Production planning: types, methods, stages
From this material you will learn:
- Tasks and functions of production planning
- The components of the production planning system
- The main principles of planning the production process
- Types production planning
- Strategy and tactics in production planning
- 3 methods of production planning
- Phased planning of production activities of the organization
Production planning includes a whole range of measures: from strategy and tactics to capacity planning. It is impossible to carry out this process qualitatively if at least one link falls out of the chain.
There are various planning methods. The use of one or another approach is determined by the specifics of the enterprise, the tasks and goals facing the management. The slightest flaw, and all the time developing the plan will be wasted. Below is detailed how to properly carry out production planning so that it brings results.
Tasks and functions of production planning
To effectively manage production, it must be planned: set goals and objectives of the organization's economic and financial activities and determine the ways to achieve them. That is, it is necessary to formulate planned tasks (measures, actions) and set specific deadlines for their implementation. In this case, the organization is considered as a system consisting of several levels, in which the control object of the higher level is the subject of control of the lower level.
For example, if an enterprise has a shop-floor structure, then the direct supervisor of the section chief (foreman) is not the director, but the head of the shop, who is both the object of the director's management and the subject of management for the foreman. The master, in turn, is the object of management for the head of the shop and the subject of management for his subordinates.
Implementation of the planning function is very important for a subsystem of absolutely any level. Since all subsystems of company management are components of a single system, it is imperative to agree on the goals of their functioning. In this case, the content of planning may vary depending on what place the subsystem occupies in the general management hierarchy, what is its role. There is, of course, a connection between the plans of the plant, workshop, site, and the assignment to the employee, but the content of these plans is different.
Production planning involves forecasting the future. An important point is the desired future. Planning decisions are the result of planning, which the company is guided by in its activities. Planning production in a free market economy is much more difficult than when enterprises are centrally controlled, since the management has to develop its own development prospects.
From the above it follows that effective production planning in the existing market conditions is possible only with the modernization of the principles, forms and content of the process of forming planned targets.
For example, when a former company is liquidated, all positive developments are taken from there, which are subsequently corrected taking into account mistakes or oversights. But more often than not, this item has to start from scratch.
What should be included there?
In case of a positive result of the analysis, one should think over the question of the prospects of the adopted technology - it should be at least 20-25% more perfect than that of the closest competitors. In this case, specialized knowledge weighs more than the services of a consulting firm: it is unlikely that a plan of an ideal enterprise will be immediately developed in front of the author of a business plan to the slightest precision; most likely, consultants will limit themselves to general assessments of the degree of business favors.
At the same time, it is characteristic that almost all analytical notes feature the concept of probabilistic assessment (“with a probability of 97%, we can assume that ...”). It should always be remembered that the chance to get into the same 3% for which the analytical assessment did not work means not only wasted funds, but also a delay in the business start.
The technology selected for implementation predetermines the need for premises for the installation of production equipment, mechanization equipment, warehouse equipment, etc. In this issue, it is worth assessing both the location of production facilities and their composition.
The infrastructure of the future enterprise will also play a great role. Depending on the main technological processes, certain transport equipment will be required, and not only cargo - many businessmen increase the prestige of their enterprises due to the convenient and quick delivery of the personnel of their company to the place of work.
How you can model and optimize the production section using a specialized program - see the following video:
Selection of main technological processes
The key features of the choice are not only the aforementioned 20-25% of equipment perfection, but also its availability and applicability in the specific conditions of the future enterprise. To do this, use the following sources of information:
- Expanded technical characteristics of the equipment, for which it is necessary to use information from the official websites of manufacturers, as well as the objective results of using this device by consumers. If information from the sources of the first group should be considered more or less reliable, then individual consumers should be more careful in evaluating the usefulness: sometimes they use a positive "cheat" reviews, which are not always fair for verification.
- Practical assessment of the work of the closest analogues at enterprises of the same profile located in neighboring regions. At the same time, it is worth avoiding excursions to nearby enterprises: no one is happy about potential competitors, and therefore actual advantages can be presented as disadvantages, and in the worst case, access may be closed for various reasons.
In the process of deciding on equipment, the following operational advantages are guided by:
- Durability (number of hours of warranty work on failure): if this parameter is not among the basic characteristics, this may be a serious argument against purchasing this equipment.
- The presence of a network of service centers on the territory of the region: if there is one, then the issues of installation supervision of the purchased equipment, as well as its routine maintenance during the warranty period, are automatically resolved.
- The degree of versatility of the equipment and its ability to perform a wide range of operations. In a small business environment, the serial production of products or services is often quite low. So that the equipment does not stand idle, it makes sense to use it for another purpose. Therefore, they often pay attention to the versatility of the unit diagram and to equipping it with additional tools or equipment.
- The presence in the design of units produced by subcontractors - their routine maintenance may be difficult if there is no dealer center of this enterprise in the region. Modern technical means presuppose high-quality maintenance of units, without which the risk of forced downtime turns into noticeable losses and loss of prestige of the newly created enterprise.
Do not forget that the production section should also include the calculation of the need for the number and standard sizes of the required office equipment.
Production plan in the business plan: features and classification
Production plan is a special section of business documentation containing a detailed description of technological processes. It is presented to investors for consideration. This paragraph should be given special attention as it reflects the skills of an entrepreneur and assesses the prospects of a business. Therefore, if a sufficiently serious event is planned with the involvement of third-party assets, the production plan in the business plan must be executed professionally.
The calculations that accompany the production plan should be based on the projected sales and supply of raw materials. The most obvious will be the confirmation of the information by the generated calendar (production table) of supply of production stocks, storage and shipment of finished products to retail or the end consumer.
The content of the production plan is based on the chain of transformations of the input resources into the result of the technological process. Personnel, investments, equipment and raw materials will be used as the capacity used at the enterprise. At the exit, the organization, according to the production project, must provide goods or services that will be in demand in the market and the interest of the consumer.
Features of drawing up a production plan
After the leading sections of the production plan are outlined, it is necessary to determine and forecast the indicators used to justify professional calculations. Using a standard business example, the following parameters are specified:
- The cost of utilities. Almost any production in business requires the use of electricity, gas, water consumption and sanitation. When determining the production plan, the costs for the services of specialized companies are taken into account in the context of a month, quarter, year;
- Before drawing up a production plan for a business plan, it is important to determine the level of costs for paying staff salaries. It is possible that in the first year of operation this will be the largest item of expenditure;
- In the technological plan of the business, it is important to lay down the supply. For certain categories of industries, various formulas for the cost price and the output of the ratio to sales can be used. The classic proportion of production in business is to calculate profitability 1: 2. That is, with the cost of executing a unit of goods of 1 ruble, it should cost in the end at least 2.
Production planning diagram
In addition to the costs included in business planning, the company's revenue is also taken into account. This includes profit margins, efficiency in attracting skilled people, and return on investment. Here, it will be important to reflect the impact of production costs on business.
Classification of production plans