Production/Operations Plan

Ace Institute Of Management

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Outline of Presentation

I. Why Production/Operations Plan?II. The content of

Production/Operations planIII. Few Tips

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“The Only Place Where Success Comes before Work is the Dictionary”

- Vidal Sassoon

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Why Production/ Operations Plan?

To find the answer to following: Where do we locate our facility? How big should our facility be? Chronologically, what are the steps

needed to establish our facility? Which technology will I use? Why? Where will I get the technology from? What equipment(s) will be needed? What raw materials will be needed? Will I manufacture all parts by myself or

outsource some of it?BDP - Operations Plan 4

Contd. Why Production/Operation Plan?

How will I buy the inputs/raw materials? From where?

What will be the layout of the production process/service?

How will I maintain my inventory level?

How do I define and maintain quality of my product/service?

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Linking corporate objective with Production/ Operational Planning

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MarketingDecisions

OperationsDecisions

Fin./Acct.Decisions

CompanyMission

BusinessStrategy

Functional AreaFunctional AreaStrategies

POM StrategyFlexibility (design,

Volume)Low cost

Faster Delivery Quality

Broader Product line

After sales service

How are we going

to achiev

e these?

10 Production/Operations decisions

1. Product design, Product Specifications2. Quality management3. Process, capacity design4. Location 5. Layout design 6. HR, job design7. Supply-chain management8. Inventory management9. Production/Operations Scheduling 10. Maintenance (after sales service)

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Putting Production/Operational plan in the BP

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What are the Product attributes/ Specifications

Physical Attributes of product/serviceCompositions (constituents of product/service)Packaging sizes/options available

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How is your product made/delivered? Give a brief process flow chart:

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Storage PasteurizationCream

separationStorage Past. Milk

PackagingMilk out (in

500ml pouches)

Ghee out

RawMilk

in

What kind of a process are you following? (process design)

Introduction of technologyE.g. Manual Batch semi automatic Automatic Continuous production etc.

What are the reasons for selecting the technology?Which are the key equipments in the production process?Who is/are the suppliers of technology

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How big is your plant/facility (capacity)

What is the key measure of “capacity”? What is the installed/designed capacity? What is the capacity utilization schedule? How to meet the excess demand (e.g. seasonality)- inventory policy, sub-contracting etc.

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Where do you locate your production facility?

Where is your plant/facility located? Why did you choose it there, What are the advantages, constraints of this location? Is the land your own or rented? If rented, for how many years is it rented? Where do you get your key input materials (raw materials)

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What is your “quality” policy/plan?

Dimensions of quality for your product (product itself, user, process, value etc.)The firms views on qualityHow is the quality measured?How will you maintain and communicate your “quality”? E.g. TQM, ISO 9000, SQC, after sale service, warrantee, guarantee etc.

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Few Tips

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Do not exaggerate your production capabilities

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Do not try to over sell your technology/ production plan.

Acknowledge if there are any limitations in your production/ operational plan. This can only help you later.

Be “fact” based

Do not write too much flowery and poetic statements. Provide exact data/facts as far as possible

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Exercise economy in your writing

Avoid highly technical jargons. Remember your plan will be read by mostly “non-technical” persons. Do not write too many pages in this section. Nobody wants to read BP with long technical details Use “appendix” section for more detailed and complicated aspects such as drawings, blue prints

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Follow the 4 C’s rule

Clear – as to what u intend to achieve out of

this plan and business

Complete – wrt all aspects of the business

Consistent – Strategy selected should be

consistent across all functions and depts

Concrete – wrt facts and figures (no “wishy-

washy” stuff!

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