WEEK 1 LECTURE 1

Production Planning and Control

Engr. Abdul Aleem

 PRODUCTION PLANNING
Production planning
is a pre-production
function performed to
match the production
capacity with the
essential market demand
in the most feasible
manner.
It consist of 1-
Production & 2- Planning
 PRODUCTION CONTROL

Production control

It follows other
functions of
production & helps
to determine the
performance of an
organization.
 OBJECTIVES OF PRODUCTION PLANNING
To meet the demand of the product effectively
& maintain the balance between different
production activities.
The best possible utilization of available
resources.
To operate the plant at a predetermined level of
efficiency.
To utilize production facilities to the maximum
for getting the minimum operating costs &
meeting delivery schedules.
To assist workers engaged in production
activities for making right & greater earnings.
To equip management for tackling any
difficulty, which may arise later on in the
achieving of production target.
 FUNCTIONS OF PRODUCTION PLANNING
Production selection & design – this helps the selection
of most suitable product that fulfills market demand. It
also ensures that design of the product is according
to customer requirements.

Process selection & planning – this helps to choose

right technology, equipments, machines, material
handling systems, automation involved in production
of product.

Facility location – this helps to minimize the costs

such as production & distribution costs.

Facility location & materials handling – this helps to

material transfer & processing of product in the most
efficient manner through the shortest possible
distance with minimum time wages.

Capacity planning – decides about how much resource

should be kept to meet current market demand.

Procedure planning – specifies production procedure

to be practiced for obtaining the desire output at
optimum cost.
 STEPS INVOLVED IN PP
 Determination of target (past experience/
budget/manpower/production capacity).

 Collection & interpretation of information (raw

material availability/new technology /
regulations).

 Developing plan (deciding batch size/

procedure/process/lead time).

 Putting plan into operations (execution).

 Follow up action (controlling to correct deviation

 PRODUCTIION PLANNING HIERARCHY
Long Term (Capacity Planning)
Capital Intensive in nature
- This deals with Strategic and business issue. In the long term we deal with
those issue which help us to create demand for our products and generating
sufficient revenue for the company.
- Reflect in process choice and equipment selection. Since selection of
equipment and facilities require lot of investment and decision is
irreversible, one should pay utmost care keeping in mind customer
requirements.

Medium Term (Aggregate Planning)

- How demand can be met from existing facilities and resources. Here we
are trying to utilizing our existing resources (manpower, machine, facilities
etc) to satisfy the market demand
Short Term (operational Planning)

- In short term we monitoring the production activities on

day to day basis and compare the output against the plan
and take corrective action.

Master Production Schedule (MPS) - Is a statement of how

many finished items are to be produced and when they are
to be produced.

Material Requirement Planning (MRP) - System that uses

net demand from the MPS and explodes it using the bill of
materials (BOM).
 Organizational structure of PPC
department
• It differ from organization to organization
• FACTORY HEAD
• PRODUCTION MANAGER
• PRODUCTION SUPERVISOR SKILLED WORKER
• QC/QA MANAGER
• MAINTAINANCE MANAGER

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 PRODUCTION CONTROL
To execute the Production plans & to attain the
company objectives production manager needs
to check the work progress & correct the
deviations between actual performance &
planned standards or requirements of customers.

Controlling is the process that measures the

existing performance of an organization & guides
it towards predetermined objectives.

It means Production Control is essentially the

control of quantity in manufacturing of the
required quality.
FUNCTIONS
FUNCTIONS OF
OF PRODN
PRODN CONTROL
CONTROL
Inventory control – Helps determine the optimal
inventory levels, components, parts, tools, spares
in order to ensure their availability with minimum
capital investment. (JIT)
Time management – Helps to ensure whether the
manufacturing of product is according to schedule.
Quality control – Helps ensures that the services &
products produced by company meet the declared
quality standards with minimum cost.
 FUNCTIONS
FUNCTIONS OF
OF PRODN
PRODN CONTROL
CONTROL
Cont…..
Maintenance & replacement – Helps select the optimal
maintenance policy to ensure or availability of
equipments& machines, includes – preventive
inspection, planned lubrication, periodic cleaning,
planned replacement of parts etc.
• Cost reduction & cost control
• Dispatching – Moving of RM among various
operations, collecting fixtures & tools from stores an
issuing them to concern department, issuing route
cards etc.
ADVANTAGES
ADVANTAGES OF
OF PRODN
PRODN CONTROL
CONTROL
TO
TO MANAGEMENT
MANAGEMENT
Prodn control aims to make right quantity & quality
of product, accessible to customers at right time & at
minimum cost.
Investment in inventories & finished stock can be
kept minimum.
The firm can capture market share by producing
goods at lowest cost & best quality & may result in
large amount of sales.
The amount of profit will be higher.
The firm can compete in the market with low cost
prodn & higher profits.
TECHNIQUES OF PRODUCTION
PLANNING & CONTROL
 Routing – is selection of path or route over which each piece is to
travel in being transformed from RM into FG.
 Scheduling – It involves establishing the amount of work to be done
& the time when each element of work will start.
 Determine most feasible sequence of operations.

 Dispatching – is concerned with the issue of orders to shop floor,

instructions, tools are provided, job cards & work force.
 Guiding & controlling the material & operations in processing on
the basis of route sheet & shedule
 Follow up – to see whether the work is being carried on according
to planning & orders & instructions issued.
 Inspection – To check the process or quality
 Correction – Making correction or initiating necessary action to
ensure desired output.
OBJECTIVES
OBJECTIVES OF
OF PRODN
PRODN PLANNING
PLANNING &
&
CONTROL
CONTROL
Effectiveness – ensures right kind of goods to fulfill the customer
requirement.
Maximizing output – ensures the prodn of maximum goods &
resources in minimum output.
Quality control – ensures quality of goods/services meet the
quality specification.
Minimizing the output time – ensures reducing delays, waiting
time & ideal time.
Capacity utilization – ensures manpower/machine is fully utilized.
Maintain inventory level – ensures optimal level of stock.
Flexibility – ensure that flexibility maintain for all operations.
 OBJECTIVES
OBJECTIVES OF
OF PRODN
PRODN PLANNING
PLANNING &
&
CONTROL
CONTROL
Cont…..
Better coordination – between machine & labour.
Reducing bottlenecks – ensures that all the bottlenecks
are removed from all stages of operations.
Maintaining performance – ensures the proper
standards are maintained by comparing actual result
with planned result.
Prepare production schedules – ensures that timely
production is made according to the schedule.
BENEFITS
BENEFITS OF
OF OF
OF PRODN
PRODN PLANNING
PLANNING &
&
CONTROL
CONTROL
Higher quality,
Better utilization of resources,
Reduced inventories,
Reduced manufacturing cycle time,
Faster delivery,
Better customer services,
Lower production costs,
Lower capital investments,
Higher customer services,
Improve sales turnover,
BENEFITS
BENEFITS OF
OF OF
OF PRODN
PRODN PLANNING
PLANNING &
&
CONTROL
CONTROL
Improve market share,
Improve profitability,
Flexibility,
Lower prices,
Competitive advantage for firm due to balance
inventory levels & higher quality.
Demand Forecasting
Objective

To predict demand for planning purposes

Laws of Forecasting

Forecasts are always wrong

Forecasts always change
The further into the future, the less reliable the
forecast will be

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Aggregate Production Planning
Objective

To generate a medium-term production plan

To establish rough product mix
To anticipates bottlenecks
To align capacity and workforce plans.
It is usually done for next 2 to12 months.

Demand changes over a period of time at a faster

rate than the resources. Aggregate planning offers
strategies to absorb these fluctuations. May 9, 2024
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Scheduling
Concerned with timetable of production
Scheduling arranges the different manufacturing
operations in order of priority, fixing the time & date
for the commencement & completion of each
operation.

Types of scheduling

Forward scheduling
Backward scheduling
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Workforce Planning
To find out and direct

Right people
Right place
Right time
Right price

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Materials Requirement Planning
MRP is a production planning and inventory control
system used to manage manufacturing processes.

An MRP system has 3 major objectives

Ensure materials are available for production and

products are available for delivery to customers
Maintain the lowest possible level of inventory
Plan manufacturing activities, delivery schedules
and purchasing activities

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Capacity Planning
Wrong Capacity

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Shop floor Control
Objective

To control flow of work through plant and coordinate

with other activities (e.g., quality control, preventive
maintenance, etc.)

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