Production Management: Scope and Strategic Decisions

Production Management

• Production ranks as the first and most important management function.
• Marketing cannot occur if goods aren't available.
• It incorporates planning, organizing, staffing, directing, and supervising production-related activities, ensuring goods and services meet specifications at optimal times and costs.
• Production transforms raw materials and equipment into finished products.

Scope of Production Management

• Encompasses production planning, budgeting, scheduling, and control.
• Production managers must ensure the completion of all manufacturing on schedule and within budget constraints.
• Strategic and operational decisions dictate the scope.

Strategic Decisions

• Decisions are made regarding product design, production systems, and timelines.
• Organizations may decide to introduce new items or modernize existing ones to meet evolving consumer demands.
• Process/layout planning includes decisions on tech for converting materials into products, process design, workstation layout, and workflow.
• Location decisions for production facilities are crucial.
• These depend on raw material supplies, market proximity, transit, labor, and climate.
• Equipment should minimize costs, labor, and time.
• Equipment options depend on workstation spacing, flow, and substance type.
• Capacity must be decided, and consider demand, resources, and regulations.

Operating Decisions

• Short-term decisions are vital for efficient production.
• Daily production choices include work allocation, repairs, and quota fulfillment.
• Production control finds if activities align with plans.
• Measuring actual against standard output and improve as necessary.
• Inventory control, maintenance, cost management, and providing working conditions are included in other activities.

Production Systems

• Production is a process which makes goods and services for consumption.
• Common production systems have inputs, transformation, and outputs.
• Production systems are various operations converting goods and services.
• A production system is comprised of many subsystems, each of which with a unique operation.
• According to Buffa and Sarin, a production system transmutes resource inputs into useful goods and services for outputs.
• There are two main types of production system: intermittant adn continuous

Intermittent Systems

• Make goods as customer orders come their way.
• In turn, resulting in an irregular flow of materials.
• Job production creates one or few consumer products by a deadline
• Price is specified before production.
• Manufacturers take orders to reproduce visiting cards or calendars etc.
• Batch production makes identical items upon demand expectations in particular amounts.
• Goods are ordered and made in a collection.
• Product production focuses towards a lone difficult responsibility which is completed within an expected time and expenses.
• Building and shipbuilding industries are project-based.

Continuous System

• Method of production is used to fabricate or treatment of materials without ceasing
• Assembly is always in process by demand forecast.
• Items have standardized procedures and inputs, with the outputs being built on a big scale for selling purposes.
• Mass production stocks warehouses on a wide scale until demanded, using single or multiple operations.
• Many mass production systems are producing toothpaste, soap, fiber, and dairy.
• Process production dedicates a plant to only one good, with near 0 alterations.
• Some process production has electronic products, metals, papers, and toys.

Production Planning and Control

• According to Alford and Beatty, production planning and control includes the planning, routing, scheduling, dispatching, and follow-up functions.
• Organized so movement of materials are directed and coordinated as to quantity, quality, time, and place.

Steps in Production Planning and Control

• The production department has to follow processes.

Routing

• Serves as the first step in the planning and control of the production
• Work and movement of operations are selected to finalize output efficiently.
• The main objective is to pass work through a lot of machines to complete procedures.
• Locate top of the line and efficient sequence.
• Procedure includes find items to produce, materials, manufacturing, and factors involved.
• Forms, quantities, and sheets made pre and post-production.

Scheduling

• Involves setting times and dates for each activity
• Preparation of table needed.
• Aims at output level achieved with lowest disturbance occurrences
• Objective is work on time and continuity.
• Timetable needs preparation with list of activities.
• Completion dates and available space should be stated.

Dispatching

• Involves production plan execution, factory/department instruction, all rooted in schedule and routing
• Instruction implementation is done.
• Objective is to tell machine operators of plan and that it is carried out.
• Proper and organized materials and tooling are vital.
• Tasks are also assigned alongside instructions.
• Operation periods are also followed, may be centralized or decentralized.

Follow-Up

• Checks what happened for improvements on a production.
• Goal is remedial measures are taken.
• Monitoring production is the procedure.
• Production results can be compared to ideal numbers for comparison.
• Measures are put to see improvement.

Productivity

• Productivity is the ratio of output to inputs.
• It's also the volume made from a list of many supplies used.
• Represents how one ingredient unit creates products at intervals to the cycle.
• It links the relationship and contributions from system to inputs to creation.
• Formula: Productivity = Output / Input.
• As per Peter Drucker, productivity is the balance among all parameters of production which gives the largest output with the least effort.

Factors Influencing Productivity

• Natural, technological, production, organizational, governmental, financial, human, and sociological factors
• Technology, production, and internal structure boosts overall efficiency.

Productivity Management in India

• India sees growth in several automative, tech, and chemical markets.
• PPC aids sustainable gains in productivity.
• Low skills, training, and turnover are India’s challenges in low skill.
• Upskilling is the solution.
• New automatons and AI are still slow integrations, but are growing.
• Upgraded PPC boosts integration rates for tech.
• PPC can better inventory flow, reduce downtime, waste, minimize.
• Policies (Make in India) aims for domestic production rates.
• QMS boosts quality and manufacturing for firms seeking to answer demands.

Measuring Productivity

• Measurements assesses resources used.
• There are 5 approaches
• Labour: Output goods divided by labor.
• Efficiency rates measure services and production.
• Capital: Goods divided by capitol and equipment investments.
• Capital sees the production rate in India.
• MFP is output into labor, wealth, and commodities.
• MFP is the assessment of inputs.

Total Factor Productivity (TFP)

• Method includes labor, wealth and tech and key India goal.

Capacity Utilization

• This metric measures the use of firm/econ output.
• Utilization sees improved production.

Inventory Management and Control

• Inventory control is stock's standard of parts and supplies, following policy to be established and run.
• Control refers to supervision with sufficient stock in businesses at intervals.
• This sees proper operation and consumer demand is achieved.

Objectives of Inventory Control

• Prevent loss, theft or misuse of inventory.
• Deliver its products on schedule.
• Inventory can also maintain continuity.
• Boosts return on investments with an ideal level.
• Also acts a buffer stocks when an interruption strikes with materials, following up with demand surges.
• Gives clarity on ordering and timing while stopping duplication.
• Boosts materials control in projects.
• Restricts resources and supplies.
• Cuts loss of materials that occur from human mistakes.

Techniques of Inventory Control

• Some common tools are ABC Analysis, EOQ, JIT, CARDEX system, and maximum/minimum system.
• ABC analysis sees various inventory and billing is classified as A, B, or C stock for its worth and amount.
• Economic Order Quantity is determined fixed depending on re-order times.
• JIT is a Japanese approach for materials and goods being processed.
• Cardex uses cards and trays for posting.
• Maximum/minimum quantifies the inventory needed.
• MAPICS uses data of inventories to manage and run.

Logistic Management: Relevance and Importance

• Ensures the proper movement of data and services.
• Boosts cost effectiveness, consumer, and supply chains.

Dimensions of Quality

• Quality is a degree in what is good.
• Performance of function is an operating feature to satisfy.
• Additional characteristics aid operation.
• Reliability indicates the working life and assurance.
• Conformance refers if a products follows design and standards.
• Durability refers to lifespan.
• Repairs, maintenance are serviceability factors.
• Appearance and judgment are in place for personal feeling.
• Information that consumers cannot access relies on brand opinion.

Need of 360° Quality Management

• Manages all facets of the organization.
• Provides insight and a holistic method.
• Feedback from investors.
• Businesses sustain improvements.
• Pinpoints issues and cuts customer concerns.
• Meets demands and customer satisfaction.
• Fosters a sense for requirements.
• Industry requirements are met, with increases to profits, by reducing fees.
• Quality standards increase throughout.

Quality Circle

• Idea from Kaoru Ishikawa.
• Promotes the strategy of quality.
• Teams collaborate.
• Has improvements on outputs.

Key Characteristics of Quality Circles

• Employee participation, group format, issues are solved, and tasks improve with management support

Benefits of Quality Circles

• Improves worker morale with teamwork and innovation.
• Solves the process with development from problem solving.

Quality Management Tools and Techniques

• It relates to improving of the organization, techniques.
• Regular innovation is employed.
• Actions follow with requirements of customer that is external.

Importance of Total Quality Management (TQM)

• Provides insights with constant enrichment which improves business.
• Key is to improve satisfaction and effectiveness, engaging workers
• Customers are satisfied and loyal from operations, feedback ensures development.
• Environment allows all ranging from head to employees improve by Kaizen and Six Sigma.
• Employees contribute with morale via change suggestions.

Competitive Advantage

• Companies using TQM are responding to the market.
• Allows premium price by reputation.
• Is rooted in decision making driven by input.
• Compliance measures are followed.
• Overall environment allows businesses to flourish.

Six Sigma

• Method to use tools for process improvements.
• Created in 1986 by Bill Smith.
• It reduces flaws and variations in output.
• Variation stays within boundaries.

Steps in Six Sigma

• DMAIC: There are five steps in the application of Six Sigma to improve the quality of output, that is, define,measure, analyse, improve and control. Phase contains project.

International Standards Organisation (ISO 9000)

• From Switzerland, it is worldwide standards from countries like India are under ISO guidance.
• Is an mark of quality.
• ISO family of norms centers on control framework.

ISO 9000 benefits are often for reasons:

• Standards and satisfactory clients.
• The standard is used in operations for output delivery, is client centered.
• By enforcement of frameworks that better products meet and do what they must.

International Standard

• ISO is also used for continuous improvements and ensures that regulations are followed with a focus on equality.

Kaizen

• Made by Masaaki Lamai in 1980, as "shift" is good.
• It improves organizational qualities.
• There is a philosophy to better goods too.
• Needs processes and steps.
• Identifying and find sources of causes to improve with outcomes.

Kaizen Process: The following are the steps

• Includes: Definition of trouble, review, measures and standardization.

Service Quality Management

• Improves quality and satisfies client.
• Is also to weigh the costs related to quality.

Importance of Service Quality Management (SQM)

• Increases rates of loyalty, performance, and the image, which must keep customers happy.
• Boosts efficiency that meets returns of the operation.
• Helps the staff that perform.
• Premium prices, corporate picture and scalable profits are important. Allows transactions by tech.

Employee Training and Development In Service Quality

• Equips employees for needs through necessary skills.

SERVQUAL Model

• Widely held framework that serves improve service.
• It measures how performance compares after service from a quality with customer care.
• Gap analyses is the measure.

Measures to improve service quality

• By customer survey results.
• Through training and standards.

Emerging trends in quality management

• Integration of strategies and processes for innovation and needs.
• Is aided through AI, processes, and tech.
• Data driven and centered.
• Includes sustainable plans.

Indian Financial System – Institutional Framework

• It is a system to aid savings and grow economic strength.

Indian Financial Markets:

• Organized (banks) and disorganized markets ( lenders).
• These are split in long term funds and markets.

Capital Market

• Is a financial area where stocks are bought and sold.
• Gives resources.
• 3 Features: Financing that is long term, easy to trade over, and safe.
• Types can split it in industrial, financial government options. Industrial: Includes industry equities, and is split in primary equity, and secondary stock.
• Primary: The issuing new equity market in first offering.
• Factors with regulations help.

Methods of Issuing Securities in the Primary Market:

• Consisting of initial public, rights and bonus shares.
• Advantage companies raise funds.

Right and Bonus Issue:

• Advantage fair for shares.
• Existing shares get capital.

Secondary Market

• Features: Deals with assets for trading.
• Liquidity converts to profit.
• A Stock Exchange is one of the types of secondary market.
• Stocks trade based on price and priority with rules.

Government Securities Market

• Instruments by government and state.
• The are low-risk investments.

Functions or Roles of a Stock Exchange

• Includes: Trading easier, pricing discovery, liquidity and law.
• Protects fraud through capital creation for money and broadens ownership of investors. Facilitating Derivative Markets: The stock exchange’s main function has a vital platform for securities market.
• Market has regulations for entities, and the role sees that agencies oversee.

Regulatory Institutions in India

SEBI:

• The role of the body overseeing and regulating the securities markets. It was formed for the promote of the market. Is a stock overseer
• Protects in stock well

IRDAI

• Government agency and licensing group with client rights.
• It's been a long with transparency.
• Insuring that the industry is improved to help clients.

PFRDA

• Manages for financial income and helps long term security.
• Improves funds.
• Pushing subscriber and help.
• This sees a pension for each person from all backgrounds.
• Gives help for people after retirement. NABARD: Serves to help development and the rural.
  • Promotes the support of the credit
  • Regulates finances.
  • Has an act to support growth.

Credit Rating Agencies

• Assesses individuals, coorperations and governments for investing.
• Helps check their debt.
• Provide insights a range from high to defaults
• Can find the level on individual equities to gauge and risk.

Dematerialization and Depository Participant: Process of opening Demat Account

• Account opening process of electronics converting form shares, as intermediaries helps investors in markets today.

Demat Account

• Electronic where equity stock management for the investor can stay, is done.
• Process opens from the DP.
• A, account and KYC forms must be filled.
• Has a verification and rules for online and physical actions. And trading account and help to invest in security.

Depository

• Electronic forms and transfers sees transparency is improved.
• Is needed for today's stock accounts.

Contemporary Issues In Management (Indian Financial System)

• It involves management for a personal portfolio and savings planning. It also offers mutual funds, investment and plans.

Mutual Funds

• Is an investment for many people, that are supervised well and are somewhat secure. Sees equity, debt.
• Factors with India: Economic Literacy, Support, Tech. It benefits with high return and low rupee averages for stock. SIP: Is investment that grows money overtime.

Key Features of Systematic Investment Plan has:

• Fixed with SIPs and payments are monthly.
• It averages units that is time a help.

NBFIs

• NBFIs is organization that does not take full deposit.
• Regulation oversees the market.
• Helps more people, and creates equity. Asset Firm are one of the types.
• Manages, distributes and is financial and diversifies.

Other Funds

• Equity, debt, and HYBRID for risks.
• It is all with value can have risks if one is involved, and risks if it does well. Risks exist if they not be be performed.
• Refinances sees more people to manage loans that had lower intrest rate to assist to clients in restructuring payments.

Angel Investor

• Individuals offer funds to startups trading equity shares. Characteristics sees personal funds and the risk.
• Investment does make for those that contribute
• Equity for shares help.

Microfinance

• Small is loans , saving is offered.
• Increases access on capital.
• Women income is good.
• People have access for support.
• Has MFIs in India for the self group and those with it are selected in poverty. Has a network with rural people.

Personal finance

• Focuses is budgeting and investment. It's a help for savings until income post the plan at 50,000 until 100k. Includes stocks, and retirement. With monthly and short investing.
• Investment will grows for people overtime that like to get wealth through consistent steps. A key in growing more of the national pension.

Retirement

• Retirement schemes are a long plan and the individual retirement account are for benefits to their workers for low cost strategies.

National Pension System

Is robust for returns. Provides high opportunities