Production Management; means planning, organizing, directing and controlling of production activities. Also, in other words, P.M. involves an application of planning, organizing, directing and controlling the production process. P.M. deals with converting raw materials into finished goods or products. It brings together the 6M’s i.e. men, money, machines, materials, methods, and markets to satisfy the wants of the people. Also learn, the Financial Management, What is Definition of Production Management?
Learn, Explain, Definition of Production Management.
Production and operation management is the science-combination of techniques and systems. That guarantees the production of goods and services of the right quality, in the right quantities and at the right time with the minimum cost within the shortest possible time. The essential features of a production and operation function are to bring together people, machines, and materials to provide goods and services for satisfying customer needs.
Production management also deals with decision-making regarding the quality, quantity, cost, etc., of production. It applies management principles to production. Production management’s a part of business management. It is also called “Production Function.” Production management is slowly being replaced by operations management. The main objective of production management is to produce goods and services of the right quality, right quantity, at the right time and at minimum cost. It is also trying to improve efficiency. An efficient organization can face competition effectively. P.M. ensures full or optimum utilization of available production capacity.
Meaning of Production Management:
Production is the creation of goods and services. It is concerned with transforming the inputs in the form of raw materials, labor, machines, men and money into output i.e. goods and services with the help of certain production processes.
The production function is the most important function in an organization around. Which other activities of an enterprise (viz., marketing, financing, purchasing, and personnel, etc.) revolve. It is pertinent to note that production function should manage in an efficient and effective manner for the achievement of the organizational goals.
In a departmental type of organization, production management is concerned with carrying out the production function. Production management becomes the process of effectively planning and regulating the operations of that part of an enterprise. Which is responsible for the actual transformation of raw materials into finished products. Also, Production managing department more helps in the Business.
Simply stated, production management is concerned with decision making relating to processes for producing goods and services in accordance with the predetermined specifications and standards by incurring minimum costs.
The result of at least three developments:
- First is the development of the factory system of production. Until the creation of the concept of manufacturing, there was no such thing as management, as we know. It is true that people operated one type or another business, but for the most part, these people were business owners and did not consider themselves as managers.
- Essentially stems from the first, namely, the development of the large corporation with many owners and the necessity to hire people to operate the business.
- Stems from the work of many of the pioneers of scientific management. Who was able to demonstrate the value, from a performance and profit point of view, of some of the techniques they were developing.
Definition of Production Management:
It is observed that one cannot demarcate the beginning and end points of Production Management in an establishment. The reason is that it is interrelated with many other functional areas of business, viz., marketing, finance, industrial relation policies, etc.
Alternately, Production and Operation Management is not independent of marketing, financial, and personnel management due to which it is difficult to formulate some single appropriate definition of Production and Operation Management.
The following definitions, also explain main characteristics:
By the words of Mr, E.L. Brech:
“Production Management is the process of effective planning and regulating the operations of that section of an enterprise. Which is responsible for the actual transformation of materials into finished products.”
This definition limits the scope of production management to those activities of an enterprise which are associated with the transformation process of inputs into outputs. & the definition does not include the human factors involved in a production process. It lays stress on materialistic features only.
Production Management deals with decision-making related to the production process. So, the resulting goods and services are producing in accordance with the quantitative specifications and demand schedule with minimum cost.
Main functions of production management:
According to this definition design and control of the production system are two main functions of production management.
Production Management is a set of general principles for production economies, facility design, job design, schedule design, quality control, inventory control, work study and cost, and budgetary control. This definition explains the main areas of an enterprise where the principles of production management can apply. This definition clearly points out that production management is not a set of techniques.
It is evident from the above definitions that production planning and its control are the main characteristics of production management. In the case of poor planning and control of production activities, the organization may not be able to attain. Its objectives and may result in loss of customer’s confidence and retardation in the progress of the establishment.
The main activities of production management can list as:
- Specification and procurement of input resources namely management, material, and land, labor, equipment, and capital.
- Product design and development to determine the production process for transforming. The input factors into the output of goods and services.
- Supervision and control of the transformation process for the efficient production of goods and services.