Production planning- Definition, Objectives and Levels

Production planning is concerned with deciding in advance what is to be produced, when to be produced, where to be produced and how to be produced. It involves foreseeing every step in the process of production so as to avoid all difficulties and inefficiency in the operation of the plant.  Production planning has been defined as the technique of forecasting or picturing ahead every step in a long series of separate operations, each step to be taken in the right place, of the right degree, and at the right time, and each operation to be done at maximum efficiency.  In other words, production planning involves looking ahead, anticipating bottlenecks and identifying the steps necessary to ensure smooth and uninterrupted flow of production.  It determines the requirements for materials, machinery and man-power; establishes the exact sequence of operations for each individual item and lays down the time schedule for its completion.

Objectives of Production Planning

The basic objectives of production planning are as under:-

  • On the basis of the sales forecast and its engineering analysis, to estimate the kind of the resources like men, materials, machines, methods etc. in proper quantities and qualities.  It also estimates when and where these resources will be required so that the production of the desired goods is done most economically.
  • It also aims to make all necessary arrangement so that the production targets as set in the production budget and master schedules are reached.  While attaining these targets, adjustments are made for the fluctuations in the demand.

For an effective planning of production activities, the executives concerned must have complete information regarding the following:-

  • Engineering data including complete analysis of the product to be manufactured ,the operations, processes and methods through which each component or class of product must pass, the nature of inspection required, and the method of assembly.
  • Machine analysis giving full information regarding speeds of all available machines and their maximum capacity to perform certain operations, and the rate   of output per day, week or month, and the maximum plant capacity per day for each process or operation.
  • The various types and classes of tools and equipment required of production.
  • Material analysis giving full information as to the type, quality and quantity of the raw material to be used in each process or operation.  Also, information as to raw materials in stores, how much are on order, and how much are a located or reserved for current orders.
  • The characteristics of each job and the degree of skill and personnel  qualifications required for the effective performance of each such job.
  • Information relating to power production and consumption, internal transport and material handling service.
  • Job analysis giving information as to what methods of operation would yield uniformity of output, ease in production and reduction in costs.
  • Information as to the customers orders on hand, and the delivery for customers, and what for stock purpose.

It is the job of the production department to arrange for the order in which the work will be done the routing and scheduling of work, and determine what machines tools, workplaces materials and operatives should do the work.

A balanced production planning would tend to increase operating efficiency by stabilizing productive activities, facilitate selling and customer service, and help reduce production cost by providing reliable basis for investment in raw materials and tools. It would promote fuller utilization of plant, equipment and labour by controlling all time and efforts essential in manufacturing.

Levels of Production Planning

Production planning can be done at three levels namely Factory Planning, Process Planning and Operation Planning which are as follows:

  • Factory Planning:  At this level of planning the sequence of work/ tasks is planned in terms of building machines and equipment required for manufacturing the desired goods and services.  The relationship of workplaces in terms of departments is also planned at this stage taking into consideration the space available for the purpose.
  • Process Planning: There are many operations involved in factory planning for transforming the inputs into some desired end product.  In process planning these operations are located and the sequence of these operations in the production process is determined.  Plans are also made for the layout of work centers in each process.
  • Operation Planning:  It is concerned with planning the details of the methods required to perform each operation viz. selection of work centers, designing of tools required for various operations.  Then the sequences of work elements involved in each operation are planned.  Specifications about each transfer, work centers, nature of tools required and the time necessary for the completion of each operation are prescribed.

About Abey Francis

Abey Francis is the founder of MBAKnol - A Blog about Management Theories and Practices - and he's always happy to share his passion for innovative management practices. You can found him on Google+ and Facebook. If you’d like to reach him, send him an email to: [email protected]

Leave a Reply

Your email address will not be published. Required fields are marked *


*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>