Production planning and control refers to two strategies that work cohesively throughout the manufacturing process. Production planning involves what to produce, when to produce it, how much to produce, and more. A long-term view of production planning is necessary to fully optimize the production flow. Production control uses different control techniques to reach optimum performance from the production system to achieve throughput targets. Click below to ENROLL in the course OR Copy paste the URL below. https://www.udemy.com/course/production-ppc

1. An integral part of
Industrial Engineering
PRODUCTION
PLANNING AND
CONTROL

2. SCOPE OF COURSE
SN Sections/Units Contents
1. Introduction Production system, Manufacturing processes, Meaning of PPC.
2. PPC procedure Elements of PPC, steps involved, benefits and affecting factors.
3. Forecasting Qualitative and quantitative forecasting, Forecasting errors.
4. MRP Classes of MRP users, I/O system, Product structure, Kanban, JIT, Order size.
5. Vital techniques Break-even point analysis, Lot sizing rules, Assembly line balancing.
6. Numericals Solved questions from GATE/IES/PSU exams.
“Give me six hours to chop down a tree and I will spend the first four sharpening the axe.”
– Abraham Lincoln

3. MEANING OF PRODUCTION
• A value addition process.
• The step-by-step conversion of one form of material into another form through chemical or
mechanical process to create or enhance the utility of the product to the user.
• Concerned with the transformation of a range of inputs into the required outputs (products)
having the requisite quality level.
• A very complex process and is very difficult to manage for the people.
• Edwood Buffa defines production as “a process by which goods and services are created”

4. THE 6 M’S
Inputs
Man
Material
Machine
Money
Method
Management

5. SCHEMATIC OF PRODUCTION SYSTEM
• Man
• Material
• Capital
• Machine
• Information
Input
• Product design
• Prototyping
• Production planning
• Production control
• Maintenance
Process
• Product
• Services
Output
• Inventory
• Quality
• Cost

6. TYPES OF PRODUCTION
Types
Continuous/Mass
production
Job or unit
production
Intermittent/Batch
production

7. TYPES OF PRODUCTION
Continuous/Mass production
• It is used when we need to produce standardized products with a standard set of process and
operation sequence in anticipation of demand.
• This ensures continuous production of output
• Also termed as mass flow production or assembly line production.
• This ensures very high rate of production as we need not to intervene once the production
has begun.
• Appropriate in plants where large volume of small variety of output is produced.
e.g. oil refineries, cement manufacturing and sugar factory etc.

8. TYPES OF PRODUCTION
 Characteristics of Continuous/Mass production:
• As same product is manufactured for sufficiently long time, machines can be laid down in order of processing sequence.
• Standard methods and machines are used during part manufacture.
• Most of the equipment’s are semi automatic or automatic in nature.
• Material handling is also automatic (such as conveyors).
• Semi-skilled workers are normally employed as most of the facilities are automatic.
• As product flows along a pre-defined line, planning and control of the system is much easier.
• Cost of production per unit is very low owing to the high rate of production.
• In process inventories are low as production scheduling is simple and can be implemented with ease.

9. TYPES OF PRODUCTION
Job or Unit production
• Ensures the simultaneous production of large number of batches/orders.
• It involves production as per customer's specifications. (Viz products are made to satisfy a sp
ecific order.)
• It is flexible and can be adapted to changes in product design and order size without much inc
onvenience.
• This system is most suitable where heterogeneous products are produced against specific ord
ers.

10. TYPES OF PRODUCTION
 Characteristics of Job/Unit production:
• Machines and methods employed should be general purpose as product changes are quite frequent.
• Man power should be skilled enough to deal with changing work conditions.
• Schedules are actually non-existent in this system as no definite data is available on the product. In process inventory will us
ually be high as accurate plans and schedules do not exist.
• Product cost is normally high because of high material and labour costs.
• Grouping of machines is done on functional basis (i.e. as lathe section, milling section etc.) This system is very flexible as
management has to manufacture varying product types. Material handling systems are also flexible to meet changing
product requirements.

11. TYPES OF PRODUCTION
Intermittent/Batch Production
• Concerned with the production of different types of products in small quantities usually term
ed as batches.
• This is used to meet a specific order or to meet a continuous demand.
• Automobile plants, printing presses, electrical goods plant are some of the
examples of batch production.

12. TYPES OF PRODUCTION
 Characteristics of Intermittent/Batch production:
• As final product is somewhat standard and manufactured in batches, economy of scale can be availed to
some extent.
• Machines are grouped on functional basis similar to the job shop manufacturing.
• Semi-automatic, special purpose automatic machines are generally used to take advantage of the similarity
among the products.
• Labour should be skilled enough to work upon different product batches.
• In process inventory is usually high owing to the type of layout and material handling policies adopted.
• Semi-automatic material handling systems are most appropriate in conjunction with the
semi-automatic machines.

13. TYPES OF MANUFACTURING PROCESS
Types
Jobbing Batch Mass Process

14. FACTORS AFFECTING THE SELECTION OF MANUFACTURING PROCESS
Volume/Variety
Lead time
Flexibility
Capacity

15. PPC - Meaning
• Production planning and control are inter-related in a complex manner which
eventually looks like a unary function of management of an enterprise.
• PPC is a very critical decision which is necessarily required to ensure an efficient and
economical production. Planned production is an important feature of any manufacturing
industry.
• Production planning and control (PPC) is a tool to coordinate and integrate the entire
manufacturing activities in a production system.
• According to Gorden and Carson, PPC usually involve the organization and planning of
manufacturing process. Principally, it includes entire organization.

16. PPC - Meaning
PPC
Production planning
Production control
1. Estimating
2. Routing
3. Scheduling
4. Loading
1. Dispatch
2. Follow-up
3. evaluation

17. PRODUCTION PLANNING
• Formulation of a new plan in-line with the objective of production.
• Begins with the analysis of given data on the basis of which a scheme for the utilization of
resources is outlined.
• Determines the optimal schedule and sequence of operations, economic batch size, machine
assignments and dispatching priorities.
• Synonymous to process analysis.
• Leads to elimination of undesirable process elements as well as improvement of
certain processes as well.

18. PRODUCTION PLANNING
Production
Planning
PP
Estimating
Deciding quantity
Routing
Best and cheapest route
Loading
Optimum utilization
Scheduling
Deciding priorities

19. PRODUCTION CONTROL
• A device to attain maximum efficiency in production.
• Involves control over production quantity, labour efficiency, Material and tools, spares and
maintenance, delivery, schedule etc.
• “A production activity of an enterprise is said to be in control when the actual performance is
within the objective of planned performance.”

20. PRODUCTION CONTROL
Production
Control
PC
Dispatching
Release of resources
Follow-up
Comparison
Evaluation
Formulate corrective action

21. STEPS OF PPC
1. Forecasting the demands of the customers for the products and services.
2. In advance preparing the production budget.
3. Design the facility layout.
4. Specify the types of machines and equipment.
5. Appropriate production requirements of the raw materials, labour, and machinery.
6. Drawing the apt schedule of the production.
7. Confirming the shortage or any excess of the end product.
8. Future plans are drawn for any sudden surge in the demand for the product.
9. The rate and scale of production is setup.

22. PRODUCTION ACTIVITY & INFORMATION FLOW
Forecasting
Strategic Planning
Aggregate production planning
Disaggregation
Product scheduling
Shop floor control
Raw Material
Fabrication plant
Assembly centre
Distribution centre
Retailer
Administrative Functions
Marketing
Product design
Process planning
Manufacturing Support

23. STAGES OF PPC
Planning
Action
Monitoring

24. Requirements for an effective Production Planning and Control
• Appropriate organization structure with sufficient delegation of authority and responsibility at various levels of manpower.
• Right person should be deputed at right place for right job.
• Maximum level of standardization of inventory, tooling, manpower, job, workmanship,
equipment, etc.
• Appropriate management decision for production schedule, materials controls,
inventory and manpower turnover and product mix.
• Flexible production system to adjust any changes in demand, any problem in production or availability of materials maintena
nce requirements, etc.
• Estimation of accurate leads times for both manufacturing and purchase.
• Management information system should be reliable, efficient and supporting.
• Capacity to produce should be sufficient to meet the demand.
• The facility should be responsive enough to produce new products change of products mix and be able to
change the production rates.

25. BENEFITS OF PPC PRODUCTIONS
Optimum
utilization of
resources
Benefits to
workers
Improved
services to
customers
Better
coordination
of plants
activities

26. FACTORS AFFECTING PPC
PPC Factors
affecting

27. ESTIMATION OF STAGES OF PRODUCTION PLANNING
• Seeks for appropriate estimates of production quantity.
• Considerably affected by growing competition, frequent changes in customer demand, and
the inclining trend towards automation.
• Decision on production can never be (well sometimes) based on guesses.
• A careful analysis of data connecting the future course of events is mandatory.
• “When estimates of future conditions are made on a systematic and mundane basis of
historical and current data, the process is then called as FORECASTING and the statement
thus obtained is known as a FORECAST.”

28. METHODS OF FORECASTING
Forecasting
Qualitative
Market survey
Delphi method
Opinion pole
Life cycle analogy
Quantitative
Casual
Time series
Simple average
Moving average (M.A)
Weighted M.A
Exponential smoothing
"Forecasting is the art of saying
what will happen, and then
explaining why it didn't! "

29. QUALITATIVE FORECASTING
Qualitative
Market survey
Delphi method
Opinion pole
Life cycle analogy

30. METHODS OF FORECASTING
Quantitative
Casual
Time series
Simple average
Moving average (M.A)
Weighted M.A
Exponential smoothing
Ft = Ft-1 + μ (Dt-1 – Ft-1)

31. FORECASTING ERRORS
Characteristics of forecasting errors :-
– When the forecast is almost wrong, the potential error in the forecast can be accommodated through
use of buffer capacity.
– Is easier for a product line because forecasting of individual product tends to cancel each other.
– Forecasts for short time periods are more accurate.
– Incomplete without the mention of estimated forecast error.
– Cannot be substituted by calculations of demand based on actual data for a given time period.

32. FORECASTING ERRORS
Measures
MAD – Mean Absolute
Deviation Bias Mean square error
MAD =
𝒆
𝒏
Bias =
𝒆
𝒏
MSE =
𝒆𝟐
𝒏

33. MRP
• Material Requirements Planning is primarily related to the inventory of raw materials and
components which are required to produce the products in a facility.
• The demand for the finished products is known as primary demand. This primary demand is
ascertained mainly by aggregating the demand from sales orders and forecasted demand.
• MRP is a time phased priority-planning technique that estimates material requirements and
schedules supply to meet demand across all products and parts in one or more plants.
• MRP techniques focus on optimizing inventory.

34. THE CONCEPT BEHIND
• Basically concerned with the inventory of raw materials and components which are required to produce
the products in a facility.
• It is a time phased priority-planning technique that estimates material requirements and
schedules supply to meet demand across all products and parts in one or more plants.
• MRP techniques are used to explode bills of material, to compute net material requirements and plan
future production.
What to
order and
when
Master
Production
schedule
BOM
Production
cycle time
Supplier
lead
time

35. THE CONCEPT BEHIND
Aggregate
product
plan
Orders
from
customer
known
Forecasted
demand for
unknown
customers
Design
changes
Inventory
transactions
Master
production
schedule
MRP
(Software)
BOM
Inventory
record
Primary
reports
Secondary
reports

36. CLASSES OF MRP USERS/COMPANIES
• Class A represents full implementation of MRP. MRP system is tied up with company “financial system and
includes capacity planning, shop floor dispatching, and vendor scheduling as well as links with human
resource planning.
• Class B represents a little less than full implementation. MRP system is confined in the pre-defined
manufacturing area.
• Class C represents a classical MRP approach in which the system is confined to management of the
inventories.
• Class D represents a data processing application of MRP.

37. CONDITIONS FOR SUCCESSFUL IMPLEMENTATION OF MRP
• Availability of a computer based manufacturing system is a must.
• A feasible master production schedule must be drawn up.
• The bills of material should be accurate.
• Inventory records should be a precise representation of reality.
• Lead times for all inventory items should be known and given to the MRP system.
• Shop floor discipline is necessary.

38. INPUT/OUTPUT (I/O) IN MRP
I/O
INPUT
Product Demand
BOM
Master Production
Schedule
Inventory record file
OUTPUT
Primary report
Secondary report
Planned order report
Order release report
Order changes report

39. PRODUCT DEMAND
Product demand for end items stems from two main reasons. The first is known customers who
have placed specific orders, such as those generated by sales personnel, or from
interdepartmental transactions.
The second source is forecast demand. Demand from known customers and demand forecast are
combined and become the input to the master production schedule.

40. BOM
BOM file is a document which tells us about an items product structure and also it tells us about
the sequence in which components are assembled and their required number. It also tells us
about the workstations in which it is assembled.
Bill of Materials gives information about the product structure, i.e., parts and raw material units
necessary to manufacture one unit of the product of interest

41. PRODUCT STRUCTURE
A
B(1) C(2)
X
A(2)
B(1)
C(2)
Y(1)
Sub-assembly/
Components Number of units
Y 1 x No. of units of X = 1 x 100 = 100
A 2 x No. of units of X = 2 x 100 = 200
B 1 x No. of units of A = 1 x 100 = 100
C 2 x No. of units of A = 2 x 100 = 200

42. PRODUCT STRUCTURE
M
N (3)
P (1)
Q (2)
O (1)
N (2)
Level 0
Level 1
Level 2

43. MASTER PRODUCTION SCHEDULE (MPS)
Months Number of Cars
Jan 10000
Feb 12000
Mar 8000
Apr 11000
May 7000
June 12000
Weeks of Jan 1st 2nd 3rd 4th 5th
Model A 1200 2000 2700 750 6650
Model B 700 950 1100 200 2950
Model B 100 50 200 50 400
Total 2000 3000 4000 1000 10000
The Master Production schedule includes quantities of products to
be produced at a given time period. Quantities are included both at
aggregate and detailed levels. Aggregate may refer to monthly
production and detailed may refer to weekly or daily production.
The master production schedule takes the form of a table in which
rows represent products and columns represent time components.

44. INVENTORY RECORD FILE
IRF
Details of the
suppliers of the items
Time taken by supplier to
supply the item
Size of each order to be
placed to the supplier.

45. WORKING OF MRP PROGRAM
• A list of end items needed by time periods is specified by the master production schedule.
• A description of the materials and parts needed to make each item is specified in the bill of
materials (BOM) file.
• The number of units of each item and material currently on hand and on order are contained
in the inventory file.
• The MRP program “works “on the inventory file in addition, it continuously refers to the bill
of materials file to compute quantities of each item needed.
• The number of units of each item required is then corrected for on hand amounts, and the
net requirement is “offset” to allow for the lead time needed to obtain the material.

46. PRIMARY REPORTS
• Planned orders to be released at a future time.
• Order release notices to execute the planned orders.
• Changes in due dates of open orders due to rescheduling.
• Cancellations or suspensions of open orders due to cancellation or suspension of orders on
the master production schedule.
• Inventory status data.

47. SECONDARY REPORTS
SR
Secondary Reports
Planned Order
Report
POR
Order Release
Report
ORR
Order Change
Report
OCR

48. INVENTORY RECORD FILE
Order size
calculation
Lot for lot method
Economic Order
Quantity (EOQ)
method
Least total cost
method
Least unit cost
method

49. CALCULATIONS OF ORDER SIZE IN MRP
Ordering cost (OC) = Rs 50 per order
Carrying cost (CC) per unit per week = 0 .5% of unit cost price
Unit cost price = Rs 20
CC per week = 20 X .5% = Rs 0.1
Week Net requirement
1 80
2 100
3 90
4 60
5 110
6 50
Total 490

50. CALCULATIONS OF ORDER SIZE IN MRP
Ordering cost (O) = Rs 50 per order
Carrying cost (CC) per unit per week = 0 .5% of unit cost price
Unit cost price = Rs 20
CC per week = 20 X .5% = Rs 0.1
Week Net requirement
1 80
2 100
3 90
4 60
5 110
6 50
Total 490

51. CALCULATIONS OF ORDER SIZE IN MRP – Lot for lot method
Ordering cost (O) = Rs 50 per order
Carrying cost (CC) per unit per week = 0 .5% of unit cost price
Unit cost price = Rs 20
CC per week = 20 X .5% = Rs 0.1
Week
Net
requirement
1 80
2 100
3 90
4 60
5 110
6 50
Total 490

52. CALCULATIONS OF ORDER SIZE IN MRP – The EOQ Method
Economic order quantity (EOQ) is the ideal order quantity a company should purchase to
minimize inventory costs such as holding costs, shortage costs, and order costs. This production
scheduling model was developed in 1913 by Ford W. Harris and has been refined over time.
– The formula assumes that demand, ordering, and holding costs all remain constant.
– The EOQ is a company's optimal order quantity that minimizes its total costs related to ordering,
receiving, and holding inventory.
EOQ =
2 𝐴0 𝑂
𝐶
A0 = Annual Demand
O = Ordering cost
C = Carrying cost

53. CALCULATIONS OF ORDER SIZE IN MRP – EOQ Method
Ordering cost (O) = Rs 50 per order
Carrying cost (CC) per unit per week = 0 .5% of unit cost price
Unit cost price = Rs 20
CC per week = 20 X .5% = Rs 0.1
Annual CC for 52 weeks = C = 52 X 0.1 = 5.2
Week
Net
requirement
1 80
2 100
3 90
4 60
5 110
6 50
Annual Demand = 𝐴0 =
490 𝑋 52
6
= 𝟒𝟐𝟒𝟔. 𝟔𝟕
EOQ =
2𝐴0𝑜
𝑐
=
2 𝑥 4246.67 𝑥 50
5.2
= 285.77 = 286

56. JIT – Just In Time
• It is a system to produce and deliver finished goods just in time to be sold, sub assemblies
just-in-time to be assembled into finished goods, and purchase materials just in time to be
transformed into fabricated parts.
• Originally developed by the Toyota motor company in Japan.
• JIT may be understood as the continuous improvement of material flow in either factory or
a combination of factories.
• Being used in wide variety of industries such as automobiles, consumer electronics, office
equipments etc.

57. JIT – Just In Time
JIT
Techniques
Factory layout
revision
Set up time
reduction
Pull system
implementation
Better coordination
with suppliers
Minimizes material
handling activities
Reduces lot size Only produce
actual orders
Makes the supplier an
extension of the internal
material flows

58. KANBAN VISUAL SYSTEM
• Japanese word that means flag or signal, and is a visual aid to convey the message that action
is required.
• First adapted by American supermarkets for replenishing empty shelves in racks and
originally introduced by the Toyota motor company in Japan.
Stage 4
Stage 3
Stage 2
Stage 1
Kanban Card with
Identification number
Mizosomashi
Production kanban card
Final implementation

59. KANBAN VISUAL SYSTEM

60. MRP BENEFITS
• Reduced inventories without reduced customer service.
• Ability to track material requirements.
• Ability to evaluate capacity requirements.
• Means of allocating production time.
• Increased customer satisfaction due to meeting delivery schedules.
• Faster response to market changes.
• Improved labour and equipment utilization.
• Better inventory planning and scheduling.

61. BREAK EVEN POINT ANALYSIS
$ Break even units =
𝑭𝑪
𝑺𝑷 −𝑽𝑪
FC – Fixed Cost
SP – Selling price
VC – Variable cost

62. LOT SIZING
Rules
Lot sizing rules
FOQ
Fixed order quantity
EOQ
Economic order
quantity
Lot for Lot
LFT
FPQ
Fixed period
requirement
POQ
Periodic order
quantity
PPB
Part-period
balancing

63. ASSEMBLY LINE BALANCING
Cycle
efficiency (𝜼)
Number of
workstations
Cycle
Time
Balance Delay =
1 - 𝜼
Tc =
𝑇𝑝
𝑇𝑜
NT =
𝑇
𝑇𝑐
𝜼 = NT/Na

64. (1) For a product, the forecast and the actual sales for December 2019 were 25 and 20
respectively. If the exponential smoothing constant (μ) = 0.2, calculate the forecast
for January 2019.
Ft = Ft-1 + μ (Dt-1 – Ft-1)
= 25 + 0.2 ( 20 – 25 )
= 25 – 1
= 24.

65. (2) The sales of a product during last four years were 860,880,870 and 890 units. The
forecast for fourth year was 876 units. If the forecast for the fifth year using simple
exponential smoothing is equal to the forecast using three years moving average, Find
out the value of exponential smoothing constant “μ”.
By moving average method
F5 =
𝟖𝟖𝟎+ 𝟖𝟕𝟎+ 𝟖𝟗𝟎
𝟑
= 880
By exponential smoothing method
F5 = 876 + μ (890 – 876) Gives; μ = 2/7.

66. (3) For a canteen, the actual demand for disposable cups was 500 units in January and
600 units in February. Calculate the forecast for the month of March considering smo
othing constant as 0.75.
FFeb = FJan + μ (DJan – FJan)
= 400 + 0.75 (600 - 475)
= 475 Units.
FMar = FFeb + μ (DFeb – FFeb)
= 475 + 0.75 (600 – 475)
= 568.75 = 569 Units

67. (4) A firm uses a turning center, a milling center and a grinding machine to produce
two parts. The table below provides the machining time required for each part and
the maximum machining time available on each machine.
The profit per unit on parts I and II are 40 and 100 respectively. Calculate
the maximum profit per week of the firm.
M/C
Machining time required (minutes) Max machining
time available per
week (minutes)
I II
Turning 12 6 6000
Milling 4 10 4000
Grinding 2 3 1800

68. 12x + 6y ≤ 6000
4x + 10y ≤ 4000
2x + 3y ≤ 1800
x,y ≥ 0
OR
12x + 6y ≤ 6000
4x + 10y ≤ 4000
12x + 30y ≤ 12000
Gives x = 375 & y = 250
Hence, profit = 40 X 375 + 100 x 250 = 40000
1000
600
400
0
500 900 1000
(375,250)

69. (5) Two models P and Q of a product earns profit of 100 and 80 per piece. Production
time for P and Q are 5 hours and 3 hours respectively, while the total production time
available is 150 hours. For a total batch size of 40, to maximum profit, calculate the
number of units of P to be produced.
x + y = 40
5x + 3y = 150
Gives, x = 15

70. (6) In an assembly line for assembling toys, five workers are assigned tasks which takes
time 10,8,6,9 and 10 respectively. Find out the balance delay for the line.
Ta =
𝟏𝟎+𝟖+𝟔+𝟗+𝟏𝟎
𝟓
= 8.6 minutes.
Balance delay = 1 - 𝜼
= 1 – 8.6/10
= 0.14 Or 14%

71. (7) Manufacturing of a product requires fixed investment of 4,50,000 in a particular
year. The estimated sales for this period is 8,00,000. The variable cost per unit for
this product is 10. Determine the break-even point of production if unit price of the
product is 50.
Break even point =
𝑭𝒊𝒙𝒆𝒅 𝑪𝒐𝒔𝒕
𝑼𝒏𝒊𝒕 𝒑𝒓𝒊𝒄𝒆 −𝑽𝒂𝒓𝒊𝒂𝒃𝒍𝒆 𝒄𝒐𝒔𝒕
=
𝟒𝟓𝟎𝟎𝟎𝟎
𝟓𝟎 −𝟏𝟎
= 11250.

72. Workshop Technology OR Machine Shop Theory
Heat And Mass Transfer – HMT
Production planning and control – PPC
Applied Mechanics Or Engineering Mechanics
Engineering Materials or Material Science
Engineering Thermodynamics Or Applied Thermodynamics
IC Engines
Engineering Mathematics - Numerical Analysis & more
Strength of material OR Mechanics of solid
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