Flexibility – ensure that flexibility maintain for all operations.

18. OBJECTIVES OF PRODN PLANNING & CONTROL Cont….. • Better coordination – between machine & labour. • Reducing bottlenecks – ensures that all the bottlenecks are removed from all stages of operations. • Maintaining performance – ensures the proper standards are maintained by comparing actual result with planned result. • Prepare production schedules – ensures that timely production is made according to the schedule.

19. BENEFITS OF OF PRODN PLANNING & CONTROL • Higher quality, • Better utilization of resources, • Reduced inventories, • Reduced manufacturing cycle time, • Faster delivery, • Better customer services, • Lower production costs, • Lower capital investments, • Higher customer services, • Improve sales turnover,

20. BENEFITS OF OF PRODN PLANNING & CONTROL • Improve market share, • Improve profitability, • Flexibility, • Lower prices, • Competitive advantage for firm due to balance inventory levels & higher quality.

21. Demand Forecasting • Objective • Topredict demand for planning purposes • Laws of Forecasting • Forecasts are always wrong • Forecasts always change • The further into the future, the less reliable the • forecast will be

22. Aggregate Production Planning • Objective • To generate a medium-term production plan • To establish rough product mix • To anticipates bottlenecks • To align capacity and workforce plans. • It is usually done for next 2 to12 months. • Demand changes over a period of time at a faster rate than the resources. Aggregate planning offers strategies to absorb these fluctuations.

23. Scheduling • Concerned with timetable of production • Scheduling arranges the different manufacturing operations in order of priority, fixing the time & date for the commencement & completion of each operation. • Types of scheduling • Forward scheduling • Backward scheduling

24. Workforce Planning • To find out and direct • Right people • Right place • Right time • Right price

25. Materials Requirement Planning • MRP is a production planning and inventory control system used to manage manufacturing processes. • An MRP system has 3 major objectives • Ensure materials are available for production and • products are available for delivery to customers • Maintain the lowest possible level of inventory • Plan manufacturing activities, delivery schedules • and purchasing activities

26. Capacity Planning Wrong Capacity

27. Shop floor Control Objective To control flow of work through plant and coordinate with other activities (e.g., quality control, preventive maintenance, etc.)