Introduction to Production Planning and Production Management 1

Introduction to Production Planning and Production Management 1

The Organization The Three Basic Functions Organization (R&D) Finance Operations PPC QA Marketing SC 2

Value-Added Process The operations function involves the conversion of inputs into outputs Value-added Inputs Land Labor Capital Transformation/ Conversion process Outputs Goods Services Feedback Control Feedback 3

Value-Added & Product Packages 4

Value-Added & Product Packages • Value-added is the difference between the cost of inputs and the value or price of outputs. • Product packages are a combination of goods and services. • Product packages can make a company more competitive. 5

Goods-service Continuum Goods (manufacturing) Service Surgery, teaching Song writing, software development Computer repair, restaurant meal Automobile Repair, fast food Home remodeling, retail sales Automobile assembly, steel making 6

Manufacturing or Service? Tangible Act 7

The Kinds of Products and Services • Make-to-order: products and services are made to customer specifications after an order has been received • Make-to-stock: products and services are made in anticipation of demand • Assemble-to-order: products and services add options according to customers specifications 8

Processes Classification for Manufactured Product 9

Processes Classification for Services 10

Food Processor Inputs Processing Outputs Raw Vegetables Metal Sheets Water Energy Labor Building Equipment Cleaning Making cans Cutting Cooking Packing Labeling Canned vegetables 11

Hospital Process Inputs Doctors, nurses Hospital Medical Supplies Equipment Laboratories Processing Outputs Examination Surgery Monitoring Medication Therapy Healthy patients 12

Types of Operations Examples Goods Producing Farming, mining, construction, manufacturing, power generation Storage/Transportation Warehousing, trucking, mail service, moving, taxis, buses, hotels, airlines Exchange Retailing, wholesaling, banking, renting, leasing, library, loans Entertainment Films, radio and television, concerts, recording Communication Newspapers, radio and television newscasts, telephone, satellites 13

% employed population in manufacturing & some service sections in TH-VN-USA 14

Change in the number of manufacturing Jobs in US • Productivity – Increasing productivity allows companies to maintain or increase their output using fewer workers • Outsourcing – Some manufacturing work has been outsourced overseas (e. g. Thailand, Vietnam, China) to reduce operation cost 15