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PRODUCTION MANAGEMENT The management of those resources & activities that are required to produce goods for consumers

or to the organizations. The Production Management is generally concerned with Manufacturing Industries.

PRODUCTION MANAGEMENT

To be effective, requires the focus and attention to details related to; - Utilization of materials - Utilization of plant & machinery - Utilization of men with the Product design and plant design being optimum for the requirements.

PRODUCTION MANAGEMENT

To achieve the objectives, key areas of interest are;


- Manufacturing Systems - Materials Management - Methods - Plant layout - Human Resource

DISTINCT STAGES OF PRODUCTION SYSTEM


Planning To analyze given data and devise scheme for the best utilization of resources Operations To perform action as per the plan Control To supervise operations with appropriate control mechanism that feeds backs information about the progress of the work. The mechanism is also responsible for subsequent adjusting, modifying and redefining plans and targets to attain the goal.

PRODUCTION PLANNING AND CONTROL

Direction and coordination of the firms resources (materials and physical facilities towards the attainment of prespecified production goals in the most efficient available way.

FUNCTION OF PPC
Materials Methods Machines & Equipment Routing Estimating Loading & Scheduling Expediting Inspection Evaluating

Production Management
Materials
- Raw materials - Semi Finished Products - Standard Finished Parts > Specifications (dimensions and quality) > Quantities and availability > Delivery Dates > Standardisation and variety reduction > Procurement and Inspection - including semi finished from subcontractors

Production Management
Methods: - Analyze possible methods of manufacture
- Define best method, for given facilities/circumstances

Selection of processes for components and assemblies

- Sequence of Operations - Division of Products into assemblies/subassemblies, within limitations of the layout

Production Management
Machines and Equipment:
Relate methods to machines/facilities Maintenance Policy Tool Management Design and economy of jigs and fixtures Replacement policy for plant and machinery

Production Management
Routing:
- Once methods and sequence of operations have been laid
down > Define each operation in detail > Plan for production orders - Routing prescribes the flow of work in the plant and related to considerations of layout, of temporary storages, location of raw materials and components and of material handling system. - A fundamental production function on which all subsequent planning is based.

Production Management
Estimating:
- Based on Production Orders and detailed operation sheets, operation times are worked out - Application of Methods and Routing, work measurement, with performance standards
- Human factor in Time and Motion study and hence time schedule

Production Management
Loading and Scheduling:
- Machine loading to their capability and capacity for the task - In conjunction with routing to ensure smooth work flow - Together with estimating to ensure prescribed methods, feeds, speeds - Toughest job as determines the utilisation of the resources and hence efficiency of the plant - Scheduling must dovetail the operations, to avoid delays on subsequent operations, and minimise WIP - Requires careful analysis of process capacities, coordination
and knowledge of allowances, maintenance breakdowns etc.

Production Management
Dispatching:
- Execution of planning function - Routine of setting productive activities in motion, through, > Release of orders and instructions > As per the sequence-route sheets, loading schedules - Authorizes start of production operations by releasing materials, components, tools, fixtures and instructions sheets to the operator - Ensures material movement according to the planned routing
sheets and to schedules

Production Management
Expediting:
- To keep close watch on the progress of the work - Expediting- Follow up- Progress is a logical step after dispatching - Dispatching initiates the execution production plan, expediting maintains and sees them through to their successful completion. - Keeps close liasion with scheduling to have prompt feedback and corrections.

Production Management
Inspection:
- Generally not a part of the PPC but critical in execution of the execution of the current plan. - The limitations forms the basis for improvements and also planning.

Production Management
Evaluating:
- Most essential function as link between control and future planning - Dispatching and Expediting are concerned with immediate issues, but valuable information gathered in the process with proper feedback mechanism is very useful for evaluation and
hence for improvement in utilsation of methods and facilities - Must get its due attention as future profits depend on utilising best feedback for corrections

Production Management
Preplanning:
- Covers an analysis of data and outline of basic sales reports, market research, product development and design. - Problems of equipment policy and replacement - New processes and materials, layout and workflow
- Collection of data on 4 Ms materials, methods, machines and manpower (and money) with respect to availability, scope and capacity

Production Management
Planning:
- Once task specified, thorough analysis of 4Ms to select appropriate materials, methods and facilities - Followed by routing, estimating and scheduling - Detailed, realistic and precise planning leads to achieving schedules with greater efficiencies - Short term and long term planning , for immediate and more distant future - Functions include , standardization and simplification of
products, materials and methods

Production Management
Controls:
- Through dispatching, inspection and expediting
- Control of inventories, scrap, analysis of WIP, transportation

Production Management
Layout:
- Affects allocation of machines to perform given tasks - Important at design stage inselection of production processes - Rigid layout may hamper integration of additional equipment, lack of space or limited mobility of equipment - May have long transportation lines, increase production costs, WIP and cycle time - Restrictions imposed affect PPC.

Production Management
Simplification and Standardisation
- Different types of materials and methods for production of different components, models or products - Leads to variety of materials at different stages bought outs, manufactured, sub assemblies/assemblies etc. - Also in processes tools, machines, jigs and fixtures etc. - Simplification and Standardisation aims at defining a limited variety of different types which can satisfy the basic requirements with higher plant efficiency - Joint responsibility of Design, Materials management, R&D,PPC and others

Production Management
Time and Motion Study:
- Relates to efficient utilisation of manpoer and to scheduling problems. - Consists of Operation analysis and Work Measurement - Operation analysis/Method study: Evaluation,selection and development of an efficient method for a given task - Work Measurement: relates to establishing standard times for the various operations in the process of estimating function in production planning. Scheduling cannot be performed without such data.

Inventory Control
Importance of materials availability at various stages of production. Inventory Control & Stores Management Complex Function
No over stocking
Finance Obsolescence Space etc

Inventory Control
No stock Outs Loss of production, Loss of business Imbalances adding costs

Inventory Management
What is meant by Inventory? Why inventory is necessary? What are the various forms of the inventory? What are the costs involved in inventories? What are the risks associated with the inventories?

Materials Management
Importance :
- Materials form major part of the Product cost 60% or so - With contribution at say 15%, every % saved in materials is equal to approx 4% increase in Sales. - Has direct bearing on the profitability - Timely and right quality of materials availability decides the overall productivity of any organisation. - Cannot afford too much or too little both dangerous for survival and growth.

Materials Management
Functions: - Material Planning and controlling

- Purchasing/Vendor development
- Stores and inventory control

Inventory Management
Forms bulk of current assets. Stock outs - Loss of profit from the missed sales - Loss of customer and good will - Loss of production - Reduced machine/men utilization Excessive Inventory - Inventory carrying costs - Cost of storage - Deterioration/obsolescence/pilferage

Just in Time Production System


Inventory forms one of the major cost of production
Inventory is a must to enable smooth and cost effective production and hence one looks for most optimum inventory planning balancing between the two objectives. Just in time (JIT) as the name suggests is to work towards getting parts at a workstation just when they are required and move through the operations quickly.

Just in Time Production System


JIT is an integrated set of activities designed to achieve high volume production using minimal inventories of raw materials, work in progress and finished goods. JIT works on a pull system-when an item is sold, the market pulls a replacement from the last work station, that is finished goods, the last workstation in turn pulls parts from the earlier station and so on. The process keeps getting repeated to meet market requirements

Just in Time Production System


Essentials for JIT System to succeed: - High quality and strong vendor relationship - Vendor reliability - Plant reliability - Adequate Vendor and Captive plant capacities - Strong back ups - Fairly steady demand

SCHEDULING
- Business plan transformed into a Master Production plan
- Master production plan Derive resource requirements and check availability - Labour, skills/numbers - Plant & machinery - Finance - Utilities and services and decide and/or agree on the plan

SCHEDULING
Scheduling is the final stage of PPC, where all the production activities are coordinated and projected on a time scale. It tells what resource should be doing what and when. Varies with the manufacturing process It involves a process with which we try to match the requirements set out in the production plan ( quantities,delivery) with the available facilities, including vendors.

SCHEDULING
Several ways to meet the requirements, different routings through machines or processes, sequence of products, priority scale, when and how to expand facilities incl. short term through overtime etc. The best method is decided costs which meets the objectives

SCHEDULING
Objectives
Meet due dates Minimise late completion of jobs or tardiness Minimise completion time Minimise response time Minimise idle time Minimise overall costs Minimise WIP and other inventories Maximise resource utilisation.

SCHEDULING
Forms of scheduling

A production flow diagram:


Number of items to be manufactured for the final assly line and items to be made concurrently, the master flow diagram takes into account the sequence of operations and indicates when work on each component must start. In order to meet required date of completion of the product.

SCHEDULING Forms of scheduling


A production master diagram for large projects:
- Useful for static layouts where the tools, materials, machines and operators flow from one object to another and requires high level of scheduling skills to coordinate the activities of all the facilities by appropriate phasing to achieve the desired level of utilsation and effectiveness of resources.

SCHEDULING Forms of scheduling


A cumulative output progress chart: For new jobs likely to take several months or years, the initial rate of production and subsequent rate of production are considered with due weightages to improvements through learning ned to be applied.

SCHEDULING Forms of scheduling


An outline master programme:
- This merely translates the general requirements specified by the sales as a basis on which final and detailed schedules can be worked out.

A schedule for order breakdowns:


- This is a form of expressing the rate at which the work should progress, particularly useful for decentalised scheduling as it only indicates the quantities and dates for completion.

SCHEDULING
Basic scheduling problems
Flow production scheduling for fluctuating demands Smoothening problems Batch production scheduling, when products are manufactured consecutively Assignment problems Scheduling orders with random arrivals - Product sequencing

SCHEDULING

SCHEDULING
Basic scheduling problems
Flow production scheduling for fluctuating demands
- When sales of some products are subject to seasonal fluctuations, it can be met in one of the following ways; 1. Have a static production programme, coupled with sufficient inventory to satisfy the fluctuating demands. Inventory levels will vary with fluctuating demands but replenishment at constant flow. 2. Have a fluctuating production programme, to cater to changing demand and keep constant inventories with safety cushion between production and marketing. 3. A combination of the two systems, with total costs at minimum, through proper balance between the amount of fluctuations and stock levels.

SCHEDULING
Basic scheduling problems
Batch production scheduling, when products are manufactured consecutively
When the rate of production is higher than the rate of consumption, the plant resorts to batch production. To fully utilise the available time, plant undertakes production of several products in succession. The scheduling has to consider the plant to produce n products one at a time and the manufacturing cycle is concluded when all products have been produced. The cycle length is determined by the total time for all the products in the cycle. The quantities of each products produced must be sufficient to cover the requirements of the cycle time, to avoid overstocking or stock outs. The quantities are governed by the batch production principles.

SCHEDULING
Basic scheduling problems
Batch production scheduling, when products are manufactured consecutively
The issues to be analysed include: - How to go about optimising the whole schedule - Criterion for optimisation - Optimum schedule and optimum batch quantities for individual products - To balance the two objectives More complex situation arise when products are manufactured on a batch basis, some consecutively and some concurrently, with overlapping production time. Requires combination of techniques including linear programming/assignment models etc.

SCHEDULING
Basic scheduling problems
Batch production scheduling, when products are manufactured consecutively
The assignment problem: - To assign the tasks to the machines or to the operators in such a manner as to minimise the processing cost and time. - Distribution according to capacity: Effective utilisation of process capacity with the best mix. Assign the given tasks to the available machines and work out the cost of operating production facilities with alternatives, using linear programming model. - Effects of Overtime or subcontracting, though may provide extra capacity, it is to be evaluated wrt the extra costs

SCHEDULING
Two objectives, which may not be compatible:
- Batch size optimisation for individual products - Optimal solution for the whole production schedule The batch sizes for optimal schedule may differ from the respective batches required for individual product optimization, and in order to reconcile the two, a compromise production schedule is constructed. This requires production range which specifies the allowable deviations from the individual optimums and thereby provides a certain amount of flexibility in constructing the schedule. The fluctuations in consumption are taken care of through appropriate Safety stocks. The changes in average consumption and trends in consumption may affect the batch size and the schedule. This requires constant revaluation in the light of changing circumstances.

SCHEDULING
Critical Path Scheduling:
- Large & Complex projects, with interrelationship among these tasks, like design and manufacture of special purpose machine or development and introduction of a new product or construction of a building.

Techniques:
- The Critical Path Method (CPM) - Project Evaluation and review Technique (PERT)

SCHEDULING
Critical Path Method:
- Begins with determination of each job that makes up the project - Relationship of jobs with each other (preceding/succeeding or independent) - Time for each job Usually expressed in days/weeks Job Description Imm. Predecessor Time-days G Start 0 H Procure matl for part 1 G 4 I Procure matl for part 2 G 3 J Machine part 1 H 6 K 2 I 5 L Assemble 1 and 2 J&K 2 M Inspect & Test L 1 N Finish M 0

SCHEDULING
Critical Path Method: To draw network, we need to find S earliest start for the project ES earliest start for each job t - time required to complete the job EF - ES+t F - earliest finish for the project

G---H-----J----L----M----N G---I------K----L

SCHEDULING
Critical Path Method: To draw network, we need to find T target completion LF - latest finish without delay in T t - Time for the job LS LF-t Slack = LS-ES or LF-EF

SCHEDULING
Critical Path Method:
Job G H I J K L M N Possible start time ES 0 0 0 4 3 10 12 13 LS 0 0 2 4 5 10 12 13 Possible finish time EF 0 4 3 10 8 12 13 13 LF 0 4 5 10 10 12 13 13 Slack time 0 0 2 0 2 0 0 0

SCHEDULING
Critical Path Method:
Benefits : - Determines probable completion dates with alternate plans - Evaluation of progress - Corrective steps and effect on cost and completion - To evaluate ways to reduce completion ,if required through looking at activities on critical path, continuous review - To explore possible reduction in costs, utilising slacks

SCHEDULING
PERT A refined CPM
- Analyse description of project in terms of activities and events - Activity is performance of a Task and is like a job in CPM - An event represents the start or completion of a task - Time estimates for each activity are made on the basis of; - optimistic time , a - most likely time , m - pessimistic time , b and Average is taken as (a+4m+b)/6

SCHEDULING
PERT A refined CPM
Example Event 10 Start material procurement 20 Complete part 1 material procurement 30 Complete part 2 material procurement 40 Complete part 1 machining 50 Complete part 2 machining 60 Start assembly 70 Complete assembly 80 Complete inspection and testing

SCHEDULING
PERT A refined CPM
Event 10 20 30 40 50 60 70 80 TE 0 4.2 3.0 10.2 7.8 10.2 10.2 13.3 TL 0 4.2 5.4 10.2 10.2 10.2 10.2 13.3 Slack TL-TE 0 0 2.4 0 2.4 0 0 0 a=3, m=4,b=6

SCHEDULING
PERT and CPM, limitations: - Requires clear understanding of interrelationships of activities. - Estimation of time, with resource and other factors - Cost comparisons of alternatives - Skilled job and also costly