Introduction to production planning and control

INTRODUCTION OF PRODUCTION
PLANNING AND CONTROL
UNIT - 1

PRODUCTION PLANNING AND CONTROL
 PPC is aimed to achieving the efficient
utilization of resources (material, men ,
facility) in the manufacturing organizations
through planning , coordinating and control the
production activities that transform the raw
materials in to finished product

PRODUCTION PLANNING AND
CONTROL
 PPC = Production Planning +
Production Control

OBJECTIVES OF PPC
 To design the production system to meet with
minimum cost and quality standard
 To ensure maximum utilization of resources
 To ensure production of quality products
 To maintain inventory controls
 To maintain flexibility in manufacturing
operations

OBJECTIVES OF PPC
 To plan the plant capacities for future
requirements
 To establish targets and checking them against
peformance
 To ensure effective cost reduction and cost
control.

PRODUCTION PLANNING
Meaning:-
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:-
"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 - kimball

OBJECTIVES OF PRODUCTION
PLANNING
1.To determine the requirements of men, material
and equipment.
2.Arranging production schedules according to
the needs of marketing demand.
3.Arranging various inputs at a right time and in
right quantity.
4.Making most economical use of various inputs.
5.To achieve coordination among various
departments relating to production.

6.To make all arrangements to remove possible
obstacles in the way of smooth production.
7.To achieve economy in production cost and
time.
8.To operate plant at planned level of efficiency.
9.Making efforts to achieve production targets in
time.
10.Providing for adequate stocks for meeting
contingencies.

LEVELS OF PRODUCTION
PLANNING
1. Factory planning (Availability of machines,
buildings, and goods)
2. Process planning (Operations involved)
3. Operation planning (Tools required)

FACTORS DETERMINING
PRODUCTION PLANNING
1. Volume of production
2. Nature of production process
3. Nature of operations

PRODUCTION CONTROL
Meaning:-
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 see that every theme goes as per the plan.
Definition:-
"Production control refers to ensuring that all which occurs is in
accordance with the rules established and instructions issued.“
-HENRY FAYOL

ESSENTIAL STEPS FOR
CONTROL PROCESS
1. Initiation the production
2. Progressing
3. Corrective action based up on the feed back

OBJECTIVES OF PRODUCTION
CONTROL
1.To implement production plans by issuing
orders to those who are supposed to implement
them.
2.To ensure that various inputs like men,
machine, materials etc. are available in the
required quantity and quality.
3.Making efforts to adhere to the production
schedules.
4.To ensure that goods are produced according to
the prescribed standards and quality norms.

5.To undertake the best and most economic
production policies.
6.To introduce a proper system of quality
control.
7.To ensure rapid turnover of production and
minimizing of inventories of raw materials and
finished products.

SCOPE OF PRODUCTION
CONTROL
1. Control of planning
2. Control of tooling
3. Control of materials
4. Control of activities
5. Control of material handling
6. Control of information
7. Control of quantity
8. Control of due dates
9. Control of quality
10. Control of manufacturing capacity

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."

PHASES OF PRODUCTION
PLANNING AND CONTROL
1. PRE – PLANNING PHASE
2. PLANNING PHASE
3. CONTROL PHASE

1. PRE – PLANNING PHASE
 Micro planning
 Analysis of data
 Out line of basic planning (Demand , Market
analysis, and product design and development)
 Pre planning concern with 4’M’s
Material, Machine, Methods, Manpower
 Pre planning contents are given below:

PRE PLANNING CONTENTS
1. Product development and design
2. Process design
3. Work station design
4. Sales forecasting
5. Estimating
6. Factory outlet and location
7. Equipment policy
8. Pre – planning production

2. PLANNING PHASE
 Analysis of 4’M’s (Material, Machine,
Methods, Manpower) to undertake the above
“M”s
 Phase for Planning, Estimating, & Scheduling
 Short-term planning
 Long-term planning

3. CONTROL PHASE
 This involves Dispatching, Inspection,
Expediting, and evaluation.
 Control of scrap, control of transportation.
 Feed back information for the corrective
actions.

FUNCTIONS OF PPC
 MATERIAL PLANNING(Batch, delivery
rates, etc,.)
 METHODS PLANNING(Identify the
alternate methods and select the best methods)
 MACHINES AND EQUIPMENT(Tools and
machines checking for requirements)
 PROCESS PLANNING(Sequence of
operation in the production)
 ESTIMATING (Production orders and
detailed root sheets)

 SCHEDULING AND LOADING (Fixing priorities and
machine loading)
 DISPATCHING (Release the orders for customers)
 EXPENDITING(Tracking of the progress of work
according to the planned schedule)
 INSPECTION AND TESTING (Quality of the products
meet the specification)
 EVALUATION ( Link between the control and future
planning)

PRODUCTION SYSTEM
 PRODUCTION – sequence of operations
 Transform given materials to desired products.
 Combination of different manufacturing
process.
 SYSTEM- Logical arrangement of
components according to the plan.
 PRODUCTION SYSTEMS- Inputs to outputs.

TYPES OF PRODUCTION
SYSTEMS
1. Job shop production (units of customer orders)
2. Batch production(Small batches in large variety)
3. Mass production( Large quantities of products)
4. Process or continuous production (Manufacture
the products where the demand is high)

PRODUCT DESIGN AND
DEVELOPMENT
 PRODUCT DESIGN:
 It deals with FORM and FUNCTION
 FORM- Shape and Appearance
 FUNCTION- Working of the product.
 PRODUCT DEVELOPMENT:
 Revising the product to meet the changing
requirements of the market (UPDATION)

PRODUCT ANALYSIS
 Objectives of product analysis to obtain the
qualitative and quantitative products influencing
factors to success of manufacturing products.
 FACTORS INFLUENCING PRODUCT ANALYSIS:
1. Marketing aspects
2. Product characteristics
1. Functional aspects
2. Operational aspects
3. Durability and dependability
4. Aesthetic aspects

3. Economic analysis
(a) Profit consideration
(b) Effect of standardisation, simplification and
specialisation
(c) breakeven analysis
4. Production aspects( Design for Manufactures)
1.Guidelines for general approach for DPM
2. Guidelines for the selection of production
process
3. Guidelines for particular process
4. Guidelines for assembly

BASIC PRINCIPLES OF PRODUCT
DEVELOPMENT(PRODUCT DEVELOPMENT
TECHNIQUES) (16 mark)
 Standardisation
 Simplification
 Specilisation
 Diversification
 Miniaturisation, etc.

STANDARDISATION
 Setting up standards
 Measuring by Quality, Quantity, Value,
Peformance
 Definition:
 Process of defining and applying the conditions
necessary to ensure that given range of
requirements can normally be met with a
minimum variety and in a reproducible and
economic manner based on current techniques.

STANDARDISATION
 It means fixation of size, shape, quality and
manufacturing process
 Example: shaving blades, television etc.,
 It applicable for all factors such as, Men machines
and materials
 It is an instrument to maximum variety of
products
 Standardization implies non-standard items are
not to be manufactured expect when customers
order especially

OBJECTIVES OF STANDARDISATION
1. To achieve maximum overall economy by,
1. Cost
2. Human effort
3. Materials
2. Maximum use of changing( repair)
3. To adopt best possible solutions
4. To define the levels of quality
5. To exchange goods by national and international
levels (because of standardisation)

CLASSIFICATION OF STANDARDISATION
1. Basic Standardizations( weight, voltages , numbers, sizes )
2. Dimensional standardization (Nuts, Bolts)
3. Material standardization (Raw materials , coolants,
Lubricants)
4. Equipment standardisation (Specifications , performance,
ratings)
5. Process standardisation (Maximum benefit and cheapness
in production)

CLASSIFICATION OF STANDARDISATION
6. Quantity standardisation (Decided earlier based up
on dealer)
7. Safety measures standard+isation ( Rules and
regulations)
8. Personnel standardisation (Workers selection ,
training, wages rates)
9. Administrative standardisation (Office methods and
procedures)

BENEFITS OF STANDARDISATION
1. Reduction in material waste.
2. Reduction in manufacturing cost per unit
automatically reduces cost of the product.
3. Uniform quality of product
4. Reduce servicing , replacement and
maintenance of parts
5. Better and quicker service deliveries

LIMITATIONS OF STANDARDISATION
1. Reduced choice of customers because reduce
variety
2. Changes in product design or new product design
may take a very long time
3. Standardisation of operations and procedure will
reduce interest of workers

SIMPLIFICATION
 Simplification is the process of reducing the
variety of products manufactured
 Elimination of excessive and un desirable waste
for achieve economy
 It reduction in
 Product range
 Assembly and
 Parts
 Other wise called as “PRODUCT LINE
CONTRACT”

CONSIDERATION IN
SIMPLIFICATION
 Before simplifying any product
 Simplification should done efficetively for the
given product
 How many simplification will affect customer
demand?
 Does market competation permit simplification ?

BENEFITS OF
SIMPLIFICATION
1. Reduce manufacturing operations
2. Possible effective utilisation
3. Simplifies production planning and
supervision
4. Lower manufacturing costs and higher sales
5. Provides quick delivery

LIMITATIONS OF
SIMPLIFICATION
 Cannot satisfy wide range of demand
 Cannot enable better contact in demand to
satisfy taste
 It cannot create demand

SPECIALISATION
 Name itself shows specialization means
EXPERT In particular product line, instead of
diversion.
 Concentrate limited number of products in a
particular area.
 Combination of simplification and
standardisation leads specialisation.

ADVANTAGES AND DISADVANTAGES OF
SPECIALISATION
1. Better utilization of equipments
2. Higher productivity
3. Greater efficiency
4. Better quality
5. Use of Standardized methods
DIS ADVANTAGES:
1. Lesser flexibility
2. Same work in special loss of
initiative(Invention)

ECONOMIC ANALYSIS
 Management decision in product decision policy.
 Capital expenditure in terms of fixed and variable
costs
 Production cost per price
 Price (cost+profit)
 Quantity manufactured
 Requirements of direct and indirect materials

PROFIT CONSIDERATION
1. PURE PRICING STRATERGY
 Increase the total profit by increasing the profit
by unit price.
 Sales volume remain same total profit would
proportional to increase the margin profit
 Due to the competitors products profit may
shrink.

2. MARKETING STRATERGIES
 Through design, advertisement and pricing
 More attractive product by reducing costs
 Too low margin cause in stabilities in market
3. REDUCTION IN HOUSE PRODUCTION
COSTS:
 Increase the total profit by reducing the total
production costs

BREAK - EVEN ANALYSIS
(8 mark)
 It is otherwise called as Cost volume profit
analysis
 It deals with Companys Sales , profit, and
Costs
 Simple method of presenting to management
the effect of changes in volume of production.

AIMS OF BREAK EVEN
ANALYSIS
 Help to deciding profitable level of output
 To take decision regarding make or buy
 To decide product mix or promotion mix
 To take plant expansions decisions
 To indicate margin of safety
 To compare a number of business enterprise

ASSUMPTIONS OF BREAK
EVEN ANALYSIS
 Selling price remain constant for all sales( no
discount)
 Relation ship between sales volume and costs
 Assumes it as Fixed and variable costs
 Production is equal to sales

DETERMINATION OF BREAK
EVEN POINT
1. THE ALGEBRIC METHOD
2. THE GRAPHICAL METHOD
THE ALGEBRIC METHOD
Total costs= fixed cost + variable costs
Break even Quantity= FIXED COSTS by
(SELLING PRICE – VARIABLE COSTS)

2) THE GRAPHICAL METHOD
It is break even chart Graphical representation of
relation ship between Cost and revenue at given
time.

ECONOMICS OF A NEW PRODUCT DESIGN
(SAMUEL EILON MODEL)
 When launching of a new design or model, a
careful analysis of a proposed project.
 Introduction of the new model to the market.
 To increase the profit of the organization.
 To avoid decline the sales of execution due to stiff
competition
PIE = (PROFIT + FIXED COSTS) by (QUANITY
SOLD).

Introduction to production planning and control

More Related Content

What's hot (20)

Similar to Introduction to production planning and control (20)

More from MohanKirthik (20)

Recently uploaded (20)

Introduction to production planning and control