REFERENCES:

1. Samson Eilon, Elements of production planning and control, Universal Book

Corpn.1984
2. Elwood S.Buffa, and Rakesh K.Sarin, Modern Production / Operations Management, 8th
Ed. John Wiley and Sons, 2000.
3. Kanishka Bedi, Production and Operations management, Oxford university press, 2nd
Edition 2007.
4. Melynk, Denzler, Operations management A value driven approach Irwin Mcgrawhill.
5. Norman Gaither, G. Frazier, operations management Thomson learning 9th edition IE,
2007
6. K.C.Jain & L.N. Aggarwal, Production Planning Control and Industrial Management,
Khanna Publishers, 1990.
7. S.N.Chary, Theory and Problems in Production & Operations Management, Tata
McGraw Hill, 1995.
8. Upendra Kachru, Production and operations management Text and cases Excel books 1st
edition 2007.
Unit No. Description Page no.
Syllabus
Key Notes & Formulae
1
2 Marks Questions with Answers
16 Marks Questions with Answers
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Key Notes & Formulae
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2 Marks Questions with Answers
16 Marks Questions with Answers
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Key Notes & Formulae
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2 Marks Questions with Answers
16 Marks Questions with Answers
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2 Marks Questions with Answers
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16 Marks Questions with Answers
UNIT I INTRODUCTION 9
Objectives and benefits of planning and control-Functions of production control-Types of
production-job- batch and continuous-Product development and design-Marketing aspect -
Functional aspects-Operational aspect-Durability and dependability aspect aesthetic aspect.
Profit consideration-Standardization, Simplification & specialization- Break even analysis-
Economics of a new design.

Brief Notes
Introduction
Production Planning is a managerial function which is mainly concerned with the following
important issues:
What production facilities are required?
How these production facilities should be laid down in the space available for
production? and
How they should be used to produce the desired products at the desired rate of
production?

Broadly speaking, production planning is concerned with two main aspects:

(i) Routing or planning work tasks
(ii) Layout or spatial relationship between the resources. Production planning is dynamic in
nature and always remains in fluid state as plans may have to be changed according to the
changes in circumstances.
Production control is a mechanism to monitor the execution of the plans. It has several important
functions:
Making sure that production operations are started at planned places and planned times.
Observing progress of the operations and recording it properly.
Analyzing the recorded data with the plans and measuring the deviations.
Taking immediate corrective actions to minimize the negative impact of deviations from
the plans.
Feeding back the recorded information to the planning section in order to improve future
plans.
A block diagram depicting the architecture of a control system is shown in Figure1.
Figure 1: Architecture of Control System

Important functions covered by production planning and control (PPC) function in any
manufacturing system are shown in Table1along with the issues to be covered.
Table 1: Production Planning and control Functions

Types of Production Systems

A production system can be defined as a transformation system in which a saleable product or
service is created by working upon a set of inputs. Inputs are usually in the form of men,
machine, money, materials etc. Production systems are usually classified on the basis of the
following:
Type of product,
Type of production line,
Rate of production,
Equipments used etc.
They are broadly classified into three categories:
Job shop production
Batch production
Mass production

Job Production
In this system products are made to satisfy a specific order. However that order may be
produced-
 only once
or at irregular time intervals as and when new order arrives
or at regular time intervals to satisfy a continuous demand

The following are the important characteristics of job shop type production system:
Machines and methods employed should be general purpose as product changes are quite
frequent.
Planning and control system should be flexible enough to deal with the frequent changes in
product requirements.
Man power should be skilled enough to deal with changing work conditions.
Schedules are actually nonexistent in this system as no definite data is available on the
product.
In process inventory will usually be high as accurate plans and schedules do not exist.
Product cost is normally high because of high material and labor costs.
Grouping of machines is done on functional basis (i.e. as lathe section, milling section etc.)
This system is very flexible as management has to manufacture varying product types.
Material handling systems are also flexible to meet changing product requirements.

Batch Production
Batch production is the manufacture of a number of identical articles either to meet a specific
order or to meet a continuous demand. Batch can be manufactured either-
only once
or repeatedly at irregular time intervals as and when demand arise
or repeatedly at regular time intervals to satisfy a continuous demand

The following are the important characteristics of batch type production system:
As final product is somewhat standard and manufactured in batches, economy of scale can
be availed to some extent.
Machines are grouped on functional basis similar to the job shop manufacturing.
Semi-automatic, special purpose automatic machines are generally used to take advantage of
the similarity among the products.
Labor should be skilled enough to work upon different product batches.
In process inventory is usually high owing to the type of layout and material handling
policies adopted.
Semi-automatic material handling systems are most appropriate in conjunction with the
semi-automatic machines.
Normally production planning and control is difficult due to the odd size and non repetitive
nature of order.
Mass Production
In mass production, same type of product is manufactured to meet the continuous demand of the
product. Usually demand of the product is very high and market is going to sustain same demand
for sufficiently long time.
The following are the important characteristics of mass production system:
 As same product is manufactured for sufficiently long time, machines can be laid down in
order of processing sequence. Product type layout is most appropriate for mass production
system.
Standard methods and machines are used during part manufacture.
Most of the Equipments are semi-automatic or automatic in nature.
Material handling is also automatic (such as conveyors).
Semi-skilled workers are normally employed as most of the facilities are automatic.
As product flows along a pre-defined line, planning and control of the system is much
easier.
Cost of production is low owing to the high rate of production.
In process inventories are low as production scheduling is simple and can be implemented
with ease.

PRODUCT DESIGN
Product design is a strategic decision as the image and profit earning capacity of a small
firm depends largely on product design. Once the product to be produced is decided by the
entrepreneur the next step is to prepare its design. Product design consists of form and function.
The form designing includes decisions regarding its shape, size, color and appearance of the
product. The functional design involves the working conditions of the product. Once a product is
designed, it prevails for a long time therefore various factors are to be considered before
designing it. These
Factors are listed below: -
(a) Standardization
(b) Reliability
(c) Maintainability
(d) Servicing
(e) Reproducibility
(f) Sustainability
(g) Product simplification
(h) Quality Commensuration with cost
(i) Product value
(j) Consumer quality
(k) Needs and tastes of consumers.
Above all, the product design should be dictated by the market demand. It is an important
decision and therefore the entrepreneur should pay due effort, time, energy and attention in order
to get the best results.
TYPES OF PRODUCTION SYSTEM
Broadly one can think of three types of production systems which are mentioned here under: -
(a) Continuous production
(b) Job or unit production
(c) Intermittent production
(a) Continuous production: - It refers to the production of standardized products with a
standard set of process and operation sequence in anticipation of demand. It is also known as
mass flow production or assembly line production This system ensures less work in process
inventory and high product quality but involves large investment in machinery and equipment.
The system is suitable in 117plants involving large volume and small variety of output e.g. oil
refineries reform cement manufacturing etc.
(b) Job or Unit production: - It involves production as per customer's specification each batch
or order consists of a small lot of identical products and is different from other batches. The
system requires comparatively smaller investment in machines and equipment. It is flexible and
can be adapted to changes in product design and order size without much inconvenience. This
system is most suitable where heterogeneous products are produced against specific orders.
(c) Intermittent Production: Under this system the goods are produced partly for inventory and
partly for customer's orders. E.g. components are made for inventory but they are combined
differently for different customers. . Automobile plants, printing presses, electrical goods plant
are examples of this type of manufacturing.
Several different terms are used such as:
Operations management, production and operation management, production planning and
control, manufacturing system and management, etc. Originally applied primarily in
manufacturing companies focus on production management. These approaches and tool later
applied to service organizations focus on managing an organizations operation.

Factors affecting operations management

Reality of global competition
Quality, customer service, and cost challenges
Rapid expansion of advanced technologies
Continued growth of the service sector
Scarcity of operations resources
Social-responsibility issues

Break-Even Analysis
The objective is to maximize profit. On economic basis only revenues and cost need to be
considered for comparing various locations.
The steps for locational break-even analysis are :
Determine all relevant costs for each location.
Classify the location for each location in to annual fixed cost and variable cost per unit.
Plot the total costs associated with each location on a single chart of annual cost versus
annual volume.
Selwct the location with the lowest total annual cost(TC) at the expected production
volume.

Question:
Potential locations A, B and C have the cost structures shown below for manufacturing a product
expected to sell for Rs 2700 per unit. Find the most economical location for an expected volume
of 2000 units per year.
Solution:
For each plant find the total cost using the formula
TC=Fixed cost+ Variable cost/unit (volume)
= FC+VC(v)

From the graph, the different ranges of production volumes over which the best location to be
selected are summarized.

The same details can be worked out using a graph. From the graph one can visualize that the site
c is desirable for lower volume of production. For higher volume production site B is desirable
for a moderate volume of production site A is desirable. In the increasing order of production
volume the switch over from one site to another takes place as per the order below
Site C to site A to site B
Let Q be the volume at which we switch the site C to site A
Total cost of site C Total cost site A
5000000+4000Q 6000000+1500*Q
2500Q 1000000
Q 400 Units
Similarly the switch from site A to site B
Total cost of site A total cost of site B
6000000+1500Q 7000000+500Q
1000Q 1000000
Q 1000 Units
The cutoff production volume for different ranges of production may be obtained by using
similar procedure.

2 Marks Questions with Answers

INTRODUCTION

1) Define production planning and control.

PPC may be defined as the direction and coordination of the organizations materials
and physical facilities towards the attainment of pre-specified goals in the most efficient way.
2) Define production planning
Production planning is defined as the determination, acquisition and arrangement of all
facilities necessary for future production of products.
3) What is meant by production control?
Production control through control mechanism, tries to take corrective action to match
the plant and actual production .Thus production control reviews the progress of the work and
takes corrective steps in order to ensure that programmed production takes place.
4) What are the Phases of PPC?
PPC involves three phases
1. Pre-planning phase 2. Planning phase and 3. control phase
5) List the various functions/activities of PPC?
1. Materials planning, 2. Facility planning, 3. Methods planning, 4. Estimating
5. Process planning(routing), 6. Scheduling and loading, 7. Dispatching
8. Expediting (or follow up), 9. Inspection and testing, 10. Evaluation
6) Differentiate between routing and scheduling
Routing provides the best and the most economical production sequence, whereas
scheduling prepares a logical time- table showing the starting and finishing time of each
production work in accordance with some predetermined programme. In simple words routing
considers the where aspects and scheduling when aspects.
7) What is production system?
A production system is the frame work within which the conversion of inputs into
output occurs. At the one end of the production system are the inputs and at the other end outputs.
8) How can you classify the production system?
1. Job shop production, 2. Batch production, 3. Mass production,
4. Process or continuous production.
9) What do you mean by batch production?
In batch production, the products are made in small batches and in large variety. Each
batch contains identical items but every batch is different from others.
10) Differentiate between intermittent and continuous production systems.
The job shop production and batch production are also known as intermittent
production systems. The mass production and process production are termed as continuous
production system.
11) What types of plant layouts are suitable for job shop, batch and continuous production?
Job shop production Process of functional layout
Batch production - Cellular layout
Continuous production Line or product layout
12) What is the objective of product analysis?
The main objective of product analysis is to obtain qualitative as well as quantitative
evaluation of the influencing factors which determine primarily the success of a manufactured
product.
13) Distinguish the terms durability and dependability.
Durability refers to the length of the active life or endurance of the product under
given working conditions.
Dependability refers to the reliability with which the product serves its intended
function.
14) What do you mean by design manufacture and design for assembly?
Design for manufacture (DFM) means the design for ease of manufacture of the
components of a product.
Design for assembly (DFA) means the design of the product for ease of assembly.
15) What do you understand by product standardization?
Standardization means setting up standards or measuring sticks by which extent,
quality, quantity, value, performance, or service may be gauged or determined.
16) What are the 3Ss with respect to product development techniques?
1. Standardization, 2. Simplification and 3. Specialization
17) What do you mean by specialization?
Specialization is the process whereby particular firms concentrate on the manufacture
of a limited number of products or types of products.
18) What are the advantages of specialization?
1. Better utilization of equipments, 2. Higher productivity, 3. Greater efficiency
4. Better quality, 5. Reduced production cost & hence lower unit price, and
6. Use of standardized methods.
19) What do you understand by break-even analysis?
Break-even analysis, also known as cost-volume-profit analysis, is the study of inter-
relationships among a firms sales, costs and operating profit at various levels of output.
20) Contrast product simplification with product diversification.
Product simplification is the process of reducing the variety of products manufactured
i.e., variety reduction.
Product diversification is completely opposite to simplification. Product diversification
involves adding new products or lines products to achieve a balanced product range.
16 Marks Questions with Key points
INTRODUCTION

1. Explain the objectives and benefits of planning and control:

Effective equipment utilization and resources.
Improve production rate and optimum loading to machines.
Control work in process inventory and help to achieve production target.
2. Discuss the functions of production planning and control:
Material, method, machine and equipment, routing, loading and scheduling,
estimating, expediting, dispatching, inspection and evaluation.
3. Briefly explain the types of production system:
Comparative study of the production system which comprises of Job, Batch, Mass and
continuous production based on variety of products, volume of production, machines used, type
of layout, required skill level with its merits and demerits.
4. Briefly explain the Product Design and Development:
Need for design. Characteristics for a good product design like reparability,
maintainability, reliability, modular design, durability, miniaturization etc. Phases in product
development which includes concept development, product planning, product/ process
engineering, pilot production.
5. Describe the Factors influencing product design:
Various factors which influence product design like marketing aspect, functional aspect,
operational aspect, aesthetic aspect, economic aspect, production aspect, etc.
6. Describe Standardization:
Definition, Aim, classification of standardization like, Basic standardization,
dimensional, material, equipment, process, quantity, etc. Benefits and limitation of
standardization.
7. Write a note on Simplification:
Objectives and benefits of simplification, Effects with respect to % of products
with respect to % of sales income.
8. Briefly discuss about Specialization:
Process by which concentrate on the manufacture of limited number of products or type
of products.
9. What is Break Even analysis: Describe it.
Aims, assumptions, determination of breakeven point by algebraic method, graphical
method. Problems in Breakeven point based on various parameters such as quantity, cost and
other variables.
10. Write a note on Economics of new design:
Careful analysis of the economics of the preferred project to be undertaken by
introducing a new model taking into consideration the profits of organization, to avoid
declining in sale of the existing model.
UNIT II WORK STUDY 9

Method study, basic procedure-Selection-Recording of process - Critical analysis,

Development - Implementation - Micro motion and memo motion study work
measurement - Techniques of work measurement - Time study - Production study - Work
sampling - Synthesis from standard data - Predetermined motion time standards.

WORK STUDY
o First technique applied for increasing productivity.
o Considered as a valuable tool in increasing productivity.
Definition: Work study is a generic term for the techniques of method study and work
measurement. These techniques are used in the examination of human work in all its
contexts. They lead systematically to the investigation of all the factors which affect the
efficiency and economy at the work place in order to affect improvement.

METHOD STUDY
Method study is the technique of systematic recording and critical examination
of existing and proposed ways of doing work and developing an easier and economical
method.

Objectives of Method Study

1. Improvement of manufacturing processes and procedures.
2. Improvement of working conditions.
3. Improvement of plant layout and work place layout.
4. Reducing the human effort and fatigue.
5. Reducing material handling
6. Improvement of plant and equipment design.
7. Improvement in the utility of material, machines and manpower.
8. Standardization of method.
9. Improvement in safety standard.

BASIC PROCEDURE FOR METHOD STUDY

The basic procedure for conducting method study is as follows:
1. Select the work to be studied.
2. Record all facts about the method by direct observation.
3. Examine the above facts critically.
4. Develop the most efficient and economic method.
5. Define the new method.
6. Install the new method
7. Maintain the new method by regular checking.
1. Select
While selecting a job for doing method study, the following factors are considered:
(a) Economical factors.
(b) Human factors.
(c) Technical factors.
(a) Economical Factors
Based on the economical factors, generally the following jobs are selected.
(a) Operations having bottlenecks (which hold up other production activities).
(b) Operations done repetitively.
(c) Operations having a great amount of manual work.
(d) Operations where materials are moved for a long distance.
(b) Human Factors
The method study will be successful only with the co-operation of all people concerned
viz., workers, supervisor, trade unions etc.
Workers may resist method study due to
1. The fear of unemployment.
2. The fear of reduction in wages.
3. The fear of increased work load. Then if they do not accept method study, the study
should be postponed.
(c) Technical Factors
These types of technical factors should be considered.
2. Record
All the details about the existing method are recorded. This is done by directly
observing the work. Symbols are used to represent the activities like operation, inspection,
transport, storage and delay.
Different charts and diagrams are used in recording. They are:
1. Operation process chart: All the operations and inspections are recorded.
2. Flow process chart
(a) Man type All the activities of man are recorded
(b) Material type All the activities of the material are recorded
(c) Equipment type All the activities of equipment or machine are recorded.
3. Two-handed process chart: Motions of both lands of worker are Right hand-
Left hand chart recorded independently.
4. Multiple activity chart: Activities of a group of workers doing a single job or the
activities of a single worker operating a number of machines are recorded.
5. Flow diagram: This is drawn to suitable scale. Path of flow of material in the
shop is recorded.
6. String diagram: The movements of workers are recorded using a string in a
diagram drawn to scale.
3. Examine
Critical examination is done by questioning technique. This step comes after the
method is recorded by suitable charts and diagrams. The individual activity is examined by
putting a number of questions. The following factors are questioned

1. Purpose To eliminate the activity, if possible.

2. Place To combine or re-arrange the activities.
3. Sequence -do-
4. Person -do-
5. Means To simplify the activity.
The following sequence of questions is used:
1. Purpose What is actually done? Why is it done?
What else could be done? What should be done?
2. Place Where is it being done? Why is it done there?
Where else could it be done? Where should it be done?
3. Sequence When is it done? Why is it done then?
When could it be done? When should it be done?
4. Person Who is doing it? Why does that person do it? Who else could do it?
Who should do it?
5. Means How is it done? Why is it done that way?
How else could it be done? How should it be done?
4. Develop
The answer to the questions given below will result in the development of a better method.
1. Purpose What should be done?
2. Place Where should it be done?
3. Sequence When should it be done?
4. Person Who should do it?
5. Means How should it be done?
5. Define
Once a complete study of a job has been made and a new method is developed, it is
necessary to obtain the approval of the management before installing it. The work study
man should prepare a report giving details of the existing and proposed methods. He
should give his reasons for the changes suggested. The report should show
(a) Brief description of the old method.
(b) Brief description of the new method.
(c) Reasons for change.
(d) Advantages and limitations of the new method.
(e) Savings expected in material, labour and overheads.
(f) Tools and equipment required for the new method.
(g) The cost of installing the new method including.
1. Cost of new tools and equipment.
2. Cost of re-layout of the shop.
3. Cost of training the workers in the new method.
4. Cost of improving the working conditions.
6. Install
This step is the most difficult stage in method study. Here the active support of both
management and trade union is required. Here the work study man requires skill in getting
along with other people and winning their trust. Install stage consists of
(a) Gaining acceptance of the change by supervisor.
(b) Getting approval of management.
(c) Gaining the acceptance of change by workers and trade unions.
(d) Giving training to operators in the new method.
(e) To be in close contact with the progress of the job until it is satisfactorily
executed.
7. Maintain
The work study man must see that the new method introduced is followed. The
workers after some time may slip back to the old methods. This should not be allowed. The
new method may have defects. There may be difficulties also. This should be rectified in
time by the work study man. Periodical review is made. The reactions and suggestions
from workers and supervisors are noted. This may lead to further improvement. The
differences between the new written standard practice and the actual practice are found out.
CHARTS AND DIAGRAMS USED IN METHOD STUDY (TOOLS
AND TECHNIQUES)
As explained earlier, the following charts and diagrams are used in method
study. 1. Operation process chart (or) Outline process chart.
2. Flow process chart.
(a) Material type
(b) Operator type
(c) Equipment type
3. Two-handed process chart. (or) Left hand-Right hand chart
4. Multiple activity chart.
5. Flow diagram.
6. String diagram.
WORK MEASUREMENT
Work measurement is a technique to establish the time required for a qualified worker
to carry out a specified job at a defined level of performance.
Objectives of work measurement
1. To reduce or eliminate non-productive time.
2. To fix the standard time for doing a job.
3. To develop standard data for future reference.
4. To improve methods.
TECHNIQUES OF WORK MEASUREMENT
The different techniques used in work measurement are
1. Stop watch time study.
2. Production study.
3. Work sampling or Ratio delay study.
4. Synthesis from standard data.
5. Analytical estimating.
6. Predetermined motion time system.
CALCULATION OF BASIC TIME
Basic time is the time taken by an operator of standard performance (rating of
100). A man whose work is observed, may be a slow worker or a fast worker. His rating
may be less than 100 or above 100. The observed time cannot be taken as the basic time.
Here the rating factor is applied and basic time is calculated as follows.

For example, assume that observed time for an operation is 0.7 mts. The rating of the
Operator is found to be 120.
ALLOWANCES
Various types of allowance are
1. Rest and personal allowance.
2. Process allowance.
3. Contingency allowance.
4. Special allowance.
5. Policy allowance.
CALCULATION OF STANDARD TIME
Standard time or allowed time is the total time in which a job should be completed at
standard performance. It is the sum of normal time (basic time) and allowances. Policy
allowance is not included.
Standard time is worked out in a stop watch time study in the following manner.
PRODUCTION STUDY
Production study is a technique of work measurement to check accuracy of the original
time study. This study is done to find the time delay due to occasional elements. These
elements may occur at irregular intervals. Example: Tool grinding, setting tools etc. There
are chances of missing these elements in the stop watch time study. Production study is
conducted for a longer periodat least for half a day or one shift.
RATIO DELAY STUDY
This study is also known as work sampling or activity sampling. Here the ratio of
the delay time and working time to the total time of an activity is found out. This is done
by random (irregular) observations. This study is applied to
1. Long cycle operations.
2. Activities where time study is not possible.
SYNTHESIS FROM STANDARD DATA
Synthesis is a work measurement technique to work out standard time for a job by
totaling the elemental times already obtained from previous time studies. Many operators
in an industry have several common elements. Example: starting the machine, stopping the
machine etc. Whenever these activities occur, they take the same duration of time. These
elements are called constant elements. Time for some elements vary proportionately with
the speed, feed, and length of cut etc. in machining operation. These elements are known as
variable elements. Time for all these constant elements and variable elements are collected
from the time studies previously made. These are stored in a file. This is called time
standard data bank. Data bank contains data in the form of
1. Tabulated standard time for constant elements.
2. Charts and graphs.
3. Formulae etc.
ANALYTICAL ESTIMATING
Setting the time standards for long and non-repetitive operations by stop watch
method are uneconomical. Analytical estimating technique determines the time values for
such jobs either by using the synthetic data or on the basic of the past experience of the
estimator when no synthetic or standard data is available. In order to produce accurate
results the estimator must have sufficient experience of estimating, motion study, time
study and the use of synthesized time standards.
PREDETERMINED MOTION TIME SYSTEM (PMTS)
Definition: PMTS is a work measurement technique where by times, established
for basic human motions (classified according to the nature of the motion and the
conditions under which it is made) are used to build up the time for a job at a defined level
of performance. Few well-known systems using this concept are
1. M.T.M. : Method Time Measurement.
2. W.F.S. : Work Factor System.
 3. M.T.A. : Motion Time Analysis.
4. D.M.T. : Dimensional Motion Times.
5. B.M.T. : Basic Motion Times.
ERGONOMICS
Ergons means work and Nomos means Natural laws. Ergonomics or its
American equivalent Human Engineering may be defined as the scientific study of the
relationship between man and his working environments. Ergonomics implies Fitting the
job to the worker. Ergonomics combines the knowledge of a psychologist, physiologist,
anatomist, engineer, anthropologist and a biometrician.

2 Marks Questions with Answers

WORK STUDY
1) Define work study
Work study is a generic term for those techniques, particularly method study and
work measurement, which are used in the examination of human work in all its contexts
and which leads systematically to the investigation of all factors which after the
efficiency and economy of the situation being reviewed, in order to effect improvement.
2) List the objective of work study.
1. To find the most economical way of doing the work
2. To simplify and standardize the methods, materials, tools and equipments.
3. To determine the time required by a qualified worker to perform the work at a
normal pace.
4. To plan the training programmes for the workers for the new methods.
3) Define method study.
Method study is the systematic recording and critical examination of existing and
proposed ways of doing work, as a means of developing and applying easier and more
effective methods and reducing costs.
4) List the objectives of method study.
1. To improve the processes and procedures.
2. To improve the design of plant and equipment
3. To improve the plant layout.
4. To improve the use of men, materials and machines.
5. To achieve efficient material handling.
6. To improve the flow of production and processes.
5) Differentiate between operation and inspection.
An operation always takes the material, component or service a stage further
towards completion. An inspection does not take the material any nearer to become a
completed product. It merely verifies that an operation has been carried out correctly as to
quality and / or quantity.
6) Differentiate between Permanent storage and Delay.
The difference is that a requisition, chit, or other form of formal authorization is
generally required to get an article out of permanent storage but not out of temporary
storage.

7) What is a process chart? Mention its types

A process chart is a graphical representation of the sequence of events and
related information that occur in the work method or procedures.
There various types of process charts are
Outline process chart, Flow process chart and Two- handed process chart
8) Differentiate between outline process chart and flow process chart.
An outline process chart is a process chart given an overall picture by
recording in sequences only the main operations and inspections.
A flow process chart is a graphical representation of all operations,
transportations, inspections, delays and storages occurring during a process or procedure.
9) Distinguish between flow diagram and string diagram.
The sting diagram must be drawn correctly to scale. The flow diagram can be
drawn approximately to scale. The flow diagram would look cumbersome when there are
too many to and fro movement between points but, such movements will not effect the
string diagram.
11. Define time study.
Time study is defined as a work measurement technique for recording the times
and rates of working for the elements of a specified conditions and for analyzing the data
so as to obtain the time necessary for carrying out the job at a defined level of
performance.
12. Why the job is divided into elements?
i) To ensure that productive work is separated from unproductive activity.
ii) To ensure better and accurate performance rating.
iii) To identify and distinguish different types of elements.
iv) To facilitate checking of method.
13. What is meant by performance rating?
Performance rating is the process of adjusting the actual pace of working of an
operator by comparing it with the mental picture of pace of an operator working at normal
speed.
14. List the various allowances to be considered while calculating the standard time of
job.
i) Relaxation allowances, ii) Contingency allowances iii) Process allowances
iv) Interference allowances v)Special allowances
15. Define the terms basic time and standard time.
Basic time may be defined as the time for carrying out an element of work
standard rating. Standard time is the time allowed to an operator to carry out the
specified task under specified conditions and defined level of performances.
16. What is meant by work sampling?
Work sampling is defined as a method of finding the percentage occurrence of a
certain activity by statistical sampling and random observations.
17. What do you mean by synthetic data?
Synthetic data is the data derived from the analysis of the accumulated work
measurement data in the form of tables and formulas where the data is arranged in a form
suitable for building up the standard times and similarly machine processing times by
synthesis.
18. What is PMTS?
PMTS stands for Predetermined Motion Time System. A predetermined motion
time system consists of a set of time data which has been developed from many
observations of a workers performance.
19. Give the acronym for the following: MTA, WFS and MTM.
MTA - Methods Time Analysis
WFS Work Force System
MTM Method Time Measurements
20. Define time study.
Time study is defined as a work measurement technique for recording the times
and rates of working for the elements of a specified conditions and for analyzing the data
so as to obtain the time necessary for carrying out the job at a defined level of
performance.
21. Define Cumulative timing.
The cumulative timing allows the stopwatch to start at the entire duration of the
study. Accumulated elemental times are recorded in sequence while the watch is
running. At the end of the study, the time for each element is determined by subtracting
the beginning time from the end time.

16 Marks Questions with Key points

WORK STUDY
1. Describe about Method study:
Objectives and advantages of method study, factors facilitating method study,
Method study procedure which include select record using process charts and diagrams.
Examine using 5 W, 1 H, and Develop by generating alternatives, Install and maintain
the new system.
2. Write a note on Recording of process:
Outline process chart, operation process chart, flow process chart, Two
handed chart, multiple activity chart, man machine chart. Flow diagram and string
diagram
3. Describe about Micro motion and Memo motion study:
Using therbligs, principles of motion economy.
4. Write a note about Work measurement techniques:
Direct time study, synthesis method, analytical estimating, PMTS, work sampling
or activity sampling.
5. Describe about Time study:
Objective, procedure, selecting the job, selecting the worker, conduct stop watch
time study. Find various allowances like relaxation allowance, contingency allowance,
process allowance and special allowance, derive the standard time.
6. Write a note on Synthesis method:
Advantages and application, analytical estimating, procedure.
7. Discuss about Predetermined Motion Time System ( PMTS):
Advantages and disadvantage, Type of PMTS, Method Time Measurement, work
factor, Basic motion time.
8. Describe abut Work sampling:
Uses, procedures, steps in work sampling, principles involved in work sampling.
UNIT III PRODUCT PLANNING AND PROCESS PLANNING 9

Product planning-Extending the original product information-Value analysis-Problems in

lack of product planning-Process planning and routing-Pre requisite information needed for
process planning-Steps in process planning-Quantity determination in batch production-
Machine capacity, balancing-Analysis of process capabilities in a multi-product system.

PROCESS PLANNING
PROCESS PLANNING

Process planning is a detailed specification which lists the operation, tools, and
facilities
Usually accomplished in manufacturing department
Also known as operations planning
Systematic determination of the engineering processes and systems to manufacture
a product competitively and economically
DEFINITION
Process planning can be defined as an act of preparing a detailed processing
documentation for the manufacture of a piece part or assembly
APPROACHES TO PROCESS PLANNING
1. Manual Process planning
2. Computer Aided Process planning (CAPP)
a. Retrieval CAPP system
b. Generative CAPP system

MANUAL PROCESS PLANNING

Manually prepared

Task involves examining and interrupting engineering drawings, making decisions
on machining process selection, equipment selection, operation sequence, and shop
practices

Dependent on judgment and experience of process planner
Advantages

Very much suitable for small scale companies

Highly flexible

Low investment costs

Disadvantages
Very complex
Time consuming
Requires large amount of data
Requires skilled process planner
More possibilities for human error
Increases paper work
Inconsistent process plans results in reduced productivity.

GENERATIVE CAPP SYSTEM

In this approach computer is used to synthesize or generate each
individual process plan automatically without reference to any prior plan
Generates the process plan based on decision logics and pre-coded
algorithms. Computer stores the rules of manufacturing and equipment
capabilities
 Specific process plan for specific part can be generated without any
involvement of process planner

Components of Generative CAPP system

Part descriptor
Subsystem to identify machine parameters
Subsystem to select and sequence individual operations
Database
Report generator
Advantages
Generate consistent process plan rapidly
New components can be planned as easily as existing components
It has potential for integrating with automated manufacturing facility to provide
detailed control information
Drawbacks
Complex and very difficult to develop
PROCESS PLANNING ACTIVITIES

1. Specific activities involved in Process planning are

2. Analysis of the finished part requirements as specified in the engineering
design
3. Determining the sequence of operation required
4. Selecting the proper equipment to accomplish the required operations
5. Calculating the specific operation setup times and cycle times on each machine
6. Documenting the established process plans
7. Communicating the manufacturing knowledge to the shop floor
1. Analyze finished part requirements
Component drawing should be analyzed to identify its features,
dimensions, and tolerance specifications
Parts requirement defined by its features, dimensions, and tolerance
specifications will determine corresponding processing requirements
2. Determine operating sequence
Basic aim is to determine the type of processing operation that has the
capability to generate various types of features, given the tolerance requirements
There are two ways of viewing decision process
o First view is to consider processing evaluation of part from rough state
to finished final state. In this view material is removed or modified on
rough part in stages in order to transform it into finished part
o Second view is to consider part evaluation from finished state back to
rough/ initial state. In this view material is added back onto the part.
3. Select machines
Machine selection requires determining how the part would be processed on
each of the alternative machines so that best machine can be selected
At this phase, firm has to decide whether to make or buy the component part
Break even analysis is most convenient method for selecting optimum method of
manufacture or machine amongst the competing ones

Factures which influence the selection of machine are,

o Economic considerations
o Production rate and unit cost of production
o Durability and dependability
o Lower process rejection
o Minimum set-up and put away times
o Longer productive life of machines or equipment
o Functional versatility
4. Material selection parameters
Function
Appearance
Reliability
Service life
Environment
Compatibility
Productivity
Cost
5. Calculate processing time
Determination of set-up times requires knowledge of available tooling and
sequence of steps necessary to prepare the machine for processing given work
piece
For establishing accurate set-up times, detailed knowledge of equipment capacity,
tooling, and shop practice required
Calculation of part processing time requires determination of sequence of
processing steps on each machine. This is called as OUTPLANNING
After calculation of processing time, appropriate times for loading, part
unloading, machine indexing, and other factors involved in one complete
cycle for processing a part must be included to compute the expected machine
cycle time
Allowances are added with machine cycle time to calculate standard cycle time
for processing one piece
Appropriate machine rates are added with calculated cycle time to calculate
expected standard
cost for given operation
 6. Document process planning

Process plan is documented as job routing or operation sheet

Operation sheet also called route sheet, instruction sheet, traveler, planner
Information provided by route sheet are,
Part identification
Description of processing steps in each operation
Operation sequence and machines
Standard set-up and cycle times
Tooling requirements for each operation
Production control information showing the planning lead time at each
operation
Reasons for documentation
To have a record on hoe a part is processed in order to plan future parts with
similar design requirements in a consistent manner
To provide a record for future job quoting, cost estimating, and standard costing
systems
To act as a vehicle for communication
7. Communicate process knowledge
Communication is essential to ensure that part will be processed according
to most economical way
Process documentation and communication provide basis for improved part
consistency and quality in manufacturing

2 Marks Questions with Key points

Product Planning and Process Planning

1. What is product planning?

i) The evaluation of the range, mix, specification and pricing of existing and new
products in relation to present and future market requirements and competition.
ii) Planning of product range, mix, specification and pricing to satisfy company object
iii) Specifying the research, design and development support required.
2. What is the purpose of feasibility study in relation to product planning?
The purpose of feasibility study is to extend the market analysis with the intent of
arriving at a preferred system configuration that the firm is willing to offer the product or
product-mix in response to an identified need.
3. List the information that can be obtained from the system operation concept.
i) Identification of prime mission of the system
ii) De fi ni t i on of operating characteristics of the system
iii) Anticipated usage of the system and its elements
iv) Identification of effectiveness factors
4. List the information that can be obtained from the system maintenance concept.
i) Identification of level of maintenance support. ii) Definition of repair policies
 iii) Definition of effectiveness measures, iv) Establishment of supportability
requirements in system/ equipment design v) Establishment of requirements of logistics
support
5. List the activities of advanced product planning.
i) Product selection and justification, ii) Products specifications and plans iii)
Product acquisition plan and iv) Product evaluation plan
6. What is value analysis?
Value analysis is a disciplined approach that ensures the necessary functions at
minimum cost without comprising on quality, reliability, performance and appearance.
7. What is value? List its types
Value, in general, taking the use value as an objective, is the ratio between the
function and the cost. Value=
Types of economic value: 1. Use value, 2. Esteem value, 3. Cost value, 4. Exchange
value.
8. How can you increase the value of a product?
The value of a product can be increased:
i) By reducing the costs ii) B y improving function
iii) By increasing function by increasing the costs disproportionately low
9. Differentiate between primary and secondary functions with respect to value
analysis.
Primary functions are the basic functions which the product is specially
designed to perform.
Secondary functions are those which if deleted would not prevent the devices
from performing its primary functions

10. Distinguished between value analysis an value engineering

Value analysis is the application of a set of techniques to an existing product
with a view to improve its value. Thus value analysis is a remedial process. Value
engineering is the application of exactly same set of techniques to a new product at the
design stage itself. Therefore value engineering is a preventive process.

11. Mention any four uses of value analysis.

i) It reduces the cost of product and determines the appropriate cost for the
reliable performance of the product.
ii) It helps employees to understand their jobs in a better fashion
iii) It creates new ideas and concepts for R&D department
iv) It creates cost consciousness among the employees in the firm

12. When do you apply value analysis?

Value analysis can be applied in case of the following indications.
i) When the firm is unable to meet delivery schedules
ii) Due to change in technology
iii) When the cost of manufacturing is high
iv) When rate of profit has a falling trend
13. List any four reasons for products unnecessary costs.
i) Failure to utilize specialized knowledge
ii) Poor design of the component
iii) Lack of ideas and relevant information
iv) Unavoidable delivery constraints

14. List the various phases of value analysis.

i) Orientation phase
ii) Information phase
iii) Functional analysis
iv) Creative phase
v) Evaluation phase

15. What is meant by process planning?

Process planning can be defined as an act of preparing a detailed processing
documentation for the manufacture of a piece part or assembly.

16. List the various information required for process planning.

1) Assembly and component drawings and bill of materials
2) Machine and equipment details
3) Standard time for each operation and details of set up time for each job
4) Availability of machines, equipment and tools

17. What are the factors affecting process planning?

i) Volume of production
ii) The skill and expertise of man power
iii) Delivery dates for parts or products
iv) Materials specifications
v) Accuracy requirements of parts or products.

18. What is meant by machine balancing?

Machine balancing refers to the procedure of adjusting the times at work centres to
conform as much as possible to the required cycle time.

19. List the commonly used methods to reduces the cycle time to a minimum.
i) Reduce/eliminate idle time in the bottleneck activity
ii) Reduce the independent activity time
iii) Reduce the concurrent activity time.

20. What is meant by machine loading?

Machine loading is the process of assigning specific jobs to machines, men or
work centers based on relative priorities and capacity utilization.
16 Marks Questions with Key points
Product Planning and Process Planning
1 Discuss about Product planning:
Factors to be considered in product planning, which includes marketing factor, product
characteristics, economic analysis and the production factor. Problems in lack of product
planning.
2 Write a note on Value Analysis:
Objective, FAST diagram, Various phases involved in value analysis which includes,
introduction phase, documentation phase , recommendation phase, evaluation phase, analysis
phase , conclusion phase etc.
3 Discuss in detail about Process planning and routing:
Manual process planning and computer aided process planning, important consideration for
process planning, which includes manufacturing specification, determination of raw material
and selection of machine tool.
4 Write a note on Prerequisite information for process planning:
It includes product data, production volume, quality, available equipment and personnel,
available time, standard time, sequence of operation, material specification.
5 What are the Steps in process planning:
Preparation of drawing, make or buy decision, selection of manufacturing process,
machine capacity, machine selection, selection of material, bill of material, selection of jigs and
fixtures, operation planning and tooling requirements, preparation of documents and
preparation of operation sheet and route sheet.
6 Describe in detail about Quantity determination in batch production, problems:
Stock control, definition of batch size, minimum cost batch size , Raymonds formula,
maximum return , maximum rate of return.
7 What is Machine capacity, balancing:
Line balancing, Variation of time efficiency, balancing to meet demand,
estimating capacity, modifying time efficiency, multi product analysis, graphical
representation, analysis by linear programming.
UNIT IV PRODUCTION SCHEDULING 9

Production Control Systems-Loading and scheduling-Master Scheduling-Scheduling

rules-Gantt charts-Perpetual loading-Basic scheduling problems - Line of balance Flow
production scheduling-Batch production scheduling-Product sequencing Production Control
systems-Periodic batch control-Material requirement planning kanban Dispatching-Progress
reporting and expediting-Manufacturing lead time-Techniques for aligning completion times and
due dates.
Production Planning and Control
In any manufacturing enterprise production is the driving force to which most other
functions react. This is particularly true with inventories; they exist because of the needs of
production. In this chapter the relationship of production planning and control to work-in-process
inventories is stressed.
Objectives of Production Planning Control
The ultimate objective of production planning and control, like that of all other
manufacturing controls, is to contribute to the profits of the enterprise. As with inventory
management and control, this is accomplished by keeping the customers satisfied through the
meeting of delivery schedules. Specific objectives of production planning and control are to
establish routes and schedules for work that will ensure the optimum utilization of materials,
workers, and machines and to provide the means for ensuring the operation of the plant in
accordance with these plans.

Production Planning and Control Functions

All of the four basic phases of control of manufacture are easily identified in production
planning and control. The plan for the processing of materials through the plant is established by
the functions of process planning, loading, and scheduling. The function of dispatching puts the
plan into effect; that is, operations are started in accordance with the plant. Actual performance is
then compared to the planned performance, and, when required, corrective action is taken. In
some instances re-planning is necessary to ensure the effective utilization of the manufacturing
facilities and personnel. Let us examine more closely each of these functions.

Process Planning (Routing)

The determination of where each operation on a component part, subassembly, or
assembly is to be performed results in a route for the movement of a manufacturing lot through
the factory. Prior determination of these routes is the job of the manufacturing engineering
function.
Loading
Scheduling
Combining Functions
Dispatching
Reporting or Follow up
Corrective Action
Re-planning
Factors Affecting Production Planning and Control
The factors that affect the application of production planning and control to
manufacturing are the same as the factors we have already discussed that affect inventory
management and control. Let us briefly review these in relation to production planning and
control.
Type of Product
Type of Manufacturing
Production Planning and Control Procedures
Production Planning and Control Systems
Sales Order
Stock Order
Shop Order
Standard Process sheet
Engineering Specifications
Route Sheet
Job Tickets
Project Planning Methods
Production Planning and Control Organization
Centralized Production Planning and Control
Decentralized Production Planning and Control
Control Phase

PRODUCTION SYSTEM
Introduction
A Production System is a system whose function is to transform an input into a desired
output by means of a process (the production process) and of resources. The definition of a
production system is thus based on four main elements: the input, the resources, the production
process and the output. Most of the organizations (including non-profit organization) can be
described as production systems.

Models of Production system:

A model is a representation of reality that captures the essential features of an
object/system/process. Three types of models are there such as physical, schematic and
mathematical.
I. Physical model: Replica of a physical object with a change of scale.
a. For big/huge structure of physical object: small scale (Ex. solar system)
b. For microscopic objects: magnified scale(Ex. Atomic model)
II. Schematic model: These are 2-D models which represents
Price fluctuations with year.
Symbolic chart of activities in sequence for a job.
Maps of routings
Networks of timed events.

The pictorial aspects are useful for good demonstration purposes.

III. Mathematical model:
Formulas and equations have long being the servants of physical sciences. One can
represent the important aspect of a system/problem in mathematical form using variables,
parameters and functions. This is called mathematical model .by analyzing and manipulating the
mathematical model; we can learn how the real system will behave under various conditions.

Types of production system:

Facility Planning
4.1 Definition of Facilities Planning
4.2 Disciplines involved in Facilities Planning (FP)
4.3 Applications of Facilities Planning (FP)
4.4 Factors affecting Facility Layout
Time study

It was proposed by Frederick Taylor and later modified to include a performance rating
(PR) adjustment.
Once the method is established, the next objective is to set the standard time for the work.
This aspect of work study is called Time study (or Work measurement).
The main objectives of time study are:
1) To determine the standard time for various operations which helps in fixing wage rates
and incentives.
2) To estimate the cost of product accurately.
3) To predict accurately the duration for a particular work and customer is promised
accordingly.
 4) To determine the number of machines an operator can run.
5) To determine the optimum number of men and machine.
6) To provide information for planning and scheduling.
7) To balance the work of all workers working in a group.
8) To compare the work efficiency of different workers/operators.
Work measurement techniques
1. Time study using stop watch.
2. Predetermined motion time system (PMTS).
3. Work sampling.
4. Analytical estimating.
Selection of Worker for Time Study
The worker on which time study should be conducted must
Have necessary skill for the job.
Have sufficient experience with the given method on the job (that is, he should have
crossed the learning stage).
Be an average' worker as regards the speed of working.
Be temperamentally suited to the study (those who can't work in normal fashion when
watched, are not suitable for the study).
Have knowledge about the purpose of study.

Time Study Equipment

The following equipment is needed for time study work.
Timing device
Time study observation sheet
Time study observation board

Line balancing
Plants having continuous flow process and producing large volume of standardized
components prefer conveyor assembly line. Here the work centres are sequenced in such a way
that at each stage a certain amount of total work is carried out so that at the end of conveyor line,
the final product comes out. This requires careful preplanning to balance the timing between
each work centres so that idle/waiting time is minimized. This process of internal balancing is
called Assembly line balancing.
Line balancing is defined as the procedure for creating work stations and assigning tasks
to them according to a predetermined technological sequence such that the idle time at each work
station is minimized.
Some terminologies used in line balancing:
1. Work station: It is a location on the assembly line where specified work is performed.
2. Cycle time: It is the amount of average time a product spends at one work station

3. Task : The smallest grouping of work that can be assigned to a work station.
4. Task time: Standard time to perform task.
 5. Station time: Total standard time at a particular work station.

A typical example will clarify the procedure of line balancing.

Ex: A company is setting an assembly line to produce 192 units per 8 hour shift. The information
regarding work elements in terms of times and intermediate predecessors are given below:

1. What is the desired cycle time?

2. What are the theoretical numbers of stations?
3. Use largest work element time rule to work out a solution on a precedence diagram.
4. What are efficiency and balance delay of the solution obtained?
Solution: The precedence diagram is represented as shown below:

(a) Cycle time: 8hours/192 units = 150 sec/unit.

(b) Sum of the time of all work elements = 720 secs
So, minimum number of work station = 720/150 = 4.8 = 5 stations.
(c) Assignment of work element to stations:
(d) Efficiency: t100/nCT = 720100/5150 = 96%.
(e) Balance delay = 100-96 = 4%.

Flow control
Flow control applies to the control of continuous production as found in oil refineries,
bottling works, cigarette making factories, paper making mills and other mass manufacturing
plants.
(a) Operation time: It amounts the time required to manufacture each part, to make one
subassembly and to execute one assembly. This information is available from the operation
sheet.
(b) Line balancing: the assembly line should be balanced. Each work station should have the
more or less same operating time and the various operations should be sequenced properly.
(c) Routing and scheduling: A combination route and schedule chart showing the fabrication of
parts, subassemblies and final assembly is shown below.
(d) Control of parts subassemblies and Assembly: A supervisory function coupled with an
appropriate information feedback system keeps a check whether the small parts arriving in lots
and big parts coming continuously are available at right time, in proper quantities for making
subassemblies as per scheduled plan.

(e) Dispatching: Dispatching is nothing but issuing orders and instructions to start a particular
work which has already been planned under routing and scheduling.

Functions of Dispatching
(i) Assignment of work to individual man, m/c or work place.
(ii) Release necessary order and production firm.
(iii) Authorize for issue of materials, tools, jigs, fixtures, gauges, dies for various jobs.
(iv) Required materials are authorized to move from stores or from operation to
operation.
(v) Issue m/c loading and schedule chart, route sheet, etc.
(vi) To fix up the responsibilities of guiding and controlling the materials and operation
processes.
(vii) To issue inspection order.
 (viii) Issue of time tickets, drawing, and instruction cards.
Dispatch procedure
The various steps of dispatch procedure for each operation are listed below:
(a) Store issue order: Authorise store department to deliver required material.
(b) Tool order: Authorise tool store to release the necessary tools. The tools can be
collected by the tool room attendant.
(c) Job order: Instruct the worker to proceed with operation.
(d) Time tickets: It records the beginning and ending time of the operation and forms the
basis for workers pay.
(e) Inspection order: Notify the inspectors to carry out necessary inspections and report
the quality of the component.
(f) Move order: Authorise the movement of materials and components for one facility to
another for further operation.
In addition, there are certain dispatch aspects such as:
(1) All production information should be available beforehand.
(2) Various order cards and drawing with specification should be ready.
(3) Equipment should be ready for use.
(4) Progress of various orders should be recorded.
(5) All production records should be on Gantt chart.
(a) Centralized Dispatching:
In centralized dispatching system, a central dispatching department orders directly to the
work stations. It maintains a full record of the characteristics and capacity of each equipment and
work load against each m/c.
(b) Decentralized Dispatching:
In decentralized dispatching system, the shop supervisor performs the dispatch function.
He/she decides the sequence of handling different orders.
A centralized dispatching system has the following advantages:
(i) Much of red tape (excessive adherence to official rules) is minimized.
(ii) Shop supervisor knows the best about his shop.
(iii) Communication gap is reduced.
(iv) It is easy to solve day to day problem.
Line of balance (LOB)
LOB is a graphical technique used to find out the state of completion of various processes
at a given time for a product. This technique is economical when the production volume is
limited and applied to the production of aircrafts, missiles, heavy machines, etc.
For drawing the LOB, the following information are required:
Contracted schedule of delivery
Key operations in making the product.
The sequence of key events.
The expected/observed lead time w.r.t. delivery of final product.
Based on above information, a diagram is drawn which compares pictorially the planned verses
actual progress. This is called line of balance (LOB).
2 Marks Questions with Answers
PRODUCTION SCHEDULING

1. What do you mean by loading?

Loading may be defined as the assignment of work to a facility without specifying when
the work is done and in what sequence.
2. What is scheduling? What are its objectives?
Scheduling refers to the setting of operation start dates so that jobs will be
completely by their due date.
The objectives of production scheduling are:
i) To meet due date
ii) To minimize lead time
iii) To minimize setup time or cost
iv) To minimize work-in process inventory
v) To maximize machine or labour utilization
3. What is master scheduling?
The master schedule, also known as master production schedule (MPS), formalize the
production plan and translates it into specific end-item requirements over a short to immediate
planning horizon.
4. What is MPS?
The master schedule, also known as master production schedule (MPS), formalize the
production plan and translates it into specific end-item requirements over a short to immediate
planning horizon.
5. What are Gantt charts?
Gantt charts are usual aids used to depict the sequencing, load on facilities, or
progress associated with work effort over a well-defined time period.
6. What is priority sequencing?
Priority sequencing is a systematic procedure for assigning priorities to waiting jobs
thereby determining the sequence in which the jobs will be performed.
7. What are the dispatching rules?
Dispatching rules, also known as priority rules or sequencing rules or scheduling rules,
are the rules used in obtaining a job sequence.
8. What is meant by product sequencing?
Priority sequencing is a systematic procedure for assigning priorities to waiting jobs
thereby determining the sequence in which the jobs will be performed.
9. What is meant by EBQ scheduling?
EBQ scheduling is nothing but the economic batch quantity scheduling that can be
performed by using aggregate run-out method.
10. What do you mean by line-of-balance? What are its uses?
Line-of-balance is a charting technique that uses lead times and assembling
sequencing to compare planned component completion with actual component completions.
11. List the various charts that are used in line-of-balance analysis.
1. Operation programme chart/ or assembly chart,
2. Objective chart
3. Progress chart
4. Line of balance chart
12. What is the use of objective chart?
The objective chart shows the contrast between expected completion schedule of
production and the actual performance.
13. When do you use progress chart?
The progress chart is a bar type chart which shows the actual number of items
produced at each operation stage against the quantities that should have been produced as
indicated by line of balance.
14. What is MRP?
Materials requirements planning(MRP) is a computational technique that converts the
master schedule for final products into a detailed schedule for the raw materials and parts used
in the final products.
15. List the various inputs required for MRP
1. Master production schedule
2. Bill of materials file
3. Inventory record file
16. What is MPS?
Master Production Schedule(MPS) is a detailed plan that shows how many end items
will be available for sale or distribution during specific periods.
17. List some commonly used forms in dispatching.
1. Material requisitions
2. Job cards/ Tickets
3. Labour cards/Tickets
4. Move cards/Tickets
5. Inspection cards/Tickets
6. Tool and gauge tickets
18. What do you mean by expediting?
Expediting, also known as follow-up or progressing, is a control function that keeps track of
the progress of work in accordance with planned schedule.
19. List the various recording methods for the progressing purpose.
1. Gantt charts
2. Visual charts
3. Cumulative and weekly charts
20. What do you mean by dispatching?
Dispatching is the routine of setting productive activities in motion through the release of
orders and instructions, in accordance with previously planned times and sequences,
embodied in route sheets and schedule charts.

16 Marks Questions with Key points

PRODUCTION SCHEDULING

1. What do you mean by Production control system, loading and scheduling:

Describe them?
Basic scheduling problems, production loading, multi product scheduling in batch
production, product sequencing, minimum processing time.
2. What is Batch production scheduling: Explain it.
Sequence of batches, optimizing the production schedule, maintaining the stock level,
specifying batch sizes, minimum cost per unit, maximum profit for whole schedule,
maximum return to the whole schedule, deriving a realistic solution.
3. What are the Scheduling techniques: Explain.
Forward scheduling, Backward scheduling, stages in scheduling, loading, dispatching,
finite and infinite loading, load chart ( Gantt chart) , priority sequencing.
4. Explain the Sequencing rules:
Single point sequencing rules, dynamic sequencing rules, basic scheduling problems
.Scheduling and controlling production for delivery schedules, line of balance method.
5. Describe the Material Requirement Planning (MRP or MRP-1):
Objective flow chart, general overview, operation of MRP system, definition and terms
used in MRP system, MRP inputs, Issues in MRP, potential benefits from MRP, Implementation
in MRP, Problems in designing and managing the MRP system, Evaluation of MRP.
KANBAN, Dispatching, Progress routing and expediting, manufacturing lead time, Techniques
for aligning completion time and due dates.
UNIT V INVENTORY CONTROL AND RECENT TRENDS IN PPC 9

Inventory control-Purpose of holding stock-Effect of demand on inventories-Ordering

procedures. Two bin system -Ordering cycle system-Determination of Economic order quantity
and economic lot size-ABC analysis-Recorder procedure-Introduction to computer integrated
production planning systems elements of JUST IN TIME SYSTEMS-Fundamentals of MRP II
and ERP.

INVENTORY
Introduction
The amount of material, a company has in stock at a specific time is known as inventory or in
terms of money it can be defined as the total capital investment over all the materials stocked in
the company at any specific time. Inventory may be in the form of,
Raw material inventory
In process inventory
Finished goods inventory
Spare parts inventory
Office stationary etc.

Why Inventories?

Inventories are needed because demand and supply cannot be matched for physical and
economic reasons. There are several other reasons for carrying inventories in any organization.

To safe guard against the uncertainties in price fluctuations, supply conditions, demand
conditions, lead times, transport contingencies etc.
To reduce machine idle times by providing enough in-process inventories at appropriate
locations.
To take advantages of quantity discounts, economy of scale in transportation etc.
To decouple operations i.e. to make one operation's supply independent of another's
supply. This helps in minimizing the impact of break downs, shortages etc. on the
performance of the downstream operations. Moreover operations can be scheduled
independent of each other if operations are decoupled.
To reduce the material handling cost of semi-finished products by moving them in large
quantities between operations.
To reduce clerical cost associated with order preparation, order procurement etc.

Inventory Costs

In order to control inventories appropriately, one has to consider all cost elements that are
associated with the inventories. There are four such cost elements, which do affect cost of
inventory.
Unit cost: it is usually the purchase price of the item under consideration. If unit cost is
related with the purchase quantity, it is called as discount price.
 Procurement costs: This includes the cost of order preparation, tender placement, cost of
postages, telephone costs, receiving costs, set up cost etc.

Carrying costs: This represents the cost of maintaining inventories in the plant. It
includes the cost of insurance, security, warehouse rent, taxes, interest on capital
engaged, spoilage, breakage etc.
Stockout costs: This represents the cost of loss of demand due to shortage in supplies.
This includes cost of loss of profit, loss of customer, loss of goodwill, penalty etc.

If one year planning horizon is used, the total annual cost of inventory can be expressed as:

Total annual inventory cost = Cost of items + Annual procurement cost + Annual carrying
cost + Stockout cost
Variables in Inventory Models
D = Total annual demand (in units)
Q = Quantity ordered (in units)
Q* = Optimal order quantity (in units)
R = Reorder point (in units)
R* = Optimal reorder point (in units)
L = Lead time
S = Procurement cost (per order)
C = Cost of the individual item (cost per unit)
I = Carrying cost per unit carried (as a percentage of unit cost C)
K = Stockout cost per unit out of stock
P = Production rate or delivery rate
dl = Demand per unit time during lead time
Dl = Total demand during lead time
TC = Total annual inventory costs
TC* = Minimum total annual inventory costs

Number of orders per year =

Total procurement cost per year = S.D / Q

Total carrying cost per year = Carrying cost per unit * unit cost * average inventory per cycle

Cost of items per year = Annual demand * unit cost = D.C

Total annual inventory cost (TC) =

The objective of inventory management team is to minimize the total annual inventory cost. A
simplified graphical presentation in which cost of items, procurement cost and carrying cost are
depicted is shown in Figure 1 . It can be seen that large values of order quantity Q result in large
carrying cost. Similarly, when order quantity Q is large, fewer orders will be placed and
procurement cost will decrease accordingly. The total cost curve indicates that the minimum cost
point lies at the intersection of carrying cost and procurement cost curves.

Figure 1 : Inventory Related Costs

Inventory Operating Doctrine

When managing inventories, operations manager has to make two important decisions:
When to reorder the stock (i.e. time to reorder or reorder point)
How much stock to reorder (i.e. order quantity)
Reorder point is usually a predetermined inventory level, which signals the operations manager
to start the procurement process for the next order. Order quantity is the order size.
Inventory Modeling
This is a quantitative approach for deriving the minimum cost model for the inventory
problem in hand.
Economic Order Quantity (EOQ) Model
This model is applied when objective is to minimize the total annual cost of inventory in the
organization. Economic order quantity is that size of the order which helps in attaining the above
set objective. EOQ model is applicable under the following conditions.
Demand per year is deterministic in nature
Planning period is one year
Lead time is zero or constant and deterministic in nature
Replenishment of items is instantaneous
Demand/consumption rate is uniform and known in advance
No stockout condition exist in the organization

The total annual cost of the inventory (TC) is given by the following equation in EOQ model.
The graphical representation of the EOQ model is shown in Figure 2 .

Figure 2: Economic Order Quantity Model (EOQ Model)

A numeric illustration of the EOQ model is given in example 1.

ABC manufacturers produces 1, 25,000 oil seals each year to satisfy the requirement of
their client. They order the metal for the bushing in lot of 30,000 units. It cost them $40 to place
the order. The unit cost of bushing is $0.12 and the estimated carrying cost is 25% unit cost. Find
out the economic order quantity? What percentage of increases or decrease in order quantity is
required so that the ordered quantity is Economic order quantity?
Economic Production Quantity (EPQ) Model

In EOQ model supply was instantaneous, which may not be the case in all industrial
applications. If supply of items is gradual to satisfy a continuous demand, then supply line will
be depicted by a slanted line (Figure 3 ). Figure 3 : Economic Production Quantity Model
(EPQ Model)

In this situation, when the order is placed, the supplier begins producing the units and supplies
them continuously. While new units are added to inventory, other units are being used. Thus, if
delivery rate (P) > demand rate (D), the net result will be a net increase in the inventory level.
The slope of replenishment line will thus be (P-D). Similarly the slope of demand line will be (-
D). The average inventory carried per year is
A numeric illustration of the EPQ model is given in

MRP

Introduction

It was discussed in demand forecasting that in the dependent demand situation, if the
demand for an item is known, the demand for other related items can be deduced. For example, if
the demand of an automobile is known, the demand of its sub-assemblies and sub components
can easily be deduced. For dependent demand situations, normal reactive inventory control
systems (i.e. EOQ etc.) are not suitable because they result in high inventory costs and unreliable
delivery schedules. More recently, managers have realized that inventory planning systems (such
as materials requirements planning) are better suited for dependent demand items. MRP is a
simple system of calculating arithmetically the requirements of the input materials at different
points of time based on actual production plan. MRP can also be defined as a planning and
scheduling system to meet time-phased materials requirements for production operations. MRP
always tries to meet the delivery schedule of end products as specified in the master production
schedule.

MRP Objectives
MRP has several objectives, such as:
Reduction in Inventory Cost: By providing the right quantity of material at right time to
meet master production schedule, MRP tries to avoid the cost of excessive inventory.

Meeting Delivery Schedule: By minimizing the delays in materials procurement,

production decision making, MRP helps avoid delays in production thereby meeting
delivery schedules more consistently.
 Improved Performance: By stream lining the production operations and minimizing the
unplanned interruptions, MRP focuses on having all components available at right place
in right quantity at right time.

MRP System

A simple sketch of an MRP system is shown in figure 1. It can be seen from the figure that an
MRP system has three major input components:

Figure 1: Material Requirements Planning System Architecture

Master Production Schedule (MPS): MPS is designed to meet the market demand (both the
firm orders and forecasted demand) in future in the taken planning horizon. MPS mainly depicts
the detailed delivery schedule of the end products. However, orders for replacement components
can also be included in it to make it more comprehensive.
Bill of Materials (BOM) File: BOM represents the product structure. It encompasses
information about all sub components needed, their quantity, and their sequence of
buildup in the end product. Information about the work centers performing buildup
operations is also included in it.
Inventory Status File: Inventory status file keeps an up-to-date record of each item in
the inventory. Information such as, item identification number, quantity on hand, safety
stock level, quantity already allocated and the procurement lead time of each item is
recorded in this file.
After getting input from these sources, MRP logic processes the available information and gives
information about the following:

Planned Orders Receipts: This is the order quantity of an item that is planned to be
ordered so that it is received at the beginning of the period under consideration to meet
 the net requirements of that period. This order has not yet been placed and will be placed
in future.
Planned Order Release: This is the order quantity of an item that is planned to be
ordered in the planned time period for this order that will ensure that the item is received
when needed. Planned order release is determined by offsetting the planned order receipt
by procurement lead time of that item.
Order Rescheduling: This highlight the need of any expediting, de-expediting, and
cancellation of open orders etc. in case of unexpected situations.

2 Marks Questions with Answers

Inventory Control and Recent Trends in PPC

1) Define term inventory and inventory control.

An inventory is a stock of an item or idle resource held for future use. Inventory
control may be defined as the Scientific method of determining
what to order , when to order and how much to order and how much to stock so that the costs
associated with buying and storing are optimal without interrupting production and sales.
2) Mention at least four reasons for keeping an inventory.
1. To maintain independence of operations.
2. To meet variation in product demand.
3. To allow flexibility in production scheduling.
4. To provide a safeguard for variation in raw material delivery time.
3) What are inventory costs?
The major costs associated with procuring and holding inventories are:
1. Ordering costs,
2. Carrying(or holding) costs,
3. Shortage (or stock out) costs
4. Purchase costs.
4) Define the following terms: (a) Lead time (b) Re-order point
(a)Lead time: The time gap between placing of an order and its actual arrival in the
inventory is known as a lead time.
(b) Re-order point: The level of inventory at which an order is placed is known as
Re-order point or re-orders level.
5) Define the terms buffer stock, and re-order quantity.
Safety or buffer stock: This represents the minimum stock which must be
maintained at all times. If stock is less than the buffer stock, then the work will stop due to
shortage of materials.
Re-order quantity: The quantity of items to be ordered at re-orders level is
known as re-order quantity.
6) What is EOQ?
The technique of economic ordering quantity (EOQ) strikes a balance
between the ordering cost and the carrying cost. EOQ is the size of order which
minimizes the total cost of carrying inventory and ordering.
7) What do you understand by fixed-time period model/
The fixed time period models are also referred to us the periodic system, periodic
review system, fixed order interval system and P model.
In a fixed time period system, periodic review of inventories is made and order is invariably
placed in that period.
8) What is JIT?
Just-In-Time is a management that strives to eliminate sources of manufacturing
waste by producing the right part in the right place at the right time.
9) What are the objectives of JIT?
The JIT is applied to achieve the following goals:
1. Zero defects
2. Zero setup time
3. Zero inventories
4. Zero handling
5. Zero breakdowns
6. Zero lead time and
7. Lot size of one.
10) List the seven wastes that becomes the target of elimination in a JIT process
1. Waste of over production
2. Waste of waiting
3. Waste of transportation
4. Waste of processing itself
5. Waste of stocks
6. Waste of motion
7. Waste of making defective products
11) What do you mean by kanban production control system?
Kanban means sign or instruction card in Japanese. A kanban is a card that is attached
to a storage and transport container. It identifies the part number and container capacity, along
with other information.
12) Differentiate between Pull system and Push system
A kanban system, is a Pull system, in which the Kanban is used to Pull parts to the next
production state when they are needed i.e., in Pull system product is made to order.
A MRP system is a Push system in which a detail production scheduled for each part is
used to Push the parts to the next production stage when scheduled i.e., in a Push system the
product is made to stock.
13) What is MRP II?
MRP II is defined as a computer base system for planning scheduling and controlling the
materials, resources and supporting activities needed to meet the Master Production Schedule.
Infact MRP II consist of vertully all the functions in a PPC system plus additional
business functions that are related to production.
14) What are the functions of MRP II?
1. Management planning: Business strategy aggregate production planning, master
production scheduling, rough cut capacity planning and Budget planning.
2. Customer services: Sales forecasting, order entry, sales analysis and finished
goods inventory
3. Operations planning: Purchase order and work order release
4. Operations execution: Purchasing, product scheduling and control, work- in-
process, inventory control shop floor control and labour hour tracking
 5. Financial function: Cost accounts receivable, accounts payable, general ledger
and payroll.
15. Define the terms inventory and inventory control?
An inventory is a stock of an item or idle resource held for future use.Inventory control
may be defined as the scientific method of determining what to order, when to order and how
much to order and how much to stock so that costs associated with buying and storing are
optimal without interrupting production and sales.
16. Differentiate between anticipation and fluctuation inventories.
Anticipation inventories: these are stocks maintained to meet the anticipated i.e.,
expected demand.
Fluctuation inventories: these are safety stocks maintained to meet the unexpected
demand and thereby to avoid the risk of losing sales.
17. Contrast lot size inventories with transportation inventories.
Lot size inventories: Goods are brought in large to get the benefit of discount. The goods
so purchased are stocked unit sale or use.
Transportation inventories: When transport of items requires a long time, then items in
transport represent the inventory.
18. Mention at least four reasons for keeping an inventory.
i. To maintain independence of operations
ii. To meet variation in product demand
iii. To allow flexibility in production scheduling
iv. To provide a safeguard for variation in raw material delivery time.
19. What are inventory costs?
i) Ordering costs ii) Carrying costs iii) Shortage costs iv) Purchase cost
20. What do you mean by inventory carrying costs?
Inventory carrying costs are the costs associated with holding a given level of
inventory on hand.
The holding costs include:
i) Costs for storage facilities
ii) Handling costs
iii) Depreciation, taxes and insurance
iv) Costs on record keeping
21. What is EOQ?
The technique of economic ordering quantity (EOQ) strikes a balance between the
ordering cost and the carrying cost. EOQ is that size of order which minimizes the total costs of
carrying inventory and ordering.
22. What is JIT?
Just-In-Time (JIT) is a management that strives to eliminate sources of manufacturing
waste by producing the right part in the right place at the right time.
23. Mention any four ERP packages that are widely used in India.
1. SAP
2. JD Edwards
3. Mfg/Pro
4. BPCS
5. Marshal
6. Oracle Financials
24. List the seven wastes that becomes the target of elimination in a JIT process.
i) Waste of over production
ii) Waste of waiting
iii) Waste of transportation
iv) Waste of processing itself v)
Waste of stocks
vi) Waste of motion
vii) Waste of making defective products

16 Marks Questions with Key points

Inventory Control and Recent Trends in PPC

1 What is Inventory Control:Explain them.

Purpose of holding the stock, functioning of inventory control, effective running of
stores, Technological responsibility for the state of merchandise, stock control system.
2 What are the Effects of demand on inventories:
Effect of a demand impulse on requirement in successive periods, restrictive on output
increase, fluctuation in distribution channels, stock control system.
3 Write about the Ordering procedures:
Two bin system, ordering cycle system, combination of two bin system and the
ordering cycle systems. Reorder quantity, Reorder range, Effect of splitting and order.
4 Discuss about the Reorder procedure:
Reorder point in the two bin system, reorder procedure in the cycle system, effect of
uncertainty, comparison of replenishment policies, optimistic, realistic and pessimistic
policies.
5 Discuss about the Determination of Economic order quantity:
Economic lot size, ABC analysis. Introduction to computer integrated production
planning system, Elements of JIT system.

6 Describe about the Fundamentals of MRP-II:

From MRP-I to MRP- II, Evolution of MRP-II, closed loop MRP.

7 Write a note on ERP:

Functioning of ERP, features of ERP, scope and benefits of ERP, applications of ERP,
selection of ERP package.