Production Planning and Control Emphasis on Performance Managament

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BACKGROUND TO THE STUDY

The research topic is Production Planning and Control (PPC) with special emphases on Performance Measurement (PM). As we know that in this fast and technological era, only industries having proper planning can survive. Proper planning in all areas for any industry like Site Selection, Building, Machinery, Transportation, Availability of Materials, Procurement of Materials, Production, Quality Control, Yield, Efficacy, Performance are the basic entities for survival and growth. If we try to find out the central axes of all such activities, we capable of concluding that Production Planning & Control and Performance Measurement is the central axes for all such planning processes.

Bird eye view of industrial units in under developed countries shows a picture of less efficiency and yield. They have machinery for production, cheap labour, and availability of cheap raw materials. However, no good yield and efficiency attained. This is only because there is no proper consideration on Production Planning & Control and Performance Measurement

In order to find out the reasons/ factors influencing the processes of Production Planning & Control and Performance Measurement this research work conducted. This research work analyze the various factors, which are crucial for designing the production planning and control check, list out the factors influencing the choice of production process. It also explain the design of production system and manufacturing process, establish the basic reasons and causes that effects of PPC and PM in industrial sector. Describe the benefits, which a small entrepreneur can reap by having properly designed production planning, and control system, search new knowledge to the problem solving. More over it establish the relationship between PPC and PM. The marked effects of technological changes in machinery and the market on the work in industry also considered and find out results and their solution to the problem and identify any recommendations.

Performance measures not developed newly but the importance placed on them. Recently excellent manufacturers started to replace their cost based performance measurement systems with ones, which truly drive the production process. As we know that performance, measures can also dictate behaviour and it is very important that they should be suitable for the processes they are measuring.

The new performance measurement systems should go hand in hand with the introduction of new manufacturing techniques open wide truth e.g. previously processes can be re-planed, there must a clear strategy for the venture, and suitable performance measures must be in place to measure the impact of the re-planed process. In short, strategy and new performance measures are fundamentals to Business Process Re-planning.

HISTORICAL BACKGROUND OF PRODUCTION PLANNING AND CONTROL WITH REFERENCE TO PERFORMANCE

Production management becomes the acceptable term from 1930s to 1950s. As F.W. Taylor's works become more widely known, managers developed techniques that focussed on economic efficiency in manufacturing. Workers studied in detail to eliminate wasteful efforts and achieve greater efficiency. At the same time, psychologists, socialists and other communal scientists began to study people and human behaviour in the working environment. Here addition, economists, mathematicians, and computer socialists contributed newer, more sophisticated analytical approaches. With the 1970s, emerge two distinct changes in our views. The most obvious of these, reflected in the new name operations management was a shift in the service and manufacturing sectors of the economy. As service sector became more prominent, the change from 'production' to 'operations' emphasized the broadening of our field to service organizations. The second, more suitable change was the beginning of an emphasis on synthesis, rather than just analysis, in management practices.

In the past two centuries, the focus was on operations and production management because of the fact that it plays an important role in a country's economic growth. If we go through the history of PPC with reference to performance measurement, we find out scattered work, started on related topics in late1700 when a book written by Adam Smith in 1776 named Specialization of labour in manufacturing. After words in 1799, Eli Whitney and others presented Interchangeable parts, cost accounting. For more than 30 years there is no significant work can seen until 1832 when Charles Babbage published his work under the title Division of labour by skill.

Again, there is a big gap of 70 years of research work. In 1900 Frederick W. Taylor note down Scientific management time study and work study developed dividing planning and doing of work then again in 1900 Frank B. Gilbreth did work on Motion of study of jobs.

In 1901, Henry L. Gantt put pen to paper on Scheduling techniques for employees, machines jobs in manufacturing.

While F.W. Harris in 1915 did excellent work on Economic, lot sizes for inventory control and Elton Mayo in 1927pen down Human relations a great contribution.

W.A. Shewart for the first time in 1931 forwarded Statistical inference applied to product quality. After him, H.F. Dodge & H.G. Rooming in 1935 forwarded Statistical sampling applied to quality control.

P.M. Blacker and others in 1940 Operations research applications in World War II

John Mauchlly and J.P. Eckert 1946 Digital computer

G.B. Dantzig, Williams & others 1947 Linear programming

A. Charnes, W.W. Cooper & others 1950 Mathematical programming, on-linear and stochastic processes

Sperry Univac 1951 Commercial digital computer: large-scale computations available.

L. Cummings, L. Porter 1960 Organizational behaviour: continued study of people at work

G. Wright 1970 Integrating operations into overall strategy and policy,

W. Skinner J. Orlicky 1970 Computer applications to manufacturing, Scheduling and control, Material requirement planning (MRP)

W.E. Deming and J. Juran 1980 Quality and productivity applications from Japan: CAD-CAM and robotics,

PROBLEM FORMULATION, STATEMENT, DEFINITION

The reason for choosing this topic for research is due to my personal interest in researching further about the issues in production planning and control in industry with special emphases on performance measurement.

The research work deals with the industrial sector in South East Asia including the case study of production planning and control with special emphases on performance measurement in industrial sector of Pakistan

Now the basic question arises that why I selected this topic.

Simple answer to it is that there are number slack loops and flaws in the production planning and control with special emphases on performance measurement, in these countries especially in Pakistan.

Production function is the part of an organization concerned with the transformation of a range of inputs into the required outputs (products) having the necessary quality level. It can define as "the step-by-step conversion of one form of material into another form through chemical or mechanical process to create or enhance the utility of the product to the user".

Therefore, you can say that production is a value addition process and on every stage of processing, there will be addition in value.

Production can also define as 'a process by which goods and services are created'. Like manufacturing custom-made products like, cars with a specific capacity, constructing bungalows, some structural fabrication works for selected customers, etc., and manufacturing standardized products like, TV, Busses, Cycle, Radio, etc.

In all manufacturing unit production is the basic dynamic force to which other all functions act in response. It is true for inventories as they are necessary for the needs of production.

The decisive objective of production planning and control, like that of all other manufacturing controls, is to add to the profits of the business enterprise.

Precise objectives of production planning and control are to launch routes and plan for work that will make sure the optimum spending of materials, workers, and machines and to provide the means for ensuring the operation of the plant in harmony with these plans.

There are four basic phases of control of manufacturing which can easily identified in production planning and control. The sketch for the processing of materials through the plant established by the functions of process planning, loading, and scheduling and the function of dispatching puts the plan into operations that started in accordance with the plant. Real performance then compared to the planned performance, and, when necessary, counteractive actions taken. In some occasions, re-planning needed to ensure the effective utilization of the manufacturing facilities and personnel.

The factors that influence the application of production planning and control to manufacturing are the same as the factors that affect inventory management and control.

Mostly, there are three types of production systems, which refer to,

(a) Continuous production

(b) Job or unit production

(c) Intermittent production

Performance measurement is a requirement to improve performance. Now a question arises that in today's industrial environment how projects can improve their performance, there is a simple answer to it is that they must calculate how they are performing at present and measure how they will perform after any changes. Performance measurement can define as an explanation of something that can be directly measured (e.g. number of items/units per day).

The Performance Indicator is a draft of something that is designed from performance measures (e.g. % units / day / direct employee) and the Performance Measurement Data is the assessment or end result for the performance measures and indicators (e.g. units /day = % units / day / direct employee). A Performance Measurement System is a complete set of performance measures and indicators extracted in a customary manner according to a set of rules or guidelines cleared in the performance measurement system.

Performance measurement systems usually based on cost and management accounting and such techniques developed in the late nineteenth and early twentieth century has to meet the needs of manufacturing industries. The concepts of performance measurement fully shaped in the 1930s and since then have been the basis of manufacturing performance measurement systems. In recent years, many changes have taken place in technology and production techniques that resulted in no longer usefulness traditional PM systems (are management accounting based).

Managing techniques used in production plants are changing considerably with time.

Now a new performance measurement systems required by manufacturing ventures should have the following descriptions i-e. Related to the manufacturing strategy, Use non-financial measures, Differ between locations, Changeable over time as needs change, Straightforward and easy to use, Fast feedback to operators and managers, Projected to encourage improvement rather than simply check performance.

RESEARCH QUESTIONS

The basic research question is factors effecting Production Planning and Control with Reference to Performance Measurement, while addressing this question number of subsidiary questions arises like

Analyze various factors, which are crucial for designing the production planning and control check

Explain the design of production system and manufacturing process

List out the factors influencing the choice of production process

Describe the benefits, which a small entrepreneur can reap by having properly designed production planning, and control system.

Establish the basic reasons and causes that effects of PPC and PM in textile sector.

Bridge the gaps of the literature survey that is to find out more about the PPC and PM in textile sector due to limited availability of theory and findings of fact and figures.

Explore new knowledge to solve the problems and to establish the relationship between PPC and PM.

Find out results and their solution to the problem and identify any recommendations if necessary made.

When these questions unfolded (in wider sense) during the research work they resulted into numerous simple questions which are the basics for any production planning and control process with special emphases on performance measurement. They separately treated as,

As for as the production planning and control concerned the emerging questions are

Is customer demands satisfied?

Is lowest costs achieved?

Are all organizations are making use of process planning (routing) required for production planning and control?

Is proper loading the work against the selected machine or workstation?

Is scheduling for the inventory for planning functions conducted?

Are full processes functions combined?

Is timely authorizing of start of an operation on the shop floor?

Is reporting or follow up for all processes in production and performances down?

Are organizations taking corrective actions for production planning and control?

Re-planning factors used in different circumstances?

What are the issues affecting production planning and control?

Are they following the production planning and control procedures?

Are they following the production planning and control systems?

Market forecasting always checked before starting production?

What has customer has purchased sales order should specify that?

What has left over in stock order should specify that?

What is in pipeline for manufacturing shop order should specify that?

Any standard process sheet generated?

Are institutes considered and maintain engineering specifications?

Are they always following route sheet?

Have they formulated load charts?

Have they jobbed assigned tickets?

Is there only single pattern for the production planning and control activity?

Is centralized production planning and control for processes?

Is decentralized production planning and control according to situation and requirements?

Have they measured effectiveness of vision, mission, and planning regularly?

Have they made site selection in accordance with availability of raw materials, work force, and transportation?

Have they built up building according to requirements and forecasted upon future 10 years?

Is machinery up dated?

Are they transportation materials and products through quick services?

Are they checking availability of materials always regularly?

Are procurements of materials in accordance with order?

Is production planning and control practical?

Is quality control is their basic task?

Are they regularly checking yield of the processes?

Are they maintaining efficiency of machines and human?

As for as the performance measurements concerned the emerging questions are

Are they monitoring performance of both machine and working force?

Is there any effective mechanism for reviewing and revising targets and standards?

Is there any process for developing individual measures as performance and circumstances change?

Is there any process for periodically reviewing and revising the complete set of measures in use?

Is performance measurement system challenge the strategic assumptions?

Are they making use of tools and techniques for monitoring, controlling, investigating and problem solving? Like

Affinity diagram

Interrelationship digraph

Tree diagram

Prioritisation grid

Matrix diagram

Process decision chart

Activity network diagram

Are causes analysed when failure to move effectively towards its strategic objectives?

Under-performance at a lower level

Strategic objectives not communicated effectively

Strategic objectives not been defined properly

Validity/Relevance of the objectives

Is any control chart prepared?

Are correlation analysis conducted?

Is multivariate analysis down?

Is any cause and effect diagram prepared?

Is consistency of the communication checked?

Is departmental reports and input prepared?

HOW QUESTIONS ANALYSED

I tried my best to answer the questions in this research work, and are answered by QUALITATIVE METHOD.

The written material provided by different organizations and studied addressed the question like, is customer demands satisfied? Is lowest costs achieved? Is reporting or follow up for all processes in production and performances down? Are organizations taking corrective actions for production planning and control? Re-planning factors used in different circumstances? What are the issues affecting production planning and control? Have they market checked forecasting before starting production? What has customer has purchased sales order should specify that?, What has left over in stock order should specify that?, Any standard process sheet generated?, Are procurements of materials in accordance with order? Is production planning and control practical? Are they regularly checking yield of the processes? Is there any effective mechanism for reviewing and revising targets and standards?, Are they making use of tools and techniques for monitoring, controlling, investigating and problem solving? Like (Affinity diagram, Interrelationship digraph, Tree diagram, Prioritisation grid, Matrix diagram, Process decision chart, Activity network diagram), Is any control chart prepared? Is multivariate analysis down? Is departmental reports and input prepared? Is any cause and effect diagram prepared?

Question like procedures, systems, controls and efficiencies, are answered by the questioner developed during the research work for example are they following the production planning and control procedures? Are they following the production planning and control systems?

Is quality control is their basic task? Are they maintaining efficiency of machines and human?

In this research work both structured and unstructured interview conducted and the main questions addressed by interviews like Are they always following route sheet? Have they formulated load charts? Have they jobbed assigned tickets? Is there only single pattern for the production planning and control activity? Are they transportation materials and products through quick services? Are they checking availability of materials always regularly? Have they measured effectiveness of vision, mission, and planning regularly? Is there any process for developing individual measures as performance and circumstances change? Is performance measurement system challenging the strategic assumptions? Are they monitoring performance of both machine and working force?

Are correlation analysis conducted?

In this research work, some materials also incorporated, developed (collected) during surveys directly into the organizations by physical observations. The questions addressed by observations, are full processes functions combined? Is timely authorizing of start of an operation on the shop floor? Have they made site selection in accordance with availability of raw materials, work force, and transportation? Have they built up building according to requirements and forecasted upon future 10 years? Is machinery up dated? Are institutes considered and maintain engineering specifications? What is in pipeline for manufacturing shop order should specify that? Is there any process for periodically reviewing and revising the complete set of measures in use? Is consistency of the communication checked?

The research work also contain some questions which are addressed by sampling technique like

Are all organizations are making use of process planning (routing) required for production planning and control? Is proper loading the work against the selected machine or workstation? Is scheduling for the inventory for planning functions conducted? Is centralized production planning and control for processes? Is decentralized production planning and control according to situation and requirements? Are causes analysed when failure to move effectively towards its strategic objectives? (Under-performance at a lower level, Strategic objectives not communicated effectively, Strategic objectives not been defined properly, Validity/Relevance of the objectives).

BRIEF EXPLAINATION OF THE DISSERTATION STRUCTURE

The structure of the dissertation is very simple as normal case it has a Title Page. After that, I added a summary of my research and containing the main themes of the research and the main findings in the form of Abstract. The next page contain Acknowledgement showing that the people who helped me during this research work and have significant contribution to my research work. Then there is Table Of Contents showing major topics/elements of this dissertation and their page numbers.

In Chapter 1: Introduction I first of all give the brief background to the Study then Problem formulation, statement, definition. After that research questions and how they were addressed then aims/objectives. It also contains that why I think this research work is important

In Chapter 2: Literature Review there is Literature review discussing the strengths and weaknesses of all the literature (books, journals, etc ) that I have read on this topic and research problems, theories, and how my research work contribute to the literature/new knowledge.

In Chapter 3: Research Design and Methodology I discussed the strengths and weaknesses of qualitative and reality methods in general terms. Then write and tell the reader about the methods that I have used in research address location selection, respondent selection and timeframe the data analysis techniques I am using in my research and reasons for choosing these methods and techniques.

In Chapters 4: Data collection and analysis I described how I went about collecting the data for my research, description of where the study took place, where data collection took place, sampling procedures, piloting the questionnaire, increasing response rate response rate for the study, interviews, hand-written data, video taping observations. In this chapter I also considered the Ethics

That while gaining access and data there should be no embarrassment, stress, discomfort, pain and harm to my respondents and their confidentiality, anonymity, and privacy maintained.

In Chapter 5: Discussion and interpretation there is Interpretion my findings and what do they mean within the broader context of the research project? I also described that upto which extent research answered the questions.

In Chapter 6: Conclusions and recommendations I concluded all the research work together in the form of conclusion and recommendations from these results how these recommendations address the problems that you identified at the start of research work.

AIMS/OBJECTIVES

Aims of this research study summarised as to analyze various factors, which are crucial for designing the production planning and control check? to list out the factors influencing the choice of production process. Moreover, to explain the design of production system and manufacturing process and to establish the basic reasons and causes that effects of PPC and PM in textile sector. It also describe the benefits, which a small entrepreneur can reap by having properly designed production planning, and control system and search new knowledge to the problem solving and to establish the relationship between PPC and PM.

WHY YOU THINK THE STUDY IS IMPORTANT

It already discussed that the research topic is Production Planning and Control (PPC) with special emphases on Performance Measurement (PM).

As we know that in this fast and technological era, only industries having proper planning can survive. Proper planning in all areas for any industry like Site Selection, Building, Machinery, Transportation, Availability of Materials, Procurement of Materials, Production, Quality Control, Yield, Efficacy, Performance are the basic entities for survival and growth.

If we try to find out the central axes of all such activities, we capable of concluding that Production Planning & Control and Performance Measurement is the central axes for all such planning processes.

Industrial units in under developed countries shows a picture of less efficiency and yield. They have machinery for production, cheap labour, and availability of cheap raw materials. However, no good yield and efficiency attained. This is only because there is no proper consideration on Production Planning & Control and Performance Measurement

In order to find out the reasons/ factors influencing the processes of Production Planning & Control and Performance Measurement this research work conducted. This research work analyze the various factors, which are crucial for designing the production planning and control check, list out the factors influencing the choice of production process. It also explain the design of production system and manufacturing process, establish the basic reasons and causes that effects of PPC and PM in industrial sector. Describe the benefits, which a small entrepreneur can reap by having properly designed production planning, and control system, search new knowledge to the problem solving. More over it establish the relationship between PPC and PM.

The marked effects of technological changes in machinery and the market on the work in industry also considered and find out results and their solution to the problem and identify any recommendations.

Performance measures not developed newly but the importance placed on them. Recently excellent manufacturers started to replace their cost based performance measurement systems with ones, which truly drive the production process. As we know that performance, measures can also dictate behaviour and it is very important that they should be suitable for the processes they are measuring.

The new performance measurement systems should go hand in hand with the introduction of new manufacturing techniques open wide truth e.g. previously processes can be re-planed, there must a clear strategy for the venture, and suitable performance measures must be in place to measure the impact of the re-planed process. In short, strategy and new performance measures are fundamentals to Business Process Re-planning.

All this research work based on the case study of industrial sector of Pakistan. The major industry of Pakistan is the textile industry and key components of exports for Pakistan. It contributes about 60% of total exports worth about 5± .3billion US $. It contributes nearly about 46% total industrial production of the country. Textile industry of Pakistan contributes 8.5 % of the total GDP and provides employment to 38 % of the total work force in the country and the employment figure is roughly 15 million.

There are number of factors effecting the production and performance in the industry. Textile industry currently experiencing enormous confronts. The most important issues are production planning and control along with performance measurements.

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