Production Planning and Control are interrelating and interdependent. Planning is meaningless unless control action takes to ensure the success of the plan. Control also provides information feedback which helps modify the existing plans and in making new plans.
Production Planning and Control: Objectives, Importance, and Limitations.
Similarly, control is dependent on planning as the standards of performance are laid down under planning. Therefore, they should consider an integrated function of planning to ensure the most efficient production and regulation of operations to execute the plans successfully.
They may define as the direction and coordination of the firm’s material and physical facilities towards the attainment of pre-specified production goals in the most efficient available way.
It is the process of planning production in advance of operations, establishing the exact route of each item, part, or assembly, setting starting and finishing dates for each important item or assembly and finished products, and releasing the necessary orders as well as initiating the required follow up to effectuate the smooth functioning of the enterprise.
Thus, they involve planning, routing, scheduling, dispatching, and expediting to coordinate the movements of materials, machines, and manpower as to the quantity, quality, time, and place. It is based upon the adage of “first plan your work and then work your plan”.
Objectives of Production Planning and Control:
The main objective of production planning and control is to ensure the coordinated flow of work so that the required number of products are manufactured in the required quantity and of the required quality at the required time at optimum efficiency.
In other words, production planning and control aimed at the following purposes:
Continuous Flow of Production:
It tries to achieve a smooth and continuous production by eliminating successfully all sorts of bottlenecks in the process of production through well-planned routing and scheduling requirements relating to production work.
Planned Requirements of Resources:
It seeks to ensure the availability of all the inputs i.e. materials, machines, tools, equipment, and manpower in the required quantity, of the required quality, and at the required time so that desired targets of production may achieve.
Coordinated work Schedules:
The production activities plan and carries out in a manufacturing organization as per the master schedule. They try to ensure that the schedules to issue to the various departments/ units/supervisors are in coordination with the master schedule.
It aims at minimum investment in inventories consistent with the continuous flow of production.
It aims at increased productivity by increasing efficiency and being economical. This achieves by optimizing the use of productive resources and eliminating wastage and spoilage.
It also aims at satisfying customers’ requirements by producing the items as per the specifications or desires of the customers. It seeks to ensure the delivery of products on time by coordinating the production operations with customers’ orders.
Production and Employment Stabilization:
They aim at ensuring production and employment levels that are relatively stable and consistent with the number of sales.
Evaluation of Performance:
The process of production planning and control expects to keep a constant check on operations by judging the performance of various individuals and workshops and taking suitable corrective measures if there is any deviation between planned and actual operations.
Importance of Production Planning and Control:
The system of production planning and control serves as the nervous system of a plant. It is a coordinating agency to coordinate the activities of engineering, purchasing, production, selling, and stock control departments. An efficient system of production planning and control helps in providing better and more economic goods to customers at a lower investment. It is essential in all plants irrespective of their nature and size.
The principal advantages or importance of production planning and control summarize below:
Better Service to Customers:
They, through proper scheduling and expediting of work, help in providing better services to customers in terms of a better quality of goods at reasonable prices as per promised delivery dates. Delivery in time and proper quality, both help in winning the confidence of customers, improving relations with customers, and promoting profitable repeat orders.
Fewer Rush Orders:
In an organization, where there is an effective system, production operations move smoothly as per original planning and matching with the promised delivery dates. Consequently, there will be fewer rush orders in the plant and less overtime than, in the same industry, without adequate.
Better Control of Inventory:
A sound system helps in maintaining inventory at proper levels and, thereby, minimizing investment in inventory. It requires a lower inventory of work-in-progress and less finished stock to give efficient service to customers. It also helps in exercising better control over raw-material inventory, which contributes to more effective purchasing.
More Effective Use of Equipment:
An efficient system makes for the most effective use of equipment. It provides information to the management regularly about the present position of all orders in process, equipment, and personnel requirements for the next few weeks. The workers can communicate well in advance if any retrenchment, lay-offs, transfer, etc. are likely to come about. Also, unnecessary purchases of equipment and materials can avoid. Thus, it is possible to ensure proper utilization of equipment and other resources.
Reduced Idle Time:
They help in reducing idle time i.e. loss of time by workers waiting for materials and other facilities; because it ensures that materials and other facilities are available to the workers in time as per the production schedule. Consequently, fewer man-hours are lost, which has a positive impact on the cost of production.
Improved Plant Morale:
An effective system coordinates the activities of all the departments involved in the production activity. It ensures an even flow of work and avoids rush orders. It avoids “speeding up” of workers and maintains healthy working conditions in the plant. Thus, there improve plant morale as a by-product.
Good Public Image:
A proper system helps keep systematized operations in an organization. Such an organization is in a position to meet its orders in time to the satisfaction of its customers. Customers’ satisfaction leads to increased sales, increased profits, industrial harmony, and, ultimately, the good public image of the enterprise.
Lower Capital Requirements:
Under a sound system, everything relating to the production plan is well in advance of operations. Where, when, and what requires in the form of input knows before the actual production process starts. Inputs make available as per schedule which ensures an even flow of production without any bottlenecks. Facilities use more effectively and inventory levels keep as per schedule neither more nor less. Thus, helps, in minimizing capital investment in equipment and inventories.
Limitations of Production Planning and Control:
Undoubtedly, their system is a must for efficient production management; but in, practice, sometimes, it fails to achieve the expected results because of the following limitations.
The principal disadvantages or limitations of production planning and control summarize below:
Lack of Sound Basis:
They are based on certain assumptions or forecasts about the availability of inputs like materials, power, equipment, etc., and customers’ orders. In case these assumptions and forecasts do not go right, their system will become ineffective.
Rigidity in Plant’s Working:
They may be responsible for creating rigidity in the working of the plant. Once the production planning has been completed, any subsequent change may resist by the employees.
Production planning is a time-consuming process. Therefore, under emergencies, it may not be possible to go through the process of production planning.
Costly Device or machine:
It is not only a time-consuming process but is a costly process also. Its effective implementation requires the services of specialists for performing functions of routing, scheduling, loading, dispatching, and expediting. Small firms cannot afford to employ specialists for the efficient performance of these functions.
Their effectiveness is sometimes limited because of external factors which are beyond the control of the production manager, Sudden break-out of war, government control, natural calamities, change in fashion, change in technology, etc. are factors that harm the implementation of them.