What is Production Management
Production Management is a process which involves managing and controlling production activities of business. It involves the application of management principles to the production function of the business to increase productivity. Production management applies planning, directing, organising and controlling for managing production operations. This process is concerned with the conversion of raw materials into business finished products efficiently without any wastage of resources.
Production management involves framing of various production strategies and ensures the successful implementation of these strategies in business operations. These strategies are formed and implemented by production management for achievement of different pre-set goals in terms of unit costs, quality, production mix and capacity of production.
Production management aims at proper integration and utilisation of 6M’s: Men, Machine, Money, Methods, Materials and Market to satisfy the customer needs in a better way. Its main objective is to manufacture products and services in the right quantity, of the right quality, at the right time and at a lower cost. Various technological and innovation changes are easily implemented in business using Production management. Production management supervises and controls all persons associated with production operations of the business and ensure the desired output. The objectives of Production Management are as follows:
Objectives of Production Management
Production in Right Quantity
Production management formulate and implement various production strategies to ensure production in right quantity. Production in the right quantity is important for every organisation to ensure profitability. Excess or shortage in production will have adverse effects. Excess production of products will leads to blockage of funds in inventory. Whereas the shortage in production will create a shortage of its products and will not be able to fulfil demand.
Minimisation of Production Time
Completion of production activities timely is essential for the achievement of the goal. Production management designs schedules for various production activities of business. It monitors all production activities and ensures that all operations are going as per planned schedules. In case of any deviation in production activities, production manager takes all necessary corrective measures to remove these deviations. It helps in minimising the overall time involved in production activities.
Production of Right Quality
Production management ensures that quality products are manufactured by the organisation. It aims that customers’ expectations are fulfilled by the product. Attempts are made to convert the needs of customers into production specification while designing a product. Certain standards are set through production management process and attempts are made to fulfil these standards.
Minimisation of Cost
Cost reduction is the primary focus of every business. Production management aims at minimising the cost of product activities of business. It involves usage of sound supply chain management in production planning minimising the overall production and supply cost. Production management estimates the true cost of a product before its production and tries to keep its production cost within the parameter of pre-estimated cost.
Planning and Control of Materials
Production management helps in maintaining the optimum stock of inventory within the organisation. It keeps complete record of all materials required for various production activities. By maintaining records, shortage of any raw materials can be easily detected. It helps in ensuring that all raw materials are always available in the right quantity so that production activities are not affected.
Analyse the Market
Production management completely analyse market situations before framing production strategies. It recognises and takes into account various technological and innovation changes at early as possible. All these changes are implemented in production activities of the organisation to face the market competition. Production activities go in line with market demand.
Optimum Utilisation of Resources
Proper utilisation of all resources is must to earn the desired profit and achieve desired goals. Production management issues rules and guidelines for all persons associated with production operations. It monitors their activities and helps them in improving their efficiency. Production managers check the overall activities and productivity of all departments of organisations. It is ensured that there is no wastage of resources and all resources are efficiently utilised.