INTRODUCTION TO

PRODUCTION MANAGEMNET

Dr.Sanjay Rajurkar

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 INTRODUCTION

Production is defined as “the step-by-step conversion of

one form of material into another form through some
process to create or enhance the utility of the product to the
user.” Thus production is a value addition process. At each
stage of processing, there will be value addition.

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 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.

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."

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 What is POM?

Production is the creation of goods and services

Production and/or Operations Management are the

activities that transform resources into goods and
services
The set of interrelated management activities, which are
involved in manufacturing certain products, is called as
Production Management. If the same concept is
extended to services management, then the
corresponding set of management activities is called as
Operations Management.

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 Why To Study POM?
It is one of the 3 critical parts of any organization:
– Marketing – generates demand
– Operations – creates the product
– Finance/accounting – tracks organizational
performance, pays bills, collects money
It shows us how goods and services are produced
It shows us what POM managers do
It is the most costly part of any organization

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 5 P`s of Production Management

PRODUCTS.
PLANT.
PROCESS.
PROGRMS.
PEOPLE.

When this five element integrated a successful

production management takes place.

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 OBJECTIVE OF PRODUCTION
MANAGEMENT
RIGHT QUALITY.
RIGHT QUANTITY.
PREDETERMINED TIME.
PRE-ESTABLISHED COST.
Other objectives are :
Machinery and Equipment.
Materials.
Manpower.
Supporting Service.

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 The Critical Decisions
Quality management
– Who is responsible for quality?
– How do we define quality?
Service and product design
– What product or service should we offer?
– How should we design these products and
services?
Process and capacity design
– What processes will these products require and in
what order?
– What equipment and technology is necessary for
these processes?
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 Location
– Where should we put the facility
– On what criteria should we base this location
decision?
Layout design
– How should we arrange the facility?
– How large a facility is required?
Human resources and job design
– How do we provide a reasonable work
environment?
– How much can we expect our employees to
produce?

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 Supply chain management
– Should we make or buy this item?
– Who are our good suppliers and how many should
we have?
Inventory, material requirements planning,
– How much inventory of each item should we have?
– When do we re-order?
Intermediate, short term, and project scheduling
– Is subcontracting production a good idea?
– Are we better off keeping people on the payroll
during slowdowns?
Maintenance
– Who is responsible for maintenance?
– When do we do maintenance?
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 New Challenges in OM
To
From
 Global focus
Local or national focus  Just-in-time

Batch shipments  Supply chain

Low bid purchasing partnering
Lengthy product  Rapid product
development cycles development
Standardized products  Strategic alliances
Job specialization  Mass customization
 Empowered
employees
 Teams
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 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 Planning
(c) Inventory Control
(d) Product maintenance & replacement
(e) Cost Control & Cost Reduction

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 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 & the basis of information available and
resources like machine, material & men.

So, PPC is the process of directing & coordinating of

firms resources towards attaining prefixed goal.

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 FUNCTIONS OF PPC

Material Function
Machine & Equipment
Methods
Routing
Estimating
Scheduling
Dispatching
Expediting
Inspection
Evaluation

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 TYPES OF PRODUCTION

BATCH PRODUCTION

MASS & FLOW PRODUCTION

PROCESS PRODUCTION

PROJECT PRODUCTION

JOBBING PRODUCTION

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 BATCH PRODUCTION

Batch production is the manufacturing of limited

number of product produced at regular intervals
& stocked in warehouse as finished goods.

e.g. Chemical , paint & motor vehicles etc.

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 CHARACTARISTIC OF BATCH PRODUCTION

Short Run.
Skilled labours in specific trades
Limited span of control
General purpose machine and process type layout
Manual material handling
Manufacturing cycle time affected due to queues
Large WIP
Flexible production schedule
Need to have PPC.

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 JOBBING PRODUCTION

Jobbing production is characterized by the manufacture

of one or few number of a single product designed and
manufactured strictly to customer’s specifications within
the given period and within the price fixed prior to the
contract.

Eg: general repair shop, tailoring shops.

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 CHARACTARITIC OF JOBBING PRODUCTION

Small production runs.

Discontinuous flow of materials.
Not proportionate manufacture cycle time.
Highly skilled labour.
Highly competent knowledgeable supervision.
Large WIP.
Limited function of PPC.

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 PROJECT PRODUCTION

Project production is characterized by complex sets of

activities that must be performed in a particular order
within the estimated expenditure.

Eg: construction of Roads, Buildings etc.

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 CHARACTARITIC OF PROJECT PRODUCTION

Definite beginning & definite end.

Non uniform requirement of resources.
Involvement of different agencies.
Fixed position layout.
High cost overrun.
Scheduling & control.

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 MASS & FLOW PRODUCTION

Mass as well as flow production are characterized by the

manufacturer of several number of a std product and
stocked in the warehouses as finished goods awaiting
sales. The goods under mass production are
manufactured either at a single operation or a series of
operation on one machine.

Eg: Assembly shop of automobiles, radios, electric fans.

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 CHARACTARITIC OF MASS & FLOW
PRODUCTION

Continuous flow of material.

Special purpose m/c and product type layout.
Mechanized material handling.
Low skilled labour.
Short manufacturing cycle time.
Easy supervision.
Limited WIP.

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 PROCESS PRODUCTION

Process production is characterized by the manufacture

of single product produced and stocked in the
warehouses awaiting sales.

Eg: Sugar, Steel, Paper, Cement plants.

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 CHARACTARITIC OF PROCESS PRODUCTION

Special purpose m/c with built in control.

Highly mechanized material building.
Virtually zero manufacturing time.
Low skilled labor.
Highly qualified supervisors.
Negligible WIP.
Limited PPC.

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