ORGANIZATION

AND
PRODUCTION
MANAGEMENT
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 PRODUCTI
ON • A process by which goods and services are created, this consists of
bringing together restricted sets of resources like materials, labor,
equipment, and structures and operating them in strict observance of
the processes to obtain the desired product.

PRODUCTION MANAGEMENT
• is the planning controlling, and decision making for carrying out the
production processes to obtain the objectives.

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BASIC
ELEMENTS
1. Production design
2. Process design
3. Material flow
PRODUCTION
OPERATION
• means materials flowing through one or more steps of a process

INTERMITTENT
• operations are purely on a one-shift-a-day basis.
PROCESS
• operations may be stopped at the end of each day and without any
difficulty, can operate the next day.

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PRODUCTION PROCESS MAY BE
SPECIALIZED
• A company may limit its field of activity
to only few processes, equipment or
labor skills which would then develop to
a high degree of quality and perfections.

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Organization and management
• Most organizations are set up in levels. Each level has a certain
nature, requires different understanding, and dictates different
behavior. It is desirable for each level to understand all levels. It
is mandatory for managers to know every level.

• A critical problem in management is that upper levels are

reached through lower levels, and that since different attitudes
and habits are required, behavior which guarantees success at
one level automatically guarantees failure at the next level up.

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Level One is the “Things” level.
• This is where everybody starts.
• Letters are typed, blueprints are drawn, and gasoline is pumped. Lead-time on
work may be anything from 3 minutes to a day or two. The boss says, “take a
letter”, and planning consists of making sure you have a pencil. It is even the boss’
responsibility to set up a system so the pad and pencil will be available.
Level Two is the “People” level.
• Jobs are accepted from “upstairs ” analyzed into special tasks, and assigned to
people on the things level.
• Lead time is usually from a week to a month, to allow time for planning
facilities, providing supplies, issuing work, coordinating efforts of specialists in
group tasks, evaluating results and correcting discrepancies.
• Environment is relatively unstable. “The Book” is much less useful. More
flexibility and ingenuity are required. A typewriter is much easier to manage
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Level Three is the “Ideas” level.
• The work comes down from upstairs in the form of sub-goals, which are part of
general goals. Lead-time may run from a month to a year. This is to allow time, not to
arrange facilities, but to provide facilities, to train or secure a personnel, and to
correlate the needs of those on the “People” level.
• The environment is quite unstable, and one of the main responsibilities here is to
stablilize the environment so that tasks assigned are definite and understood.

“Goals” level.
• The environment is very unstable indeed. Lead-time may run from a year to ten years.
The primary responsibility here is determining goals.
• Life-or-death decisions of the organization are made.

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• Supervisor -is a part of management, a vital part of organization
-operates an organization on his own, and, within certain limits, has the
leeway to set it up so that it will run with maximum efficiency.
-his unit must work with other units to assist in the accomplishment of the mi
of the whole organization.
-must demonstrate that he has the ability to set up and manage an effective
organization and
- demonstrate that he knows how to coordinate the work of his organization
with the whole.
 Many managers choose to rely on intuition.
They depend upon bright ideas, their personal ability
or that of their subordinates, or the attainment of
cooperation among their subordinates for the
successful accomplishment of their jobs.
Now, managing by intuition may result in an
adequate organization, but it seldom results in a
completely sound one.
Organizations that are built entirely upon the
personal abilities of men will last only so long as
these men remain. Although organizations must, to a
certain extent, depend upon the personalities of
individuals; they depend mainly on the application of
certain principles.
 The force which brings an organization into being
and makes it move is the conception of a goal.
Goals are different from needs. Needs exist, but they
become goais only when a person has a desire to
satisfy the need. Consequently, goal setting becomes the
primary job of management.
Without goals, no real organization is possible.
Some Factors that can break the organization:
• The availability of equipment and people will either
make or break the organization.
• Goal is achieved.

The primary and constant job of Management is

goal setting.
Organizations have an insatiable appetite for goals.
The manager must furnish them in a constant stream.
 Unity of Command
-means that each individual in an
organization is responsible to only one boss.
-there is only one boss at each level and that
each activity is under the executive control
of only one person.
- Observance of this principle is necessary
in order to establish a definite chain of
command. It is also necessary in order to
attain the most efficient executive direction.
Every- one must report to someone, and
everyone must be subordinate to someone.
The principle should be applied in two ways:

1. Know whom you report to.

This is necessary in order that you may carry
out your job as a super- visor. It is vital that you
know from whom you are to receive your goals
and to whom you are to report your results.

2. Know whom you direct.

In carrying out your job as a supervisor, it is
important that you know who you have to work
under you, whom you will direct, and who you
have to help you in accomplishing your
particular job. A detailed knowledge of whom
you will be directing also helps in placing
responsibility.
How can unity of command be
achieved within an organization?

First, lines of communications must

be made as short as possible. They
should be definite, clear-cut, and
understood by all. Organization charts
should be drawn, and personnel should
be instructed in their use. A list of
duties and responsibilities of each
person in the organization should be
prepared.
 Span of Control
The application of the principle on span of control in an
organization results in limiting both the number of direct
subordinates a supervisor has and his area of supervision.
These limitations allow him to attend to all necessary duties
within the time available to him.
In all supervisory positions, three aspects of this principle
should be carefully considered.
 People
Experience shows that a supervisor should manage no fewer
than three nor more than seven subordinates. If he supervises
fewer than three, full use of his capabilities has not been
made. If he supervises more than seven, he may not be
managing efficiently, because there is too great a strain on his
energy and ability.
Careful analysis of the immediate situation will give the
answer to the correct span of control of people.
Distance.
• deals with the physical area of supervision and requires
that subordinates and activities be located so as to
permit ease of supervision. It is unwise for a supervisor
to locate a subordinate either too close(may result in
over-supervision) or too far away(may result in
under-supervision).

Over-supervision - interference with the work of the

subordinate and frequently results in stifling him to such
an extent that he does only what he is told to do and
nothing else.
Under- supervision - the subordinates begin to operate
independently to such a degree that the influence of the
supervisor becomes minimal. The ideal distance, then, is
one which minimizes both over-supervision and under-
supervision and is a matter of good judgment rather than
measurement.
Time
Every supervisor's job consists of four main types of
work: routine, regular, special, and creative.

Time must be allowed for each type.

Routine work should be performed insofar as possible

by subordinates.
Regular work consists of the normal supervisory
duties relating to activities and subordinates, and du-
ties which can be performed only by the supervisor.
Special work is assigned to the supervisor by his
superior, or is initiated by himself, and is related to his
regular work.
Creative work is that which is done to improve the
quality and quantity of work and assures progress in the
organization.

Homogenous Assignments
Homos means like or similar; genos means family,
race or kind; therefore, homogenous means a similar
family, race, or kind.
Homogenous assignments means that workers
performing like functions should be grouped, and
that functions should be scheduled so that each
operation is another step toward completion.
If an individual is assigned more than one task, the
knowledge and skill to accomplish the first should aid
in the performance of the second. If he is assigned a
third task, the knowledge and skill required in the first
and second should aid in the accomplishment of the
third.
There is a limit to the variety of jobs a person can
successfully accomplish.
• Secondary duties should require the employee's
present skills. The magnitude of any assignment is
limited by the physical and mental capabilities of the
person to whom the assignment is made.
• Different jobs require different abilities. Mental tasks
should be given to those with ability to reason.
Those with physical limitations should be assigned
jobs requiring the strength they have.
 Delegation
Authority and must be linked. No one should be assigned
responsibility for work without authority to direct the manner of its
performance.
There are certain rights which comprise executive authority:

1. The right to plan. This includes the power to in-vestigate,

formulate policies, and interpret basic objectives.

2. The right to decide. This involves making decisions regarding why,

what, when, where, and how.

3. The Right to organize. This includes the power to select, train,

assign, transfer, and promote personnel. Under this heading comes any
action undertaken to effect the smoothest possible operation of the
personnel of an organization.
 Cross-communication
"Going through the chain of command" often heard in organizations.
However, if everything done in a typical activity were handled strictly through its
chain of command, many simple operations would bog down. There are times
when persons in parallel positions (two division supervisors) can reach an
understanding of a problem with- out referring it to higher authorities. Informal
agreement by those who have the clearest picture of the matter simplifies the work.
This is the principle of cross-communication.
Observance of this principle does not, however, mean that supervisors may by-pass
the chain of command. Super- visors must learn the policies of the activity as to
matters that must be handled through the chain and use careful judgment when
they deviate. . It does mean that top supervisors must recognize that many things
can and should be handled at lower levels as matters of mutual cooperation.
 Division of Work
Every supervisor should understand the principle of division of work, and know its basic
systems. These systems are used in both offices and shops. Each has advantages and
disadvantages.

1. The series (or assembly-line)

In the series system, the papers, materials, etc., flow from one person to another, each
person performing a segment of the work. This system could be best illustrated by an automobile
assembly line. Individual jobs are simple and require only short training periods. Little skills are
required. However, disadvantages include reduced worker interest, added transportation, and
lack of flexibility (inability to shift the workers from one job to another).

2. The parallel system

In the parallel system, each employee performs a whole operation. In this system, each works
independently, turns out the final product, and goes through all the steps to complete operation.
For example, six clerks might be processing bills of lading, each handling completely a certain
number of them.
Or each man or group of men in a shop is given a separate carburetor to
overhaul. Each disassembles, checks, repairs, adjust, and assembles his
own carburetor. (How would this be done under the series system?) The
parallel system makes for a more flexible work force and much greater
worker interest. It creates better understanding of the whole job, and
reduces transportation time for the work item. However, it requires much
greater training time, and personnel with higher skills. It also uses some
of the time of the skilled workers on jobs which do not require their
highest skills.
3. The unit-assembly (simultaneous handling) system. In the unit-
assembly system, seveForral employees work together as a crew on one
item from start to finish. example, a crew of men might work together
overhauling a single engine. The advantages and disadvantages are the
same as those of the series system. The unit-assembly system can only be
applied in limited situations, where work can be treated in separate parts.
Careful planning and supervision are needed to avoid uneven
distribution of work, loafing, and confusion.
 Simplicity
One of the marks of a good supervisor is his ability to devise good
systems for performing work. And the principle of simplicity requires that
these systems be kept as simple as possible. Some supervisors set up
detailed systems on paper, with checks and cross-checks to cover every
possible slip-up. In theory, these systems should work fine. They forget,
however, that many employees, particularly in shops, cannot and will not
read anything that looks complicated, nor can they interpret more than the
simplest order. The systems must remain uncomplicated. Furthermore,
after the systems are set up, watch for every possible chance to simplify
them even more. These ideas are developed in de- tail in the two units on
Making Work Simple.
Organization Types
Authority, in a line organization, flows directly from
the top executive to subordinate executives in charge of
various portions of the organization and from them to
the men. Line organization is simple and direct, and
responsi- bility is readily fixed. Discipline is easy to
maintain, and the authority of the top man is complete.
However, this organi- zation has many disadvantages;
for instance, the top man
must handle employment, personnel problems, purchasing,
engineering, and all other phases; key men are difficult to replace;
coordination between departments causes problems; the organization
is inflexible; and structure becomes clumsy as it expands.
Line-and-staff organization has replaced the line type in many activities. In
addition to the line, staff personnel specialists who handle planning, personnel,
etc.) are incor- porated in the organization at various levels to assist and advise
the line. Look at the organization chart of your activ- ity and note the
relationship of staff to line. Note also that the staff personnel who act in an
advisory capacity to the line may also have employees working directly under
them. To these employees, the staff personnel act in a line capac- ity. Line-and-
staff organizations are more flexible than line organizations. Specialists relieve
line supervisors of del- egated support functions.
The functional organization is seldom used today; how- ever, the line-and-staff
idea grew out of it. Under the func- tional organization several foremen, each a
specialist, would supervise the same group of workmen. One foreman would
boss the gang in one function, another foreman in another function, and so on;
for example, one foreman might handle the planning and records, another the
discipline, another the repair work, and another the actual project work. This
arrangement violates the "one boss" idea, creates confusion among the men,
The Committee Idea - Multiple Management
Excellent use is being made today of the committee idea in organization.
Briefly, this consists of committees appointed by the top executives, who work
out policies, regulations and plans, and make recommendations to him. Thus,
the men who direct the actual work have a real part in management. A
combination of ideas from these men makes for a better organization, and the
men themselves feel that they are an important part of the organization.

Organizational Changes
Many supervisors have attempted to set up or change organizations by
carefully drawing up all the plans them- selves. When they have everything
figured out, charts pre- pared, and orders written, they call a meeting of all
their subordinates and spring the plan. If you were ever in a group where this
was done, you may remember the confu- sion, resentment, resistance to
change, and dismay which resulted. Experienced supervisors consult with all
the per- sons who will be affected and ask for suggestions. They know that the
Principle of Span of Control

The wider the span a supervisor can

control, the smaller the total
number of people necessary to
achieve objectives and the lesser
the cost. The fewer organizational
levels, the greater potential for
effective communication and
organizational control.
What It Means
The width of supervisory control is directly relevant to the personnel
capacity to manage. Science has not yet devel- oped a mathematical
formula to determine precisely the optimum number a supervisor can
supervise. The truth, however, remains, that if a supervisor can manage
20, it will take only one supervisor to do the job. However, if said
supervisor is capable of handling only 10 people, another supervisor is
needed to handle the other 10 people, thus requiring an additional man.
Since there are two (2) supervisors, each supervising 10 people, the
organization will need one more person to synchronize the operations of
the two supervisors. In effect, there is addition of level in the
organization. As will be noted, the more level is added, the more the
organization

Since there are two (2) supervisors, each supervising 10 people, the
organization will need one more person to synchronize the operations of
becomes larger and more complicated both for control and for
communication. To limit the number of organizational levels, the
logical action is to maximize coverage of each manager or
supervisor.
Principle of Departmentalization
Similar and/or related activities should be
grouped to- gether in specified units in the
organization to avoid organi- zational overlap and
friction; the more consistent and logi- cal the
groupings, the greater the potential effectiveness
of people.

What It Means
For example, if the activities of the Sewing
Section are clearly delineated from those of the
Examining Section, there is greater potential
efficiency for both Sewing and Examining
operations because of the absence of duplication
and overlapping of authority.
Principle of Unity of Command
The more an individual has a complete
reporting rela- tionship to a single superior, the
less problem of conflict in instruction and the
greater the feeling of personal responsi- bility
for results. (Koontz and O'Donnel)
What It Means
A person should have only one boss.
Requiring him to report to more than one
superior would make him less and less
accountable for assigned work.