Introduction to Production Planning and Control ( PPC )
Production is done by manufacturing different things with various processes. Planning looks ahead, anticipates possible difficulties, and decides in advance about the production. The control phase makes sure that the programmed production is constantly maintained.
A production planning and control (PPC) system has many functions to perform like:-
- Planning phase:- Forecasting, order writing, product, product design, material control, tool control, loading, etc.
- Action phase:- Dispatching
- Control phase:- Data processing, expediting and replanning
- Production planning and control can be viewed as the nervous system of the production operation.
- This function aims at the efficient utilization of material resources, people, and facilities in any undertaking through planning, coordinating, and controlling the production activities that transform the raw material into finished products or components as the most optimal manner.
- All the activities in the manufacturing or production cycle must be planned, coordinated, organized, and controlling to its objectives.
- Production planning and control as a department plays a vital role in manufacturing organizations.
- It is clear from the name that it is something about planning. Planning is defined as setting goals. Production planning and control provides different kinds of information to different departments.
- It provides information about available manufacturing resources to the marketing department. Marketing department receives orders according to that information. Similarly, it coordinates with other departments and provides relevant information.
What is PPC?
- Production planning and control may be defined as the direction and coordination of the firm’s material and physical facilities towards the attainment of pre-specified production goals, most efficiently and economically.
- According to Samuel Elion: “The highest efficiency in production is obtained by manufacturing the required quantity of the product, of the required quality, at the required time, by the best and cheapest method.”
- To attain this target, management employs production planning and control, the tool that co-ordinates all manufacturing activities.
- The four factors mentioned above—namely: quantity, quality, time and price encompass the production system, of which production planning and control is the brain.
- Production control will be in action when production activity begins.
It can comprise the following activities
1) Determination of the required product mix and factory load to satisfy customer’s needs.
2) Matching the required level of production to the existing resources.
3) Scheduling (Scheduling is the process of arranging, controlling, and optimizing work and workloads in a production process or manufacturing process. Scheduling is used to allocate plant and machinery resources, plan human resources, plan production processes and purchase materials) and choosing the actual work to be started in the manufacturing facility”
4) Setting up and delivering production orders to production facilities.
Relations between Production Planning and Control
- There exists a very close inter-relationship among the phases and functions of the production planning and control and they are mutually supporting. For instance, realistic planning is quite dependent upon the data which is compiled during the function phase. Action, in turn, is dependent upon continuous planning of the work to be performed by the activity. Follow-up is the comparison of the work that was originally planned against the work actually done. It must be understood, that if the plans are lacking, or not stated properly or are recorded inadequately in terms of objectives, starting and completion dates, and utilization of resources, there will not be a basis for a comprehensive follow up phase.
Relation between production planning and production control
- The planning and control is an integral part of the system and it is very difficult to isolate one from the other. They are so inter-related that one is always identified with the other. Planning concerns with the formulation of production strategies and targets for the enterprise whereas control is vested with actual implementation and execution of planned Objectives. Production planning determines the operations required to manufacture the product and control regulates and supervises these operations. Through production control information the organization can locate shortcomings in the planning process and the necessary modifications can be done at the time of planning in the future. Similarly, production control operations can be improved to adjust with the planning requirements.
Need of PPC
PPC is needed to achieve:
1) Effective utilization of the firm’s resources.
2) To achieve the production objective concerning quality, quantity, cost, and timeliness of delivery.
3) To obtain the uninterrupted production flow to meet the customer demands concerning quality and committed delivery schedule.
4) To help the company to supply a good quality product to the customer continuously at company rates.
Objectives of PPC
- There are three M’s of production viz, Men, Materials and Machines without which production cannot be carried out.
- The production planning and control (P.P.C.) system integrates and coordinates the use of manpower, machines, and materials for efficient production to meet the sales requirements.
Objectives of PPC are discussed below:
1. To design a system and plan, by which production may be carried out to meet the promised delivery date consistent with minimum cost and quality standard.
2. To ensure efficient utilization of production facilities.
3. To coordinate the production activities of different departments.
4. To maintain adequate but not excessive stock of raw materials, work in process, and of finished goods to meet production requirements and delivery schedules at the most economical level.
5. To ensure the production of the right product in the right quality at the right time.
6. To maintain flexibility in manufacturing operations, to accommodate rush jobs or to meet contingencies.
7. To co-ordinate labor, machines, and equipment most effectively and economically.
8. Ensuring smooth flow of materials by eliminating bottlenecks if any, in production.
9. Establishing targets and checking it against performance.
10. To provide alternative production strategies in case of emergencies.
11. To determine the nature and magnitude of various input factors to manufacture the desired output
12. The PPC department guides production by preparing and issuing manufacturing orders which direct the use of facilities and material and allocate labor to the output of the required quantity of products of the required quality.
Factors affecting on PPC
PPC is affected by the different factors, which all are discussed below:
1) Use of Computers:
Modern factories are using office automation equipment like PC, punch cards, etc. It helps accurate computation of required of men and machines.
2) Seasonal Variations:
The demand for certain products is affected by seasons, for instance umbrellas and raincoats during the monsoons and outputs. Production planning and control must consider such changes while planning and control activities of inputs and outputs.
3) Test Marketing:
In an aggressive marketing strategy new products are to be test marketed to know the trends. This is a short- cycle operation, intermittent and often upsets regular production.
4) After Sales Service:
This has become an important parameter for success. In after-sales services, many items are returned for repair. These are unscheduled work and also overload the production line.
5) Losses due to Unpredictable Factors:
Losses occur due to accidents, fire, and theft of production inputs, mainly materials and components. These are unpredictable. Shortage of input due to such factors upset the planned production schedule in time and quantity.
6) Losses due to Predictable Factors:
There are losses of inputs, due to natural engineering phenomena like production losses and changes in the consumption of materials and the occurrence of defectives.
7) Production of Order:
There are occasions when last-minute prioritization of existing orders due to external pressure takes place. These changes in priority are often decided by a sufficiently high level of management.
8) Design Changes:
Design changes are issued by R & D and the engineering department. This will necessarily force production planning control to change the input materials and process.
9) Rejection and Replacement:
There are occasions when sub-assemblies or finished goods are rejected during a stage or final inspection. Production planning and control must cater for contingent plans to take care of rework without affecting scheduled quality
Functions of PPC
Three main phases of PPC:
1. Planning phase
2. Action phase
3. Follow up or control phase
- These three phases as mentioned above make up the main body of functions of PPC. There are other secondary functions that are essential contributors to the efficient performance of production, planning, and control.
- Also there are other functions that are supported by these three phases which are not generally considered to be direct functions of production planning and control.
- These include quality control- cost control and so on.
- Prior planning implies that a course of action is established in advance. The whole activity must be planned and exists on paper before the very first action takes place
1. Fore-canting (Estimation of future work): Fore-casting is defined as the estimation of future activities i.e. the estimation of type, quantity, and quality of future work. These estimates provide the basis for establishing the future requirement for men, materials, machines, time, and money.
2. Order writing (Preparation of work authorization): If the work is to be controlled, it must begin with a specified documents authorising it. So it means giving the authority to one or more persons to do a particular job.
3. Product design (Preparation of specifications): After the work authorization has been prepared the next step is to collect the information necessary to describe the work in detail. This includes blueprints or drawings, a list of specifications, a bill of material, and so on.
In any type of work activity the following steps are necessary for planning details of the work to be done:
1. Process planning: The determination of the most economical method of performing an activity, all factors being considered. Routing. The arrangement of work stations is determined by the route.
2. Material control: Determination of material requirements and control of material (inventory control).
3. Tool control: Tool control may be subdivided into two categories :
(a) Design and procurement of new tools.
(b) Control storage and maintenance of tools after procurement.
4. Loading: Determination and control of equipment and manpower requirements. Loading may be defined as the assignment of work to the facility. The facility may be equipment, manpower, or both.
5. Scheduling: Determination when the work is to be done. Scheduling consists of time phasing of loading (workload) i.e., setting both, starting and ending time for the work to be done.
The common practice dictates that routing, loading, and scheduling be performed simultaneously.
- The work is started in the action phase. There is only one production planning activity in the action phase i.e., dispatching. Dispatching is the transition from the planning phase to the action phase.
- It consists of the actual release of detailed work authorization to the work centers. Follow up or Control Phase:
- Once the work is started in an activity it is necessary to evaluate continuously the progress in terms of plan so that deviations can be detected and corrected as quickly as possible. The control phase accordingly consists of two parts:
1. Progress reporting: (Data collection). The first step in progress reporting is to collect data for what is actually happening in the activity (Progress of work).
2. Data interpretation. After the data has been collected, then it is necessary to interpret it by comparing the actual performance against the plan.
1. Expediting. If the data collected from the production unit indicates that there is a significant deviation from the plan and the plan cannot be changed, then some action must be taken to get back on plan.
2. Replanning. It should be emphasized that the plan is not to be changed but to be followed, however, if after expediting to correct deviation it is found that, it is impossible to perform according to plan. It would be necessary to replan the whole affair. It may also be found that there were errors made while developing the original plan. In all such cases replanning is necessary.
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