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CAD vs CAMCAD and CAM are important tools in designing and manufacturing. Before the adventofcomputersand especially PC in the eighties, draftsmen performed important role indesigning in companies. But computers changed the scenario completely. Their affordabilityand versatility allowed engineers to do drafting on their own. Today hand drafting for

designing has become obsolete and the days of compasses and protractors are virtuallyover. CAD and CAM are important terms in the field of design and manufacture and refer toComputer Aided Design and Computer Aided Manufacture respectively.CADCAD is the use of computers for designing in simple language. It is also known as CADD,which stands for computer aided design and drafting. In CAD, a wide range of computerbased tools are used to assist engineers, architects and other design professionals in theirdesign activities.Originally CAD referred to computer aided drafting as it was a replacement of traditionaldrafting board. But today it is called designing to reflect the fact that much more can be donewith the help of computers besides just drafting. CAD is usually employed when simpledrafting is not able to do the job such as in design of automobiles, airplanes, ships and other

industrial designs.CAMCAM is the use of computer based tools that assist engineers, tool and die makers and CNCmachinists in the manufacture and prototyping of productcomponents. While CAD has manyfunctions that do not necessarily involve CAM, the same cannot be said about CAM, and ingeneral, CAM is heavily dependent upon CAD.Difference between CAD and CAMCAD and CAM are both part of an over all important process that is referred to as computeraidedengineering(CAE). CADS and CAM have similar advantages and they render items in2D or 3D. Both CAD and CAM help in quick processing and production of any design that isconceptualized by a scientist. Most of the CAM machines have inbuilt CAD software.The major difference between CAD and CAM lies in the end user. While CAM software is

mostly used by an engineer, CAM is used by a trained machinist. These machinists arehighly skilled and are equivalent to a computer engineer.

Summary

CAD refers to Computer Aided Design, while CAM stands for Computer Aided

Manufacture.

CAD and CAM have revolutionized the way things are designed and

manufactured.

CAD and CAM are heavily dependent upon each other.

Read more:http://www.differencebetween.com/difference-between-cad-and-vs-

cam/#ixzz1JDGYNmOC

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Standardization is the process of developing and implementingtechnical standards.

The goals of standardization can be to help with independence of

singlesuppliers(commoditization),compatibility,interoperability,safety,repeatability

, orquality.Insocial sciences, includingeconomics, the idea of standardizationis close to the

solution for acoordination problem, a situation in which all parties can realize mutual

gains, but only by making mutually consistent decisions. Standardizationis defined

as best technical application consentual wisdom inclusive of processes for selection

in making appropriate choices forratificationcoupled with consistent decisions for

maintaining obtained standards. This view includes the case of "spontaneous

standardization processes", to producede facto standards.

Contents

[hide]

1 Usage

2 Techniques

3 Other uses

4 Types

5 Further reading

6 See also

7 References

[edit]Usage

Standardization is the process of establishing atechnical standard, which could be a

standardspecification, standardtest method, standarddefinition, standard procedure

(or practice), etc.

The existence of a published standard does not necessarily imply that it is useful or

correct. Just because an item is stamped with a standard number does not, by itself,

indicate that the item is fit for any particular use. The people who use the item or

service (engineers, trade unions, etc) or specify it (building codes, government,

industry, etc) have the responsibility to consider the available standards, specify the

correct one, enforce compliance, and use the item correctly.Validationof suitability

is necessary.

Standardization is implemented greatly when companies release new products to

market. Compatibility is important for products to be successful; many devices

http://en.wikipedia.org/wiki/Technical_standardhttp://en.wikipedia.org/wiki/Technical_standardhttp://en.wikipedia.org/wiki/Technical_standardhttp://en.wikipedia.org/wiki/Wholesalerhttp://en.wikipedia.org/wiki/Wholesalerhttp://en.wikipedia.org/wiki/Wholesalerhttp://en.wikipedia.org/wiki/Commoditizationhttp://en.wikipedia.org/wiki/Commoditizationhttp://en.wikipedia.org/wiki/Commoditizationhttp://en.wikipedia.org/wiki/Compatibilityhttp://en.wikipedia.org/wiki/Compatibilityhttp://en.wikipedia.org/wiki/Compatibilityhttp://en.wikipedia.org/wiki/Interoperabilityhttp://en.wikipedia.org/wiki/Interoperabilityhttp://en.wikipedia.org/wiki/Interoperabilityhttp://en.wikipedia.org/wiki/Safetyhttp://en.wikipedia.org/wiki/Safetyhttp://en.wikipedia.org/wiki/Safetyhttp://en.wikipedia.org/wiki/Repeatabilityhttp://en.wikipedia.org/wiki/Repeatabilityhttp://en.wikipedia.org/wiki/Quality_(business)http://en.wikipedia.org/wiki/Quality_(business)http://en.wikipedia.org/wiki/Quality_(business)http://en.wikipedia.org/wiki/Social_scienceshttp://en.wikipedia.org/wiki/Social_scienceshttp://en.wikipedia.org/wiki/Social_scienceshttp://en.wikipedia.org/wiki/Economicshttp://en.wikipedia.org/wiki/Economicshttp://en.wikipedia.org/wiki/Economicshttp://en.wikipedia.org/wiki/Coordination_problemhttp://en.wikipedia.org/wiki/Coordination_problemhttp://en.wikipedia.org/wiki/Coordination_problemhttp://en.wikipedia.org/wiki/Ratificationhttp://en.wikipedia.org/wiki/Ratificationhttp://en.wikipedia.org/wiki/Ratificationhttp://en.wikipedia.org/wiki/De_facto_standardhttp://en.wikipedia.org/wiki/De_facto_standardhttp://en.wikipedia.org/wiki/De_facto_standardhttp://en.wikipedia.org/wiki/Standardizationhttp://en.wikipedia.org/wiki/Standardizationhttp://en.wikipedia.org/wiki/Standardizationhttp://en.wikipedia.org/wiki/Standardization#Usagehttp://en.wikipedia.org/wiki/Standardization#Usagehttp://en.wikipedia.org/wiki/Standardization#Techniqueshttp://en.wikipedia.org/wiki/Standardization#Techniqueshttp://en.wikipedia.org/wiki/Standardization#Other_useshttp://en.wikipedia.org/wiki/Standardization#Other_useshttp://en.wikipedia.org/wiki/Standardization#Typeshttp://en.wikipedia.org/wiki/Standardization#Typeshttp://en.wikipedia.org/wiki/Standardization#Further_readinghttp://en.wikipedia.org/wiki/Standardization#Further_readinghttp://en.wikipedia.org/wiki/Standardization#See_alsohttp://en.wikipedia.org/wiki/Standardization#See_alsohttp://en.wikipedia.org/wiki/Standardization#Referenceshttp://en.wikipedia.org/wiki/Standardization#Referenceshttp://en.wikipedia.org/w/index.php?title=Standardization&action=edit&section=1http://en.wikipedia.org/w/index.php?title=Standardization&action=edit&section=1http://en.wikipedia.org/w/index.php?title=Standardization&action=edit&section=1http://en.wikipedia.org/wiki/Technical_standardhttp://en.wikipedia.org/wiki/Technical_standardhttp://en.wikipedia.org/wiki/Technical_standardhttp://en.wikipedia.org/wiki/Specification_(technical_standard)http://en.wikipedia.org/wiki/Specification_(technical_standard)http://en.wikipedia.org/wiki/Specification_(technical_standard)http://en.wikipedia.org/wiki/Test_methodhttp://en.wikipedia.org/wiki/Test_methodhttp://en.wikipedia.org/wiki/Test_methodhttp://en.wikipedia.org/wiki/Definitionhttp://en.wikipedia.org/wiki/Definitionhttp://en.wikipedia.org/wiki/Definitionhttp://en.wikipedia.org/wiki/Validation_and_verificationhttp://en.wikipedia.org/wiki/Validation_and_verificationhttp://en.wikipedia.org/wiki/Validation_and_verificationhttp://en.wikipedia.org/wiki/Validation_and_verificationhttp://en.wikipedia.org/wiki/Definitionhttp://en.wikipedia.org/wiki/Test_methodhttp://en.wikipedia.org/wiki/Specification_(technical_standard)http://en.wikipedia.org/wiki/Technical_standardhttp://en.wikipedia.org/w/index.php?title=Standardization&action=edit&section=1http://en.wikipedia.org/wiki/Standardization#Referenceshttp://en.wikipedia.org/wiki/Standardization#See_alsohttp://en.wikipedia.org/wiki/Standardization#Further_readinghttp://en.wikipedia.org/wiki/Standardization#Typeshttp://en.wikipedia.org/wiki/Standardization#Other_useshttp://en.wikipedia.org/wiki/Standardization#Techniqueshttp://en.wikipedia.org/wiki/Standardization#Usagehttp://en.wikipedia.org/wiki/Standardizationhttp://en.wikipedia.org/wiki/De_facto_standardhttp://en.wikipedia.org/wiki/Ratificationhttp://en.wikipedia.org/wiki/Coordination_problemhttp://en.wikipedia.org/wiki/Economicshttp://en.wikipedia.org/wiki/Social_scienceshttp://en.wikipedia.org/wiki/Quality_(business)http://en.wikipedia.org/wiki/Repeatabilityhttp://en.wikipedia.org/wiki/Safetyhttp://en.wikipedia.org/wiki/Interoperabilityhttp://en.wikipedia.org/wiki/Compatibilityhttp://en.wikipedia.org/wiki/Commoditizationhttp://en.wikipedia.org/wiki/Wholesalerhttp://en.wikipedia.org/wiki/Technical_standard

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coming out haveUSB,Ethernet, or other standard types of connection. This allows

consumers to use their new items along with what they already own.

By using standardization, groups can easily communicate through the set guidelines,

in order to maintain focus. The method is made to facilitate processes and tasks; thisis why it interlocks with lean manufacturing.

[edit]Techniques

There are typically four different techniques for standardization

Simplification or variety control

Codification

value engineering / value analysis

Statistical process

[edit]Other uses

Instatistics, standardization refers to conversion tostandard scores.

Intest theory, standardization refers to measurements or assessments

conducted under exact, specified, and repeatable conditions.

Insupply chain management, standardization refers to approaches for increasing

commonality of either part, process, product orprocurement. Such change will

enable delayed making ofmanufacturingor procurement decisions, thus reducing

variability found in having many non-standard components.

From aNew institutional economicspoint of view, standardization processstarts

with a social problem known as "coordination dilemma". Standards, as "voluntary

norms", serve to facilitate the resolution ofcoordination dilemmasand realize

mutual gains; then standardrefer also to a kind of social dilemma solution.

[edit]Types

Types of standardization process:

Emergence asde facto standard:tradition, market domination, etc.

Written by aStandards organization:

in a closed consensus process: Restricted membership and often having

formal procedures for due-process among voting members

in a full consensus process: usually open to all interested and qualified parties

and with formal procedures for due-process considerations.

Written by a government or regulatory body

Written by a corporation, union, trade association, etc

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A bill of materials (sometimes bill of material or BOM)is a list of the raw materials, sub-assemblies,intermediate assemblies, sub-components, components,parts and the quantities of each needed to manufactureanend product. No physical dimension is described inBOM[1][2]

It may be used for communication betweenmanufacturing partners,[3]or confined to a singlemanufacturing plant.

A BOM can define products as they are designed(engineering bill of materials), as they are ordered (salesbill of materials), as they are built (manufacturing bill of

materials), or as they are maintained (service bill ofmaterials). The different types of BOMs depend on thebusiness need and use for which they are intended. Inprocess industries, the BOM is also known asthe formula, recipe, or ingredients list. In electronics, the

BOM represents the list of components used on theprinted wiring board or printed circuit board. Once the

design of the circuit is completed, the BOM list is passedon to the PCB layout engineer as well as componentengineer who will procure the components required forthe design.

BOMs are hierarchical in nature with the top levelrepresenting the finished product which may be a sub-assembly or a completed item. BOMs that describe the

sub-assemblies are referred to asmodular BOMs. An

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example of this is the NAAMS BOM that is used in theautomative industry to list all the components in anassembly line. The structure of the NAAMS BOM is

System, Line, Tool, Unit and Detail.The first hierarchical databases were developed forautomating bills of materials for manufacturingorganizations in the early 1960s. At present this BOM isused as a data base to identify the many parts and theircodes in automobile manufacturing companies.[4]

A bill of materials "implosion" links component pieces to

a major assembly, while a bill of materials "explosion"breaks apart each assembly or sub-assembly into itscomponent parts.

A BOM can be displayed in the following formats:

A single-level BOM that displays the assembly orsub-assembly with only one level of children. Thus it

displays the components directly needed to make theassembly or sub-assembly.

[5]

An indented BOM that displays the highest-level itemclosest to the left margin and the components used inthat item indented more to the right.[1]

Modular (planning) BOM

A BOM can also be visually represented by a product

structure tree, although they are rarely used in theworkplace.[1][edit]

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Getting Started: BOM ProcedureThe ABC Lamp Company product line example fromFogarty, Blackstone, and Hoffmann

(1991)illustrates the basic features of PROC BOM. The Part Master data set,PMaster0,

displayed inFigure 2.1, contains the part master records for all items in the company. Each

master record contains the part number (denoted by the Partvariable) and the part description(denoted by the Desc variable) for an item. It also contains data on unit of measure (denoted

by the Unit variable) for the item. The Product Structure data set, ParComp0, displayed

inFigure 2.2, contains all product structure records in the company. Each product structure

defines a parent-component relationship. The Parent variable contains the part number for the

parent item and the Component variable contains the part number for the component.

The QtyPer variable contains the quantity per assembly for the parent-component

relationship.

The values for the Parent and Component variables are linked by the value of

the Part variable in the Part Master data set to define the parent-component relationship. For

example, in the 11th observation of the data set ParComp0 (as displayed inFigure 2.2), thevalue '1100' for the Parent variable is linked to the first observation of the data

set PMaster0 (as displayed inFigure 2.1), which provides the part description and unit of

measure for the parent item. Similarly, the value of '2100' for the Componentvariable is

linked to the eighth observation of the part master file providing the master data for the

component. Therefore, the parent-component relationship that is represented in the 11th

observation of the product structure data set, ParComp0, should be interpreted as: each

finished shaft uses 26 inches of 3/8 steel tubing.

ABC Lamp Company

Part Master Data Set

Obs Part Desc Unit

1 1100 Finished shaft Each

2 1200 6-Diameter steel plate Each

3 1300 Hub Each

4 1400 1/4-20 Screw Each

5 1500 Steel holder Each

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6 1600 One-way socket Each

7 1700 Wiring assembly Each

8 2100 3/8 Steel tubing Inches

9 2200 16-Gauge lamp cord Feet

10 2300 Standard plug terminal Each

11 A100 Socket assembly Each

12 B100 Base assembly Each

13 LA01 Lamp LA Each

14 S100 Black shade Each

Figure 2.1: Part Master File (PMaster0)

ABC Lamp Company

Product Structure Data Set

Obs Parent Component QtyPer

1 LA01 B100 1

2 LA01 S100 1

3 LA01 A100 1

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4 B100 1100 1

5 B100 1200 1

6 B100 1300 1

7 B100 1400 4

8 A100 1500 1

9 A100 1600 1

10 A100 1700 1

11 1100 2100 26

12 1500 1400 2

13 1700 2200 12

14 1700 2300 1

Figure 2.2: Product Structure File (ParComp0)

The following code invokes PROC BOM to produce the indented bill of material for the

product 'LA01' and the summarized parts list for the production plan in which 1 unit

of'LA01' is planned in the current planning period (period 1).

/* Create the indented BOM and summarized parts list */

proc bom data=ParComp0 pmdata=PMaster0out=IndBOM0 summaryout=SumBOM0;

structure / part=Part

parent=Parent

component=Component

quantity=QtyPer

id=(Desc Unit);

run;

The Indented BOM data set, IndBOM0, is displayed inFigure 2.3. This data set contains the

indented bill of material for the product 'LA01'. Each record or observation in this data setcontains product structure data: the part number for the parent item is contained in

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the _Parent_ variable, the part number for the component is contained in the _Part_ variable,

and the quantity per assembly is contained in the QtyPer variable. It also contains the part

master data (Desc and Unit variables) from the Part Master data set for the component

identified by the _Part_ variable. If a component is used in more than one parent item, it

appears in multiple records. For example, the item 1/4-20 Screw (part number '1400') is used

in both Base assembly (part number 'B100') and Steel holder (part number '1500'); this item

occurs in records identified by the values 6 and 10 for the variable Part_ID.

ABC Lamp Company

Indented Bill of Material, Part LA01

_Lev

el_

_Pare

nt_

_Pa

rt_

Desc Qty

Per

Qty_P

rod

Unit Paren

_ID

Part

_ID

_Pro

d_

0 LA0

1

Lamp

LA

. 1 Eac

h

. 0 LA01

1 LA01 B100

Baseasse

mbly

1 1 Each

0 1 LA01

2 B100 110

0

Finish

ed

shaft

1 1 Eac

h

1 2 LA01

3 1100 210

0

3/8

Steeltubing

26 26 Inch

es

2 3 LA01

2 B100 120

0

6-

Diame

ter

steel

plate

1 1 Eac

h

1 4 LA01

2 B100 130

0

Hub 1 1 Eac

h

1 5 LA01

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2 B100 140

0

1/4-20

Screw

4 4 Eac

h

1 6 LA01

1 LA01 S10

0

Black

shade

1 1 Eac

h

0 7 LA01

1 LA01 A10

0

Socke

t

asse

mbly

1 1 Eac

h

0 8 LA01

2 A100 150

0

Steel

holder

1 1 Eac

h

8 9 LA01

3 1500 140

0

1/4-20

Screw

2 2 Eac

h

9 10 LA01

2 A100 160

0

One-

way

socket

1 1 Eac

h

8 11 LA01

2 A100 170

0

Wiring

asse

mbly

1 1 Eac

h

8 12 LA01

3 1700 220

0

16-

Gaug

e

lamp

cord

12 12 Feet 12 13 LA01

3 1700 230

0

Stand

ard

plugtermin

al

1 1 Eac

h

12 14 LA01

Figure 2.3: Indented Bill of Material (IndBOM0)

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As discussed in the section"Overview: BOM Procedure", each indented bill of material can

be illustrated by a family tree. In fact, each record in the Indented BOM data set corresponds

to a node in this tree.Figure 2.4displays the tree diagram for the indented bill of material in

the IndBOM0 data set. Each tree node or record is uniquely identified by

a sequenceor IDnumber that is assigned to it by the procedure. The Part_ID variable

contains this ID number for each record. The Paren_ID variable contains the sequence

number for the parent node or parent record. A parent recordfor a given record is the

record that defines the parent node of the node defined by the given record. For example, the

parent record of record 6 in the data set IndBOM0 is record 1, while record 9 is the parent

record of record 10. Record 0 has no parent record.

Read more:There are four main types of production. Describe each one, giving examples

where each type may be employed. |

Answerbaghttp://www.answerbag.com/q_view/554067#ixzz1JDKHqrOi

Figure 2.4: Tree Diagram for the Bill of Material for LA01

The IndBOM0 data set contains other data: The _Level_ variable denotes the indenture level

number for each node or record. The root node with the sequence number 0 is at level 0, and

the level numbers increase as you look down the tree. The _Prod_ variable contains the part

number of the end item. The Qty_Prod variable contains thequantity per product, that is,the quantity of the component identified by the _Part_ variable required to make one unit of

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the end item 'LA01'. Note that in this particular example, the values of the Qty_Prod variable

are identical to the values of the QtyPer variable. This is because the quantities per assembly

for all the parent-component relationships are 1, except for relationships 'B100'-'1400', '1100'-

'2100', '1500'-'1400', '1700'-'2200'. The components ('1400', '2100', and '2200') of these

parent-component relationships do not have any subcomponents themselves.

Figure 2.3, as well asFigure 2.4, shows that the Indented BOM data set lists all the records

in depth-firstorder. This scheme lists tree nodes from top to bottom and from left to right.

For example, item '1100' is listed directly after its parent, 'B100', and before

items 'S100' and 'A100' (the right siblings of item 'B100'). Similarly, item '2100' is listed

directly after item '1100' and before items '1200', '1300', and '1400'. Refer toAho, Hopcroft,

and Ullman (1983)for details about depth-first ordering. See the section"Indented BOM

Data Set"for details regarding the records in this data set.

ABC Lamp Company

Summarized Parts List, Period 1

_Part_ Low_Code Gros_Req On_Hand Net_Req Desc Unit

1100 2 1 0 1 Finished

shaft

Each

1200 2 1 0 1 6-

Diameter

steel

plate

Each

1300 2 1 0 1 Hub Each

1400 3 6 0 6 1/4-20

Screw

Each

1500 2 1 0 1 Steel

holder

Each

1600 2 1 0 1 One-way

socket

Each

1700 2 1 0 1 Wiring

assembly

Each

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2100 3 26 0 26 3/8 Steel

tubing

Inches

2200 3 12 0 12 16-

Gaugelamp

cord

Feet

2300 3 1 0 1 Standard

plug

terminal

Each

A100 1 1 0 1 Socket

assembly

Each

B100 1 1 0 1 Base

assembly

Each

LA01 0 1 0 1 Lamp LA Each

S100 1 1 0 1 Black

shade

Each

Figure 2.5: Summarized Parts List (SumBOM0)

The Summarized Parts data set, SumBOM0, is displayed inFigure 2.5. This data set, which

has been sorted by the _Part_ variable, has a record for each item in the ABC Lamp

Company's product line. Each record contains the part master data from the Part Master data

set, PMaster0. The _Part_, Desc, and Unit variables contain the part number, part description,

and unit of measure, respectively, for each item. It also contains some other

data: The Low_Code variable denotes the low-level codeof the item. The low-level code

for an item is a number that indicates the lowest level in any bill of material at which this

item appears. For example, item '1400' appears at levels 2 and 3 in this example; thus, its

low-level code is 3. The low-level codes are necessary to make sure that the net requirement

for a given item is not calculated until all the gross requirements have been calculated down

to that level. The On_Hand variable contains the quantity of the item currently on hand. Since

the part master file (as shown inFigure 2.1) does not contain any quantity on hand

information, the procedure assumes that this variable is 0 for allitems. The Gros_Req and Net_Req variables contain the gross and net requirements,

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respectively. Again, since the PMaster0 data set does not provide any production plan

information, PROC BOM assumes that the final product, 'LA01', is the only master schedule

item and the gross requirement for this item is 1 unit. The net requirement for item 'LA01' is

the gross requirement (1) minus the quantity on hand (0). The gross and net requirements of

the other items are then calculated sequentially:'B100' Base assembly (1 per lamp)

Gross requirement

(= net requirement of 'LA01' quantity per assembly)

Quantity on hand

Net requirement 1

'1100' Finished shaft (1 per base assembly)

Gross requirement

(= net requirement of 'B100' quantity per assembly)

Quantity on hand

Net requirement 1

'2100' 3/8 Steel tubing (26 inches per shaft)

Gross requirement

(= net requirement of '1100' quantity per assembly)

Quantity on hand

Net requirement 26

If an item (such as item '1400' in this example) is used in more than one assembly, the gross

requirement is the total needed in all assemblies where it is used. See the

section"Summarized Parts Data Set"for details about determining the gross and net

requirements.Recall that the Part Master data set (as shown inFigure 2.1) does not contain any quantity on

hand and requirement information, and item 'LA01' is the only final product. Thus, in this

example, the summarized parts list (as displayed inFigure 2.5) is actually the same as the

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summarized bill of material for item 'LA01', with the gross (or net) requirement representing

the total usage of each item.

TYPES OF PRODUCTION SYSTEM

The production system varies from factory to factory and from product toproduct. However, one of the most important issues is productionvolume. The most common type of production systems are:

1. Job shop production2. Batch production3. Mass production

Further, a particular type of job shop situation is project production.Similarly, the mass production could be line (or flow production) and

continuous production.

Methods of production

Production is at the heart of all industry and is the process of using the resources of

a firm to convert inputs into outputs, which are products or services desired by

customers.

Job production

Job production is used to create one-off orders or jobs especially made for the

purpose. This might be a relatively small job such as bespoke suit or a sandwich

made to order in a caf, or it could be a massive job such as a cruise liner or the

Arsenals new stadium.

Job production helps ensure that the product or service matches the customers

exact needs, as closely as the firm is able, because it is literally custom-made. In

many cases, skilled or specialised staff make products of very high quality, or which

have individual character that might have less appeal if they were mass-produced.

Job production is a relatively expensive process because it requires specialised and

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skilled staff who concentrate on the individual job or project. It is therefore labour

intensive, although some projects such as the cruise liner may also need a lot of

expensive capital equipment.

Small businesses that are built on the skills of the owner, such as a window cleaneror a hairdresser, use job production techniques.

Batch production

As the name suggests, products are produced in small or large batches. This

process is useful to a firm that makes a number of different variations of basically

similar products. Examples would include; a bakery, a car exhaust pipe factory or atoothpaste manufacturer.

If the sandwich shop mentioned above wanted to speed up production, instead of

making sandwiches to order, it might be able to benefit by making the days

sandwiches in batches of all the different types and have them available for sale,

pre-packed.

A toothpaste manufacturer will set its weekly batches of production of each product

according to the orders from the supermarkets and wholesalers. The samemachinery is used for each product but the ingredients, packaging an/or size is

changed for each batch as required. It is crucial that the machinery can be quickly

cleaned and re-configured for each new batch to minimise unproductive time.

In a factory that uses flow production (see below), it is quite common for component

parts to be made in batches enough for a weeks production.

Flow production

This is a production line method, where product is continuously produced, flowing

from one stage of production to the next. Workers and, increasingly robots, carry out

individual repetitive tasks aiming to work as quickly as possible without loss of

quality. This is the method pioneered by Henry Ford for his Model T car, and the

efficiencies he gained enabled him to produce large numbers of cars at low cost. Any

product made in high volumes will almost certainly be made on a flow production

line.

This approach to production has close links with FW Taylor and his Scientific schoolof management Taylors motivational theories were all about creating the

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workplace and forms of reward to maximise efficiency. This in turn led to very boring

work and contributed to industrial unrest over the years where workers interests

were overlooked.

More modern, lean production techniques have at least partly recognised the factthat this type of work can be extremely boring, and ideas such as cell production and

quality circles can help improve the workplace as workers become multi-skilled, take

more responsibility for quality and can contribute their ideas for improvements.

Flow production systems are typically capital intensive and it is important to keep

them running smoothly with high levels of capacity utilisation, so that these high

overhead costs are spread over as many units as possible.

Once set up properly, flow production lines can in some cases produce millions of

consistently high quality products.

Cell production

This is a form of flow production in which the line is separated into a number of

sections, each looked after by a group of workers called a cell. Cells take

responsibility for work in their area, such as quality, job rotation, training and so on.

See notes on Lean Production for more detailed discussion of Cell Production.

PLANT LOCATION

Selecting the location of a facility is of strategic importance for any organization as it

acts as the basis for determining the production technology and cost structure. For

example, a manufacturing facility that is located in a less developed country will use a

labor-intensive process, to cash in on the low cost labor and will have a different cost

structure than the one located in a developed country.

In the case of a developed country, the cost of labor will be high because the

manufacturing process will be more capital intensive. Second, location decisions require

huge financial investments and are not easily reversible in the short term. Third, the

location of the facility affects the company's ability to serve customers quickly and

conveniently. Major factors that influence plant location decisions are:

Market proximity.

Integration with other parts of the organization.

Availability of labor and skills.

Availability of amenities.

Availability of transport.

Availability of inputs.

Availability of services. Suitability of land and climate.

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Regional regulations.

Room for expansion.

Safety requirements.

Site Cost.

Political, Cultural and Economic Situation.

Regional taxes, special grants and import/export barriers.

Major functions of production planning and control

A ll 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.

Major Functions of Production Planning and Control:

o Loading

o Scheduling

o Combining Functions

o Dispatching

o Reporting or Follow up

o Corrective Action

o Re-planning

LESSON 8

PRODUCTION PLANNING AND

CONTROL

Abha Kumar

STRUCTURE

8.0 Introduction

8.1 Objectives

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8.2 Production management

8.3 Product design

8.4 Design of production system

8.4.1 Types of production system

8.5 Manufacturing process

8.5.1 Types of manufacturing process

8.5.2 Factors affecting the choice of manufacturing process

8.6 Production planning and control

8.6.1 Benefits to small entrepreneur

8.6.2 Steps of production planning and control

8.7 Summary

8.8 Glossary

8.9 Self-Assessment Questions

8.10 Further Readings

8.0 INTRODUCTION

After taking decisions about the type of business, its location, layout etc. the

entrepreneur steps into the shoe of production manager and attempts to apply

managerial principles to the production function in an enterprise.

Production is a process whereby raw material is converted into semi finished

products and thereby adds to the value of utility of products, which can be

measured as the difference between the value of inputs and value of outputs.

Production function encompasses the activities of procurement, allocation and

utilization of resources. The main objective of production function is to produce

the goods and services demanded by the customers in the most efficient and

economical way. Therefore efficient management of the production function is of

utmost importance in order to achieve this objective. 115

8.1 OBJECTIVES

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After studying this lesson, you should be able to

Describe the production function and its component

Define production management

Analyze various factors, which are crucial for designing the production

Explain the design of production system and manufacturing process

List out the factors influencing the choice of production process

Discuss the benefits, which a small entrepreneur can reap by having

properly designed production planning, and control system

8.2 PRODUCTION MANAGEMENT

Production system is a system whose function is to convert a set of inputs into a

set of desired outputs. Production system is depicted under with help of chart

Figure 8.1: Production System

Production management involves the managerial decisions regarding design of

the product and design of the production system i.e. determination of production

processes and production planning and control.

8.3 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

Inputs Conversion

Process

Outputs

Land

Building

machines

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labour capital

management

material

other

Goods

services

Control 116

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.

8.4 DESIGN OF PRODUCTION SYSTEM

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Production system is the framework within which the production activities of an

enterprise take place. Manufacturing process is the conversion process through

which inputs are converted into outputs. An appropriate designing of production

system ensures the coordination of various production operations. There is no

single pattern of production system which is universally applicable to all types of

production system varies from one enterprise to another.

8.4.1 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 117

plants 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.

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(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.

8.5 MANUFACTURING PROCESS

The nature of the process of production required by these three different types of

production system are distinct and require different conditions for their working.

Selection of manufacturing process is also a strategic decision as changes in the

same are costly. Therefore the manufacturing process is selected at the stage of

planning a business venture. It should meet the basic two objectives i.e. to meet

the specification of the final product and to be cost effective.

8.5.1 TYPES OF MANUFACTURING PROCESS

The manufacturing process is classified into four types.

(i) Jobbing production

(ii) Batch production

(iii) Mass or flow production

(iv) Process Production

(i) Jobbing Production: - Herein one or few units of the products are produced as

per the requirement and specification of the customer. Production is to meet the

delivery schedule and costs are fixed prior to the contract.

(ii) Batch Production: - In this, limited quantities of each of the different types of

products are manufactured on same set of machines. Different products are

produced separately one after the other. 118

(iii) Mass or flow production: Under this, the production run is conducted on a set

of machines arranged according to the sequence of operations. A huge quantity of

same product is manufactured at a time and is stocked for sale. Different product

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will require different manufacturing lines. Since one line can produce only one

type of product, this process is also called as line flow.

(iv) Process Production: Under this, the production run is conducted for an

indefinite period.

8.5.2 FACTORS AFFECTING THE CHOICE OF

MANUFACTURING PROCESS

Following factors need to be considered before making a choice of manufacturing

process.

a) Effect of volume/variety: This is one of the major considerations in selection of

manufacturing process. When the volume is low and variety is high, intermittent

process is most suitable and with increase in volume and reduction in variety

continuous process become suitable. The following figure indicates the choice of

process as a function of repetitiveness. Degree of repetitiveness is determined by

dividing volume of goods by variety.

One

Figure 8.2: Types of Production Processes

b) Capacity of the plant: Projected sales volume is the key factor to make a choice

between batch and line process. In case of line process, fixed costs are

substantially higher than variable costs. The reverse is true for batch process thus

Jobbing

Batching

Line

Process

Degree of

repetitiveness

Quantity

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Many 119

at low volume it would be cheaper to install and maintain a batch process and line

process becomes economical at higher volumes.

c) Lead time: - The continuous process normally yields faster deliveries as

compared to batch process. Therefore lead-time and level of competition certainly

influence the choice of production process.

d) Flexibility and Efficiency: - The manufacturing process needs to be flexible

enough to adapt contemplated changes and volume of production should be large

enough to lower costs.

Hence it is very important for entrepreneur to consider all above mentioned

factors before taking a decision regarding the type of manufacturing process to be

adopted as for as SSI are concerned they usually adopt batch processes due to low

investment.

8.6 PRODUCTION PLANNING AND CONTROL

Once the entrepreneur has taken the decisions regarding the product design and

production processes and system, his next task is to take steps for production

planning and control, as this function is essentially required for efficient and

economical production. One of the major problems of small scale enterprises is

that of low productivity small scale industries can utilise natural resources, which

are otherwise lying.

Small scale sector can play an important role, similar to the one played by small

scale industries in other developed countries.

Planned production is an important feature of the small industry. The small

entrepreneur possessing the ability to look ahead, organize and coordinate and

having plenty of driving force and capacity to lead and ability to supervise and

coordinate work and simulates his associates by means of a programme of human

relation and organization of employees, he would be able to get the best out of his

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small industrial unit.

Gorden and Carson observe production; planning and control involve generally

the organization and planning of manufacturing process. Especially it consists of

the planning of routing, scheduling, dispatching inspection, and coordination,

control of materials, methods machines, tools and operating times. The ultimate

objective is the organization of the supply and movement of materials and labour,

machines utilization and related activities, in order to bring about the desired

manufacturing results in terms of quality, quantity, time and place. 120

Production planning without production control is like a bank without a bank

manager, planning initiates action while control is an adjusting process, providing

corrective measures for planned development. Production control regulates and

stimulates the orderly how of materials in the manufacturing process from the

beginning to the end.

8.6.1 BENEFITS TO SMALL ENTREPRENEUR

Production planning and control can facilitate the small entrepreneur in the

following ways

(1) Optimum Utilisation of Capacity:

With the help of Production Planning and Control [PPC] the entrepreneur can

schedule his tasks and production runs and thereby ensure that his productive

capacity does not remain idle and there is no undue queuing up of tasks via proper

allocation of tasks to the production facilities. No order goes unattended and no

machine remains idle.

(2) Inventory control:

Proper PPC will help the entrepreneur to resort to just- in- time systems and

thereby reduce the overall inventory. It will enable him to ensure that the right

supplies are available at the right time.

(3) Economy in production time:

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PPC will help the entrepreneur to reduce the cycle time and increase the turnover

via proper scheduling.

(4) Ensure quality:

A good PPC will provide for adherence to the quality standards so that quality of

output is ensured.

To sum up we may say that PPC is of immense value to the entrepreneur in

capacity utilization and inventory control. More importantly it improves his

response time and quality. As such effective PPC contributes to time, quality and

cost parameters of entrepreneurial success.

121

8.6.2 STEPS OF PRODUCTION PLANNING AND

CONTROL

Production Planning and Control (PPC) is a process that comprises the

performance of some critical; functions on either side, viz., planning as well as

control. See figure 8.3.

Figure 8.3: PPC Process

Production planning: Production planning may be defined as the technique of

foreseeing every step in a long series of separate operations, each step to be taken

at the right time and in the right place and each operation to be performed in

maximum efficiency. It helps entrepreneur to work out the quantity of material

manpower, machine and money requires for producing predetermined level of

output in given period of time.

Routing: Under this, the operations, their path and sequence are established. To

perform these operations the proper class of machines and personnel required are

also worked out. The main aim of routing is to determine the best and cheapest

Production Planning and control

Production Planning Production Control

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Planning

Routing

Scheduling

Loading

Dispatching

Following up

Inspection

Corrective 122

sequence of operations and to ensure that this sequence is strictly followed. In

small enterprises, this job is usually done by entrepreneur himself in a rather

adhoc manner. Routing procedure involves following different activities.

(1) An analysis of the article to determine what to make and what to buy.

(2) To determine the quality and type of material

(3) Determining the manufacturing operations and their sequence.

(4) A determination of lot sizes

(5) Determination of scrap factors

(6) An analysis of cost of the article

(7) Organization of production control forms.

Scheduling: It means working out of time that should be required to perform each

operation and also the time necessary to perform the entire series as routed,

making allowances for all factors concerned. It mainly concerns with time

element and priorities of a job. The pattern of scheduling differs from one job to

another which is explained as below:

Production schedule: The main aim is to schedule that amount of work which

can easily be handled by plant and equipment without interference. Its not

independent decision as it takes into account following factors.

(1) Physical plant facilities of the type required to process the material being

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scheduled.

(2) Personnel who possess the desired skills and experience to operate the

equipment and perform the type of work involved.

(3) Necessary materials and purchased parts.

Master Schedule: Scheduling usually starts with preparation of master schedule

which is weekly or monthly break-down of the production requirement for each

product for a definite time period, by having this as a running record of total

production requirements the entrepreneur is in better position to shift the

production from one product to another as per the changed production

requirements. This forms a base for all subsequent scheduling acclivities. A

master schedule is followed by operator schedule which fixes total time required

to do a piece of work with a given machine or which shows the time required to

do each detailed operation of a given job with a given machine or process.

Manufacturing schedule: It is prepared on the basis of type of manufacturing

process involved. It is very useful where single or few products are manufactured

repeatedly at regular intervals. Thus it would show the required quality of each

product and sequence in which the same to be operated

Scheduling of Job order manufacturing: Scheduling acquires greater

importance in job order manufacturing. This will enable the speedy execution of

job at each center point. 123

As far as small scale industry is concerned scheduling is of utmost importance as

it brings out efficiency in the operations and s reduces cost price. The small

entrepreneur should maintain four types of schedules to have a close scrutiny of

all stages namely an enquiry schedule, a production schedule, a shop schedule and

an arrears schedule out of above four, a shop schedule is the most important most

suited to the needs of small scale industry as it enables a foreman to see at a

glance.

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1. The total load on any section

2. The operational sequence

3. The stage, which any job has reached.

Loading: The next step is the execution of the schedule plan as per the route

chalked out it includes the assignment of the work to the operators at their

machines or work places. So loading determines who will do the work as routing

determines where and scheduling determines when it shall be done. Gantt Charts

are most commonly used in small industries in order to determine the existing

load and also to foresee how fast a job can be done. The usefulness of their

technique lies in the fact that they compare what has been done and what ought to

have been done.

Most of a small scale enterprise fail due to non-adherence to delivery schedules

therefore they can be successful if they have ability to meet delivery order in time

which no doubt depends upon production of quality goods in right time. It makes

all the more important for entrepreneur to judge ahead of time what should be

done, where and when thus to leave nothing to chance once the work has begun.

Production control: Production control is the process of planning production in

advance of operations, establishing the extract route of each individual item part

or assembly, setting, starting and finishing for each important item, assembly or

the finishing production and releasing the necessary orders as well as initiating the

necessary follow-up to have the smooth function of the enterprise. The production

control is of complicated nature in small industries. The production planning and

control department can function at its best in small scale unit only when the work

manager, the purchase manager, the personnel manager and the financial

controller assist in planning production activities. The production controller

directly reports to the works manager but in small scale unit, all the three

functions namely material control, planning and control are often performed by

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the entrepreneur himself production control starts with dispatching and ends up

with corrective actions.

Dispatching: Dispatching involves issue of production orders for starting the

operations. Necessary authority and conformation is given for:

1. Movement of materials to different workstations.

2. Movement of tools and fixtures necessary for each operation.

3. Beginning of work on each operation.

4. Recording of time and cost involved in each operation. 124

5. Movement of work from one operation to another in accordance with the

route sheet.

6. Inspecting or supervision of work

Dispatching is an important step as it translates production plans into production.

Follow up: Every production programme involves determination of the progress

of work, removing bottlenecks in the flow of work and ensuring that the

productive operations are taking place in accordance with the plans. It spots

delays or deviations from the production plans. It helps to reveal detects in routing

and scheduling, misunderstanding of orders and instruction, under loading or

overloading of work etc. All problems or deviations are investigated and remedial

measurer are undertaken to ensure the completion of work by the planned date.

Inspection: This is mainly to ensure the quality of goods. It can be required as

effective agency of production control.

Corrective measures: Corrective action may involve any of those activities of

adjusting the route, rescheduling of work changing the workloads, repairs and

maintenance of machinery or equipment, control over inventories of the cause of

deviation is the poor performance of the employees. Certain personnel decisions

like training, transfer, demotion etc. may have to be taken. Alternate methods may

be suggested to handle peak loads.

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CHECK YOUR PROGRESS

Activity 1: Circle the key words, which do not belong to this lesson.

Dispatching Plant Layout Inspection

Productivity Index Loading Marketing Mix

Activity 2: Match the following

Routing Working out of time that should be required to perform each

operation

Scheduling To assign the work to the operations at machines or work place

Loading To determine the best and cheapest sequence of operations

Activity 3: Explain the meaning of following key words in your own words

(a) Production planning

(b) Production control

(c) Routing

(d) Scheduling 125

8.7 SUMMARY

Small-scale industries have a challenge to manufacture products at economical

prices. They need to embrace management principles surrounding production

processes, which are effective for the products manufactured by them. An upfront

planning and study of the critical factors of the manufacturing processes will not

only help the small scale entrepreneurs to understand the steps they need to take

in selecting the most appropriate manufacturing process but also help them

identify areas of risk so that necessary control procedures are put in place. This

will eventually help the small entrepreneur to eliminate the wastages and increase

the production, productivity and profits.

8.8 GLOSSARY

Inventory Stock of raw material, WIP or finished goods

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Lead time Time lag between placing an order or getting deliveries

Personnel Team of persons who work for organization

8.9 SELF-ASSESSMENT QUESTIONS

1. Discuss with examples various manufacturing processes?

2. What factors affect the choice of manufacturing process?

3. Write short notes on

a. Production planning

b. Relationship between production planning and control

4. What do you understand by production planning and control? Discuss its

elements in brief.

5. State the requirements for an effective system of production planning and

control?

6. What benefits can small scale enterprises can derive by installing an effective

system of production planning and control?

Definition of MRP: "a time phased priority planningtechnique that calculates material requirements andschedules supply to meet changing demand acrossall products and parts in one or more plants"

MRP is used to derive the master schedule from the

forecast, the sales order or both. The masterschedule is the foundation of all the operations, withMRP handling all the ordering and scheduling of theinventory (raw materials, components, etc). One bigadvantage of MRP is that it analyses and plans yourfuture needs for all dependant demand items. If anitem is not needed, you don't plan for it any more.

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Components of an MRP system

The bills of material in tabular form show theproduct structure, which basically lists all thedifferent component parts and sub-assemblies thatmake up product, showing the lead times andrelationships between each components.

The BOM diagrams show the same information asthe bills of material but are represented in adiagrammatical sense.

The MRP calculations are derived from the bills ofmaterial and the BOM diagrams. This tabular datarepresents the quantity of each component of thefinal product that is required and the current periodof time that it is required for.

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The MRP system outputs a variety of informationthat can be used by the company, both for theplanning side and the management side of the

factory operations. These outputs include orderrelease notices for the placement of orders that mayhave been planned by the MRP simulator system.

The capacity and master schedule need to bemanaged correctly to help reduce the workload andmaximise the effectiveness. Management has a bigresponsibility in this and how they choose to plan

ahead and how effective they are, will in turn effecttheir decisions on the right approach and howeffective the MRP system is. If certain areas becomestressed and overloaded, jobs may end up beingpushed back past their due date and end up beinglate. Planning is very important to help the companybecome more efficient, reduce costs and increase

profits.

Information systems are a competitive tool whenrunning along side traditional stock controlsystems. A computerised MRP system is reliant onthe fact that the demand for low-level components isbrought about from the production of an end

product of which the production level is planned.The system itself will make it easy to put togetherthe production schedule saving vast amount ofmoney that would otherwise be spent on labour timeto do the same activity.

MRP does not take into account the level of capacityof what can or cannot be handled by the shop floor.

MRP is best used in manufacturing companies with

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products and techniques achieve business needs within the

standards set by the market and the regulatory standards bodies.

4.*With the Warehouse and Distribution Manager, develop, direct

and control the warehouse and distribution activities toensure the efficient and economical utilisation of facilities

for storing and distributing the finished goods.

5.*Wtih the Manufacturing Services Manager, develop, direct the

implementation of manufacturing sustainability strategies/

actions plans and continuous improvement programs.

Reporting the Operation/ Production Manager are

*Planning/Production Manager, R & D Engineering Manager,

Manufacturing Services Manager, Factory Services Manager,

Warehousing/ Distribution Manager, &Demand Planning Manager.

SCOPE.

Primary Objective.

*Direct and Control a variety of divergent functional business

activities, including Manufacturing, R&D Engineering, Production,

Logistics, Demand Planning, Manufacturing Services, Factory

Services, to achieve optimum Productivity, Profitability andEffective use of the OPERATION's assets and human resources,

within guidelines set by the Managing Director. Direct planning

activities and provide leadership and guidance on the OPERATION.

SPECIFIC ACCOUNTABILITIES

*Manage and Control the logistics function to ensure supplies of

raw materials, finished goods, parts and accessories are

available within required time frames and budgets.

*With the Planning & Production Manager, develop, direct the

implementation of production business strategies and activities

to enable the production to achieve output and quality objectives.

*With the R&D Engineering Manager, develop, direct the

the research & development/ engineering activities to ensure

products and techniques achieve business needs within the

standards set by the market and the regulatory standards bodies.

*With the Demand Planning Manager, develop, direct and control

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the supply activities to maximise the quality and reliability

of raw materials, parts, accessories and finished goods.

*With the Warehouse and Distribution Manager, develop, direct

and control the warehouse and distribution activities toensure the efficient and economical utilisation of facilities

for storing and distributing the finished goods.

*Wtih the Manufacturing Services Manager, develop, direct the

implementation of manufacturing sustainability strategies/

actions plans and continuous improvement programs.

*Wtih the Factory Services Manager, develop, direct the

service operations and the factory warehousing management.

MAJOR RESPONSIBILITIES.

*Responsible for directing the operation/ PRODUCTION activities to ensure

the current and future plans of the organization are met.

*Report to the Managing Director on major PRODUCTION /operational issues

and results.

*Participates in group corporate planning and budgeting workshops.

*Responsible for the implementation of Demand Flow

Technology and Six Sigma systems.

*Responsible for establishing PRODUCTION / operation Organization

Structure / Management Process.

*Responsible for the Implementation of Policies / Procedures

throughout the PRODUCTION / Operation Department.

*Responsible for recruitment /selection/orientation/training of senior

personnel of the PRODUCTION / operation department.

*Responsible for purchase of Capital goods/ PRODUCTION Operation equipments.

*Responsible for maintenance of equipments.

*Responsible for PRODUCTION /Operation Department Planning/ Budgeting.

*Responsible for Cost Control Programs.

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*Responsible for O H & S Implementation.

*Responsible for Industrial Relations/ Union Negotiation.

*Responsible for Security management.

*Responsible for Building Maintenance.

*Responsible for People Management.

Ensure that personnel under his control have been

inducted into COMPANY 's OHS induction program.

*Take reasonable care for the health, safety and welfare of

themselves and others whilst at work.

How to conduct a time studyFive steps for analyzing outpatient flow in your practice.

Jan 1, 2010

VETERINARY ECONOMICS

Consultant Pamela Stevenson, CVPM, says a time study is a great tool for analyzingoutpatient flow in your practice. "It's one of the quickest and easiest ways to get a grip onan undefined problem," she says. Here's how to do it:

1. Inform the team. Employees need to know that this isn't a pointless exercise; it's a wayto identify problems that keep your practice from offering the best service. What's more,team members' role in recording the data is crucialwithout accurate information, you can't

pinpoint the best solutions.

2. Create time sheets. Set up a system for recording each client's reason for visiting thepractice, the veterinarian he or she saw, and the time at different stages of the visit.

3. Conduct the study. During a two-week period, record the following for all clients whovisit for practice services: the time of arrival, the time they enter an exam room, the time adoctor enters that exam room, the time the doctor leaves, and the time the client checksout. Create a sheet that travels with the client for team members to record these times.

4. Analyze the results. Once the study is complete, enter the data in an Excel

spreadsheet, noting any problematic client wait times.

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5. Develop a plan. Once you see what (and who) the problems are, gather the teamtogether to brainstorm solutions. Develop target goals for your next time study in sixmonths' time.

FIXED ORDER INTERVAL SYSTEM OR P-SYSTEM

Inventory position is monitored at discrete point in time Once an order is placed at time t, another order can not be placed until (t + T), andthesecond order will not be filled until the lead time period has elapsed, at (t + T + L) Thus safety stock protection is needed for the lead-time L plus the order interval T In the fixed order size system, safety stock is needed only for the lead-time period,because the inventory position is monitored with each transaction In the fixed order size system, a higher than normal demand causes a shorter timebetween orders whereas in the fixed order interval system, the result would be alargerorder size

Predetermined inventory level (E)E = S + RT + LRWhere S is the safety stock considering demand variation during (T + L)period and (RT + LR) is the average demand during (T + L) period The orderinterval (T) 20 = =HR

FIXED ORDER QUANTITY SYSTEM OR Q-SYSTEMSafety stock is needed to protect against a stockout after the reorder point isreachedand prior to receipt of an order This period is usually called lead-timeThe reorder point B is composed of the mean lead-time demand plus safety stock Average inventory level on hand just before the receipt of a replenishment order isthesafety stock.Over many cycles, the inventory level will sometimes be more than the safetystock and sometimes less, but it should average to the safety stock Larger the order quantity, fewer the annual orders, which means the feweropportunities for stockout to occur

Safety stocks are dependent on stockout cost or service level, holding cost,demandvariation and lead-time variation Working stock quantity is determined before considering safety stock In the order quantity formulations, it is assumed that the order quantity can bedetermined by an economic balance of the relevant cost, and that it is independentofthe reorder point

EOI in years

Source(s):http://nitc.ac.in/nitc/bulletin/files/opt_25611_1877152227.pdf

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