Production Management

INTRODUCTION

Production/operations management is the process, which combines and transforms various

resources used in the production/operations subsystem of the organization into value added

product/services in a controlled manner as per the policies of the organization. Therefore, it is

that part of an organization, which is concerned with the transformation of a range of inputs into

the required (products/services) having the requisite quality level.

The set of interrelated management activities, which are involved in manufacturing certain

products, is called as production management. If the same concept is extended to services

management, then the corresponding set of management activities is called as operations

management.

1.2 HISTORICAL EVOLUTION OF PRODUCTION AND OPERATIONS MANAGEMENT

For over two centuries operations and production management has been recognised as an

important factor in a countrys economic growth.



The traditional view of manufacturing management began in eighteenth century when Adam

Smith recognised the economic benefits of specialisation of labour. He recommended breaking

of jobs down into subtasks and recognises workers to specialised tasks in which they would

become highly skilled and efficient. In the early twentieth century, F.W. Taylor implemented

Smiths theories and developed scientific management. From then till 1930, many techniques

were developed prevailing the traditional view. Brief information about the contributions to

manufacturing management is shown in the Table 1.1.

TABLE 1.1 Historical summary of operations management

Date Contribution Contributor

1776 Specialization of labour in manufacturing Adam Smith

1799 Interchangeable parts, cost accounting Eli Whitney and others

1832 Division of labour by skill; assignment of jobs by skill;

basics of time study Charles Babbage

1900 Scientific management time study and work study

developed; dividing planning and doing of work Frederick W. Taylor

1900 Motion of study of jobs Frank B. Gilbreth

1901 Scheduling techniques for employees, machines jobs in

manufacturing Henry L. Gantt

1915 Economic lot sizes for inventory control F.W. Harris

1927 Human relations; the Hawthorne studies Elton Mayo

1931 Statistical inference applied to product quality: quality

control charts W.A. Shewart

1935 Statistical sampling applied to quality control: inspection

sampling plans H.F. Dodge H.G. Roming

1940 Operations research applications in World War II P.M. Blacker and others.

1946 Digital computer John Mauchlly and

J.P. Eckert

1947 Linear programming G.B. Dantzig, Williams

others

1950 Mathematical programming, on-linear and stochastic A. Charnes, W.W. Cooper

processes others

1951 Commercial digital computer: large-scale computations

available. Sperry Univac

1960 Organizational behaviour: continued study of people

at work L. Cummings, L. Porter

1970 Integrating operations into overall strategy and policy, W. Skinner J. Orlicky and

Computer applications to manufacturing, Scheduling G. Wright

and control, Material requirement planning (MRP)

1980 Quality and productivity applications from Japan: W.E. Deming and

robotics, CAD-CAM J. Juran.

Production management becomes the acceptable term from 1930s to 1950s. As

F.W. Taylors works become more widely known, managers developed techniques that focussed

on economic efficiency in manufacturing. Workers were studied in great detail to eliminate

wasteful efforts and achieve greater efficiency. At the same time, psychologists, socialists and



other social scientists began to study people and human behaviour in the working environment.

In addition, economists, mathematicians, and computer socialists contributed newer, more

sophisticated analytical approaches.

With the 1970s emerges two distinct changes in our views. The most obvious of these,

reflected in the new name operations management was a shift in the service and manufacturing

sectors of the economy. As service sector became more prominent, the change from production

to operations emphasized the broadening of our field to service organizations. The second, more

suitable change was the beginning of an emphasis on synthesis, rather than just analysis, in

management practices.

1.3 CONCEPT OF PRODUCTION

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.

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