Pom1

PRODUCTION & OPERATION MANAGEMENT
MBA II Sem.
Unit 1 :
Introduction to Production Management : Production Management,
Objectives, functions, meaning, nature and significant scope. Relationship
of production with other functions areas. Types of production: intermittent
production, continuous production and job shop production.
Production Management:
Production is creation of utility. Production function creates utility by providing
form, time and place utilities for the produced goods. Manufacturing provides
form and utility while distribution provides time and place utility. Operation is
defined as a transformation process. Production is concerned with design and
control systems that use raw materials, human resources, equipment and
facilities in the development of a product or service. The transformation process
is a series of activities that produces value. Ex: steel sheets are formed into
different parts and assembled as per requirement. Various grades of bauxite
are mixed, heated and cast into ingots in an aluminum factory. Patients are
cured through various processes such as medication, laboratory tests, meals,
operations, etc., in a hospital.
Production can be defined as a step-by-step conversion of one form of material
into another form through chemical or mechanical process to create or enhance
the utility for the user. Thus production is a value addition process. “Production
is a process by which goods and services are created”. Elwood Buffa.
Production management is a process of planning, organizing, directing and
controlling the activities of the production function. “Production management
deals with decision-making related to production processes so that the
resulting goods or services are produced according to specifications, in
the amounts and by the schedule demanded and at minimum cost.” - E.
Buffa.
“ Production Management is the process of effective planning and
regulating the operations of that part of an enterprise that is responsible
for the actual transformation of materials into finished goods.” E.C. Brech
“Production management is not the application of tools to materials, but,
the application of logic to work.” - Peter Drucker

Te objective of production management is to produce goods or services of right
quality and quantity at pre-determined tie and pre-established cost. The
objectives are reflected in;
1. Right quality, 2. Right quantity 3. Pre-determined time 4. Preestablished cost.
Main Objectives:
1. Right Quality: The quality of a product is based upon the customer’s
need. Customers’ needs are translated into products by the product or
design engineering department. The manufacturing department then
translates these specifications into measurable objectives. The cost
decides the final quality of the product. The product must be within the
pre-established cost.
2. Right Quantity: Products should be manufactured as per demand. If
more than demand is produced, capital will be blocked up in the form of
inventory. Shortage will lead to repeated cycles of production which, in
turn, will lead to extra cost of manufacturing and wastage of time.
3. Manufacturing Costs: Manufacturing costs are established before the
product is actually manufactured. Any variation between the actual cost
and the pre-determined cost should be kept at the minimum. The
objective is also to reduce the cost of production and to maximize the
profit of an organization.
4. Manufacturing Schedule: Timeliness of production and delivery is one
of the important parameters to judge the effectiveness of the production
department. The production department has to keep in mind various
obstacles such as non-availability of material, absenteeism, machinebreakdown, environmental problems, etc., while determining the
manufacturing schedule. For this, optimal use of resources must be
made.
Subordinate objectives:
1. Machinery & Equipments: The machinery and equipment should be
such that they should be able to produce the desired products as per
the specifications and accuracy required. The total cost of procurement
and running should be reasonable and minimum. The objective should
be to utilize the machinery to the maximum extent.
2. Materials: The material, as per specifications, should be made available
as per requirement and schedule, at the most economic price.
Production department should ensure maximum utilization and minimum
wastage and scrap.
3. Manpower:
The success of production depends to a large extent on
the type of manpower the organization has. Potential skills of the
workers should be channalised and utilized in a constructive manner for
optimal outputs.

Objectives:

4. Supporting Sevices: Supporting services aid in the maximisation of
utilisation of the main departments.

2.

Process design and planning: This involves the appropriate
technology for the conversion of raw material into desired products.
The choice of technology will depend on various factors such as
demand, investment capability, labour availability, degree of
automation required, etc.

3.

Facilities Location and Layout Planning: Due consideration must
be given to facilities location as location, once decided upon will not
be altered in the near future.

4.

Design of material handling system: Handling of material should
be kept at minimum, though it is not possible to avoid all material
handling. Due thought should be given to the material handling
which will depend to a great extent on the nature of product,
distance between work stations, intensity of flow or traffic and size,
shape and nature of material to be handled.

A healthy mixture of the above factors helps the company to satisfy
customers and increase the value of the company in the market, leading to
enhanced profitability.
FUNCTIONS OF PROD. MGMT.:
The functions of Production Management are :
(i)
To convert available capital to physical resources required for
production.
(ii)
To convert the physical resources to salable goods and
services.
For this the managers must;
(a) Produce goods at the right time and the right quantity to meet the
demand.
(b) Produce goods at minimum cost .
(c) Produce goods of acceptable quality through TQM and SQC
Functions of Production Managers are;
1. Forecasting the demand for the products.
2. Determining the requirements of various resources to meet the
demands.
3. Arranging for the procurement of the various factors.
4. Arranging for services such as maintenance, store keeping,
material handling, inspection, quality control, etc., to meet targeted
level of production.
5. Effectively utilizing the factors of production.
6. Helps in determining Plant location as well as layouts.
7. Helps in material handling
8. Helps in Inventory Control.
9. Helps in quality control

Capacity Planning:
This decision is concerned with the procurement of fixed assets like plant
and machinery. It is at this stage that decisions regarding the size,
capacity out etc., are taken. The operational or production level planning
will, however, be short term decisions. These are;
1. Production Planning: It is concerned with the future course of action
regarding production to realize the organizational objectives.
2. Production Control: It is a management technique that sees to it
that activities are carried out as per plan. Production planning deals
with the out put and to takes corrective action in case of deviation
from plans or norms.
3. Other activities:
Other activities include inventory control,
maintenance and replacement, cost reduction and control and system
design.
SIGNIFICANCE OF PROD. MGMT:
a. To customers:
1. Easy availability of products
2. Reliable quantity of products.
3. Availability of products at reasonable rates.
4. Timely delivery of goods.

SCOPE OF PROD. MGMT
The objectives of Production Management are aimed at satisfying the needs
of the customer. The scope of Prod. Mgmt can be considered to be as
follows;
Strategic level decision:
1.
New product design and identification.
The success of any
organisation depends upon the product mix that it offers to the
customers. The products should be designed in such a way as to
meet the expectations and needs of the customers. The cost should
also be acceptable to them.

b. To Investors:
i. 1. High return of investment.
ii. Capital appreciation.
1.
2.

c. For Community:
Economic and social stabilization.
Satisfaction among members of community.

1.
2.
3.
4.
5.

d. To Employees:
Higher remuneration
Stable employment
Security of jobs.
Better working conditions.
All round security and prosperity to bring about national
benefits.

Relationship of Production with Other Functional Areas:
Production systems are one of the many subsystems of larger
organizational systems. Each subsystem is independent and at the same
time, interdependent. They are independent in the sense that each
functional subsystem has its own objectives and goals. At the same time,
they are functionally related with other subsystems of the organization.
The goals and objectives of the subsystem is supportive to achieve the
goals of the organization. The relationship may be enumerated as below;
Marketing: The production department transforms facilities into products
as per the identification and forecasting of product department of the
Marketing Department. The relationship is crucial because they are
strongly dependent on each other. The production department seeks the
following information from the marketing department.
(i)
Need of the customer with respect to the product and
services produced by the company.
(ii)
The demand for the product and the likely market trend for
the future period.
(iii)
Special features required by customers in the form of
feedback regarding acceptability, performance, change in
taste, preferences, drawbacks, etc.
(iv)
Delivery and product mix required by the customer.
The marketing department requires the following information from the
production department;
(i)
Production status of the products.
(ii)
Performance characteristics of the products.
(iii)
Delivery schedule as per the production plan
(iv)
Product features and specifications.
Many a times the objectives of the production and marketing
departments are conflicting. Marketing department requires a variety of
products and they want all the products to be on the production line all
the time sio that they can satisfy all customers all the time.
However, production and manufacturing efficiency is maximum when
the variety of products being manufactures is minimum. This will reduce
the set cost and time lost, especially in continuous productions.

A compromise has to be made to maximum the attainment of the
objectives of the organization. Based on the information and feedback
received from the marketing department, the production department
should plan, organize and execute production.
Finance: Finance is the bloodline of business and it is the Finance
Department which sets the wheels of production rolling. The production
department has to invest in capital facilities, raw material and
component parts. Wages and salaries have to be disbursed. Payments
have to be made to suppliers. The Finance Department has to make
plans for both long-term and short-term requirements of funds.
The production department has to furnish the detailed production
budgets to Finance Department so that funds can be made available
and released on time.
Personnel: The success of the production process depends largely on
the quality, attitudes and skills of the employees. The responsibility of
matching the job and the person lies with the Personnel Department.
The Personnel Department has to keep records of the development of
the employees and identify their training needs and weaknesses and
strengths.
In order to achieve production goals, the Production Department has to
inform the Personnel Department of the type of people and the kills
required in the department.
Materials Management: The production department, based on the
forecasts made by the marketing department, spells out the requirement
of materials. The success of the production department depends upon
the smooth flow of materials between the various workstations. The
Materials Management Department makes available the proper quantity
of specified material at the proper time. The Materials Department
selects the source of supply. The vendors are rated by them and
purchase of material is made by them. They also control inventory,
which has a direct bearing on the cost of production. The failure on the
parts of Materials Management Department to keep up the required flow
of material will have a negative effect on production.
Maintenance: There is a direct relationship between production and
maintenance department. The efficiency of the maintenance of the
equipments enhances the efficiency of production. A good and effective
maintenance department is characterized by
- Less breakdowns and hence less loss of time.
- Increase in Equipment/ machinery availability.
- Non-stop production.
- Higher utilization of equipment/ machinery.
- No process defects or reduced yields.

Production Planning and Control : PPC helps to achieve
uninterrupted flow of materials through production line by making
available of materials at the right time in required quantity. It deals with
activities such as process selection, process planning, loading,
scheduling and sequencing. Production Planning prepares the timetable of production. The PPC department will try to deviate all sorts of
obstacles from production. The department will try to sense the various
problems that may arise. Thus successful production depends on the
accuracy of the PPC Department.
Research & Development:
R&D develops new products and
improves the design of existing products in order to make it more useful
and desirable for the customer. Design Department’s output will be in
the form of drawings. The designer must prepare the designs in
consultation with the production department to ensure that it is feasible
to make the new product, with available resources.

Production systems
:
:
:
:
:
:
Continuous Production
Intermittent Production
:
:
:
:
Mass Pr.
Process Pr. Assembly
Job Prod Sys
Batch Prod. Sys
System
System
Line
:
:
Analytical __
:__
Synthetic
Prod System
Prod System

Thus it is seen that functional co-ordination between various
departments is essential for effective and optimal production to achieve
the goals of the organization.
TYPES OF PRODUCTION:

PRODUCTION SYSTEMS:
A system is a logical arrangement of components designed to achieve particular
objectives, according to pre designed plan.
Prodn Systems are frameworks within which prodn activities of an orgn are
carried out.
Input - Receiving Oprns. -- Storage - Processing operations :
:
:
:
:
storage ..V

Out put -

Shipping Operations

-

Finished good

V

Thus production system refers to the system by which various inputs are
combined and transformed to obtain desired outputs. It is a mechanism for
converting material into finished goods and services.
A production system is said to be efficient when it achieves the best balance of
resources, ie., it maintains the input or resource usage per unit of output.

The production system that a company uses will depend upon the type
of product that it will offer to the customer and the strategy it will employ
to satisfy the customer. Basically, production systems can be
categorized as;
-

Make to Stock Production
Make to Order Production
Assemble-to-Order Production

Make to Stock Production: In this system, manufactured stocks or
finished goods are kept in the inventory for immediate shipment or
supply. This system ensures immediate delivery of good quality,
reasonably priced, off the shelf standard products.
Eg: automobile bearings, ready to wear garments, nuts and bolts,
motors, televisions, etc.
This system implies that the products are well known, with predictable
type of demand pattern. Operation management focuses entirely on
replenishment of inventory. Actual, single customers’ orders cannot be
identified or catered to. The production volume of each sales unit tends
to be high and customer’s delivery time is usually determined by the
availability of finished goods. The finished good act as a buffer against
uncertain demand and stock out situation. The main advantage of this
system is the short delivery time. Disadvantage is high cost of inventory
and inability to satisfy each customer with specialized products.
Situations for Make to Stock Production:

3.
4.
5.
6.

Fairly constant and predictable demand.
Products are few and they are standardized.
Short delivery time expected by the customer.
Products with high shelf-life.

1.
2.
3.
4.

Information required:
Forecasted demand for the planned period.
starting inventory level
Desired ending inventory level
Back orders.

Assemble-To-Order Production System: When a number of alternative
combinations or options are available to customers and the customer is not
willing to wait until the product is made, manufacturers resort to the assembleto-order production system. Manufacture produce and stock standard
component parts. When the customers place the order, the manufacturer does
the assembling from the parts and components selected by the customer. Since
the parts and components are already made and stocked, the only time taken is
the time to assemble it.. This leads to lower costs and short lead time. Ex:
Consumer electronics goods and computers. Ordering of food at restaurants.

otal Production = Forecasted demand + Back orders + Ending Inventory - Opening Inventory.

Comparisons between the systems:
Theses are generally mass consumed items and pass through multiple channels
before reaching the end user. Most of the data about the customer is not
known. Feedback from distributors will have to be depended upon. Demand is
calculated from the feedback given by distributors.

Particulars
Make to Stock
Make to Order
Assemble to O
------------------------------------------------------------------------------------------------------------------------------------------1. Product Range
Low
High
Medium/ High

This system is characterized by :
- less complex production
- process and product standardization
- fairly constant demand and hence production.

3. Lead Time

2. Production Volume

High
Low

4. Customer producer interface
5. Handling of fluctuations in
Demand

Limited/distant
Safety stock
Of product
Units

6. Basis of planning

Make to Order : Some companies start production only after receiving specific
orders. Products are not supplied from existing stock and hence the lead time,
ie., the time taken from production to delivery, is long. This kind of production is
usually made for products that require custom design components. Generally
the basis components along with the engineering design are available with the
company, but the product is not completely specified. The production starts
when the customer specifies his requirement.

7. Inventory Level

8. Product category & cost

Low

End item
Forecasts
High F.G.

Medium
High

Med

High at sales & design
Planning of excess
capacity & raw
material stock

High at sales

Planning of
standard modules
& parts

Back logs &
Backlogs & trend
marketing intellianalysis
gence reports

Low inventory level
Major modules/
Inventory &
& associated carrying
carrying costs
cost

Standardised with
Special products
Low cost/ unit
high cost/unit

parts held in
inventory
Modular parts

price/unit

Made to order is a demand responsive strategy and only the product and the
design components such as raw material are held in stock. Ex: Custom tailored
clothes, special purpose machinery. Very expensive products are usually made
to order.
This system is characterized by;
- Manufacturing is done to customer’s specifications
- The customer is willing to wait as lead time is long.
- Product is expensive to store and non-standard.
- When there are several product options to store.
There is direct interaction with customer at all stages, but especially so at the
Engineering phase. Usually there is negotiation about time of delivery and cost
of product. Production schedule changes as per requirement of the customer.
Capacity utilization is usually low and there is no stock Planning and shop floor
control is critical and distribution is less complicated.

TYPES OF PRODUCTION SYSTEMS:

Production activities are classified according to the volume/ quantity and
standardization of product as follows;
•
•
•
•

Job Shop Production
Batch Intermittent Production
Continuous Production
Cellular Production

me

•

High cost of material handling and larger space requirement.

Job Shop Production :
Job Shop Production systems are characterized by the manufacturing of one or
few quantity of products designed or produced as per the specification of
customers., within prefixed time and cost. The distinguishing feature of job shop
is low volume and high variety of products.
Examples of products manufactured bu job shop industries include space
vehicles, aircrafts, machine tools, special purpose machines, tooling and jigs
and fixtures, custom clothing, large turbo generators, etc.
A job shop typically comprises of general-purpose machines arranged into
different departments. Each job requires unique technological requirements, and
demands processing in certain sequence. Because of high variety, scheduling
becomes complicated.
Characteristics of Job Order Production;
•
•
•
•
•
•
•
•
•
•
•
•

High variety of products and low volume.
Use of general purpose machines and facilities.
Highly skilled operators who can take up the challenge of unique
jobs.
Frequently changing set ups.
Process (functional) type layout for arrangement of facilities.
Large inventory of materials, tools and parts.
Movement of material is long and interrupted.
Relative imbalance of workload in different departments.
Functional departmentalization.
Requires numerous job instructions.
Detailed planning and sequencing involved.
Many products are produced so material handling has to be
modified.

Advantages:
• A variety of products can be processed.
• Because each job gives them a learning opportunity, operators
become more competent and skilled.
• All potentials of operators are utilized.
• Opportunity to use innovative and creative methods.
Disadvantages:
• Higher set and tooling set cost due to frequent changes.
• Higher levels of raw material and in process inventory.
• Production planning is difficult and complicated.
• Highly competent and skilled manpower is required.
• Product cost is high.

Project Industries:
The key feature of the project type industries is that the materials, tools,
equipments and personnel are brought to the location where the [product is to
be fabricated. Project is defined as an attempt with a specific objective to be met
within a specified and prescribed time and cost limitations. It is a one at a time
major task such as construction, ship building, erection and commissioning of
plants. It is a site type of organization and based on a single product, generally
of a large size which takes months or years for completion. Each project is
unique.
Characteristics:
• Project has a definite start and finish.
• It needs resources and skills of diversified nature.
• It has definite and definable goals or end that can be defined in
terms of costs, schedules and performance requirements.
• Projects constitute distinct activities which constitute Project Life
Cycle.
Planning and scheduling of activities and procurement function are critical to the
success of the project. Inventory is mainly concerned in the product itself.
Reducing inventory simply means shortening the delivery time and is equivalent
of using the equipment to the maximum of its capacity. The objectives of
manufacturing, namely minimizing delivery lead time and inventory investment
and maximizing equipment utilization usually conflict against each other. PERT
and CPM methods are utilized in this kind of production.
Batch production is characterized by the manufacture of limited number of
products, produced at regular intervals and stock awaiting sales. Materials tend
to be more complex and the facilities can be used for producing another batch of
product between two successive productions runs.
Batch production is justified when the production rate exceeds the demand rate.
The batch quantities are decided based on the balancing of two cost factors; the
set-up cost and the inventory carrying cost. It aims at satisfying the continuous
demand for an item, though the plant is capable of producing excess to demand
rate. The shop produces enough to build up an inventory and then moves on to
production of other items. When the stock of the first item comes down, it is
produced once again. This intermittent production caters to make to stock,
assemble to order and also to make to order manufacturing environment.
Machines used for batch production are general-purpose machines, designed
for higher production rates. These machines , with a little alteration, are then
used to produce other items.
Characteristics of Batch Production:

6. Short production runs.
7. Plant and machinery are set up to produce one item and
then re set to produce another batch of items.
8. There are more number of set ups and hence higher set up
costs.
9. Amount of supervision required less than in job orders.
10. Plant and Machinery are flexible.
11. Manufacturing lead time and also cost are lower than in job
order production.
12. There is higher level of work-in-process inventory.
13. Flexible material handling system.
Advantages:

•
•
•
•
•
•

Limitations:
•
•
•
•
•
•

Better utilization of plant & machinery
Promotes functional specialization.
Cost per unit is lower than in job order
production.
Lower investment in plant & machinery.
Flexibility to produce a number of items.
Job satisfaction for operators.

Material handling is complex owing to irregular & longer
flows.
Production planning & control is complex.
Work-in-process inventory is high.
Longer production time.
Higher set up costs
Lower utilization of production facilities as compared to
mass production.

PROCESS INDUSTRIES
PROCESS PRODUCTION)

(FLOW

PRODUCTION

OR

CONTINUOUS

Process manufacturing is defined as the production that adds value by mixing,
separating, forming and performing chemical reactions. It may be carried out in
either batch or continuous mode. Such industries produce highly standardized
non-discrete products in extremely large volumes, in a continuous process.
These industries develop extensive long range resource requirement and they
are capital intensive. The capital budgeting is crucial to financial performance.
Plant location, plant capacity, long range plan for materials, manpower, energy
and waste disposal are extremely important aspects for this kind of industry.
Maintenance planning is also extremely important. Such industries sell a high
volume of goods and production differentiation in not very obvious. Marketing
strategy focuses on availability and price.. The process follows a fixed sequence
of operations. High automation is possible.

Characteristics of Process Industry (Flow Production):
• Dedicated plant and equipments with zero flexibility.
• Material handling is fully or mostly automated.
• Flow is measured by weight or volume.
• Shorter lead time.
• Products cannot be disassembled and components cannot be
identified with final product.
• The end product is not divisible and a separate process is required
to make it ready for the market.
• These are capital intensive units requiring large investments.
• Process follows a predetermined flow of investments.
• Maintenance is an important aspect.
• Unit cost is lower due to high volume of output.
• Planning and scheduling is a routine action.
• Operators do not have to be highly skilled..
Special features:
• Variation in raw material quality due to different sources of supply.
• Processing technology variations.
• Variations in the yield of output.
• Demand for by-products and joint products.
• Shelf life of raw materials.
• Product differentiation is limited.
• Plant availability depends on prevention maintenance.

TYPES OF PRODUCTION:
1.
Job-Type Production:
In this type of production, one or a few items of the
product is made, especially as per the specific design of
the customer, within a settled cost and time.
Characteristics of Job Order Production;
•
•
•
•
•
•
•
•

High variety of products and low volume.
Use of general purpose machines and facilities.
Highly skilled operators who can take up the challenge of unique jobs.
Frequently changing set ups.
Process (functional) type layout for arrangement of facilities.
Large inventory of materials, tools and parts.
Movement of material is long and interrupted.
Relative imbalance of workload in different departments.

•
•
•
•

Functional departmentalization.
Requires numerous job instructions.
Detailed planning and sequencing involved.
Many products are produced so material handling has to be modified.

Batch-Type Production:
Batch-type of production is characterized by manufacture of
limited number products at regular interval and stocked to await
sales. Examples of such production are: medicines, chemicals,
assembly shops etc.
Characteristics of Batch production:
14. Short production runs.
15. Plant and machinery are set up to produce one item and then re
set to produce another batch of items.
16. There are more number of set ups and hence higher set up
costs.
17. Amount of supervision required less than in job orders.
18. Plant and Machinery are flexible.
19. Manufacturing lead time and also cost are lower than in job
order production.
20. There is higher level of work-in-process inventory.
21. Flexible material handling system.

Types of Manufacturing systems :
High

Job
Type

/i
i
Variety
Batch
Type
/i
i
Mass Production
Low
_______________________________________
_
Low
->
->
High
Volume
Types of manufacturing systems

MASS PRODUCTION:
Mass production is also referred to Continuous production. The production
facilities are arranged as per the sequence of production operation, from the
beginning to the finished product. This flow is maintained through material
handling equipments such as conveyor belts, transfer devices, etc. Assembly
line production is an example.
Characteristics of Mass Production:
• Flow of material is continuous
• Special purpose machines are used
• Amount of supervision is less
• Material handling systems are mechanized.
• Lower skilled persons can manage operation
• Short-cycle time
• Work-in-process is comparatively low
• High inventory of raw material
• Little flexibility of equipment and machine.

CELLULAR PRODUCTION
The Cellular production system is based on group technology which seeks to
achieve superior performance by exploiting similarities in the parts. Groups or
parts that have similar requirements are group into families. After the parts are
divided into families, a cell which has all the equipments and facilities required
by the parts is created. A team is responsible for organizing work within a cell.
Based on the date of requirement, the cell members schedule the work. Cellular
manufacturing combines the advantages of job shop to obtain high variety and
the reduced cost of mass production. Cellular processes are used as a
substitute for job shop process that need increased productivity. They are being
used for service operations also.
Advantages:
• Reduced material handling and transportation because
workstations are especially close and are often operated as
repetitive flow processes.
• Set up time are reduced because the jobs often have similar
characteristics that require less time for setting up.
• Reduction in throughput time because of reduction in waiting time
between productive stages and also for waiting for transportation.

•
•
•
•

Efficient scheduling lowers in process inventory and less
inventory.
Less space is required as the machines in the cell are located
close by.
Simplified shop floor control and reduction in defects due to
increased accountability.
Lower total investment due to higher productivity and efficiency

Limitations:
• Breakdown of a single machine leads to halt of entire cell.
• In situations of lowering the demand, breaking down the cell
and redistribution may be necessary.
• Implementation requires considerable amount of work and
expertise to characterize and classify the products and to
design appropriate work cells.

13. Investment
Capital Intensive

Low

Medium

Highl

14. Material Handling

Manual

Manual/semi auto Automated

15. Plant utilization &
Low
Medium
High
Productivity
________________________________________________________________________________

Questions:
1.
2.

Production Management is “process of planning, organizing and
controlling the activities of production functions”. Explain.

3.

Discuss the scopes and objectives of production Management.

4.

Comparison between various types of production
_______________________________________________________________

“ Production is a value addition process”. Comment with an example.

Explain the salient features and characteristics and when to use the
following types of production systems:
(i)
Make to order
(ii)
Make to stock
(iii)
Make to Assemble.

5.

Explain the various interrelationship between the following functional
Areas
1. Production and Marketing
2. Production and Finance
3. Production and Personnel

6.

Give the characteristic features of the following types of production;
a.
Job order and Project type.
b.
Batch Production
c.
Mass Production and Flow Production.
d.
Cellular Manufacturing system.

Characteristics
Job-Order
Batch
Mass
_____________________________________________________________________________
1. Volume of production
One or few
Limited number Large Quantity
2. Product variety
standard

Large variety

Medium or few

3. Layout
Product/ Line

Process/ Functional

Process/

4. Set up time

High

High & Frequent

5. Manufacturing Cycle time

Large

One

Medium

6. Material Flow

Discontinuous/ non
Discontinuous
Uniform, travel long

/few
functional

Low
Low
Uniform and

uninterrupted flow
Distances
7. Equipment & machinery General purpose

General purpose

Special purpose
High production

Dedicated
8. Flexibility
Low
9. P.P.C.

High
Complex

10. Work-in-process

High
Complex

Very

Simple/routine

High

Medium

Low

11. Cost per Unit

High

Medium

Low

12. Skill of labour

Highly skilled

Skilled

Semi or unskilled

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