What is production management? Objectives and 8 main elements of production management
For a manufacturing enterprise to develop and grow sustainably, effective production management is extremely important. So what is production management , what are the goals of production management , what are the main factors in production management, let's find out with 1C Vietnam through the article below.
1.What is production management?
Production Management is the synthesis of all activities related to building a production system in an enterprise, managing the process of using input materials to create finished products, products, and services. output services according to customer requirements or according to the enterprise's production plan to serve the set development goals.
Effective production management helps businesses grow sustainably
To explain more easily, production management activities are a set of activities including planning, monitoring, coordinating, controlling and making decisions related to input and output resources of a process. production process. It combines key elements such as people, money, materials, machines, markets and methods to meet different customer needs. Production management is considered one of the main factors in business management and greatly affects the development and growth of businesses.
2. Objectives of production management
2.1. Ensuring correct quality of goods & services
When it comes to product quality, it is determined by customer needs. After receiving customer requirements, the technical and design departments will convert those requirements into technical specifications to produce products. These parameters are translated into goals that the production department can measure and achieve. The final quality of the product will be determined through measurement and the production department will have to ensure that a reasonable balance is maintained between product quality and the production costs the business has spent.
2.2. Producing enough goods & services
Not only is it necessary to produce correctly, a goal of production management is also very important, which is to ensure the production of enough products and services in appropriate quantities according to customer needs and market demands. If a business produces less product than market demand, it will cause a supply shortage. And vice versa, in case the market demand is less but the business produces more product output, it will cause inventory or inventory exceeding the allowed level, causing inadequacies such as loss of business. additional inventory costs,... Therefore, production management with sufficient quantities of goods & services is necessary and important for businesses.
Production management with sufficient quantities of goods & services is necessary and important for businesses
2.3 . Optimize production costs
Before producing any product, businesses must determine the cost of producing that product and service. And the production of that product must be done within the limits of production costs predetermined by business managers. Ensuring the gap between standard costs and actual production costs is at a minimum level is also a central goal of production management in enterprises.
2 .4. Produce goods & services on schedule
Besides correct, sufficient production and cost optimization, one of the important parameters to determine production efficiency is on-time delivery according to schedule. In some cases, it may be due to a number of factors such as lack of human resources, late arrival of raw materials, machinery breakdown, etc., which will create negative effects on product completion time. Production management will aim to plan various activities related to production, monitor activities to ensure production follows the set schedule and limit risks affecting production. Completion time is kept to a minimum.
Besides the above goals, production management also has the goals of providing adequate human resources; Check the quality and standards of machinery & equipment; Consider the availability of raw materials in warehouse,...
3.8 main elements of production management
3.1. Forecasting production needs
This is the first step in the production management process with the aim of accurately and quickly forecasting market trends, analyzing historical data and being able to collect information from customers, and anticipate potential situations. future change situations.
3.2. Product design
Product design will include sketching initial ideas, developing prototypes and prototypes, and then delivering the final product. These activities must meet the requirements of the market and customers in terms of quality, convenience, aesthetics and economics of the product. Businesses need to research and design products quickly to meet customer needs and create competitive advantages for businesses.
3.3. Production capacity management
Production capacity management and planning plays a very important role in an enterprise's production activities. It helps determine the scale, capacity and production capabilities of an enterprise through analyzing and evaluating parameters related to production such as output, quality, production time, production costs, ...
Production capacity management and planning play a very important role in production activities
3.4. Positioning for businesses
This is the process of determining the strategic position of an enterprise in the market by selecting locations and allocation areas to ensure the enterprise's business goals. To ensure accuracy, production managers need to analyze and evaluate environmental factors that can affect production activities such as resources, markets, laws, economics, society, and culture. optimization,... to provide ways to overcome risks and optimize competitive advantages for businesses.
3.5. Production layout
This is an activity that includes organizing and arranging production space, machinery and equipment suitable for the production line so that production managers can easily manage product quality and achieve high efficiency when operate.
3.6. Plan to arrange resources
Resource planning is a process based on specific production planning to identify and allocate resources within the enterprise such as finance, human resources, machinery, materials, and time to ensure The enterprise's production process is seamless, efficient and cost-optimized.
3.7. Moderation in production
Is the process of managing and coordinating production activities in the production schedule to ensure production progress is on time and jobs are assigned reasonably and in the right order.
Moderation in production to ensure on-time production progress
3.8. Control the entire production system
This is an activity that includes inventory management and quality control of the production system. Regarding inventory management, it is necessary to ensure capital circulation and the balance between consumption and production needs, minimizing the risk of loss and damage. Regarding quality control of the production system, it is necessary to ensure product quality, meet customer and market requirements and maintain uniformity of production processes within the enterprise.
Thus, through the article, we can grasp the definition of production management , the goals of production management and the 8 main factors in production management in enterprises. If you are interested in solutions to help businesses manage production effectively, don't miss 1C:Company Management 's manufacturing business management software from 1C Vietnam. Contact 1C Vietnam immediately for advice and more detailed information.