INSTITUTE OF TECHNOLOGY & SCIENCE

⚫Subject: Production & Operation Management

⚫Code: BBA 403

⚫Faculty: Prof. Raghwendra Kumar

PRODUCTION MANAGEMENT

⚫Production management is the process of effectively

planning and regulating the operations of that part
of an enterprise which is responsible for the actual
transformation of materials into finished products.
Unit – I Introduction

⚫Production management means planning,
organising, directing, controlling and Reporting of
production activities.
Unit – I Introduction

⚫Production management deals with converting raw

materials into finished goods or products.
Unit – I Introduction

To satisfy
the wants • Men,
of the • Money,
people, It • Machines,
brings • Materials,
together • Methods And
the 6M's • Markets.
i.e.
 Definitions

⚫"Production management deals with decision-

making related to production processes so that the
resulting goods or service is produced according to
specification, in the amount and by the schedule
demanded and at minimum cost.”
- Elwood Spencer Buffa
 Definitions

⚫“Production management is concerned with those

processes which convert the inputs into the output .
The inputs are various resources like raw materials,
men, machines, methods, etc. and the outputs are
goods and services.”
- H. A. HARDING
 Definitions

⚫"Production management then become the process

of effectively planning and regulating the operations
of that part of an enterprise which is responsible for
actual transformation of material into finished
products"
- E. F. L. Brech
 5 P`s of Production Management

⚫1. PRODUCTS.
⚫2. PLANT.
⚫3. PROCESS.
⚫4. PROGRAMS.
⚫5. PEOPLE.

⚫When this five element integrated a successful

production management takes place.
 OBJECTIVE OF PRODUCTION MANAGEMENT

⚫ 1. RIGHT QUALITY.
⚫ 2. RIGHT QUANTITY.
⚫ 3. PREDETERMINED TIME.
⚫ 4. PRE-ESTABLISHED COST.

⚫Other objectives are :

⚫ 1. Machinery and Equipment.
⚫ 2. Materials.
⚫ 3. Manpower.
⚫ 4. Supporting Service.
NATURE OF PRODUCTION MANAGEMENT

⚫ Transformational Process.
⚫ Results into Value Addition:
⚫ System Itself
⚫ Exists for Certain Objectives
⚫ Carried out in part of organisation
⚫ Interrelationship among the System
⚫ Stratum Formations
⚫ Specialization of functions
⚫ Increase in Entropy
⚫ Increase in productivity
 SCOPE & ACTIVITIES OF PM

⚫ There are two types of scope & activities of PM :

⚫ 1. Strategic level.
⚫ (a) Design & development of new product.
⚫ (b) Process design & Planning
⚫ (c) Facilities location & layout planning
⚫ (d) Design of material handling
⚫ (e) Capacity planning

⚫ 2. Operational level.
⚫ (a) Production Planning
⚫ (b) Production Control
⚫ (c) Inventory Control
⚫ (d) Machine maintenance & replacement
⚫ (e) Cost Control & Cost Reduction
 Functions of Production Management

⚫ Selection of product & design ⚫Inventory control

⚫ Process selection and
⚫Plant layout and
planning
⚫ Plant location material handling
⚫ Capacity planning ⚫Work measurement
⚫ Production planning ⚫Maintenance and
⚫ Production control
replacement of
⚫ Quality and cost control
machines
⚫ Method analysis
⚫Other functions.
 Problems of Production Management

⚫Plant Location ⚫Cost control and

⚫Plant Layout minimisation
⚫Product Design and ⚫Resource optimisation
Development ⚫Process and method
⚫Quality Control Planning
⚫Inventory control ⚫Work appraisal and
⚫Production control training
 Production system

⚫Production:
⚫The step by step conversion of various raw materials
into a specified and desired product - a bundle of
utility - which is having certain utility for a group of
people or a market segment.
⚫It creates products and makes value addition with
every step of production
 Production system

⚫ Production system:
⚫ A system is an assemblage of object united by some form of regular
interaction.
⚫ It is composed of a number of component. These components ar
combined together for the accomplishment of some predetermined
goals.
⚫ The production process consists of a number of activities and
operations. These 0perataions and activities can be applied in
different combinations and order to achieve the desired objective.
⚫ The operations can be purchase of raw material, maintenance of
inventory , transportation of good, etc.
⚫ The combination of two or more operations/activities constitute a
system.
 Production system

⚫ Nature:
⚫ A set of various subsystem
⚫ Has a definite objective
⚫ An open end system: It is the systems which exchange matter and energy from the environment.

⚫ Requires decisions at all level

⚫ Aims at optimum use of resources
⚫ Aims at optimum cost of production
⚫ Production of output of desired quality
⚫ System transforms the various inputs to useful outputs,
⚫ Works as part of organization and not in isolation
⚫ Exists a feedback about the activities, which is essential to control
and improve system performance
 Production system

Production System Model: Three main components

⚫Production system and

Manufacturing system
are used
interchangeably.
⚫any Manufacturing
organisation can be
called a production
system to produce
goods, and services.
 ⚫There are several types of
Production production system and the type
system chosen by any business depends
Types upon the type of product being
made and the quantity which is
required.
⚫These types can be categorised
into :
⚫1. Continuous Production system
⚫2. Intermittent production system
 ⚫standardised products,
Production ⚫ standard set of process
system
⚫ operation sequence in
Types anticipation of demand,
⚫ insure less work, high product
1. quality,
continuous ⚫large investments.
system: - ⚫Suitable for large volume and
small variety of products,
⚫e.g. Oil Industry, Cement
Industry, milk Industry…
 ⚫Produced partly for inventory and
Production partly for customer's orders
system ⚫e.g. components are made for
Types inventory but they are combined
differently for different
2. customers.
Intermittent ⚫Automobile plants, printing
production presses, electrical goods plant are
system examples of this type of
manufacturing.
 Responsibilities of Production Manager
⚫ Planning of production
⚫ Organization of Resources
⚫ Directing the Production,
Process
⚫ Quantity and Quality control
⚫ Reporting of production to
superiors
⚫ Motivation to work force
⚫ Producing Right Quantity.
⚫ Optimum use of Resources
⚫ Minimisation of cost
⚫ Production of specified goods &
services
⚫ Waste minimization and control
⚫ Study the alternative and select
best method of production
⚫ Coordination with other
Departments
⚫ Vendor Management and
Relation Maintenance
⚫ Coordination with HR,
Marketing, Finance , IT and
Other supporting services
⚫ Liaison with Logistic Functions
viz. Transportation,
warehousing, infrastructural
support providers
 PRODUCTION PLANNING & CONTROL (PPC)

⚫PPC is the powerful tool available to the

management to achieve the stated objective.
⚫Production planning starts with the analysis of data
like demand & delivery schedule etc. and on the
basis of information available and resources like
machine, material, men, money, methods, market
etc.
⚫So, PPC is the process of directing & coordinating of
firms resources towards attaining prefixed goal.
 SCOPE OF PPC
⚫1. Material ⚫6. Scheduling &
⚫2. Machine & Loading
Equipment ⚫7. Dispatching
⚫3. Methods ⚫8. Expediting
⚫4. Routing ⚫9. Inspection
⚫5. Estimating ⚫10.Evaluation
⚫11. Cost Control
 ELEMENTS OF PPC

Production Planning Production Control

⚫Estimating ⚫Dispatching
⚫Routing ⚫Expediting
⚫Scheduling ⚫Inspection
⚫Loading ⚫Evaluation
 FACTORS AFECTING PPC

Production Planning Production Control

⚫Use of Computers ⚫ Losses due to

⚫seasonal Variation Unpredictable Factors
⚫ Losses due to
⚫Variation in Fashion
Predictable Factors
⚫Test Marketing ⚫ Production of Order
⚫Marketing ⚫ Design Changes
Integration ⚫ Rejection and
⚫After Sales services Replacement
 OBJECTIVES OF PPC

⚫Nature of Inputs.
⚫Quantity of Inputs
⚫Proper Coordination
⚫Better control
⚫Ensure Uninterrupted Production
⚫Capacity Utilisation
⚫Timely Delivery
 ADVANTAGES OF PPC

⚫Higher Productivity
⚫Removal of Hurdles
⚫Better Quality
⚫Consumer Satisfaction
⚫Saving in Cost
⚫Increase in production
⚫Optimises capabilities.
⚫Minimum Overtime
⚫Better Industrial Relation,
⚫Better’ Profitability
 U – II

⚫Types of manufacturing Systems:

⚫Intermitted & Continuous Systems etc.,
⚫Product design and development.