Q.1) Define Human Resource Management with its importance.

The human resource management is a common term which is heard amongst

professionals. This term takes on a key part in the success of any system. This
function present in any management helps in maximizing employee performance.
They are chiefly responsible for training employees, rewarding, performance appraisal
and recruitment and more. Here we are going to discuss about why human
resource management is important.

The Importance of Human Resource

Management:
1. Helps you achieve your objectives:

The chief ground for human resource management to be important is that

they help the company to achieve their objective on a regular basis by means
of developing a positive attitude amongst the employees.They assist in
diminishing wastage and make usage of maximum net income from the
resources.

2. Design recruitment and training:

They are significant because they cull the right kind of people during
recruitment. They call for initiatives and design criteria which are best suited
for a specific task.

When required they also supply preparation for employees, which helps in
evolving the presentation skills of the employees and then they take up new
posts.

3. Professional development is attained:

The policies adopted by human resource management helps in providing

excellent training for the employees.
When such training is offered, they are developed professionally. Their talent
can be used inside the system and also in other companies which one may
intend to join in the future.

4. Performance appraisals are a good thing:

The HRM motivates the employees by their performance assessment

procedure. They help people to act according to their efficacy and also offer
estimates to gain advances.The employee’s performances according to their
roles are monitored on a regular base.With this concept, the employees are
able to make an outline of their ends and go towards it. By this way the
employees are boosted and perform good.

5. Smooth relationship is preserved:

The co-ordinal relationship between union and management is maintained

with HRM.The joins in the troupe comes to a determination that the troupe is
also interested in their increment and the prospects for performing strikes are
greatly brought down.

6. The work atmosphere is maintained:

Another important aspect to be glanced is that the workplace atmosphere and

work culture are significant aspects which plays a central part in the operation
of an employee. The human resource team offers a good working condition
for the employees.A dependable, tidy and clean employee can take out the
best performance from an employee. Apart from this, job satisfaction is also
obtained with a good work environment.

7. Enhances team work:

The HRM helps individuals and trains them to play in a team; this perfect
training makes employees better to exploit in a team.

By this way team work is enhanced and employees learn to adjust and
coordinate with their squad.
8. Handles disputes:

There are a number of hassles and issues that may rise up during the track
amongst the employer and employee in an organization.In such scenarios, the
human resource department acts as a consultant as well as intercessor to set
right those sorts of events.They first hear the grievances of the employees and
sort them out by providing proper solution. Whenever mandatory, they also
require immediate action.

9. They prepare talents for the hereafter:

To integrate the occupation demands and produce perfect results, the

employees are often trained.During the training period the potential
employees of the team are distinguished to be advanced to the next higher
grade. So HRM takes responsibility for preparing people for the future by
picking talents.

10. Public relations are raised:

The human resource management is responsible for rising public relations

during the class of work.They are responsible for organizing seminars,
business meetings, and other official get together on behalf of the fellowship
so that public relationship with other systems is developed.Commercial
enterprise and marketing plans are likewise planned by human resource
management in some shells. Hence they help in preparing and maintaining
public relationships.

11. They select the right employee:

The human resource management follows a certain set of protocols to pick the
correct candidate for a fixed task. Such sort of selection offers job
satisfaction for the employee as they act in the proper class of occupation.The
routine of employees who leave their occupation is also reduced, which
decreases labor turnover.

12. For handling payrolls:

Either small business or large systems, human resource managements help in
maintaining payrolls or handling open enrollment season each year.The
employee’s complete details regarding payments are taken charge by this
squad. They too hire up the obligation to set the pay range within the
establishment.

13. They maintain management cost:

The HRM trims down the management cost with various methods and brings
about best methods for benefits where few of them include health care
coverage.The human resource management also makes a detailed study on
the current status regarding wage setting, by running through the labor
market, employee trends and salary analysis with the equivalent job
functions.For budget constrained organizations human resource management
can be a perfect solution.

14. Minimizing employee recruitment cost:

The cost of recruitment, replacement, training and ramp up time can be

outrageous for organization especially for small businesses.But the HRM
would design a well-structured recruitment and selection process which helps
in minimizing the key expenses regarding job advertisements, training and
enrolling new employees.

15. Helps you get latest salary:

Another important reason for human resource management to play a key role
is that they recommend in gaining market based salaries, they determine
salary ranges for their organization with the latest updates and knowledge.
Q.2) a) Explain Process of HRP in detail

The Human Resource Planning is a process of forecasting the organization’s demand for and

supply of manpower needs in the near future. In today’s knowledge economy an

organization’s most valuable asset is its human resources – its employees. Their skills
and knowledge, as well as their relationships with key customers, can often be
irreplaceable and can determine an organization’s success. So much so, human
resource planning is now an integral part of an organization’s strategy.

The human resource planning is a four-step process that analyzes current human
resources, forecasts future requirements, identifies areas where there are gaps, and
then implements a plan to tighten up those gaps. Breaking it down, the objectives of
human resource planning are to make sure you have the right number of people in the
right jobs at the right time.

What is the importance of human resource planning?

 HR department is prepared for changing requirements

 Your organization is not caught off-guard in the shifting workforce
market
 Adapt faster to the introduction of automation or advanced technologies
 Gain competitive advantage through rapid rollout of new products or into
new markets
 Better anticipate the need for critical skills during growth phases
 Be proactive by honing the skills of current workforce in order to move
into new areas
 Human Resource Planning Process

1. Determining the Objectives of Human Resource Planning: The foremost

step in every process is the determination of the objectives for which the
process is to be carried on. The objective for which the manpower planning is to
be done should be defined precisely, so as to ensure that a right number of
people for the right kind of job are selected.

The objectives can vary across the several departments in the organization such
as the personnel demand may differ in marketing, finance, production, HR
department, based on their roles or functions.

2. Analyzing Current Manpower Inventory: The next step is to analyze the

current manpower supply in the organization through the stored information
about the employees in terms of their experience, proficiency, skills, etc.
required to perform a particular job.

Also, the future vacancies can be estimated, so as to plan for the manpower
from both the internal (within the current employees) and the external (hiring
candidates from outside) sources. Thus, it is to be ensured that reservoir of
talent is maintained to meet any vacancy arising in the near future.

3. Forecasting Demand and Supply of Human Resources: Once the inventory

of talented manpower is maintained; the next step is to match the demand for
the manpower arising in the future with the supply or available resources with
the organization.

Here, the required skills of personnel for a particular job are matched with the
job description and specification.

4. Analyzing the Manpower Gaps: After forecasting the demand and supply, the
manpower gaps can be easily evaluated. In case the demand is more than the
supply of human resources, that means there is a deficit, and thus, new
candidates are to be hired.

Whereas, if the Demand is less than supply, there arises a surplus in the human
resources, and hence, the employees have to be removed either in the form of
termination, retirement, layoff, transfer, etc.

5. Employment Plan/Action Plan: Once the manpower gaps are evaluated, the
action plan is to be formulated accordingly. In a case of a deficit, the firm may
go either for recruitment, training, interdepartmental transfer plans whereas in
 the case of a surplus, the voluntary retirement schemes, redeployment,
transfer, layoff, could be followed.
6. Training and Development: The training is not only for the new joinees but
also for the existing employees who are required to update their skills from time
to time.

After the employment plan, the training programmes are conducted to equip the
new employees as well as the old ones with the requisite skills to be performed
on a particular job.

7. Appraisal of Manpower Planning: Finally, the effectiveness of the manpower

planning process is to be evaluated. Here the human resource plan is compared
with its actual implementation to ensure the availability of a number of
employees for several jobs.

At this stage, the firm has to decide the success of the plan and control the
deficiencies, if any.Thus, human resource planning is a continuous process that
begins with the objectives of Human Resource planning and ends with the
appraisal or feedback and control of the planning process.
b) What is recruitment? Explain sources of recruitment.
The searching of suitable candidates and informing them about the
openings in the enterprise is the most important aspect of recruitment
process.
The candidates may be available inside or outside the organisation.
Basically, there are two sources of recruitment i.e., internal and
external sources.
(A) Internal Sources:
Best employees can be found within the organisation… When a
vacancy arises in the organisation, it may be given to an employee who
is already on the pay-roll. Internal sources include promotion, transfer
and in certain cases demotion. When a higher post is given to a
deserving employee, it motivates all other employees of the
organisation to work hard. The employees can be informed of such a
vacancy by internal advertisement.

Methods of Internal Sources:

The Internal Sources Are Given Below:
1. Transfers:
Transfer involves shifting of persons from present jobs to other similar
jobs. These do not involve any change in rank, responsibility or
prestige. The numbers of persons do not increase with transfers.

2. Promotions:
Promotions refer to shifting of persons to positions carrying better
prestige, higher responsibilities and more pay. The higher positions
falling vacant may be filled up from within the organisation. A
promotion does not increase the number of persons in the
organisation.

A person going to get a higher position will vacate his present position.
Promotion will motivate employees to improve their performance so
that they can also get promotion.

3. Present Employees:
The present employees of a concern are informed about likely vacant
positions. The employees recommend their relations or persons
intimately known to them. Management is relieved of looking out
prospective candidates.

The persons recommended by the employees may be generally

suitable for the jobs because they know the requirements of various
positions. The existing employees take full responsibility of those
recommended by them and also ensure of their proper behaviour and
performance.

(B) External Sources:

All organisations have to use external sources for recruitment to
higher positions when existing employees are not suitable. More
persons are needed when expansions are undertaken.

The external sources are discussed below:

Methods of External Sources:
1. Advertisement:
It is a method of recruitment frequently used for skilled workers,
clerical and higher staff. Advertisement can be given in newspapers
and professional journals. These advertisements attract applicants in
large number of highly variable quality.

Preparing good advertisement is a specialised task. If a company

wants to conceal its name, a ‘blind advertisement’ may be given asking
the applicants to apply to Post Bag or Box Number or to some
advertising agency.

2. Employment Exchanges:
Employment exchanges in India are run by the Government. For
unskilled, semi-skilled, skilled, clerical posts etc., it is often used as a
source of recruitment. In certain cases it has been made obligatory for
the business concerns to notify their vacancies to the employment
exchange. In the past, employers used to turn to these agencies only as
a last resort. The job-seekers and job-givers are brought into contact
by the employment exchanges.

3. Schools, Colleges and Universities:

Direct recruitment from educational institutions for certain jobs (i.e.
placement) which require technical or professional qualification has
become a common practice. A close liaison between the company and
educational institutions helps in getting suitable candidates. The
students are spotted during the course of their studies. Junior level
executives or managerial trainees may be recruited in this way.

4. Recommendation of Existing Employees:

The present employees know both the company and the candidate
being recommended. Hence some companies encourage their existing
employees to assist them in getting applications from persons who are
known to them.

In certain cases rewards may also be given if candidates recommended

by them are actually selected by the company. If recommendation
leads to favouritism, it will impair the morale of employees.

5. Factory Gates:
Certain workers present themselves at the factory gate every day for
employment. This method of recruitment is very popular in India for
unskilled or semi-skilled labour. The desirable candidates are selected
by the first line supervisors. The major disadvantage of this system is
that the person selected may not be suitable for the vacancy.

6. Casual Callers:
Those personnel who casually come to the company for employment
may also be considered for the vacant post. It is most economical
method of recruitment. In the advanced countries, this method of
recruitment is very popular.

7. Central Application File:

A file of past applicants who were not selected earlier may be
maintained. In order to keep the file alive, applications in the files
must be checked at periodical intervals.
Q.3) Write Short Notes on
A] Explain the process of Job Evaluation.
Meaning of Job Evaluation:
Job evaluation can be defined as a systematic process designed to
determine the relative worth of jobs within a single work organisation.

In this process, jobs are compared in order to arrive at each job’s

appropriate worth.

Job evaluation is related to job analysis. Job analysis is the process of

describing the duties of a job, authority relationships, skills required,
conditions of work, and additional relevant information. Job analysis
involves creating job descriptions and specifications. Firstly, an
analysis is made of the jobs in the organisation, with particular
attention given to the tasks and skills involved in performing them.

This list of the specific duties of a particular job is called a job

description. The personnel manager next lists’ the qualifications for
each of these duties — the education, abilities, and experience required
of the person who fills the position. This list of qualifications is called
the job specification. Often, a job description and a job specification
appear together on a single form and are referred to jointly as a job
description.By job evaluation we mean using the information in job
analysis to systematically determine the value of each job in relation to
all jobs within the organisation. In short, job evaluation seeks to rank
all the jobs in the organisation and place them in a hierarchy that will
reflect the relative worth of each.
b) Discuss the importance of Performance Appraisal in an
Organisation.
It is common for any child or a human being to expect praise or appreciation
for the kind of work he or she has done. If that is not received, then it may
create problems.

It is just like a Five year old baby expecting a candy for doing a good home-
work or doing some works that is better than the others. Here we have
discussed the important or performance appraisal for employees
ability, knowledge, skill and overall job performance.

The world runs on the basis of inequality. There is no single, linear system
which can work well to give effective output or advice to one and all at an
equal level. Thus, performance management system or performance
appraisal types comes into the picture.

There are many important aspects of performance appraisal. Imagine you are
in an organization and you have outperformed yourself at all levels, you
would want to hear that praise, that accolade for yourself. You have stayed
days and nights working on the project which has been different in its output
than others. You will become the person who will go and demand for a better
chance at earning some better output of money or even respect. Thus, there
are many factors which come behind this role of having to expect and get an
equal amount of money for whatever has been done till now. It is rare but it is
very much needed.
Subject 5
Q.1) What is Plant Location? Explain factors affecting Plant Location for
following Industries:
i) IT Industry
ii) Pharmaceutical Industry

Plant location refers to the choice of the region where men, materials,
money, machinery and equipment are brought together for setting up a business
or factory. A plant is a place where the cost of the product is kept to low in order
to maximize gains. Identifying an ideal location is very crucial, it should always
maximize the net advantage, must minimize the unit cost of production and
distribution. Plant location decisions are very important because once the plant is
located at a particular site then the organization has to face the pros and cons of
that initial decision.

Factors you need to consider in making the choice of your pharmaceutical plant and it
plant location

1. Availability of raw materials

An ideal location for your pharmaceutical and it company is one where the raw
materials used in the manufacturing processes are readily available. This ensures
constant supply of raw material and reduction in the operational cost.

2. Nearness to the market

Reduction in your company’s overhead expenses and transportation cost can be
achieved if your company is located near the target market. Also, important
information about your company’s market can be easily obtained and analyzed by
the management specifically for the generation of strategies, confident decision-
making and formulation of production policies with regards to market opportunity,
market development and market penetration strategy.

3. Constant Power supply

Constant power supply is a pre-requisite for the localization of pharmaceutical and it
industries as the need for cheap, continuous, and adequate supply of electricity are
of paramount importance. The cost of running a company using generators is
usually high and this increases your company’s overhead cost and you might find it
difficult paying your workers.

4. Supply of Labour
Since labour is one of the most important inputs required to transform raw materials
into consumer goods, it is necessary that you locate your company where both
skilled and unskilled labour are readily available at cheaper rate.

5. Transportation Networks
Efficient transportation service is very important for marketing and distribution of
finished products, bringing raw materials and supplies, as well as allowing your
customers to reach you without difficulty. Good road networks, railways, water and
air transport systems are considered to be appropriate for the location of your
company. Also the cost of the available means of transportation should be put into
consideration.

6. Communication for it industry

Good communication facilities, such as, internet, postal and telecommunication links
are of great importance towards the success of a business. It is very important that
you open communication channels between you and your customers. Areas with
good communication system should be given priority when it comes to making
choice of a pharmaceutical plant location.

7. Water supply
The availability of constant water supply is another important requirement for
pharmaceutical industries. Even when you drill a borehole, it is advisable to check if
the water in that area is good for manufacturing.

8. Suitability of land and climate for pharmaceutical industries

Most industries need flat expanses of cheap land on which they build their factories.
The soil type of a proposed location should be able to support the load likely to be
placed on it. Climate on the other hand affects the choice of a pharmaceutical plant
location. Extremely hot, humid, dry or cold climate are not much suitable for the
establishment of pharmaceutical plants.

9. Integration with other group of companies

It is advisable to locate your pharmaceutical industries in an area where other
factories are already in existence. Liabilities like repairing of roads, buying of
transformer etc., can be shared among the companies whenever the need arises.
Thereby reducing the amount your company would have spent in fixing such
problem assuming it was to be located in an isolated area.

10. Availability of housing, other amenities and services

Setting up your pharmaceutical plant in an area where there is good housing facility,
schools, hospitals, banking facilities, restaurants, local transport facilities, shopping
malls water supply, drainage, disposal of waste, churches/mosque, etc., can easily
attract good staff especially the skilled ones.

11. Local building and planning regulation

In some cases, there is already a plan either from the local government or from the
state government that an area has been mapped out for some projects. Proposed
location should not infringe local regulations and bye-laws. To avoid losing what you
have worked for, a discussion with survey department of the local authority is most
desirable. Laws for the construction of buildings, local taxes etc. should be taken
into consideration before you finally decide where to locate your company.

12. Environmental impact, waste disposal and Safety requirements mainly for
pharmaceutical industries
Full considerations should be given to the difficulty and cost of disposal of all waste
products generated during production processes. The safety of your workers and the
populace is very important and should be put into consideration especially if your
industry is likely to cause pollution or process explosion. Such industries should be
located far away from residential areas. Workers who are allergic to some
substances (e.g., lactams) should not be exposed to such.
Q.2) What is Maintenance? What are its objectives?

Maintenance activities are related with repair, replacement and

service of components or some identifiable group of components in a
manufacturing plant so that it may continue to operate at a specified
‘availability’ for a specified period.
Thus maintenance management is associated with the direction and
organisation of various resources so as to control the availability and
performance of the industrial unit to some specified level.

Thus maintenance management may be treated as a restorative

function of production management which is entrusted with the task
of keeping equipment/machines and plant services ever available in
proper operating condition.

The minimization of machine breakdowns and down time has been

the main objective of maintenance but the strategies adopted by
maintenance management to achieve this aim have undergone great
changes in the past.

Maintenance has been considered just to repair the faulty equipment

and put them back in order in minimum possible time.

In view of the utilization of mostly general purpose/conventional

machines with low production output, the demands on maintenance
function were not very high. But with fast developments in the design,
development and mechanisms of control such as electronic, NC and
CNC in machine tools the manufacturing scenario has changed a lot.
The stringent control of dimensional tolerances and surface finish of
the product have increased the tendency to adopt standardization and
interchange-ability of parts/components of machines.

Importance of Maintenance Management:

Maintenance management is responsible for the smooth and efficient
working of the industrial plant and helps in improving the
productivity.

It also helps to keep the machines/equipment in their optimum

operating conditions. Thus plant maintenance is an important and
inevitable service function of an efficient production system.

It also helps in maintaining and improving the operational efficiency

of the plant facilities and hence contributes towards revenue by
decreasing the operating cost and improving the quality and quantity
of the product being manufactured.

As a service function it is related with the incurrence of certain costs.

The important component of such costs are — employment of
maintenance staff, other minor administrative expenses, investment
in maintenance equipment and inventory of repair components/ parts
and maintenance materials.
Absence of plant maintenance may lead to frequent machine
breakdown and failure of certain productive centres/services which in
turn would result in stoppages of production activities, idle man and
machine time, dislocation of the subsequent operations, poor quality
of production, failure to meet delivery dates of product supply,
industrial accidents endangering the life of workers/ operators and
allied costs etc.

Objectives of Maintenance Management:

The purpose of maintenance management is to optimize the
performance of productive facilities of an organization by ensuring
that these facilities function regularly and efficiently. This can be
achieved by preventing the failures or breakdowns if any, as far as
possible and by minimizing the production loss due to failures.

The main objectives of maintenance management are as

follows:
(1) Minimizing the loss of productive time because of equipment
failure to maximize the availability of plant, equipment and machinery
for productive utilization through planned maintenance.

(2) To extend the useful life of the plant, machinery and other facilities
by minimizing their wear and tear.

(3) Minimizing the loss due to production stoppages.

(4) To ensure operational readiness of all equipment’s needed for

emergency purposes at all times such as fire-fighting equipment.

(5) Efficient use of maintenance equipment’s and personnel.

(6) To ensure safety of personnel through regular inspection and

maintenance of facilities such as boilers, compressors and material
handling equipment etc.
(7) To maximize efficiency and economy in production through
optimum utilization of available facilities.

(8) To improve the quality of products and to improve the productivity

of the plant.

(9) To minimize the total maintenance cost which may consist of cost
of repairs, cost of preventive maintenance and inventory costs
associated with spare parts/materials required for maintenance.

(10) To improve reliability, availability and maintainability.

Functions of Maintenance Management:

The important functions of maintenance can be summarized
as follows:
(1) To develop maintenance policies, procedures and standards for the
plant maintenance system.

(2) To schedule the maintenance work after due consultation with the
concerned production departments.

(3) To carry out repairs and rectify or overhaul planned

equipment/facilities for achieving the required level of availability and
optimum operational efficiency.

(4) To ensure scheduled inspection, lubrication oil checking, and

adjustment of plant machinery and equipment.
(5) To document and maintain record of each maintenance activity
(i.e., repairs, replacement, overhauls, modifications and lubrication
etc.).

(6) To maintain and carry out repairs of buildings, utilities, material

handling equipment’s and other service facilities such as electrical
installations, sewers, central stores and roadways etc.

(7) To carry out and facilitate periodic inspections of equipment and

facilities to know their conditions related to their failure and stoppage
of production.

(8) To prepare inventory list of spare parts and materials required for
maintenance.

(9) To ensure cost effective maintenance.

(10) To forecast the maintenance expenditure and prepare a budget

and to ensure that maintenance expenditure is as per planned budget.

(11) To recruit and train personnel to prepare the maintenance

workforce for effective and efficient plant maintenance.
c) What is Inventory? Explain Classification of Inventory
System.
Inventory is the life blood of the industries. But an excess or shortage
of inventory is harmful. It is the most important component of
working capital.

The term inventory is used to denote the stock on hand at a particular

time comprising raw materials, goods in the process of manufacture
and finished goods. An inventory has a primary significance for
accounting purposes to ascertain the correct income for a particular
period. Inventory plays a very important part in the determination of
profit of a business.

ADVERTISEMENTS:

In the financial sector, inventory is defined as “the sum of the value

of raw materials, fuels and lubricants, spare parts,
maintenance consumables, semi-processed materials and
finished goods stock at any given point of time”.
S.E. Walters states, “The term inventory refers to the stockpiles of the
product a firm is offering for sales and the components that make up
the product”.

James H. Green observed, “An inventory refers to the movable articles

of the business which are eventually expected to go into the flow of
trade.”

Classification of Inventory:
The inventory may be classified into the following
categories:
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(a) Raw Materials Inventory:

This consists of basic materials that have not yet been committed to
production in a manufacturing firm. Raw materials that are purchased
from firms to be used in the firm’s production operations. The aim of
maintaining raw material inventory is to uncouple the production
function from the purchasing function so that delays in shipment of
raw materials do not cause production delays.

(b) Stores and Spares:

This includes those products which are accessories to the main
products produced for the purpose of sale. Examples of stores and
spares are bolts, nuts, clamps, screws, etc. These spare parts are
generally bought from outside.

(c) Works in Process Inventory:

This includes those materials that have been committed to the
production process but have not been completed. The more complex
and lengthy the production process, the larger will be the investment
in work in process inventory.

(d) Finished Goods Inventory:

These are completed products awaiting sale. The purpose of finished
goods inventory is to uncouple the production and sale functions so
that it is no longer necessary to produce the goods before a sale can
occur.

On the basis of functions, inventory may be classified into

the following four types:
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(i) Lot-size Inventories:

Some business firms prefer to purchase materials in bulk because they
receive a discount on bulk purchases. Big business firms can afford to
buy in large quantities. To produce the goods in exact amount of their
demand is not generally possible and practical. Some inventories
accumulate. The inventories accumulated as a result are known as lot-
size inventories.

(ii) Fluctuation Inventories:

Because of the demand and supply factors, the market for certain
commodities or raw materials generally fluctuates. This fluctuation is
marked in respect of agro-based products.

When the availability of raw materials is seasonal, bulk stocks are

purchased and stocked throughout the year in order to meet the high
demand during the season. Since demand fluctuates over time and
cannot be forecasted accurately, some reserve stocks are necessary.
Those safety stocks are fluctuation inventories.

(iii) Transportation Inventories:

The inventory manager of the business firm favours low inventories to
reduce inventory cost. However, this policy increases stock-outs, back
orders, paper work, special production runs and high cost fast-freight
transportation.

Raw materials are transported from its place of production to the

business firm which needs it. Since the goods and raw materials in
transit cannot serve those for whom these have been sent, these goods
or resources in transit represent transportation inventories.

(iv) Anticipation Inventories:

When a business firm anticipates a price rise or introduces the
business promotion tools, it will need to accumulate inventories. The
raw materials may be stored in the form of semi-finished goods or
stored in their original form. These inventories are known as
anticipation inventories.
Q.3) Write Short Notes on
a) Quality Circles
Perhaps the most widely discussed and undertaken intervention of
employee involvement is the quality circle (QC). The concept of QC
originally began in the United States and was exported to Japan in the
1950s. It is mentioned that it is the concept of QC that enabled
Japanese firms to make high quality products at low costs.

What is quality circle? It is a work group of employees who meet

regularly to discuss their quality problems, investigate causes,
recommend solutions, and take corrective actions. Generally, QC is a
small group of employees belonging to the same similar work area.

This is so because the employees doing the similar type of work are
well familiar to problems faced by them. The size of the QC should not
be too big so as to prevent some members from participating
meaningfully in its meetings. Generally, six to eight members are
considered the ideal size of the QC.

QC is formed to achieve the following objectives:

1. Improvement in quality of product manufactured by the
organisation.

2. Improvement in methods of production.

3. Development of employees participating in QC.

4. Promoting morale of employees.

5. Respect humanity and create a happy work place worthwhile to
work.

The main features of QC can be listed as follows:

1. Voluntary Groups:
QC is a voluntary group of employees generally coming from the same
work area. There is no pressure from anywhere on employees to join
QC.

2. Small Size:
The size of the QC is generally small consisting of six to eight
members.

3. Regular Meeting:
QC meetings are held once a week for about an hour on regular basis.
The members meet during working hours usually at the end of the
working day in consultation with the manager. The time of the
meetings is usually fixed in advance in consultation with the manager
and members.

4. Independent Agenda:
Each QC has its own agenda with its own terms of reference.
Accordingly, each QC discusses its own problems and takes corrective
actions.

5. Quality Focused:
As per the very nature and intent of QC, it focuses exclusively on
quality issues. This is because the ultimate purpose of QC is
improvement in quality of product and working life.
Q.3) b) Production Planning and Control
For efficient, effective and economical operation in a
manufacturing unit of an organization, it is essential to integrate
the production planning and control system. Production planning
and subsequent production control follow adaption of product
design and finalization of a production process.

Production planning and control address a fundamental problem

of low productivity, inventory management and resource
utilization.

Production planning is required for scheduling, dispatch,

inspection, quality management, inventory management, supply
management and equipment management. Production control
ensures that production team can achieve required production
target, optimum utilization of resources, quality management and
cost savings.

Planning and control are an essential ingredient for success of

an operation unit. The benefits of production planning and
control are as follows:

 It ensures that optimum utilization of production capacity is

achieved, by proper scheduling of the machine items which
reduces the idle time as well as over use.
 It ensures that inventory level are maintained at optimum
levels at all time, i.e. there is no over-stocking or under-
stocking.
 It also ensures that production time is kept at optimum level
and thereby increasing the turnover time.