Operations Management Concepts PDF

Operationsmanagement has been recognisedas an importantfactorina country's economic growth. The traditional view of manufacturingmanagement is the concept of ProductionManagement with the focus on econo...

Operationsmanagement has been recognisedas an importantfactorina country's economic growth. The traditional view of manufacturingmanagement is the concept of ProductionManagement with the focus on economic efficiency in manufacturing. Later the new name Operations Management was identified, sectorbecame more prominent.Rapid changes intechnology as service have posed numerous opportunitiesand challenges,which have resultedin enhancement of manufacturingcapabilities through new materials, facilities, techniques and procedures.Hence, managing a servicesystem has become a major challengein the globalcompetitiveenvironment. OperationsManagement has been a key element in the improvement and productivity in business around the world.OperationsManagement leadsthe way forthe organisations to achieveitsgoals with minimum effort. Hence, the studyof the subjectat undergraduate and postgraduate level has more significance.  INTRODUCTION which isconcerned with the transformation Operationisthat part of as organization, of a range of inputsintothe requiredoutput (services) havingthe requisite level.Management is quality which combines and transformsvariousresourcesused intheoperationssubsystemof the organization intovalueadded services ina controlled manner as per the policies of the organization. The setof interrelated which are involvedinmanufacturingcertainproducts, management activities, iscalledas productionmanagement. Ifthe same concept isextended toservices management, then the correspondingset of management iscalledas operationsmanagement. activities 1.2 HISTORICAL DEVELOPMENT Forover two centuriesoperationsand productionmanagement has been recognizedas an important factorina country'seconomic growth. The traditional view of manufacturingmanagement began ineighteenthcentury when Adam Smith recognisedthe economic benefitsof specialization oflabour.He recommended breakingof 1.3 CONCEPT OF PRODUCTION Productionfunctionis'thepartofan organisation, of which isconcerned withthe transformation a rangeof inputsintothe requiredoutputs (products) having the requisite qualitylevel'. Productionisdefinedas 'the step-by-step conversionof one form of materialintoanother of the productto the form throughchemical or mechanical process tocreate or enhance the utility user'.Thus productionisa valueadditionprocess.At each stage ofprocessing, there willbe value addition. Edwood Buffadefinesproductionas 'a processby which goods and servicesare created'. Some examples of productionare:manufacturingcustom-made productslike, boilerswith a specific capacity, constructing flats, some structural fabrication works forselectedcustomers,etc., productslike, and manufacturingstandardized car,bus,motor cycle,radio,television, etc. 14 PRODUCTION SYSTEM The productionsystem isthatpart of an organisation, which produces productsof an organisation. Itisthat activity whereby resources,flowingwithina definedsystem,are combined and transformed in a controlled manner to add valueinaccordance with the policies communicated by management'. A simplified productionsystem isshown below:  1.5 CLASSIFICATION OF PRODUCTION SYSTEM as Job-shop, Batch,Mass and Continuousproductionsystems. Productionsystemscan be classified Continuousproduction Mass production Production/ operation volume Batch production Job-Shop production OutputProduct variety Fig.1.2Classifications of productionsystems 1.5.1Job-Shop Production Job-shop productionarecharacterisedby manufacturingone or few quantityof products designed and produced as per the specification of customers withinprefixedtime and cost.The distinguishing feature of thisis low volume and high varietyof products. A job-shopcomprises of general-purpose machines arranged intodifferent departments.Each job demands unique technologicalrequirements, demands processingon machines in a certain Sequence loh.sh -shop Productionischaracterisedby 1. High varietyof products and low volume. 2. Use of general purpose machines and facilities. 3. Highlyskilled operators who can take up each job as a challenge because of uniqueness. 4. Large inventoryof materials, tools, parts. 5. Detailedplanning isessentialforsequencing therequirements ofeach product,capacitiesfor each work centre and orderpriorities. Advantages Followingarethe advantages ofJob-shopProduction: varietyof products can be produced. 1. Because of general purpose machines and facilities 2. Operators willbecome more skilled and competent, as each job gives them learning opportunities. 3. Fullpotentialofoperatorscan be utilised. 4. OpportunityexistsforCreativemethods and innovativeideas. 1.5.2Batch Production American Productionand InventoryControlSociety(APICS)definesBatch Productionas a form of manufacturingin which departments inlotsor batches and the job pass through the functional routing.Itischaracterised each lotmay have a different by the manufacture oflimited number of productsproduced at regularintervals and stockedawaitingsales. Batch Productionischaracterised by 1.Shorterproductionruns. 2. Plantand machinery are flexible. 3. Plantand machinery set up isused forthe productionof item ina batch and change of setup isrequiredforprocessingthe nextbatch. 4. Manufacturinglead-timeand costare loweras compared to job orderproduction. Advantages Followingare the advantages ofBatch Production: 1.Betterutilisation of plantand machinery. 2. Promotes functionalspecialisation. 3. Cost per unitislower as compared to joborderproduction. 4. Lower investmentinplantand machinery. 5. Flexibility toaccommodate and processnumber ofproducts. 6. Job satisfaction existsforoperators. 1.5.3Mass Production partsor assembliesusinga continuousprocess are calledMass Production, Manufactureofdiscrete Thisproductionsystem isjustified The machines are arranged by very largevolume of production. existsand all ina lineor product layout.Product and process standardisation outputs follow the same path. 1.5.4Continuous Production Productionfacilities are arranged as per the sequence ofproductionoperationsfrom the first operations to the finishedproduct.The items are made to flow through the sequence of operationsthrough materialhandlingdevicessuch as conveyors, transferdevices,etc. Continuous Productionischaracterised by 1. Dedicatedplantand equipment with zero flexibility. 2. Materialhandlingisfullyautomated. 3 predeterminesequence of operations. Process followsa 4. Component materials identified cannot be readily i withfinalproduct. 5. Planningand schedulingisa routineaction. Advantages Followingare the advantages ofContinuous Production: ofproductand processsequence. 1. Standardisation 2. Higherrate of productionwith reduced cycletime. 3. Highercapacityutilisation due to linebalancing. 4. Manpower isnot requiredformaterialhandlingas itiscompletelyautomatic. Operations Management Concepts  1.6 PRODUCTION MANAGEMENT Productionmanagement is'aprocessofplanning,organising,directing and controllingthe activities of the productionfunction.Itcombines and transformsvariousresourcesused in the production intovalueadded productina controlled subsystemofthe organization of manner as per the policies the organization'. E.S.Buffa definesproductionmanagement as follows: *Productionmanagement deals withdecision-makingrelatedto productionprocesses so that goods or servicesare produced accordingtospecifications, the resulting in the amount and by the scheduledemanded and out ofminimum cost". 1.6.1Objectivesof ProductionManagement The objectiveof the productionmanagement istoproduce goods and servicesof RightQualityand Quantityat the Righttime and Rightmanufacturingcost'. 1. RightQuality:The qualityof product isestablishedbased upon the customers need. The rightqualityisnot necessarily being the best quality. Itisdeterminedby the costof the productand the technical characteristics as suitedto the specific requirements, 2. RightQuantity: The manufacturing organisationshouldproduce the products inrightnumber. Ifthey are produced inexcess of demand the capitalwillblockup inthe form of inventoryand ifthe quantityis produced inshortof demand, leads to shortage of products. 3. RightTime: Timelinessof deliveryis one of the important parameter to judge the of productiondepartment. So, the productiondepartment has to make the optimal effectiveness utilization of inputresourcesto achieveitsobjective. 4. RightManufacturingCost:Manufacturing costs are establishedbefore the product is actuallymanufactured. Hence, allattempts shouldbe made to produce the products at pre-established cost,so as to reduce the variation between actualand the standard (pre-established) cost. 1.7 OPERATIONS SYSTEM An operationwas definedinterms ofthe missionitserves forthe organisation, technology itemploys and the human and managerialprocessesitinvolves. Operationsinan organisationcan be categorised intoManufacturingOperationsand ServiceOperations.ManufacturingOperationsis a conversion process thatincludesmanufacturing yieldsa tangibleoutput:a product, whereas, a conversionprocess that includesservice yieldsan intangible output:a deed, a performance, an effort. Feedback Inventorylevels Labourefficiency Salesvolume erationssystem fordepartr ging Operatlons  toplanned operations manager must exercisecontrolby measuring actualoutputsand comparing them management. Controlling functions and sschedulesarethe importantf costs,quality, here. t I.Behaviour:Operationsmanagers are concerned withthe activities, which affecthuman behaviourthroughmodels.They want toknow the behaviour ofsubordinates, whichaffectsmanagerial Theirmain interest activities. liesinthedecision-making behaviour. 2. Models:Models representsschematic representationof the situation, which willbe used as a toolfordecision-making.Following are some ofthe models used. Aggregate planningmodels forexamining how best to use existing capacity in shortterm, break-even volumes,Linearprogramming and computer simulation break-evenanalysisto identify Decisiontreeanalysisforlong-termcapacityproblem of facility forcapacityutilisation, expansion, simplemedian model fordeterminingbestlocationsof facilities, etc. Planning Planningconversionsystem Operationsstrategies Organising FOrendnrocesschoices.Facity locationplanning Organising forconversion on Layout planning operationsstandards,work Schedulingconversionsystem measurement ana Aggregate olanning ProjectManagement.Operations scheduling Conversion process Models Behaviour Controling Material conory control Materialrequirementplanning Managing forworld-classcompetition Managine for nhCtuning Qualtyanalysisand control Fig.1.4General model formanaging operations KESOURCE Resourcesare the human, materialand capitalinputsto the productionprocess.Human resources are the key assetsofan organisation. As the technologyadvances,a largeproportionofhuman input isinplanningand controlling By usingthe intellectual activities. ofpeople,managers capabilities can multiplythe valueoftheiremployees intoby many times.Materialresourcesarethe physicalfacilities and materialssuch as plantequipment, inventoriesand supplies.These are the major assetsof an organisation.Capitalin the form of stock,bonds, andor taxesand contributionsisa vitalasset. Capitalisa storeof value,which isused to regulatethe flow of the otherresources. SYSTEMS Systems are the arrangement of components designedtoachieveobjectivesaccording tothe plan. systems. Intum, it The businesssystems are subsystem of largesocial containssubsystem such as which will personnel,engineering,financeand operations, forthe good ofthe organisation. function A systems approach to operationsmanagement recognisesthe hierarchical management Ifsubsystems goalsare pursued independently,itwill responsibilities. A insub-optimization. results approachh will consistentand integrative w leadtooptimization ofoverallsystem goals. The system approach to specificproblems requiresthat the problem first be identifiedand fromthe maze ofthe lessrelevantdata thatconstitute isolated theenvironment.The problem abstracted from the overall(macro)environment.Then itcan be broken intomanageable (micro)parts and proposed.Doing thisanalysisisadvantageous beforemaking any changes.If analysedand solutions appears to solvethe problem in a satisfactory the solution way, changes can be made to the real system in an orderlyand predictableway. The abilityofany system toachieve itsobjectivedepends on itsdesignand itscontrol. System design isa predetermined arrangement of components. Itestablishesthe relationships thatmust and outputsinordertoachievethe system objectives. existbetween inputs,transformationactivities design,there will With themost structured be lessplanningand decision-making inthe operationsof the system. System control consists of allactionsnecessary to ensure that activitiesconform to. conceivedplansor goals.It precon involvesfollowingfouressential Measurement by an accurate sensory device. 2. Feedback of information ina timelymanner. elements: 3. Comparison withstandardssuch as time and coststandards. 4. Corective actionsby someone withthe authorityand ability tocorrect. TRANSFORMATION AND VALUE ADDING ACTIVITIES The objective ctiveofcombining resourcesunder controlledconditionsisto transformthem intogoods inputs.The transformationprocessappliedwill and serviceshavinga highervaluethan the original be in the form of technologyto the inputs. The effectivenessof the production factorsin the transformationprocessisknown as productivity. referstothe ratiobetween values ofoutputper work hourtothecostof inputs. The productivity The firmsoverallratiomust be greaterthan 1,then we can say value is added to the product. Operationsmanager shouldconcentrate improvingthe transformationefficiency and toincreasethe ratio. Goods & Non-economic services impact Personnel Marketing & publicrelation Material Transformation personnel ndng activiies Economic Finance impact Control Fig.1.5Schematic model foroperations/production system |1.9 OPERATIONS MANAGEMENT OBJECTIVES Joseph G. Monks definesOperationsManagement as the process whereby resources, mnner te by a controlled alue withina defined System, are combined and transformed inaccordance withpolicies communicated by management. ObjectivesofOperationsManagement can be categorizedintoCustomer Serviceand Resource Utilisation. CUSTOMER SERVICE The first of operatingsystems is to resources for the satisfaction of customer wan tomer serviceisa key obiective of operationsmanagement. The operating which can satisfythe customer interms of cost system must provide something to a specification, and timing.Thus,providingthe "rightthingat a rightpriceat the righttime'can satisfyprimary objective. RESOURCE UTILISATION Anothermajorobjectiveofoperatingsystems isto utilize resourcesforthe satisfaction ofcustomer wants effectively. Customer servicemust be providedwiththe achievement of effective operations use of resources.Inefficient through efficient use of resourcesor inadequate customer service leads to. mercialfailure of an operatingsystem. Operations management isconcermed essentially withthe utilisation of resources,i.e. obtaining maximum effectfrom resourcesor minimisingtheirloss,under utilisation or waste.The extentof of the resources'potentialmight be expressed interms of the proportionof available the utilisation time usedor occupied,space utilisation, of activity. levels etc.Each measure indicatesthe extentto Thisisreferredas the objective which the potentialor capacityof such resourcesisutilised. of resource utilisation. Operationsmanagement isconcerned withthe achievement ofboth satisfactory customer service An improvement inone willoftengive riseto deterioration and resourceutilisation. inthe other. Often both cannot be maximized,and hence a satisfactory performance must be achieved on both objectives.Allthe activities ofoperationsmanagement must be tackledwiththese two objectivesin.10THE STRATEGIC ROLE OF OPERATIONS Primary goals of the organisationsare relatedmarket opportunities. of Economy and efficiency conversionoperationsare the secondary goals,which will be predominant with the study and practice ofoperationsmanagement. A STRATEGIC PERSPECTIVE Infigure1.l providesthe basicdownward flow of strategyinfluence leadingtomanaging conversion The general thrustof the process is guided by competitive and market operationsand results. which providethebasisfordeterminingthe organization's conditionsinthe industry, strategy. Where isthe industrynow. and where itwill be inthe future?What are the existing and potential markets? and what competencies do we have forfilling What market gaps exist, them? A carefulanalysisof market segments and theability ofourcompetitorsand ourselvestomeet the needs of these segments will determine the bestdirectionforfocusingan organization's efforts. Afterassessingthe potentialwithinan industry, an overall organizationalstrategy must be developed.,includingsome basicchoices ofthe primary basisforcompeting. Indoingso,priorities are establishedamong the followingfourcharacteristics: Quality(product performance). Cost efficiency (lowproduct price). timelydeliveryof orders to customers). Dependability(reliable, Flexibility (respondingrapidlywith new products or changes in volume). Inrecentyears,most organizationscannot be beston allthese dimensionsand, by trying to do so,they end up doingnothingwell. Furthermore, when a competency existsinone of these areas,an attempt to switch to a differentone can lead to a downfallineffectiveness(meetingthe primary objectives). Time isemerging a critical as dimension of competition in both manufacturing and service Inany industrythe firmwiththe fastestresponse tocustomer demands has the potential industries. to achieve an overwhelming market advantage. Inan era of time-based competition, a firm's 1.11 STRATEGIC PLANNING Strategicplanningisthe processofthinking through thecurrentmissionof the organizationand the currentenvironmental conditions facingit,then settingfortha guide fortomorrow'sdecisions and Strategicplanningisbuilton fundamental concepts: that currentdecisions results. are based on futureconditions and results. 1.11.1 StrategicPlanning for Productionand Operations Intheproductionoroperationsfunction, strategicplanningisthe broad, overall planning that planning.Executives precedes themore detailedoperational who head the productionand operations involvedinstrategic functionare actively planning, developingplansthatare consistentwith the firm'soverallstrategiesas wellas such functions as marketing.financeaccountingand engineering. Production and operationsstrategicplans are the basis for (1)operationalplanningof facilities (design)and (2)operationalplanningforthe use ofthesefacilities. 1.11.2 StrategicPlanningApproaches for Production/Operations Henry Mintzbergsuggeststhreecontrastingmodes of strategic planning:the entrepreneurial, the adaptive,and the planningmodes. Inthe entrepreneurial mode, one strong,boldleadertakes planning actionon behalf of the production/operationsfunction.Inthe adaptivemode, a manager's plan is formulatedina seriesofsmall, steps inreactiontoa disjointed disjointed environment.The planning model uses planningessentials combined withthe logical analysisof management science. There are many approaches to strategic planning.The key point isthat operationsstrategies must be consistentwith the overall of the strategies fim.Operationstypicallyutilize the overall corporateapproach to strategic planning,withspecialmodifications and a focusupon operations issues One generalapproach to strategic and opportunities. planningisa forcedchoice model given by Adam and Ebert. 1.11.3 Strategic Planning -ForcedChoice Model One of many planningmodels that have been used instrategic planningisa forcedchoice model, shown inFigure1.6(on page 16).In-groupsessions or individually, analystsassessenvironmental considerationstogetherwiththe organization's position, currentproduction/operations thus forcing management optionsforoperations. todevelop strategic 1.12THE TREND: INFORMATION AND NON MANUFACTURING SYSTEMS An trendinthe Indianeconomy isthe gradualshift significant increasingly ofproductiveeffortfrom to serviceand informationbased products.With this, manufacturing (industrial) the demand for communication and information based product isgraduallyrestructuring the society.Traditional ways of doingthingsare beingreplacedby efficient methods. Computers play a major roleinthis along withfiber transition optics, microwaves, lasersand othercommunicationtechnologies. Following characteristics can be consideredfordistinguishing Manufacturing Operations with ServiceOperations: 1. Tangible/Intangible nature of output 2. Productionand consumption 3. Nature of work (job) 4. Degree of customer contact inconversion 5. Customer participation 6. Measurement of performance 7. Qualityofoutput 8. Inventoryaccumulated. 1.13PRODUCTIVITY isdefinedinterms ofutilization Productivity materialand labour.Insimple terms, of resources,like isthe ratioofoutput toinput.Forexample,productivity productivity oflabourcan be measuredas units 1.13.3 Productivity Analysis Forthe purposes of studiesof productivityforimprovement purposes,followingtypes of analysis can be cariedout: 1. Trend analysis: Studyingproductivitychanges forthe firmovera periodof time. 2. Horizontal analysis: incomparison withotherfirmsofsame sizeand Studyingproductivity engaged insimilar business. 3. Vertical Studyingproductivityincomparison withotherindustries analysis: and other firms sizesinthe same industry. of different 4. Budgetary analy sis: Settingup a norm forproductivityfora futureperiodas budget,based on studiesas above, and planningstrategiestoachieve it. 1.14FACTORS AFFECTING PRODUCTIVITY Economistssitea varietyof reasons forchanges in productivity. However some of the principle factorsinfluencing productivity rateare: 1. Capitallabour ratio:Itisa measure ofwhether enough investmentisbeingmade inplant, machinery, and toolsto make effectiveuse of labourhours. 2. Scarcityof some resources:Resources such as energy,water and number of metals will create productivity problems. 3. Work-forcechanges: Change inwork-forceeffectproductivityto a largerextent,because of the labourturnover. 4. Innovationsand technology:Thisisthe majorcause of increasingproductivity. 5. Regulatoryeffects: These impose substantial on some fims,which leadtochange constraints in productivity. 6. Bargaining power: Bargainingpower oforganizedlabourtocommand wage increases excess of output increaseshas had a detrimentaleffecton productivity. 7. Managerialfactors: Managerial factorsare the ways an organizationbenefits from the uniqueplanningand managerialskills of itsmanager. 8. Oualityof work life:Itisa term that describes the organizationalculture, and the extent to which itmotivatesand satisfies employees. NEw PRODUCTS High Volume Products likesteel,textiles, etc.with constitutean industrialbase are not secure. Nations such as Japan, France and West Germany are shifting theirindustrial base towards products and processes that make betteruse of theirresearchcapabilities and skilledworkers.Theirfuture inmicroelectronics, lies precisionmanufacturedcastings,specialty steels, fiber custom fabrics, optics, lasers,etc. TREND TowARDS MORE FLEXIBLESYSTEMS The productionruns of these highervalued specialtyitemsand custom designed productsare often much shorterthan fortraditional mass produced goods. But the non-productivetime(downtime) required tosetup equipment forproducing differentoptions, new models and new productsare very costly.So productionfacilities must be designed withthe utmost flexibility toaccommodate change overs inrapidfashion. Thisiswhere computers, robotics come intoplay. German executivesunderstand the need fora strong technologicalfocus and the dangers of hierarchicalbureaucraciesand paper profits. Studiesreveal that over 50 per cent of Germany's largemanufacturing fimsare managed by Ph.D.'s withtechnicalbackgrounds. Inrecentyears,the managerial techniquesand productivitymethods inJapanese firmshave attractedworldwideattention. The following are some ofthe characteristics ofthe Japanese firmas compared withthe American firms. 1. Corporate objectives:Employees and customers are givenpriority overshareholders. Honesty inbusinessisimportant. 2. Time horizon: Long-termviability ismore importantthan short-termprofits. 3. Productionsystems:Automated systems withextensiveuseofmicroprocessorsand robotics. Qualityisparamount, and thingshappen on schedule. 4. Employment relations: Long-term employment of loyalworkers.Unionscooperate to benefit totalfim.Politenessand harmony are emphasized. 5. Materials:Resources are limited. Space isused efficiently and inventories are kept to a bare minimum. 6.Financing:More use ismade of debt capitaland less of equity ccapital. 7.Training: Employees are thoroughlytrainedand rotatedto learna varietyof skills. 8. Worker participation: Employees are thoroughlytrainedand rotatedto learna varietyof improvements viasuggestions, productivity qualitycircles withsupervisors. and consultation  Union Employment Customer Existing Consumer Environmental Econom demands Practices demand technologyprotection laws regulation condit Personal Socialimpact Goods Material Transformation & services + Profits & Funds informations Health änd Financial Interest Resource safety State an rate |nventorytax Income tax markets availability regulations laws  Locationof facilities Plantlayout Maintenance & management Material handling Materials Production Product operations management design management Quality Process control design Production planningand Control LoCATION OF FACILITIES foroperationsisa long-termcapacity decision, Locationof facilities which involvesa long-term commitment about the geographically staticfactorsthat affecta business organisation. Itisan importantstrategiclevel decision-making foran organisation. Itdeals with the questionssuch as Where Or main operationsshould be based?" The selection location isa key-decision as large investment is made inbuildingplantand machinery.An improperlocation ofplantmay leadto waste ofallthe investmentsmade inplantand machinery equipments.Hence, location of plantshouldbe based on the company's expansion plan and policy, diversification plan forthe products,changing sourcesof raw materialsand many other The purpose of the location factors. study isto findthe optimallocation thatwillresultsin the greatestadvantage to the organization. PLANT LAYOUT AND MATERLAL HANDLING Plantlayoutrefersto the physicall Itisthe configurationof departments. arrangement of facilities. work centresand equipment intheeconversionprocess.The overall objective of the plantlayouti ut isto designa physicalarrangement thatmeets therequiredoutputqualityand quantitymost economically. AccordingtoJames More Plantlayoutisaplanof an optimum arangement offacilities including personnel,operatingequipment,storage space,materialhandlingequipments and allothersupporting servicesalongwith the designofbest structureto contain all these facilities'.  refersto the 'movingofmaterialsfrom the store room tothe machine and 'MaterialHandling' from one machine to the next duringtheprocessofmanufacture".Itisalsodefined as the "artand science of moving. packing and storingof products in any form'.Itisa specialized activityfora modern manufacturingconcern,with 50 to 75% of the costof production. Thiscostcan be reduced by proper section,operationand maintenance of materialhandling devices.Materialhandling devices increasesthe output,improves quality. speeds up thedeliveries and decreases thecostof production. Hence, material handlingisa prime consideration inthe designingnew plantand severalexisting plants. PRODUCT DESIGN Product designdeals with conversionof ideas intoreality. Every business organisation have to design,developand introduce new productsas a survival and growth strategy. Developing the new The products and launchingthem inthe market isthe biggestchallenge faced by the organizations. entireprocess of need identification to physicalmanufactures of product involvesthreefunctions Design and Marketing.Product,Development, and manufacturing.Product Development translates the needs of customersgivenby marketingintotechnicalspecifications and designingthe various featuresintothe productto these specifications. Manufacturinghas the responsibility of selecting the processesby which theproductcan be manufactured. Productdesign and development provides linkbetween marketing,customer needs and expectations and the activities requiredto manufacture the product. PROCESS DESIGN Processdesignisa macroscopicdecision-makingofan overallprocess route forconvertingtheraw materialintofinished goods. These decisionsencompass of a process,choice of the selection technology,process flowanalysisand layoutof the facilities. Hence, the importantdecisionsin processdesignaretoanalysethe workflowforconvertingraw materialintofinished productand to selectthe workstationforeach includedinthe workflow. PRODUCTION PLANNING AND CONTROL Productionplanning and controlcan be defined as the process ofplanningthe production inadvance, settingthe exact route of each item,fixing the starting and finishing dates foreach item,to give the progressofproductsaccording to orders. productionorders to shops and to follow-up The principleofproductionplanningand controlliesinthe statement 'First Plan YourWork and then Work on YourPlan'. Main functionsof productionplanningand controlincludePlanning.Routing. Scheduling, Dispatchingand Follow-up Planning is decidinginadvance what to do, how to do it, when to do itand who is to do it. Planningbridgesthe gap from where we are,to where we want to go. Itmakes itpossibleforthings to occur which would not otherwisehappen. Routingmay be definedas the selectionof path,which each part of the product will follow, which being transformed from raw materialto finished products.Routingdetermines the most advantageous path to be followedfordepartment to department and machine to machine till raw materialgets itsfinal shape.  Schedulingdetermines the programme forthe operations.Schedulingmay be defined as 'the of time and date foreach operation'as wellas itdetermines the sequence of operations to fixation be followed. Dispatchingisconcerned with the startingthe processes.Itgives necessary authorityso as to starta particularwork,which has been already been planned under 'Routing' and 'Scheduling". Therefore,dispatchingis 'Releaseof ordersand instruction forthe startingof productionforany item inacceptance with the Route sheet and Schedule Charts'. The functionofFollow-upisto reportdailythe progressof work ineach shop in a prescribed proforma and to investigatethe causes of deviationsfrom the planned performance. QUALITY CoNTROL (QC) QualityControlmay be defined as 'asystem that isused to maintain a desired levelof qualityin a t Itisa systematiccontrolof variousfactorsthat affectthe qualityof the product. productor service'. QualityControlaims at preventionofdefectsat the source,relieson effectivefeedback system and corrective actionprocedure. QualityControlcan alsobe defined as 'thatIndustrial Management technique by means of which product of uniformacceptablequalityismanufactured'.Itis the entirecollectionof activities, which ensures that theoperation will produce the optimum quality productsat minimum cost. The main objectivesof QualityControlare: 1. To improvethe companies income by making the productionmore acceptabletothecustomers i.e.by providinglonglife, greaterusefulness,maintainability, etc. 2. To reduce companies costthrough reductionof lossesdue to defects. 3. To achieve interchangeability of manufacture inlarge-scaleproduction. 4. To produce optimalqualityat reduced price. ofcustomers with productions orservicesorhigh qualitylevel,tobuild 5. To ensure satisfaction customer good will, confidenceand reputationof manufacturer. 6. To make inspection prompt to ensure qualitycontrol. 7. Tocheck the variation duringmanufacturing. MATERIALS MANAGEMENT MaterialsManagement isthataspect management function,which isprimarilyconcerned with of the acquisition, control, and use of materialsneeded and flowofgoods and servicesconnected with inview. the production process having some predeterminedobjectives The main objectivesof MaterialManagement are: 1. Tominimisematerialcost. 2. To purchase, receive,transportand storematerialsefficiently and to reduce the relatedcost. 3. To cut down coststhrough simplification, value analysis, standardisation, importsubstitution, etc. 4. Totracenew sources of supply and to developcordialrelationswith them in ordertoensure continuous supply at reasonable rates. 5. To reduce investment tiedin the inventoriesforuse in other productivepurposes and to develop highinventoryturnoverratios.