Page 10 - DMGT501_OPERATIONS_MANAGEMENT

Operations Management

Notes Moreover, production has a major impact on the quality of the goods and cost of production. In
this respect, production is a visible face of the company and is thus the central function of an
organisation and hence, we may call production as the heart of any organisation.

1.3 Functions and Responsibilities of Production Management

Production management is viewed as a continuous process of planning, organising and
controlling:

1. Planning: It includes all activities that establish a course of action. These activities guide
future decision-making. It involves product planning, facility planning and designing of
the conversion process.
2. Organising: It includes all activities that establish a structure of tasks (organisation
structure) and authority. Thus, it determines the activities required to achieve the
operations, sub-systems goals and assign authority and responsibility for carrying them
out.

3. Controlling: It includes all activities that ensure that actual performance is in accordance
with planned performance. This is done by developing standards and communication
networks necessary to ensure that the organising, staffing and directing functions are
pursuing appropriate plans and achieving objectives.

The major objective of production management is to produce quality goods and services. In
present day position, the objective of any firm is to increase profitability through higher efficiency,
higher productivity, by improving quality, and to give customer more confidence by providing
him products of quality at the right price and at the right time (JIT concept).
This can be achieved through:
1. Optimal use of resources (men, machines and materials).

2. By maximising use of manpower and machines, or minimising wastage of materials.
3. Ensuring quality of goods at minimal cost through use of statistical quality control
techniques.

4. Contributing towards all round productivity through decision-making and quantitative
techniques or techniques.

1.3.1 Scope of Production Management

Scope of production management includes:

1. Activities relating to designing or formulation of the production system.
2. Activities relating to analysing and controlling of production operation after the production
system has been activated.

1.3.2 Activities relating to Production System Designing

These activities concern the production engineering which includes problems relating to:

1. Design of tools and drawings;
2. Designing development and installation of equipments;
3. The selection and operation of the size of the firm;

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