CHAPTER 1

INTRODUCTION OF
PRODUCTION
PLANNING &
INVENTORY CONTROL
Wike Agustin Prima Dania, STP, M.Eng, Ph.D
 quantity PRODUCTION PLANNING AND
INVENTORY CONTROL
• Direction and coordination of firms
resources towards attaining the prefixed
Production goals
time quality
System
• Helps to achieve uninterrupted flow of
material through production line by
making available the material at the right
time and required quantity.
cost
 • Effective utilisation of firms resources
• To achieve the production objectives with
respect to quality, quantity, cost and
timelines of delivery
• To obtain the un-interrupted production
NEED OF flow in order to meet customers varied
PPIC demand with respect to quality and
committed delivery schedule
• To help the company to supply a good
quality products to the customer on the
continuous basis at competitive rates
 • Systematic planning of production activities
to achieve the highest efficiency in production
of goods/services
• To organise the production facilities (5M) to
achieve stated production objectives
• Optimum scheduling of resources
OBJECTIVES • Coordinate with other departments relating
OF PPIC to production to achieve regular balanced
and uninterrupted production flow
• To conform to the delivery commitments
• Material and planning control
• To be able to make adjustment due to
changes in demand and rush orders.
 PRODUCTION PLANNING

• Pre-determination of manufacturing requirement such as manpower, materials,

machines, and manufacturing process.
• Problems in production planning:
• Non availability of material (due to shortage, etc)
• Plant, equipment, and machine breakdown
• Changes in demand and rush orders
• Absenteeism of workers
• Lack of coordination and communication between various functional areas of
business
 PRODUCTION CONTROL

• Reviews the progress of the work, and takes corrective steps

in order to ensure that programmed production takes place.
 Production Planning
1. Production planning is pre-production
activity
2. Planning involves the collection,
maintenance and analysis of data with
respect to time standards, material and
their specification, machines and their
process capabilities
3. Planning is useful to anticipate the
problems
4. Planning is a centralised activity and
includes function like material control,
tool control, process planning and
control
5. Planning sees that all the necessary
resources are available to make the
production at right quality and time
Production Control
1. Production control will be in action
when production activity begins
2. Control is concerned with
communication of their information and
producing reports like output reports,
productivity, rejection rate, etc
3. Control involves in taking correctives
steps in case of error to match actual
performance against the planned
performance
4. Control is a widespread activity
5. Control keeps track of activities and sees
whether everything is going as per
schedule or not.
FUNCTION OF PPIC
 THE DIFFERENCES BETWEEN GOODS AND SERVICES

GOODS SERVICE

Tangible Intangible

There is stored inventory Produced and consumed simultaneously

It’s possible there in no consumer interaction High consumer interaction

Has consistent product definition Has inconsistent product definition

Research based Knowledge based

There is transformation process (physics, There is no transformation process

chemical, biology)
 TYPE OF PRODUCTION PROCESS

Job Production Batch Production Continuous Production

Material are purchased on receipt of Material control and tools control Material functioin is critical
the order are more important and systematic
stock replenishment system is
essential
Standard tools are stocked and Detail route sheets are prepared No tools control because of nature
special tools are either made in of the plant
house or purchased
Process planning activity normally Loading and scheduling are to be No process planning activity
does not exist worked out with greater detail

Schedule is prepared to mark the
beginning and finish of each activity
Progressing is through the meeting
with the supervisors
Progressing function is crucial as the Scheduling is restricted to final
detailed data is to be collected on quantity required
the progress of the work
Progressing requires only recording
of final production quantity
 PRODUCTION PROCEDURE

Prep prod
Customer Sales forecast Prep of detail
budget

Inspection Control Authorisation Production

Management
QC function for prod planning

feedback Evaluation of Finished Dispatch to

prod system goods stock costumer
ANY QUESTION?