Production Management: Increase the Efficiency of your Manufacturing
Perfecting your production management is essential if you want to run a successful manufacturing business.
Essentially, you can define your production management definition as an optimization problem.
The ultimate objective of production management is to optimize your production line's efficiency with your current resource capacity.
Manufacturers need Production Management.
That’s why we’ve put together this article to help you understand what this entails, the importance of doing it, and the tools you can use to make this easier.
Katana MRP is one such tool that helps make production management a walk in the park. Try it for yourself - free for 14-days.
In this article, we look into the production management, operations management, the functions, why production and operations management are important, and how you can make it work for your business.
PRO TIP: Perfecting your production management is tricky but it is not the biggest struggle that manufacturers face when trying to run their business. If you want to get ahead of the competition, be sure to check out our free guide on manufacturing inventory management.
What is Production Management?
Production management, also referred to as operations management, is the planning, organization and optimization of your manufacturing process management, from raw materials into finished products.
The function of production management is to find the:
- Right quality;
- Right quantity;
- Right time; and
- Right cost
Production management has the ultimate objective of optimizing your manufacturing efficiency with your current production capacity.
To achieve this, you need to find the best manufacturing process for your business.
This is a 24/7 production/assembly line, made possible with the use of manufacturing process automation such as conveyor belts and robotics.
This too relies on production lines. But the products that are produced by the manufacturer are varied, which requires the line to be set-up, and changed, depending on the products in production.
The humble manufacturer's choice of manufacturing process management, which utilizes workshops and separate production areas to allow for bespoke products.
Batch manufacturing allows manufacturers to make products in the necessary number of batches needed to satisfy customer demand.
Another manufacturing process that runs 27/7, although this process deals with raw materials such as gases, liquids, powders, or slurries, including areas like mining, where the products can be more granule.
So, process operations are defined as a process of production management that includes any of the above workflows, but let's look at the functions of production management in more detail.
The functions of production management systems will be:
Production Control Service
This is where you'll monitor production to make sure everyone is executing the correct plans in the manufacturing process. The purpose is to react quickly if things deviate from the plan and make sure everything is running smoothly.
A critical function in any business. Production scheduling is when you plan when production will start and finish.
Cost and Quality Control
The aim of this is to produce the highest quality product at the lowest possible cost. Not just by saving money for your business, but by offering your customers a fairer price too.
Maintenance of Machines
Finally, you’ll want to make sure all your tools and machinery are spic-and-span to avoid them underperforming or breaking down and stopping production completely.
PRO TIP: Production management is going to be the most important aspect for manufacturers when looking to get more control over their business. But, with so many tasks and responsibilities, it can quickly become overwhelming. That’s why it’s essential to find production management software that can help you automate these tasks.
What is Operations Management?
Operations management is pretty similar to production management, but is the day-to-day running of the business, ensuring operations and production within the business are carried out efficiently and smoothly. This also includes handling administrative, factory-level, and service management.
The focus point of your operations management is the customer. If the customer is satisfied, then you’re heading in the right direction.
However, how you handle your resources is also the function of operations management, since you want to be improving customer satisfaction with the least amount of wastage with the maximum utilization of resources.
But what are the functions of operations management?
From raw inventory management to routing manufacturing, under operations management, you’ll need to develop plans and tactics that will help you achieve lean inventory and a smooth production flow to get a competitive edge over your competitors.
Here is where you should investigate if your product caters to the need of the customers and follows the market trend. Yes, your product may have survived the prototype stage, but people's needs and wants change, and you need to be ready to adapt your product with those shifts in trends and predictions.
Demand planning will allow you to understand how your product is performing on the marketplace, and decide on how to proceed, be that increasing, decreasing, or even stopping production on a product.
And that’s the ins-and-outs of operations management, and as you can probably see, the difference between production management and operations management isn’t much.
Regardless of if you struggle to set them apart or call it something else, here’s why it’s important to have your operations and productions management down to a tee.
Difference between Production and Operations Management?
Production and operations management is an all-encompassing term that covers managing the manufacturing of your products and those finished goods and services.
You might be furling an eyebrow, “Aren’t those two technically different areas?”
Traditionally speaking, a manufacturer would make its products and dispatch them to a third-party, and that would be the end of it.
But, as more businesses take more control over their company and brand, they’ve started to introduce services such as customization into their production.
And as we control more aspects of our business, we need to also balance production and operations management.
As manufacturers have drifted toward a direct to consumer brand, and even retailers now manufacture their own branded products, the line between production management and operations, products and services, has become increasingly blurred.
Are you still confused?
Production and operations management are very similar, but the main difference between the two is:
Production management – Monitoring and managing the manufacturing of products.
Operations management – The services which are on offer to the customer and the work that needs to be done to finish the production.
Natural Native is a CBD manufacturer producing a wide range of pain relief medicine in the form of creams, oils, and consumables, who quickly noticed that their impromptu approach to production management was leading to delays in their production.
“We did not have a manufacturing resource, inventory system, or a production tracking system,” Madeline from Natural Native.
By using Katana, Natural Native have:
— Improved production management and increased their fulfillment rate by 80%;
— More control over their inventory with Katana’s smart auto-booking system; and
— Developed a schedule using Katana’s task list, so team members can proceed with their jobs.
Implementing Production Management
When trying to achieve production and operations management, you’ll need to make decisions at three different stages:
1. Production planning
Essentially this will be your master production schedule. As the manager, you’ll need to decide where, when, and how production will start.
2. Production control Service
This is where you’ll focus on quality, and costs, and shop floor control.
3. Improving Operations and Productions Management
The final stage of production management and operations is the development of more efficient methods of producing the firm’s goods and services.
That’s a breakdown of what is production management and it’s definition, so let’s now move onto its counterpart, operations management.
Why is Production and Operations Management Important?
Production management and operations management is not just recommended to improve some areas of your business, but it is essential.
Otherwise, you could find your business struggling to meet orders and lose customers.
So, as a manufacturer, by understanding operations management and the importance of production management, you can:
1. Accomplish Business Objectives
By performing your production and operations analysis, you’ll be able to achieve business objectives by efficiently producing goods and services that meet the needs of the customer. This will increase customer satisfaction, in turn, increasing your sales and profit.
2. Boost Brand Image
Important for D2C manufacturers, with production and operations analysis, you’ll be able to raise your reputation as a business that delivers quality products and fair prices.
3. Reduce Manufacturing Costs
Essentially, the function of a production management system is to achieve lean manufacturing. So, by optimizing your manufacturing output, you can expect to lower your manufacturing costs either by not having resources waiting idly by or by figuring out the best way to store your inventory, such as using ABC inventory.
We now know what production and operations management is, and the benefits of practicing it in your business.
However, it’s a lot of hard work, and perfecting your manufacturing can be argued as an impossible dream.
That’s why it’s fundamental to find a tool that can help you get your operations and production management under control.
Automate Your Production Management
Although it is possible to do your production management in a cumbersome spreadsheet, it's not ideal since there's so much you need to do, and you can't afford to spend any time stuck doing mundane administrative tasks.
And this is where automation comes into play.
Katana Smart Manufacturing Software is an all-in-one tool that has been built by manufacturers, for manufacturers, looking to get more control over their production management and operations.
Katana helps manufacturers by giving them the power of automation by automatically:
- Scheduling production and calculating deadlines;
- Tracking finished goods and raw materials in real-time and allocating them to sale orders and manufacturing orders; and
- Calculating manufacturing costs.
Katana can help you in this area by giving you access to:
A Visual Dashboard to Monitor Manufacturing
Katana’s intuitive and elegant dashboard allows manufacturers to get a quick breakdown of the status of production.
Once you’ve logged into Katana, the “Make” screen is where you’ll find the key elements that will help you with production management, and give you an overview of your scheduled production, including the:
— Order number;
— Customer name;
— Production time;
— Production deadline;
— Material stock level status; and
— Production status using our red, amber, green (RAG) system.
Improved Floor-Level Management
At the “Make” screen, under the “Tasks” you can see in more detail your floor-level progress, with a list of your workstations or team members and the jobs they’re working on, the operation being performed, and the status of that job.
If you’re a visual learner and want to understand how Katana’s automation can optimize your production management, be sure to check out the video below:
So, there you have it, a complete introduction to production management systems and operations management.
To quickly summarize production and operations management, to achieve this massive task you need to plan production, decide how you’ll execute this plan and the operations you and your team will need to do to finish production (whilst always asking yourself how what you're doing adds value to the customer).
However, without the proper tools or software in place, this task can be extremely challenging without the use of automation, as so many things need to be monitored.
That’s why it’s important to find a production management system that can centralize your entire business onto one, visual dashboard.
Why not give Katana MRP Software a try? Katana offers a 14-day free trial, so you can see for yourself how Katana can optimize your production management.
And until next time, happy manufacturing.