Production Planning and Logistic Systems 2

8/8/2019 Production Planning and Logistic Systems 2

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Production Process:

Every production process begins with the marketplace. Marketplace demand is an independent

demand relies on such factor change consumer test, Different seasons in a year, ups and downs

national economy, and political winds. Different forecasting techniques can used to make good

demand prediction. Expected demand as an input to production and aggregate planning, all

resources necessary to meet the demand and plans for the future. The outcome of an aggregate

planning is master production schedule (MPS). The next stage is material requirement planning

(MRP), where a product is disintegrated into several components, each component is determined

with the help of bills of materials and inventory records. Next a shop floor schedule for each

component is developed.

Although the production planning and control system is made of these blocks, there are many

important functional departments in plant operations, such as human resources, sales and

marketing, operations, distribution, and finance.

Production process flow diagram for any production process is given here


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Production Planning and Logistic Systems 2010

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Fig. 1: Production Process Flow Diagram


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Production Planning and Control

Production planning and control are two important topics that serve to increase efficiency in

manufacturing and improve effectiveness in customer service. Production planning determines

what, when, and how much to produce to meet the customer needs, without excessive inventory

or back order costs. Production control makes sure that resources, including physical resources

(plant, tools and equipments, raw-materials), human resources and financial resources are being

used efficiently and effectively.

Scheduling on the other hand, determines how to achieve the goal set in production planning

when the resource are limited, and if the goal cannot be realized, how best to set new goals that

are optimum and practical with the available resources. Production planning involves forecasting

of customer orders, determination of plant capacities, and planning for the long range such as

one year or more. The next step is that short range or immediate planning to monthly and then to

weekly level.

Production planning and control has three major sections

i. Production planningii. Production control

iii. Inventory management


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Fig.2: Production Planning and Control

Objectives of Production Planning and Control

The objective of the production planning and control is to produce goods services of right

quality and quantity at the right time and right manufacturing cost.

1. Right QualityThe quality of product is established based upon the customers needs. The right quality is

not necessarily best quality. It is determined by the cost of the product and the technical

characteristics as suited to the specific requirements.


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2. Right QuantityThe manufacturing organization should produce the products in right number. If they are

produced in excess of demand the capital will block up in the form of inventory and if the

quantity is produced in short of demand, leads to shortage of products.

3. Right TimeTimeliness of delivery is one of the important parameter to judge the effectiveness of

production department. So, the production department has to make the optimal utilization

of input resources to achieve its objective.

4. Right Manufacturing CostManufacturing costs are established before the product is actually manufactured. Hence,

all attempts should be made to produce the products at pre-established cost, so as to

reduce the variation between actual and the standard (pre-established) cost.

Production Planning and Control Stages

Production department is backbone of every process and manufacturing company and its

performance defines the performance of company. Production department plays a vital role in

achieving strategic goals and objectives of the company. The functions of Production

Management depend upon the size of the firm. In small firms the production Manager may have

to look after production planning and control along with Personnel, Marketing, Finance and

Purchase functions. In medium sized firms, there may be separate managers for Personnel,

marketing and Finance functions. But the production planning & control and Purchase & stores

may be under the control of Production management department. In large sized firms the

activities of Production Management is confined to the management of production activities

only. Production Planning and Control activities have three stages:


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i. Pre-Planning stageii. Planning stageiii. Control stage

Fig. 3: Production Planning and Control Stages

Core Functions of PPC

1. Process Planning

Process Planning involves making choices concerning the way an organization will

produce its products or provide services to its customers. It has major implications for

capacity planning, layout and work methods. Managers can select from five different

types of processes: job shop, batch, repetitive, continuous and projects. Job shops are

used to produce a low volume of each of a large variety of products or services.


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Equipment flexibility must be high to handle the high variety of jobs. Batch processing

involves less variety, less need for equipment flexibility, and higher volumes of each type

of product. Repetitive processing has even less variety, less need for equipment

flexibility, and higher volume. Continuous processing has the lowest variety, the lowest

need for equipment flexibility, and the highest volume.

Job shops and batch processing are classified as intermittent systems, meaning that output

frequently switches from one product or service to another. Repetitive and continuous

systems are classified as continuous processing because there is little or no switching

from one product to another. Projects are used for non-routine work that is intended to

meet a given set of objectives in a limited time frame. Job variety is high, volume is

usually low, and equipment flexibility needs can range from low to high. Process

selection may lead to automation or computer-aided manufacturing. A key issue in

process selection is the management of technology. See the discussion under the

Operations Strategy section. Another key issue in process selection is flexibility. There

are three fundamental types of plant layout, respectively corresponding to the three

different types of production operations situations.

a. A product layout implies that a single product or else a single type of product, forexample, automobiles, is manufactured on an assembly line, with the production tasks

assigned to workstations along the line.

b. A process layout involves the movement of batches of goods between departments viaforklift truck, moving belt, or some other type of conveyance.


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c. A fixed-position layout is appropriate for a large end item such as a house or airplane,where all material is assembled to a major structure or product at a specified site.

2. Capacity PlanningCapacity planning is the process of determining the production capacity needed by an

organization to meet changing demands for its products. In the context of capacity

planning, "capacity" is the maximum amount of work that an organization is capable of

completing in a given period of time. The phrase is also used in business computing as a

synonym for Capacity Management

A discrepancy between the capacity of an organization and the demands of its customers

results in inefficiency, either in under-utilized resources or unfulfilled customers. The

goal of capacity planning is to minimize this discrepancy. Demand for an organization's

capacity varies based on changes in production output, such as increasing or decreasing

the production quantity of an existing product, or producing new products. Better

utilization of existing capacity can be accomplished through improvements in overall

equipment effectiveness (OEE). Capacity can be increased through introducing new

techniques, equipment and materials, increasing the number of workers or machines,

increasing the number of shifts, or acquiring additional production facilities.

Capacity is calculated: (number of machines or workers) (number of shifts)

(utilization) (efficiency).

The broad classes of capacity planning are lead strategy, lag strategy, and match strategy.


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a. Lead strategyb. Lag strategyc. Match strategy3. 4 Ms (man, machine, material, method) Planning

Planning for resources including men, machines, materials and methods for the efficient

running or production process is responsibility of production planning department.

Selection of the workforce having certain skills as per requirement of the process,

training of the workforce, selection of the materials with certain quality standards and

developing bills of materials, selection of the machines and equipment that satisfy

requirements of capacity as well as quality and finishing of the final product, selection of

the methods and operations through which product will be produced and sequencing of

those operations are all responsibilities of PPC department.

4. Production ControlMethods and procedures employed in handling materials, parts, assemblies, and sub-

assemblies, from their raw or initial stage to the finished product stage in

an organized and efficient manner. It also includes activities such

as planning, scheduling, routing, dispatching, storage, etc. Production control is a sub-set

of MRPII (manufacturing resource planning) as it refers only to the control or scheduling

of production rather than the wider control of all business or enterprise resources.

5. Inventory ManagementInventory Management and Inventory Control must be designed to meet the dictates of

the marketplace and support the company's strategic plan. The many changes in market

demand, new opportunities due to worldwide marketing, global sourcing of materials,


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and new manufacturing technology, means many companies need to change their

Inventory Management approach and change the process for Inventory Control. Despite

the many changes that companies go through, the basic principles of Inventory

Management and Inventory Control remain the same. Some of the new approaches and

techniques are wrapped in new terminology, but the underlying principles for

accomplishing good Inventory Management and Inventory activities have not changed.

The Inventory Management system and the Inventory Control Process provides

information to efficiently manage the flow of materials, effectively utilize people and

equipment, coordinate internal activities, and communicate with customers. Inventory

Management and the activities of Inventory Control do not make decisions or manage

operations; they provide the information to Managers who make more accurate and

timely decisions to manage their operations.

The basic building blocks for the Inventory Management system and Inventory Control

activities are:

a. Sales Forecasting or Demand Managementb. Sales and Operations Planningc. Production Planningd. Material Requirements Planninge. Inventory Reduction

The emphases on each area will vary depending on the company and how it operates, and

what requirements are placed on it due to market demands. Each of the areas above


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will need to be addressed in some form or another to have a successful program of

Inventory Management and Inventory Control.

6. Logistics Management

Logistics Management is that part of Supply Chain

Management that plans, implements, and controls the efficient, effective, forward, and

reverse flow and storage of goods, services, and related information between the point of

origin and the point of consumption in order to meet customers requirements.


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History

The story of Servis begins with a group of friends - young, energetic, fresh from college who

established Service Industries more than 50 years ago.. These young men, named Ch. Nazar

Muhammad (Late), Ch. Muhammad Hussain (Late) both from Gujrat district and Ch.

Muhammad Saeed (Late) from Gujranwala District, started business in 1941 at a small scale in

Lahore. At that time, they were only manufacturing handbags and some other sports goods.

Within years their business flourished remarkably and they were supplying their products to

every corner of India at the time of Partition.

In 1954, they installed a shoe manufacturing plant at industrial area Gulberg, Lahore. This

started production in the same year. The industry started manufacturing various types of shoes.

Later management shifted the factory from Lahore to Gujrat. Service Sales Corporation (Pvt.)

Ltd. the Groups marketing company was established in 1959. Humility, fairness, and respect

were the values close to the heart of these founders and it were these values that led to

phenomenal success of the Group. Today, the production side of the company has flourished

into Service Industries Limited (SIL) which has world-class shoes, tyres, tubes, and rubber

production facilities in Gujrat and Muridke. SIL is also the leading exporter of footwear. Service

Sales Corporation (Pvt.) Ltd. (SSC) is today Pakistans leading footwear retailer which is also

diversifying into other businesses. A humble venture of friends has grown into a Group that

makes a difference in lives of millions of people every day today.

The Group

Servis Group is one of the most respected corporate citizens of the country and has a rich

heritage spanning over half a century. Today the Group is Pakistan's largest footwear


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manufacturer and exporter with interests in wholesale and retail sectors. With a growing

portfolio of brands and a nationwide network that touches millions of lives everyday, Servis is

one of the foremost brands in the country. Setup in 1958, the Group is the largest footwear

manufacturer, retailer, and exporter operating in the country and has overall sales of more than

PKR 12 billion. It currently employs close to 9000 people in its following companies:

i. Service Industries Limited (SIL)ii. Service Sales Corporation (Pvt.) Ltd. (SSC)

iii. Servaid Pharmacy (Pvt.) Ltd.The Brand - Celebrating 50 Years ofHappiness

Starting its journey as a single retail footwear outlet, the brand today has a 400+ stores presence

in Pakistan, 2000+ dealer-base, and a growing international footprint in Europe, Middle East,

and many other regions of the world. At the heart of all our endeavors lies the spirit of our

countrymen. Servis and its roots are grounded firmly in Pakistan and its people. We understand

their needs, their lives and their dreams. Sharing in their moments both big and small, Servis has

been their companion in happiness for over 50 years. And with our commitment to constant

innovation and uncompromising quality, we endeavor to delight our customers with the very best

products and services. Three generations connected through the thread that is happiness; the

journey continues on the road to feel good.

Best Practices

We continuously work on adopting strategies and methodologies that yield results and maximize

operational efficiency. With our focus to maintain the highest standards in operations, Servis


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partners with the best for its business processes. Servis is powered by technology giants

like Microsoft, Oracle, IBM, CISCO, DELL, HP and Agility, making the decision support

systems automated for creating efficiency & effectives at par with globally accepted scales. Our

team is consistently working to bridge the information flows from retails outlets in rural and

urban centers, following the customer centric approach. In addition, EPOS (Electronic Point of

Sale) systems have been installed in over 200 stores with a goal of EPOS in every Servis store by

2010. Our EPOS hardware partner is JBL. With a goal to create a state-of-the-art supply chain,

world renowned retail experts Kurt Salmon Associates were engaged for a landmark project:

Project Giant Leap. A key initiative within the Project Giant Leap fold was partnering with

Agility Logistics for our Central Distribution Center. Believing in bringing customer to the heart

of our decision making, we also conduct formal consumer research in concept and product

development, marketing structure and segmentation, and pricing areas and also undertake

ongoing consumer research initiatives like mystery customer programs, Consumer Links, and

brand tracking with partners like Nielsen, MEMRB, AMRB, and Startex Marketing.

International Business

We at Servis have been servicing customers internationally for more than 25 years. Our highly

qualified team of professionals and technical experts translate your designs into products of your

choice. We specialize in contract manufacturing. Manufacturing as per clients requirements, we

also assist our global clients with sourcing of raw material for manufacturing. To keep abreast

with the international manufacturing standards and techniques we follow the tests requirements

as defined by our valued clients. Our technical experts regular attend formal trainings at

internationally recognized design schools. Computer aided design and manufacturing tools


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combined with the best practices at par with global standards are used. With a major focus on

European market we follow all the pre-requisites of EU standards. With our rich experience in

exports, we are now moving towards retailing globally. Our team of professionals is

continuously accumulating marketing intelligence, leading towards establishing our retail brands

in the global arena both through our own or partner retailing initiatives as well as by establishing

a wholesale market presence. We have started establishing our brand network in UAE, Qatar &

KSA (Kingdom of Saudi Arabia). Our brands are available at leading hyper marts like Carrefour,

LuLu and K.M. Stores in Dubai. Our highly motivated team is exploring international frontiers

aiming to make Servis a globally acclaimed brand.

Nationwide Network:

Fig. 4: SILNationwide Network


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Service Industries Limited (SIL)

SIL is a public limited company listed on the stock exchanges of Pakistan. It has annual

revenues of about PKR

6

billion and is the largest manufacturer of footwear, tyres & tubes for

two-wheelers, and has been the largest footwear exporter of the country for the last 10 years.

The company employs more than 6,000 people in its facilities located in Gujrat and Muridke and

exports its products primarily to Germany, Italy, France and the UK. With a strong emphasis on

product quality and innovation, SIL has built both domestic and international recognition of

companys products.

The visionary leadership and hardworking management team has led SIL to hold this top

position in the business arena. The board comprises:

y Mr. Arif Saeed, Chairmany Mr. Shahid Hussain, Chief Executivey Mr. M. Ijaz Butt, Directory Mr. Muhammad Akram, Directory Mr. Hassan Javed, Directory Mr. Shahid Hafeez Kardar, Directory Mr. Riaz Ahmed, Directory Mr. Zahid Hussain, (Rep. ofNIT)y Mr. Anis Wahab Zuberi, (Rep. ofNIT)

Brands


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Process Planning

Process Planning and capacity planning play a key role in the ability of an organization to

achieve its mission. Technological advances in processing provide many new options for

competitive advantage, but they also pose numerous risks for the unwary decision maker.

Key aspects in process selection are

1. Make or Buy DecisionThe extent to which the organization will produce goods or provide services in house as

opposed to relying on outside organization to produce or provide them.

2. Capital IntensityThe mix of equipment and the labor that will be used by the organization.

3. Process FlexibilityThe degree to which the system can be adjusted to changes in processing requirements

due to such factors as changes in product or service design, change in volume processed,

and changes in technology.


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Fig. 5: Process Planning

Inputs

i. Forecastingii. Product/Service Design

iii. Technological ChangeOutputs

i. Plant and Equipment Selectionii. Facilities Layout

iii. Work designiv. Capacity Planning

Forecasting

Product and

Service Design

Technological

change

Capacity Planning

Plant and

Equipment Selection

Facilities Layout

Work Design

Process

Planning


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Production Systems

Production function is that part of an organization, which is concerned with the transformation of

a range of inputs into the required outputs (products) having the requisite quality level.

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. Thus production is a value addition process. At each stage of processing, there will be

value addition.

Edwood Buffa defines production as a process by which goods and services are created. Some

examples of production are: manufacturing custom-made products like, boilers with a specific

capacity, constructing flats, some structural fabrication works for selected customers, etc., and

manufacturing standardized products like, car, bus, motor cycle, radio, television, etc.

Fig. 6: Schematics Production System

The production system of an organization is that part, which produces products of an

organization. It is that activity whereby resources, flowing within a defined system, are


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combined and transformed in a controlled manner to add value in accordance with the policies

communicated by management. A simplified production system is shown above.

The production system has the following characteristics:

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.

Classification of Production System

Production systems can be classified as Job Shop, Batch, Mass and Continuous Production

systems.

Fig. 7: Classification of Production Systems


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Batch Production: Production System at SIL

Production system in practice at Servis Industries Ltd. is Batch Production. Batch Production

is to manufacture of number of identical products either to meet the specific order or to satisfy

the demand. When the production of plant and equipment is terminated, the plant and equipment

can be used for producing similar products. This system has further three categories.

i. A Batch Produced Only Once:Servis Industries have international clients. Customers place order with the firm for the

product of their specifications. Industrial Engineering dept. provides time study

information for the product. Production planning dept. generates MRPs for all the

materials which are sent to the Materials dept. for procurement. Materials arrive as per

requirement of quality and quantity withing required dates. Then production is scheduled.

In case the order is large, SIL outsources the cutting process to its vendors. Cutting

patterns and cutting requirements are provided to them by the company. Processes of

stitching andsole fixing are carried out in the company. Record of production including

materials, machines, labor is maintained.

ii. A Batch Produced at Irregular Intervals as per Customer Order or When the NeedArises:

Servis Industries Limited has a wide range of articles whose demand varies. Demand

Forecasts or Purchase orders are generated by the Marketing dept. of the company, whose

responsibility is to keep tracking customer behaviors, buying trends, and changing

customer requirements. Some articles have demand in one season and some in the other.

So, production is scheduled as per demand or as per purchase orders generated by

marketing dept. When order is received, production planning process begins, which is


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explained in previous heading. As the frequency is irregular, the firm can maintain a file

of its detailed plans and it can refer to its previous files and start production.

iii. A Batch Produced Periodically at Known Intervals:This system is used in make to stock production systems or where consistent demand

for the product exists. Here the firm either receives order from the customer at regular

intervals or it may produce the product to satisfy the demand. It can have well designed

file of its plans, material requirement and instructions for the ready reference. It can also

purchase materials required in bulk in advance. As the frequency of regular orders goes

on increasing the Batch Production system becomes Mass Production System. Here also,

incase the demand for a particular product ceases, the plant and machinery can be used

for producing other products with slight modification in layout or in machinery and

equipment.

This system is not yet being used in SIL, since demand for the articles is irregular.

Characteristics of Batch Production

Batch production system is used under the following circumstances:

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

change of set up is required for processing the next batch.

4. When manufacturing lead time and cost are lower as compared to job order production.


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Advantages of Batch Production

Following are the advantages of batch production:

1. Better utilization of plant and machinery.2. Promotes functional specialization.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 of Batch Production

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.


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Facility Layout Designing

Facility layout refers to arrangement of machines, storage areas, and/or work areas usually

within the confines of a physical structure, such as a retail store, an office, a warehouse, or a

manufacturing facility.

In Servis Industries two types of layouts are being installed.

a. Cellular Layoutb. Production Lines

Cellular Layout

There are 3 major processes involved in production of shoes, each of which is completed in a

particular section or cell. These sections/cells are:

1. Cutting Cell2. Closing or Machining Cell3. Lasting & MakingCell4. Finishing and Packing Cell

Within each cell, machines are arranged in sequence i.e, within each cell exist production line.

1. Cutting CellIn this department, the top part of the shoe or the "upper" is made. The cutting operative

is given skins of leather, mostly cow leather but not restricted to this type of leather.

Using metal strip knives, the worker cuts out pieces of various shapes that will take the

form of "uppers". This operation needs a high level of skill as the expensive leather has to

be wasted at the minimum level possible. Leather may also have various defects on the


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surface such as barbed wire scratches which needs to be avoided, so that they are not

used for the uppers. Components are cut as per cutting requirements provided by the

planning department. Various cutting machines are used in cutting section for leather

cutting. These are:

a. Press Cutting Machine (used to cut patterns of single leather layer using a cutting die)b. Transfer Head Cutting Machine (used to cut patterns of multiple leather layers using a

cutting die)

c. Splitting Machine (used to reduce thickness of leather cuttings to match designspecifications)

d. Skiving Machine (used to reduce thickness of leather cuttings at the edges, so that whentwo leather cuttings are joined/stitched together, joint does not become too thick)

Cutting Lines

In cutting cell, machines are arranged in sequence so as to maximize in-sequence moves

and avoid back-tracking.

Fig. 8: Cutting Lines in Cutting Cell

These processes must be completed in sequence. Splitting cant be done before cutting, and

skiving cant be done before splitting.

Press/Transfer Head

Cutting Machine

Splitting Machines Skiving Machines


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2. Closing or Machining CellHere the component pieces are sewn together by highly skilled machinists so as to

produce the completed upper. The work is divided in stages. In early stages, the pieces

are sewn together on the flat machine. In the later stages, when the upper is no longer flat

and has become three-dimensional, the machine called post machine is used. The sewing

surface of the machine is elevated on a post to enable the operative to sew the three

dimensional upper. Various edge treatments are also done onto the leather for giving an

attractive look to the finished upper. At this stage only, the eyelets are also inserted in

order to accommodate the laces in the finished shoes.

In stitching cell, leather cuttings are stitched using stitching machines. Different types of

stitching machines are used, such as:

a. Single Stitch Machine (such machines are conventional style but special purposestitching machines. They contain a single stitching needle, and are used for single stitch)

b. Double Stitch Machine (these stitching machines contain two needles and are used fordouble stitch)

c. Zigzag Stitching Machine (these are special purpose stitching machines which createzigzag stitching patterns on the upper. Their use depends on the design of the article)

Stitching Lines

In stitching cell, workstations are designed and arranged as per article and its

components. At each workstation, a certain stitching operation is performed within the

time provided bye the Industrial Engineering dept. so as to optimize the production

system productivity and complete the customer order in-time. For each article, there is a

different time study data, and each article has its own arrangement of machines for its


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manufacturing. So, every time when a batch is scheduled, position of machines is

shuffled accordingly. Workstations are arranged in series to maximize in-sequence

moves.

3. Lasting & MakingCellThe completed uppers are molded into a shape of foot with the help of a "Last". Last is a

plastic shape that simulates the foot shape. It is later removed from the finished shoe to

be used further in making other shoes. Firstly, an insole to the bottom of the last is

attached. It is only a temporary attachment. Sometimes, mostly when welted shoes are

manufactured, the insole has a rib attached to its under edge. The upper is stretched and

molded over the last and attached to the insole rib. After the procedure completes, a

"lasted shoe" is obtained. Now, the welt- a strip of leather or plastic- is sewn onto the

shoe through the rib. The upper and all the surplus material is trimmed off the seam. The

sole is then attached to the welt and both are stitched together. The heel is then attached

which completes the "making" of the shoe. That was the process for heeled shoes. When

a flat shoe is in the making, there are considerably fewer operations. The insole in this

case is flat and when the uppers are 'lasted', they are glued down to the surface of the

inner side of the insole. The part of the upper that is glued down is then roughed with a

wire brush to take off the smooth finish of the leather. This is done because rough surface

absorbs glue to give a stronger bond. The soles are usually cut, finished and prepared as a

separate component so that when they are glued to the lasted upper, the result is a

complete and finished shoe. Soles can also be pre-molded as a separate component out of

various synthetic materials and again glued to the lasted upper to complete the shoe.

Two methods for sole joining are:


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a. Direct Injection method (sole in joined with the upper using an injectionmolding machine. This method is used for articles such as Cheetah n other trainer

shoes for which upper is not stitched with the sole)

b. Stuck-on method (method explained above. Sole is joined with the upper usingan adhesive material, and then stitched. Soles are manufactured separately)

4. Finishing and Packing CellThe finishing of a shoe depends on the material used for making it. If made of leather, the

sole edge and heel are trimmed and buffed to give a smooth finish. To give them an

attractive finish and to ensure that the edge is waterproof, they are stained, polished and

waxed. The bottom of the sole is often lightly buffed, stained and polished and different

types of patterns are marked on the surface to give it a craft finished look. A "finished

shoe" has now been made. For shoe room operation, an internal sock is fitted into shoe

which can be of any length- full, half or quarter. They usually have the manufacturers

details or a brand name wherever applicable. Depending on the materials used for the

uppers, they are then cleaned, polished and sprayed. Laces and any tags that might have

to be attached to the shoes, such as shoe care instructions, are also attached. The shoes, at

last, get packaged in boxes.


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Capacity Planning

"Capacity" is the maximum amount of work that an organization is capable of completing in a

given period of time.

The basic questions in capacity planning of any sort are the following

1) How much is needed?2) When is it needed?

The fundamental decisions in any organization concern the choice of product or services it

offers. All other decisions pertaining to capacity, facilities, location are governed by the choice

of product.

Fig. 9: Capacity Planning

Forecast

Demand

Compute

NeededCapacity

Compute

Rated

Capacity

Evaluate

Capacity

Plans

ImplementBest Plan

QualitativeFactors

e. . Skills

Select Best

CapacityPlan

Develop

Alternative

Plans uantitative

Factorse. . Cost


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Importance of Capacity Decisions

Capacity decision have a real impact on the ability of an organization to meet futuredemands for product and services

Capacity decisions affect operating costs. A decision might be made to balance the costof over and under capacity.

Capacity is usually a major determinant of initial cost. Although larger units tend to costproportionately less than smaller units.

Capacity decisions often involve long-term commitment of resources, and it is difficultand closely to modify those.

Capacity decision can affect competitiveness.Definition and Measuring Capacity

It is difficult to assign single measure of capacity, for different products and variety of services.

The measure of capacity must be tailored to the situation.

The above definition of capacity is functional. It can be refined into three useful definitions.

Design capacity: the maximum that can be achieved under ideal conditions.

Effective capacity: The percent of design capacity actually expected.

Rated Capacity:Maximum usable capacity of a particular facility

RC = (Capacity)(Utilization)(Efficiency)

Utilization Measure of planned or actual capacity usage of a facility, work center, or machine

Utilization = Actual Output / Design capacity


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Efficiency: is the ratio of actual output to effective capacity

Efficiency = Actual Output / Effective capacity

Make or Buy Decision and Capacity Planning

A manufacture has to consider whether to make or buy some for all the parts or to subcontract

some or all of a service.

In make or buy decisions, a number of factors are usually consider.

y Available capacity: If the organization has available equipment and skill, it will producein house.

y Expertise: Buying might be a reasonable choice, if the organization lacks the expertise todo the job.

y Quality considerations: Firms that specialize can usually offer higher quality than anorganization can attain itself. Special quality requirements or the ability to closely

monitor quality may cause an organization to perform a job itself.

y Nature of demand: When the demand for item that is high and steady the organization isbetter off doing the work itself.

y Cost: Any cost savings achieved from buying or making must be weighed against thepreceding factors. Cost saving might come from itself or from transportation, fixed cost

saving.


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Strategies for Capacity Planning

The broad classes of capacity planning are lead strategy, lag strategy, and match strategy.

I. Lead strategyis adding capacity in anticipation of an increase in demand. Lead strategy is an aggressive

strategy with the goal of luring customers away from the company's competitors. The

possible disadvantage to this strategy is that it often results in excess inventory, which is

costly and often wasteful.

II. Lag strategy refers to adding capacity only after the organization is running at fullcapacity or beyond due to increase in demand. This is a more conservative strategy. It

decreases the risk of waste, but it may result in the loss of possible customers.

III. Match strategy is adding capacity in small amounts in response to changing demand inthe market. This is a more moderate strategy.

Fig. 10: Strategies for Capacity Planning

Expected Demand Expected Demand

Expected Demand Expected Demand

Time in Years Time in Years

Time in YearsTime in Years

De

ma

nd

De

ma

nd

De

ma

nd

De

ma

nd

New Capacity

New CapacityNew Capacity

New Capacity

Capacity leads demand with an incremental expansion Capacity leads demand with a one-step expansion

Capacity lags demand with an incremental expansionAttempts to have an average capacity, with an

incremental expansion


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Machine Utilization Improvement Work at SIL:

The measure of machine hours recorded against production vs. the hours available or scheduled

for a given period. The machine utilization is a measure of the fraction of time that the machine

is busy. The symbol r (rho) is often used to represent this quantity. Note that r is unit-less, and

that it's values must be in the range from 0 to 1.

Causes of poor Equipment / Machine Utilization and/or Efficiency

1. Failure to plan work so that effective and efficient utlization is made of all availablemachinery

2. Failure to inspect machinery to keep it in good condition and to prevent breakdown3. Foreman's lack of knowledge on possible use and capacity of machines4. Failure to make regular examination of wire ropes, belts, chain drives, gear drives,

conveyors, lubrication systems, valves etc

5. Using unnecessary large and powerful machine for small work6. Lack of cooperation with maintenance department; upkeep, repairs, painting etc.7. Not protecting idle machinery from weather, dust, dirt, rust, fumes etc8. Allowing machinery to stay dirty by lack of periodic cleaning9. Failure to inspect for proper lubrication of all moving parts10. Failure to make needed repairs promptly11. Lack of instruction to employees on the proper operation of machinery12. Lack of proper discipline to prevent abuse of machinery and equipment13. Allowing employees to make "shoestring" repairs14. Failure by the foreman to keep informed on the latest technology


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15. Failure to pay attention to workers opinions on value and condition of machinery.16. Abusing small machines on large work17. Repairing machinery that should be scrapped; may cost more than replacing

During our research work at Servis Industries, we collected data on machine utilization for 5

days. And we found that if we reduce change over times and could overcome break downs, we

may enhance our production up to 29 percent. Here is the study we did in Servis Industries:


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Day 1

Actual Production 467 Pairs

Loss 188 Pairs

Machine Productivity 72 %

Production Loss 28 %

Hourly Production of Desma Machine # 3

Time Production (Pairs)

07:30 to 08:30 50

08:30 to 09:30 00

09:30 to 10:30 51

10:30 to 011:30 80

11:30 to 12:45 101

12:45 to 13:15 Break

13:15 to 14:15 78

14:15 to 15:15 80

15:15 to 15:30

Total

27

467


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Breakdown Losses

Problem Frequency Time Lost Pairs Lost

Mould Problem /

Change / Adjust

1 16 24

Injection Miss 1 10 15

Incomplete Sole 1 6.67 10

Repair Work 1 14.67 22

Spray Problem 1 2.67 04

Upper not Lasted 1 2.6768 04

Cleaning & Reamer 1 68 102

Mould Adjustment 1 4.67 07

Table 1: Breakdown Losses: Day 1


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Graph 1: Problems vs Pairs Lost: Day 1

Ideal Condition Pairs = (Shift Time / Mold Turn Time) * No of pairs on mold machine

= (450 / 10.3) * 15

= 655 Pairs

Time Wasted due to Breakdowns = 125.33 mins

Pairs Wasted = 125.33 * 1.5 = 188 Pairs

Total Pairs = 655 188 = 467

Productivity = (Pairs Produced / Ideal Condition Production) * 100

= (467 / 655)100

= 72 %

Production Loss = 28 %

0 20 40 60 80 100 120

Mould Problem / Change / Adjust

Injection Miss

Incomplete Sole

Repair work

Spray Problem

Upper not Lasted

Cleaning & Reamer

Mould Adjustment

Pairs Lost


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Day 2


Loss 106 Pairs





07:30 to 08:30 60

08:30 to 09:30 65

09:30 to 10:30 74

10:30 to 011:30 77

11:30 to 12:45 90

12:45 to 13:15 Break

13:15 to 14:15 68

14:15 to 15:15 79

15:15 to 15:30

Total

36

549


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Breakdown Losses


Mould Problem /

Change / Adjust

1 3.33 05

Injection Miss 1 4 06


Upper not available 1 32.67 49


Discolor 1 4.67 07

Reamer 1 12 18

Tip Cleaning 1 5 8



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= (450 / 10.3) * 15 = 655 Pairs

Time Wasted due to Breakdowns = 70.33 mins

Pairs Wasted = 70.33 * 1.5 = 106 Pairs

Total Pairs = 655 106 = 549 PairsProductivity = (Pairs Produced / Ideal Condition Production) * 100

= (549 / 655)100

= 84 %


0 10 20 30 40 50 60


Injection Miss

Incomplete Sole

Upper not available

Spray Problem

Discolor

Reamer

Tip Cleaning

Pairs Lost


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Day 3


Loss 243 Pairs





07:30 to 08:30 32

08:30 to 09:30 22

09:30 to 10:30 54

10:30 to 011:30 52

11:30 to 12:45 78

12:45 to 13:15 Break

13:15 to 14:15 73

14:15 to 15:15 77

15:15 to 15:30

Total

28

412


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Breakdown Losses


Mould Problem /

Change / Adjust

1

18.67

28

Injection Miss 1 1.33 02






Mould Adjustment 1 4 06

Upper not Available 1 36 54

Injection M/t

Shortage

1

45.33

68

Maintenance

Problem

1

23.33

35



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Ideal Condition Pairs = (Shift Time / Mold Turn Time) * No of pairs on moldmachine

= (450 / 10.3) * 15 = 655 Pairs

Time Wasted due to Breakdowns = 162 mins

Pairs Wasted = 162 * 1.5 = 243 Pairs

Total Pairs = 655 243 = 412


= (412 / 655)100

= 64 %


0 10 20 30 40 50 60 70 80


Injection Miss

Incomplete Sole

Repair Work

Spray Problem

Upper not Lasted

Cleaning & Reamer

Mould Adjustment

Upper not Available

Injection M/t Shortage

Maintenance Problem

Pairs Lost


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Day 4


Loss 172 Pairs

Machine Productivity 73.7 %

Production Loss 26.3 %



07:30 to 08:30 00

08:30 to 09:30 31

09:30 to 10:30 68

10:30 to 011:30 88

11:30 to 12:45 99

12:45 to 13:15 Break

13:15 to 14:15 82

14:15 to 15:15 87

15:15 to 15:30

Total

28

483


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Breakdown Losses


Mould Problem /

Change / Adjust

1

13.33

20



Upper not Available 1 6.67 10

Maintenance

Problem

1

58

87

Injection Miss +

Incomplete Sole

(Scrapper Problem)

1

12.67

19



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= (450 / 10.3) * 15 = 655 Pairs



Total Pairs = 655 172 = 483


= (483 / 655)100

= 73.7%

Production Loss = 26.3 %

0 10 20 30 40 50 60 70 80 90 100


Repair Work

Mould Adjustment

Upper not Available

Maintenance Problem

Injection Miss + Incomplete Sole

Pairs Lost


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Day 5


Loss 263 Pairs

Machine Productivity 59.85 %

Production Loss 40.15 %



07:30 to 08:30 28

08:30 to 09:30 24

09:30 to 10:30 45

10:30 to 011:30 49

11:30 to 12:45 77

12:45 to 13:15 Break

13:15 to 14:15 74

14:15 to 15:15 69

15:15 to 15:30

Total

26

392


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Breakdown Losses


Mould Problem /

Change / Adjust

1

24

36

Injection Miss 1 1.33 2







Upper not Available 1 38 57

Injection M/t

Shortage

1

50

75

Maintenance

Problem

1

25.33

38



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= (450 / 10.3) * 15 = 655 Pairs



Total Pairs = 655 263 = 392


= (392 / 655)100 = 59.85 %

Production Loss = 41.15 %

0 10 20 30 40 50 60 70 80


Injection Miss

Incomplete Sole

Repair Work

Spray Problem

Upper not Lasted

Cleaning & Reamer

Mould Adjustment

Upper not Available

Injection M/t Shortage

Maintenance Problem

Pairs Lost


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Machine Efficiencies

Overall efficiencies of these five days is as follows;

Day Machine Efficiency

Day # 1 72

Day # 2 84

Day # 3 64

Day # 4 73.7

Day # 5 59.85

Average Efficiency 70.1 %

Table 6: Efficiency per Day

Graph 6: Efficiency per Day

0

10

20

30

40

50

60

70

80

90

Day # 1 Day # 2 Day # 3 Day # 4 Day # 5

Machine Efficiency

Machine Efficiency

Avg. Efficiency


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Why Too Low Efficiency?

Pairs Lost

Problem Day 1 Day 2 Day 3 Day 4 Day 5 Total Share %

Mould Problem / Change /

Adjust

24 5 28 20 36 113 11.63

Repair Work 22 0 25 25 25 97 9.98

Spray Problem 4 2 4 0 4 14 1.44

Upper not Lasted 4 0 4 0 4 12 1.23

Cleaning & Reamer 102 18 15 0 15 150 15.43

Mould Adjustment 7 0 6 9 6 28 2.88

Upper not available0 49 54 10 57 170

17.49

Discolor 0 7 0 0 0 7 0.72

Tip Cleaning 0 8 0 0 0 8 0.82

Injection M/t Shortage 0 0 68 0 75 143 14.71

Maintenance Problem 0 0 35 87 38 160 16.46

Scrapper Problem 25 17 3 19 3 67 6.89

Total 188 106 243 172 263 972 100 %


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Now for applying Pareto Rule, 1st

of all we sort out these breakdowns on basis of their

percentage share. So

Problems Percentage Share Cumulative Percentage Share

Upper not available 17.49 17.49

Maintenance Problem 16.46 33.95

Cleaning & Reamer 15.43 49.38

Injection M/t Shortage 14.71 64.09

Mould Problem / Change / Adjust 11.63 75.72

Repair Work 9.98 85.70

Injection Miss + Incomplete Sole

(Scrapper Problem)

6.89 92.59

Mould Adjustment 2.88 95.47

Spray Problem 1.44 96.91

Upper not Lasted 1.23 98.14

Tip Cleaning 0.82 99.28

Discolor 0.72 100


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Graph 7: Pareto Chart for Breakdowns

0

10

20

30

40

50

60

70

80

90

100


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The graph shows that if we overcome these types of breakdowns we may avoid almost 85.70 %

breakdowns. These breakdown cause are as follows:

1. Upper not available .17.492. Maintenance Problem..16.463. Cleaning & Reamer.15.434. Injection M/t Shortage14.715. Mould Problem / Change / Adjust..11.636. Repair Work.9.98

Total 85.70

We may categorize our breakdowns into two types

y Production Breakdownsy Mechanical Breakdowns

Production breakdowns are usually because of worker carelessness regarding production. Good

production planning may help to avioid these types of breakdowns. For example if materail

shortage occurs then this is a production breakdown and proper production planning may help to

avoid such types of breakdowns. According to our research study, Repair Work, Spray Problem,

Upper not Lasted, Upper not available, Discolor, Injection M/t Shortage, Mould Adjustment, if

we add all these causes of breakdown, these result 48.45 % of all breakdowns. So if we

overcome this type of breakdown, we may improve our machine utilization up to 84 %.


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Mechanical Breakdowns are related to machines. For example, maintenance is a major issue in

mechanical breakdowns. By adopting total productive maintenance(TPM), a hell of breakdown

causes may be avoided. According to our research study, Cleaning & Reamer, Mould Problem,

Tip Cleaning, Maintenance Problem, Injection Miss + Incomplete Sole (Scrapper Problem)

If we add all these causes of breakdown, these result 51.55 % of all breakdowns. So if we

overcome this type of breakdown, we may improve our machine utilization up to 86 %.

Because of both of these breakdowns, our time loss is (0.289*450) 130 minutes. Hence our

production loss is (130 * 1.5) 195 pairs. This is the production loss per day per machine. There

are 15 such machines with the same breakdowns and with the same results. So if we overcome

these breakdowns; production breakdowns and mechanical breakdowns; we may have dramatic

improvement in our production and we will realize that our outsourced work will be reduced and

list of our subcontractors will be shortened that is currently 19 subcontractors.


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Resource Planning: 4 Ms Approach

1. Selection of Materials:Selection of materials for the product is a major role of production planning department.

Production manager must have sound Knowledge of materials and their properties, so

that he can select appropriate materials for his product. Research on materials is

necessary to find alternatives to satisfy the changing needs of the design in the product

and availability of material resumes. In selection of the materials, safety requirements,

legal and regulatory requirements are taken into considerations. Selection of the materials

becomes even more important when there are certain quality considerations. Better is the

quality of the raw material, better will be the quality of the products, more satisfied will

be the customers and higher will be the market share.


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Fig. 11: Materials Used in Shoe Manufacturing


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2. Selection of Methods:A product can be manufactured in a number of ways, using a number of methods.

Finding the best method for the process that is consistent with the available resources of

the organization including plant, machines and equipment is first priority of the

production planning department. By doing this, organization will not have to invest much

and install a separate plant for the process, they can only increase capacity of their

running plant and achieve their goals. For products which require separate production

setup, selection of production methods and identification of sequence of operations

becomes an important job for PPC department. In selection of the methods and

operations, safety consideration is of high importance. Methods and processes which are

considered dangerous and have high injury rates, cause environmental problems are of

least priority because safety and health of not only employees but of people living in

vicinities of the organization is responsibility of the organization.

3. Selection of Machines and Equipment:An operation can be performed on various types of machines which may differ in terms

of their capacity, quality of finished good, power consumption and efficiency and

effectiveness. So, production planning department has to choose from these available

choices that best suit their requirements of capacity, quality, durability and performance.

Equipment for Shoe Production at SIL:

I. Cutting Machinesi. Pattern Cutting Machines

Press Cutting Machine used for cutting of single layer

Transfer Head Cutting Machine used for cutting of multiple layers


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ii. Splitting MachinesUsed to reduce the thickness of leather as per requirement

iii. Skiving MachinesThey are used to reduce thickness of leather at the edges so that thickness

remains according to standards even at the joints.

II. Stitching Machinesi. Single Needle Machines

This is most common type of stitching machines. Most of stitching operations

are performed on these machines. They contain single stitching needle.

ii. Double Needle MachinesThey contain two stitching needles. They are used when double stitching is

required.

iii. Zigzag Stitching MachinesThese machines are used to create zigzag stitching patterns.

III. Injection Molding MachinesThese machines are used to produce sole for trainer footwear and also for some

flat shoes. Sole Making chemicals such as Polyhole, Toluene, Iso-cyanide and

some others are mixed in certain proportion and then injected in dies. Die for

every product is manufactured separately.

4. Selection of Man-PowerTo perform various tasks of the production process and keep the process running in

desired way, educated, skilled, efficient, experience and motivated labor is required. For

this purpose, organization can hire some experienced personnel in that particular field


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such as production managers, supervisors with experience, maintenance managers and

crew and other personnel as per requirement of the job. Organizations can also train their

own employees in those particular fields and develop man power of their own.

Developing man-power in house or hiring experienced personnel is a top management

decision.


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Production Control:

Control is the last element in implementation of cycle of planning, monitoring and controlling.

Information is collected about system performance, compared with desired performance level,

and actions are taken, if required, to decrease the difference. Reporting performance, comparing

the differences between actual and desired performance levels and accounting for why such

differences exist are all parts of the control process. In essence, control is the act of reducing the

difference between plan and reality.

Elements of Concern:

Control focuses on three elements;

1. Performance2. Cost3. Time

Production department is constantly concerned about these three aspects.

1. Is it delivering what it is planned to deliver or more?2. Is it delivering at or below the promised cost?3. Is it making delivery at or before the promised time?

It is strangely easy to lose sight of these fundamental targets, especially, in large productions.

Large projects develop their own momentum and tend to get out of hands, going their own way

independent of wishes of the production department and the intent of the proposal.


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1. PerformanceProduction department is responsible to minimize issues relating to performance of the

production system. Such issues can be;

i. Arise of unexpected technical problemsii. Deficiency of resources when needed

iii. Insurmountable technical difficulties are presentiv. Quality or reliability problemsv. Requirement of changes in system on part of clients

vi. Arise of inter-functional complications2. Cost

i. Technical difficulties require more resourcesii. The scope of work increases

iii. Too low initial bids or estimatesiv. Corrective control was not exercised in timev. Changes in input price

vi. Poor or un-timely reportingvii. In-adequate budgeting

3. Timei. Technical difficulties take longer than expected to solve

ii. Optimistic initial time estimatesiii. Incorrect task sequencingiv. Un-availability of required inputs of material, personnel and equipmentv. Incomplete necessary preceding tasks


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vi. Customer-generated changed orders required re-workvii. Alteration in govt. regulations

These are only a few of the relatively mechanistic problems that can occur. Actually, there are

no purely mechanistic problems. All problems have a human element too. For example, humans,

by action or in-action, set a large chain of events that leads to failure to budget adequately,

creates a quality problem, leads the production down a technically difficult path or fails to note a

change in govt. regulations. If by chance, some of these or other things happen, as a result of

human action or not, humans are affected by them. Frustration, pleasure, determination,

hopelessness, anger and many other emotions arise during the course of production. They affect

the work of individuals who feel them for better or worse. It is over this welter of confusion,

emotion, fallibility and general cussedness that the production control department tries to control.

Fundamental Purpose of Production Control

There are two fundamental objectives of production control

i. Regulation of results through the alteration of objectivesii. Stewardship of resources of organization

Most discussions of control function are focused on regulations. Production department needs to

b equally attentive to both regulations and conversations. Production department must guard the

physical assets of the organization, its human resources, and its financial resources. The

processes for conserving these three different kinds of assets are different.


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1. Physical Asset ControlPhysical asset control requires control of use of physical assets. It is concerned with asset

maintenance, whether preventive or corrective. Timing of maintenance and quality of

maintenance are also important issues. If the production uses considerable amount of

physical equipment, production control has the problem of setting up maintenance

schedules in such a way as to keep the equipment in operating condition while

minimizing the interference with ongoing work. It is critical to accomplish preventive

maintenance prior to the start of that final section of the production known as last minute

panic (LMP).

2. Human Resource ControlStewardship of the human resources requires controlling and maintaining the growth and

development of the people. They provide particularly fertile for cultivating people

Note:

Timing of the LMP is not known, which makes the planning for pre-LMP preventive

maintenance somewhat difficult.

Physical inventory, whether equipment or material, must also be controlled. It must be

received, inspected or certified and possibly stored prior to use. Records of all in

coming shipments must be carefully validated so that payment to suppliers can be

authorized. The same precautions applied to goods from external suppliers must also

be applied to suppliers from inside the organization.


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because they are unique, differing one from another in many ways. It is possible for

people working on them to gain a wide range of experience.

3. Financial Resource ControlThough accountants have not succeeded in developing acceptable human resource

accounting, their work on techniques for conservation and regulation of financial

resources has most certainly resulted in excellent tools for financial control. It is difficult

to separate the control mechanism aimed at conservation of financial resources from

those focused on regulating resource use. Most financial controls do both. Capital

investment controls work to conserve the organizations assets by insisting that certain

conditions be met before capital can be expended, and those same conditions usually

regulate the use of capital to achieve the organization goal of a high return on

investments.

Functions of PPC at Control Stage

1. Estimating:To fix up the Production targets and delivery dates and to keep the production costs at

minimum, production management department does a thorough estimation of Production

times and production costs. In competitive situation this will help the management to

decide what should be done in arresting the costs at desired level.

A sample of estimate sheet is given here.


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Estimate Sheet

Plan issued:

Plan Status:

Cutting dept: Upper Cutting + Assembly

Closing dept: Closing/Stitching Section

Article: plan pairs: code:

ref# : month:

Cutting date: Plan Id#: cartons 39 40 41 42 43 44 45 *** Total

Raw Material Requirement U/M

Tape Magic Soft 50 mm Black-01 Mtr

Tape Magic Hard 50mm Black-01 Mtr

Tape Magic Soft 30mm Black-01 Mtr

Tape Magic Hard 30mm Black -01 Mtr

Leather Buff Nubuck Milled Dollar Printed 1.4-1.6mm Light Brown SFT

Fabric Non Woven Cambrella Coated (imp) 150 gm/l .yds Width 44 D/Brown Mtr

Assembly Fabric Play Boy Black+ eva 1.5 mm + Paly Boy Black Width 50 Mtr

Fabric Knitted Polyester Play Boy Ribbed 3.50 oz/yd sqr. Min.width 41/42 Mtr


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Packing Material Requirement

Label Sticker Servis Price for LSF Nos

Rubber Natural Latex 60 % Liquid Kgs

Carton 5-ply 795*420*355 mm Nos

80X Shoe E.Flute Breezer 335 Nos

Bag Shopper Nos

Tape PVC Printed Rol

Stuffing Sheet Sht

Stuffing Paper Poster RIM

Tie Nylon Tag String Nos

Tag Breezer Nos

Special Instructions:

_____________________________________________________________________________________

_____________________________________________________________________________________

_____________________________________________________________________________________

_____________________________________________________________________________________

_____________________________________________________________________________________


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2. Loading and Scheduling:The Production Management department draws the time table for various production

activities, specifying when to start and when to finish the process required. It also has to

draw the timings of materials movement and plan the activities of manpower. The

scheduling is to be done keeping in mind the loads on hand and capacities of facilities

available.

3. Routing:This is the most important function of Production Management department. The Routing

consists of fixing the flow lines for various raw materials, components etc., from the

stores to the packing of finished product, so that all concerned knows what exactly is

happening on the shop floor.

4. Dispatching:The Production Management department prepares various documents such as Job Cards,

Route sheets, Move Cards, Inspection Cards for each and every component of the

product. These are prepared in a set of five copies. These documents are to be released

from Production Management department to give green signal for starting the production.

The activities of the shop floor will follow the instructions given in these documents.

Activity of releasing the document is known as dispatching.


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5. Expediting or Follow up:Once the documents are dispatched, the management wants to know whether the

activities are being carried out as per the plans or not. Expediting engineers go round the

production floor along with the plans, compare the actual with the plan and feed back the

progress of the work to the management. This will help the management to evaluate the

plans.


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Date:_______________

Daily Production Report

Job

OrderNo

Order

Size

Opening

Balance

(Quantity)

Quantity to be

Produced

Issued to

Dept

Balance in

Stock

Return Wastage

Prepared By:________________________ Approved By:_________________________


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Labor Report

Name of

Employee

Working Hours

Total Normal Over Time

Machine Timing Report

On Off Fault

Machine Efficiency: __________________


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6. Inspection:Here inspection is generally concerned with the inspection activities during production,

but a separate quality control department does the quality inspection, which is not under

the control of Production Management. This is true because, if the quality inspection is

given to production Management, then there is a chance of qualifying the defective

products also. For example Teaching and examining of students is given to the same

person, and then there is a possibility of passing all the students in the first grade. To

avoid this situation an external person does correction of answer scripts, so that the

quality of answers is correctly judged.

Samples of Daily Inspection Report and Daily Rejection Sheet are given here.


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Inspection & Testing Report

Sr No PO No Job No Operator Name Description of Material Length Weight Finishing

Prepared By Checked By Final Inspection By Final Inspection By

Packing Incharge Q. Controller QC Manager ProductionManager


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Daily Rejection Sheet

Department: __________________

Article: ______________________

Date: ________________________

Plan No.: _____________________

Pairs: ________________________

Sr No Operations TotalNon-Conformity Repairs Remarks

1 Leather Defect

2 Pasting/ Discolored

3 Back Stitching4 Counter Stitching

5 Upper Binding

6 Upper Joining

7 Upper Imitation

8 Eyelet Fitting

9 Zigzag Fault

10 Eyeleting

11 Side Punch/ Strip

12 Thread Decoration

13 Foam Collar

14 Double Punch

15 Damage

Total: ______________________

Rejection Percent: ____________

Quality Inspector


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7. Evaluation:The Production department evaluates itself and its contribution in fulfilling the corporate

objectives and the departmental objectives. This is necessary for setting up the standards

for future. What ever may be the size of the firm; Production management department

alone must do Routing, Scheduling, Loading, Dispatching and expediting. This is

because this department knows very well regarding materials, Methods, and available

resources etc. If the firms are small, all the above-mentioned functions ( i to x) are to be

carried out by Production Management Department. In medium sized firms in addition to

Routing, Scheduling and Loading, Dispatching and expediting, some more functions like

Methods, Machines may be under the control of Production Management Department. In

large firms, there will be Separate departments for Methods, Machines, Materials and

others but routing, loading and scheduling are the sole functions of Production

Management.

Post Control

Post control is also known as post performance control or post project control. Post control

document contains a description of the objectives of the production. Usually the description is

taken from the proposal and entire proposal often appears as an appendix to the post control

report. As objectives include the effects of all change orders issued and approved during the

execution process.

Post control document also contains a report of performance against the planned schedule and

budget. This can be prepared by combining and editing the various status reports made during

the production. Significant deviations of actual schedule and budget from planned schedule and


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budget should be highlighted. Explanations of why these deviations occurred are also included in

post control report.

Final Report on Production Results

When significant variations of actual performance from planned performance are indicated, no

distinction is made between favorable and unfavorable variations. Managers focus their attention

on the trouble, use tools like

i. Cause and effect diagramii. Failure mode and effect analysis

Complete documents are developed regarding reasons of the variations or failure, recommended

actions to solve the problem and suggestions for the future so that the problem will not arise

again.

A specimen of Daily Production Report is given here.


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Scheduling

Determining when an activity should start or end, depending on its

1. Duration2. Predecessor activity (or activities)3. Predecessor relationships4. Resource availability5. Target completion date of the project.Scheduling pertains to establishing both the timing and use of resources within an

organization. Under the operations function (both manufacturing and services), scheduling

relates to use of equipment and facilities, the scheduling of human activities, and receipt of

materials. Generally, scheduling objectives deals with tradeoffs among conflicting goals for

efficient utilization of labor and equipment, lead time, inventory levels, and processing times.

Approaches to Scheduling

There are two general approaches to scheduling:

1. Forward SchedulingWith forward scheduling, the scheduler selects a planned order release date and

schedules all activities from this point forward in time.


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2. Backward Scheduling: Scheduling Approach used SILWith backward scheduling, the scheduler begins with a planned receipt date or due date

and moves backward in time, according to the required processing times, until he or she

reaches the point where the order will be released.

As long as the concepts are applied properly, the choice of methods is not significant. In fact, if

process lead times (move, queue and setup times) add to the job lead time and process time is

assumed to occur at the end of process time, then forward scheduling and backward scheduling

yield the same result.

Loading

Loading involves assigning jobs to work centers and to various machines in the work centers. If

a job can be processed on only one machine, no difficulty is presented. However, if a job can be

loaded on multiple work centers or machines, and there are multiple jobs to process, the

assignment process becomes more complicated. The scheduler needs some way to assign jobs to

the centers in such a way that processing and setups are minimized along with idle time and

throughput time.

Approaches to Loading

Two approaches are used for loading work centers

1. Infinite LoadingWith infinite loading, jobs are assigned to work centers without regard for capacity of

the work center. Priority rules are appropriate for use under the infinite loading


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approach. Jobs are loaded at work centers according to the chosen priority rule. This

is known as vertical loading.

2. Finite Loading: Approach being used at SILFinite loading projects the actual start and stop times of each job at each work center.

Capacity of each work center is taken into consideration and compared with the

processing time so that process time does not exceed capacity. With finite loading,

job that has the highest priority is loaded on all work centers it will require. Then the

job with the next highest priority is loaded on all required work centers, and so on.

This process is referred to as horizontal loading. A drawback of horizontal loading is

that jobs may be kept waiting at a work center, even though the work center is idle.

This happens when a higher priority job is expected to arrive shortly. The work center

is kept idle so that it will be ready to process the higher priority job as soon as it

arrives. This was a problem which was considered during machine utilization

improvement work.


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Sequencing

Sequencing is concerned with determining the order in which jobs are processed. Not only must

the order be determined for processing jobs at work centers but also for work processed at

individual work stations. When work centers are heavily loaded and lengthy jobs are involved,

the situation can become complicated. The order of processing can be crucial when it comes to

the cost of waiting to be processed and the cost of idle time at work centers.

There are a number of priority rules or heuristics that can be used to select the order of jobs

waiting for processing.

y Random (R). Pick any job in the queu

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Production Planning and Logistic Systems 2