POM it is that part of an organization, which is concerned with the transformation of a range of

inputs into the required (products/services) having the requisite quality level. The set of interrelated
management activities, which are involved in manufacturing certain products, is called as production
management. If the same concept is extended to services management, then the corresponding set of
management activities is called as operations management.

History - The traditional view of manufacturing management began in eighteenth century when
Adam Smith recognised the economic benefits of specialisation of labour. He recommended breaking
of jobs down into subtasks and recognises workers to specialised tasks in which they would become
highly skilled and efficient. Adam smith developed scientific management. 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. Workers were studied in great detail to
eliminate wasteful efforts and achieve greater efficiency. At the same time, psychologists, socialists
and other social scientists began to study people and human behaviour in the working environment. In
addition, economists, mathematicians, and computer socialists contributed newer, more sophisticated
analytical approaches.

Production - Production is defined 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.”

Prod system – resources flowing within a defined system, are combined and transformed in a
controlled manner to add value in accordance with the policies communicated by management.

1. Production is an organized activity, so every production system has an objective.

2. The system transforms the various inputs to useful outputs.
3. It does not operate in isolation from the other organization system.
4. There exists a feedback about the activities, which is essential to control and improve system
performance.
5. Goal oriented, quality oriented, backward or forward operational performance, interrelated,
optimization of resources and wasteful efforts

classification of prod system

job batch mass continuous

job - Job shop production are characterised by manufacturing of one or few quantity of products
designed and produced as per the specification of customers within prefixed time and cost. The
distinguishing feature of this is low volume and high variety of products. A job shop comprises of
general purpose machines arranged into different departments. Each job demands unique
technological requirements, demands processing on machines in a certain sequence. Custom made
furniture
Characteristics

1. High variety of products and low volume.

2. Use of general purpose machines and facilities.
3. Highly skilled operators who can take up each job as a challenge because of uniqueness.
4. Large inventory of materials, tools, parts.
5. Detailed planning is essential for sequencing the requirements of each product, capacities for
each work centre and order priorities.

Advantages

1. Because of general purpose machines and facilities variety of products can be produced.
2. Operators will become more skilled and competent, as each job gives them learning
opportunities.
3. Full potential of operators can be utilised.
4. Opportunity exists for creative methods and innovative ideas.

Limitations

1. Higher cost due to frequent set up changes.

2. Higher level of inventory at all levels and hence higher inventory cost.
3. Production planning is complicated.
4. Larger space requirements.

Batch - as a form of manufacturing in which the job passes through the functional departments in
lots or batches and each lot may have a different routing.” It is characterised by the manufacture of
limited number of products produced at regular intervals and stocked awaiting sales. Cakes and
pasteries

Characteristics

1. When there is shorter production runs.

2. When plant and machinery are flexible.
3. When plant and machinery set up is used for the production of item in a batch and
4. change of set up is required for processing the next batch.
5. When manufacturing lead time and cost are lower as compared to job order
production.

Advantages

1. Better utilisation of plant and machinery.

2. Promotes functional specialisation.
3. Cost per unit is lower as compared to job order production.
4. Lower investment in plant and machinery.
5. Flexibility to accommodate and process number of products.
6. Job satisfaction exists for operators.

Limitations
Following are the limitations of batch production:
1. Material handling is complex because of irregular and longer flows.
2. Production planning and control is complex.
3. Work in process inventory is higher compared to continuous production.
4. Higher set up costs due to frequent changes in set up.

MASS PRODUCTION

Manufacture of discrete parts or assemblies using a continuous process are called mass production.
This production system is justified by very large volume of production. The machines are arranged in
a line or product layout. Product and process standardisation exists and all outputs follow the same
path. Car light production assembly line

Characteristics

Mass production is used under the following circumstances:

1. Standardisation of product and process sequence.
2. Dedicatedspecialpurposemachineshavinghigherproductioncapacitiesandoutputrates.
3. Large volume of products.
4. Shorter cycle time of production.
5. Lower in process inventory.
6. Perfectly balanced production lines.
7. Flow of materials, components and parts is continuous and without any back tracking.
8. Production planning and control is easy.
9. Material handling can be completely automatic.

Advantages

Following are the advantages of mass production:

1. Higher rate of production with reduced cycle time.
2. Higher capacity utilisation due to line balancing.
3. Less skilled operators are required.
4. Low process inventory.
5. Manufacturing cost per unit is low.

Limitations

Following are the limitations of mass production:

1. Breakdown of one machine will stop an entire production line.
2. Line layout needs major change with the changes in the product design.
3. High investment in production facilities.
4. The cycle time is determined by the slowest operation.

CONTINUOUS PRODUCTION
Production facilities are arranged as per the sequence of production operations from the first
operations to the finished product. The items are made to flow through the sequence of operations
through material handling devices such as conveyors, transfer devices, etc. oil refining

Characteristics

1.Dedicated plant and equipment with zero flexibility.

2. Material handling is fully automated.
3. Process follows a predetermined sequence of operations.
4. Component materials cannot be readily identified with final product.
5. Planning and scheduling is a routine action.

Advantages

1. Standardisation of product and process sequence.

2. Higher rate of production with reduced cycle time.
3. Higher capacity utilisation due to line balancing.
4. Manpower is not required for material handling as it is completely automatic.
5. Person with limited skills can be used on the production line.
6. Unit cost is lower due to high volume of production.

Limitations
1. Flexibility to accommodate and process number of products does not exist.
2. Very high investment for setting flow lines.
3. Product differentiation is limited.

Prod management - Production management is a process of planning, organizing, directing and

controlling the activities of the production function. Input and quality output management, right
amount time, aligned to schedule, at optimized cost.

Objectives

Right quality customer needs It is determined by the cost of the product and the technical
characteristics as suited to the specific requirements, time effectiveness, cost actual vs predetermined
cost, quantity, aligned to Prod posdc

Operating system - Operating system converts inputs in order to provide outputs which are required
by a customer. An operating system (function) of an organization is the part of an organization that
produces the organization’s physical goods and services. An operating system is a configuration of
resources combined for the provision of goods or services.”

Operations in an organization can be categorised into manufacturing operations and service

operations. Manufacturing operations is a conversion process that includes manufacturing yields a
tangible output: a product, whereas, a conversion process that includes service yields an intangible
output: a deed, a performance, an effort.

Production is the process of creating goods or services by converting raw materials or inputs
into finished products. It is a subset of operations and is concerned with the physical or
technical aspect of the production process. Production focuses on the activities required to
create and deliver the final product to the customer, such as manufacturing, assembling, and
packaging.

Operations, on the other hand, is a broader term that encompasses all the activities that are
required to run a business successfully. Operations involve planning, organizing,
coordinating, and controlling all the resources, including people, materials, equipment, and
information, required to produce goods and services. Operations include not only the physical
production process but also the activities such as procurement, inventory management,
logistics, and customer service.

Difference –

Manufacturing is characterised by tangible outputs (products), outputs that customers consume

overtime, jobs that use less labour and more equipment, little customer contact, no customer
participation in the conversion process (in production), and sophisticated methods for measuring
production activities and resource consumption as product are made.

Service is characterised by intangible outputs, outputs that customers consumes immediately, jobs that
use more labour and less equipment, direct consumer contact, frequent customer participation in the
conversion process, and elementary methods for measuring conversion activities and resource
consumption.

1. Tangible/Intangible nature of output

2. Consumption of output
3. Nature of work (job)
4. Degree of customer contact
5. Customer participation in conversion
6. Measurement of performance.
Operation management framework –
Framework –
Planning, - planning and facility designing, planning and scheduling conversion systems
organizing, - roles and flow
controlling, - quality cost quantity schedule
behaviour – effect of behaviour, how behaviour affect above three and decision making
process.

Models - They can simplify their difficulties using models like aggregate planning models for
examining how best to use existing capacity in short-term, break even analysis to identify break even
volumes, linear programming and computer simulation for capacity utilisation, decision tree analysis
for long-term capacity problem of facility expansion, simple median model for determining best
locations of facilities etc.

Objectives of operations management –

Customer – quantity quality time specification delighter benefit customer oriented

production, customization etc.

Resource – efficient use of resources, maximum effect from resources or minimising their loss,
under utilisation or waste. The extent of the utilisation of the resources’ potential might be expressed
in terms of the proportion of available time used or occupied, space utilisation, levels of activity, etc.

Increasing one will deteriorate the other, so need a proper balance

Global operations –

There are four developments, which have spurred the trend toward globalization. These are:
1. Improved transportation and communication technologies;
2. Opened financial systems;
3. Increased demand for imports; and
4. Reduced import quotas and other trade barriers.

Global markets impose new standards on quality and time. Managers should not think about domestic
markets first and then global markets later, rather it could be think globally and act. have a good
understanding of their competitors. Some other important challenges of managing multinational
operations include other languages and customs, different management style, unfamiliar laws and
regulations, and different costs

Major issues to be focussed – time zones, labour payment paritis, customer acquisition,
manage global SCM, conceptualization and evaluation of different global operations, political
stability socio-economic, cultural acceptance key success factors in technology and all,
alignment of global trends, critical analysis of market instead of imposing home policies.

Scope of p & o

Production and operations management concern with the conversion of inputs into outputs, using
physical resources, so as to provide the desired utilities to the customer while meeting the other
organizational objectives of effectiveness, efficiency and adoptability.

Location planning – long term, large irreversible investment, should be based on

expansion, plan and policy, diversification plan for the products, changing sources of raw
materials.
 Plant layout and material handling - Plant layout refers to the physical arrangement of
facilities. It is the configuration of departments, work centres and equipment in the
conversion process to attain required output quality and quantity most economically.
Plant layout is a plan of an optimum arrangement of facilities including personnel,
operating equipment, storage space, material handling equipments and all other
supporting services along with the design of best structure to contain all these facilities.
‘Material Handling’ refers to the ‘moving of materials from the store room to the machine
and from one machine to the next during the process of manufacture’. It is also defined as
the ‘art and science of moving, packing and storing of products in any form. 50 to 75% of
the cost of production. This cost can be reduced by proper section, operation and
maintenance of material handling devices. Material handling devices increases the output,
improves quality, speeds up the deliveries and decreases the cost of production.

Product design – Product development translates the needs of customers given by

marketing into technical specifications and designing the various features into the
product to these specifications. The entire process of need identification to physical
manufactures of product involves three functions: marketing, product development,
manufacturing.

Process design - Process design is a macroscopic decision-making of an overall process route

for converting the raw material into finished goods. These decisions encompass the
selection of a process, choice of technology, process flow analysis and layout of the
facilities. Workflow and workforce considerations

Ppc - Production planning and control can be defined as the process of planning the production in
advance, setting the exact route of each item, fixing the starting and finishing dates for each item, to
give production orders to shops and to follow up the progress of products according to orders.

Planning is deciding in advance what to do, how to do it, when to do it and who is to do it. Planning
bridges the gap from where we are, to where we want to go. It makes it possible for things to occur
which would not otherwise happen.

Routing may be defined as the selection of path which each part of the product will follow, which
being transformed from raw material to finished products. Routing determines the most advantageous
path to be followed from department to department and machine to machine till raw material gets its
final shape.

Scheduling determines the programme for the operations. Scheduling may be defined as ‘the fixation
of time and date for each operation’ as well as it determines the sequence of operations to be
followed.

Dispatching is concerned with the starting the processes. It gives necessary authority so as to start a
particular work, which has already been planned under ‘Routing’ and ‘Scheduling’. Therefore,
dispatching is ‘release of orders and instruction for the starting of production for any item in
acceptance with the route sheet and schedule charts’.

The function of follow-up is to report daily the progress of work in each shop in a prescribed
proforma and to investigate the causes of deviations from the planned performance.
Quality control - a system that is used to maintain a desired level of quality in a product or service.
Quality control aims at prevention of defects at the source, relies on effective feed back system and
corrective action procedure. Quality control can also be defined as ‘that industrial management
technique by means of which product of uniform acceptable quality is manufactured’

Objectives of quality control – less defects, better utilization of resources, reducing wastage,
efficiency and effectiveness balance, optimal quality customer goodwill aligned to specifications,
feedback systems employment, variations and root cause in manufacturing

Material management – procurement, acquisition, control and deployment of materials in the process
The main objectives of materials management are:

 l To minimise material cost.

 l To purchase, receive, transport and store materials efficiently and to reduce the
related cost.
 l To cut down costs through simplification, standardisation, value analysis, import
substitution, etc.
 l To trace new sources of supply and to develop cordial relations with them in order
to ensure continuous supply at reasonable rates.
 l To reduce investment tied in the inventories for use in other productive purposes
and to develop high inventory turnover ratios.

Maintainance management –

In modern industry, equipment and machinery are a very important part of the total productive effort.
Therefore, their idleness or downtime becomes are very expensive. Hence, it is very important that the
plant machinery should be properly maintained.

Over under utilization idleness roi minimum breakdowns optimal capacity availability on time

In summary, Value Engineering focuses on improving the value of products, services, and processes
by identifying unnecessary costs and finding more efficient ways to meet functional requirements.
Business Process Reengineering focuses on improving business processes by fundamentally
rethinking and redesigning them to eliminate non-value-added activities, optimize workflow, and
leverage technology. Both methodologies can lead to significant improvements in business
performance and should be considered by companies looking to improve their operations.

Value Engineering (VE) is a systematic approach to improve the value of products, services,
and processes while reducing costs. The main objective of VE is to identify unnecessary costs
in the design, production, and delivery of goods and services without sacrificing quality or
performance. The process involves a team of experts who analyze the product or service in
detail, identify the functional requirements, and then brainstorm alternative ways to meet
those requirements more efficiently and effectively.

Business Process Reengineering (BPR) is a methodology used to improve business processes

by fundamentally rethinking and redesigning them. The main objective of BPR is to improve
efficiency, reduce costs, and improve quality by eliminating non-value-added activities,
optimizing workflow, and leveraging technology. The process involves a cross-functional
team of experts who analyze the current processes, identify inefficiencies, and then redesign
the processes from scratch.