Production planning and control is a tool available to the management to achieve the stated objectives. Thus, a production system is encompassed by the four factors. i.e., quantity, quality, cost and time. Production planning starts with the analysis of the given data, i.e., demand for products, delivery schedule etc., and on the basis of the information available, a scheme of utilization of firms resources like machines, materials and men are worked out to obtain the target in the most economical way.
Once the plan is prepared, then execution of plan is performed in line with the details given in the plan. Production control comes into action if there is any deviation between the actual and planned. The corrective action is taken so as to achieve the targets set as per plan by using control techniques.
Thus production planning and control can be defined as the “direction and coordination of firms’ resources towards attaining the prefixed goals.” Production planning and control helps to achieve uninterrupted flow of materials through production line by making available the materials at right time and required quantity.
The present techno-economic scenario of India emphasize on competitiveness in manufacturing. Indian industries have to streamline the production activities and attain the maximum utilization of firms’ resources to enhance the productivity. Production planning and control serves as a useful tool to coordinate the activities of the production system by proper planning and control system. Production system can be compared to the nervous system with PPC as a brain.
Production planning and control is needed to achieve:
- Effective utilization of firms’ resources.
- To achieve the production objectives with respect to quality, quantity, cost and timeliness of delivery.
- To obtain the uninterrupted production flow in order to meet customers varied demand with respect to quality and committed delivery schedule.
- To help the company to supply good quality products to the customer on the continuous basis at competitive rates.
Need of Production Planning and Control
Production planning is a pre-production activity. It is the pre-determination of manufacturing requirements such as manpower, materials, machines and manufacturing process. Ray wild defines “Production planning is the determination, acquisition and arrangement of all facilities necessary for future production of products.”
It represents the design of production system. Apart from planning the resources, it is going to organize the production. Based on the estimated demand for company’s products, it is going to establish the production programme to meet the targets set using the various resources.
Inspite of planning to the minute details, most of the time it is not possible to achieve production 100 per cent as per the plan. There may be innumerable factors which affect the production system and because of which there is a deviation from the actual plan. Some of the factors that affect are:
- Non-availability of materials (due to shortage, etc.);
- Plant, equipment and machine breakdown;
- Changes in demand and rush orders;
- Absenteeism of workers; and
- Lack of coordination and communication between various functional areas of business.
Thus, if there is a deviation between actual production and planned production, the control function comes into action. Production control through control mechanism tries to take corrective action to match the planned and actual production. Thus, production control reviews the progress of the work, and takes corrective steps in order to ensure that programmed production takes place. The essential steps in control activity are:
- Initiating the production,
- Progressing, and
- Corrective action based upon the feedback and reporting back to the production planning.
Following are the objectives of production planning and control functions:
- Systematic planning of production activities to achieve the highest efficiency in production of goods/services.
- To organize the production facilities like machines, men, etc., to achieve stated production objectives with respect to quantity and quality time and cost.
- Optimum scheduling of resources.
- Coordinate with other departments relating to production to achieve regular balanced and uninterrupted production flow.
- To conform to delivery commitments.
- Materials planning and control.
- To be able to make adjustments due to changes in demand and rush orders.