Production management


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Production management

  1. 1. Production ManagementPresentation Subtitle By Harsh ray
  2. 2. Production management Production management means planning, organizing, directing and controlling of production activities. Production management deals with converting raw materials into finished goods or products. It brings together the 6Ms i.e. men, money, machines, materials, methods and markets to satisfy the wants of the people.
  3. 3. Product Life Cycle (PLC)Each product may have a different life cyclePLC determines revenue earnedContributes to strategic marketing planningMay help the firm to identify when a product needs support, redesign, reinvigorating, withdrawal, etc.May help in new product development planningMay help in forecasting and managing cash flow
  4. 4. The Stages of theproduct life cycle  Development
  5. 5. Product Development New ideas Market analysis – is it wanted? Can it be produced at a profit? Who is it likely to be aimed at? Test Marketing – possibly local/regional Analysis of test marketing results and amendment of product/production process Preparations for launch – publicity, marketing campaign
  6. 6. The Stages of the product life cycle DevelopmentIntroduction
  7. 7. Product Introduction Advertising and promotion campaigns Target campaign at specific audience? Monitor initial sales Maximise publicity High cost/low sales Length of time – type of product
  8. 8. The Stages of the product life cycle DevelopmentIntroductionGrowth
  9. 9. Product Growth Increased consumer awareness Sales rise Revenues increase Costs - fixed costs/variable costs, profits may be made Monitor market – competitors reaction?
  10. 10. The Stages of the product life cycle DevelopmentIntroductionGrowth Maturity
  11. 11. Product MaturitySales reach peakCost of supporting the product declinesRatio of revenue to cost highSales growth likely to be lowMarket share may be highCompetition likely to be greaterPrice elasticity of demand?Monitor market – changes/amendments/new strategies?
  12. 12. The Stages of the product life cycle DevelopmentIntroductionGrowth Maturity Saturation
  13. 13. Product Saturation• New entrants likely to mean market is ‘flooded’• Necessity to develop new strategies becomes more pressing: – Searching out new markets: • Linking to changing fashions • Seeking new or exploiting market segments • Linking to joint ventures – media/music, etc. – Developing new uses – Focus on adapting the product – Re-packaging or format – Improving the standard or quality – Developing the product range
  14. 14. The Stages of the product life cycle DevelopmentIntroductionGrowth Maturity Saturation Decline Withdrawal
  15. 15. Product Decline and Withdrawal– Product outlives/outgrows its usefulness/value– Fashions change– Technology changes– Sales decline– Cost of supporting starts to rise too far– Decision to withdraw may be dependent on availability of new products and whether fashions/trends will come around again?