Management Of Production Problems in Manufacturing Companies in Enugu State

Management Of Production Problems in Manufacturing Companies in Enugu State (A Case Study of Anammco,Proda, Sunrise)

Kieth (1988) defined production as the conversion of a set of inputs into a set of outputs through a set of processes. It related to other three main functional fields of business, namely; marketing, finance and personal management as can be seen from the following:

Marketing programs of the company affect the demand for its producing and therefore qualities to produced, also the production policies affect the marketing and advertising programs; the financial position and policies affect the facilities available for production and therefore types of products and quantities that can be produced; industrial relations and personnel management policies affect the motivation and productivity of human resources and therefore affect the level of production.

Thus, production is interwoven with other aspects of management as highlighted above.

2.2  THEORETICAL FRAMEWORK.

TYPES OF PRODUCTION PROCESS.

       The production process refers to the methods by which materials are put into the items that people want.

There are many kinds of production process viz:

1. EXTRACTION PROCESS: This consists of extracting substances from the earth, air or sea. Example mining of coal, gold, drilling for petroleum and fishing/farming.
2. ANALYTIC PROCESS:

Here, a basic substance is broken into a number of other material, in which the product may bear little resemblance to the original substances, example petroleum refining.

iii.  FABRICATING PROCESS:

       This occurs when a material has its from changed by being machined, cut up, pressed, finished, or treated in some other manner example manufacturing of clothes, shoes.

 2.3  PRODUCTION SYSTEM

       In the conversion process, inputs go through a series of operations. The operations in a manufacturing organization many be mechanical, chemical assembly, inspection and control, packaging, shipping etc. This conversion process together with receiving of inputs and shipping of output is referred to as “Production System” (Ejiofor, 1989).

Each system of production makes its own demands on the management of the business – in all areas and on all levels. Each requires different competence, skill and performance. Unless management understands the demands of its system of production, it will not manage well (Ejiofor, 1989).

There are two main production systems in manufacturing organizations namely, “Continuous production System” and intermittent production System:

1. CONTINUOUS PRODUCTION SYSTEM.

       Employed for production those are produced continuously due to their high and stable demand, for example automobile manufacturing plants, refineries, breweries etc.

1. INTERMITTENT PRODUCTION SYSTEM.

       In this type of system, a given product is manufactured intermittently and not continuously. It is used in case where demand for a product is low that it needs not to be produced continuously, for example, if the for a product in a month can be met by production in one or two day, it then follows that the particular product can be produced only one or two days per month and stocked to cater for the demand.

This production system has the following characteristics; produces small quantities of a large numbers of products and secondly equipment must be flexible enough so that they can be adapted to process a wide variety of products.

Each of these systems has its own basic principles and each make specific demands on management. Inability of application of the appropriate system only results in lack of performance. Inappropriate system inevitably increases the difficulties of managing the business (Ducker, 1988).

2.4  DESIGN OF THE PRODUCTION SYSTEM.

       In accomplishing the objectives of production, there are two major types of decisions to be dealt with, For example, location factor, Job design, selection and design of the product, and selection of equipment.

2.4.1      LOCATION FACTORS

       The location of a manufacturing facility is very important because it partially determines operating and capital cost while the resulting physical factors influence layout. Boone puts forward factors that can influence a location decision which include market related factors. Market related factors involve the location of buyers and competition. If the company plans to provide a service to senior adult, it should probably be located in an area with an aged population. Similarly, some firms prefer to locate in areas where there is limited direct competitions (Boone, 1987).

Thus, market proximity is prime advantage in industry location. Plant location is significant because of its effect on both production and distribution costs which are frequently in conflict. The gain in government incentives and in the lower land and labor costs obtained by locating away from major cities may be set-off by the increased expense of warehousing transportation to serve these markets. Firms that produce perishable products or whose perishable products are relatively expensive to ship must usually locate their markets.

Manufacturing companies that produce a product using raw material that is more expensive to ship than the finished product usually located their plants near their source of supply of raw materials.

Tangible cost factors include transportation, utilities, labor, taxes, site costs and construction costs. Management would prefer cheap, nearby transportation, low utility costs; a ready supply of low cost but skilled labor; a modest tax structure and construction costs.

As (Pickle, 1980) supports, that it is important to consider community attitudes, taxes and services in the process of selecting a plant location. This is because many communities reject any new industry. Plants that produce offensive smells or other forms of polluting are having increasing difficulty finding communities that welcome them, inspite of the increased employment they provide. And it is difficult for a manufacturing plant to locate in a hostile environment.

In the same vein, industries searching for plant locations should always consider the services offered by different communities, for example, a firm may want to be located on the edge of the community, and find that one another community is willing to bring city utilities to them at no cost to the business.

Furthermore, taxes are also an important factor in plant location since they vary from, state to state and community to community. A production firm that operates on a narrow margin of profit may find that extra heavy taxes/levies eliminate their profit. It is on this consideration that communities in order to attract new industry do at times give special tax breaks.

It is pertinent to infer that variations in tangible cost factors require a careful handling/balancing on the part of management. There is no site location decision that needs 100 percent of the firm’s ideal standards. Therefore, management is compelled to achieved a balance of favorable and unfavorable factors and choose a site that provides the most favorable blending of all factors, Intangible cost factors, refers to the attitude , legal  regulations, room for growth, climate, schools, churches, hospitals and recreational opportunities, some industries have minimal need to be located near supply sources/markets; thus their location decisions are influence by other factors like amenity such as desirable living condition for employees.

In effect, management will, after ascertaining that adequate labor, raw materials, water and power are available seek the least cost location  which is the one for which the sun of production costs is minimized. Management choice may then be modified by market requirements, the influence of competitor’s location, employment preference(climate recreational facilities) and conditions imposed by the local authorities.

2.4.2      PHYSICAL/PLANT LAYOUT.

       All stages of production must be considered to design an efficient production facility. More so, the inputs at each stage of the production process must be considered too and also material handling system must be designed to blend smoothly with the choice of physical layouts. Ball asserts that the arrangement of machinery, personnel and service facilities should be made prior to the erection of the building. In this way, the building is accommodated to the layout that is judged to be the most capable of obtaining a smoothly functioning production system.

The design must attempt to obtain the maximum utility from costly building space while simultaneously providing room for the future expansion of each department.

The designer must attempt obtain the maximum utility from costly building space while simultaneously providing room for the future expansion of each department.

Basically, three types of layout have been identified as product layout, process layouts and fixed position layout.

Layout planning involves decisions about how to arrange the physical facilities spatially. Their equipment decisions are translated into physical arrangements handling, maximizes workers and equipment efficiency (Pickle, 1980).

1. PRODUCT LAYOUT

It involves linear flow of the various work activities performed. This design is common in assemble lines and cafeteria. MBAIKE, in management in Nigeria, identified the product layout and purports that the machines layout is dictated by the sequence of production of the product. However, the advantages of this type of layout are its simplification of production of the product. However, the advantages of this type of layout are its simplification of production planning and control and the ability to utilize unskilled workers who can quickly learn the tasks involved. In addition, materials handling and processing time are reduced. It is appropriate for continuous or repetitive operations, such as mass producing air-conditioners.

The disadvantages of the product layout include its high capital investment, unless volume of production is high, machine utilization tends to be low. One machine breakdown ultimately results in stoppage of production since the operations are in series. The systems are also fairly inflexible being unable to accommodate changes readily and special purpose machines need to be bought. Finally, this design often leads to worker monotony.

1. PROCESS LAYOUT.

       It is arranged according to task. This layout approach has the advantages of flexibility of equipment and personnel, and increased worker satisfaction because of diversity of tasks. It typically requires smaller investment in equipment because duplication is not necessary unless volume is required. Therefore, expertise is developed since the supervisors for each department become highly knowledge about their functions.

A major short coming of this approach is that it involves cost and reduced efficiency. Back tackling and long movements may occur in materials handling, thereby lowering efficiency in this area. Timing inefficiencies may occur, with work having to wait between tasks. Since workers must have broad skills, higher wages may be necessary to attract qualified employees. Since each job is different, there are different, sets-ups and operator training requirements. Thus, the result is lower productivity.

III.  FIXED POSITION LAYOUT.

This approach is used for large and fragile products that cannot be moved from place to place. Typically adopted in the manufacture of air planes, vehicles and home construction. Here, workers, machinery are preassembled; parts are brought to the stationery product.

Fixed position layout entails the usage of some workers who necessarily must be skilled and versatile. Movement of people and equipment to end from site may be expensive; equipment utilization may be low because equipment may be left at a location where it will be needed again in a few days rather than moved to another location where it would be productive.

2.4.3      JOB DESIGN

       The final decision in designing the production system concerns the structure of individual jobs. How will the work be done and who will do it? Job design specifies the content and methods of work by individuals and groups in the production system. It is the process of task declination necessary to meet various personal, works, organizational and environmental requirements. The job that is eventually specified should be technically, economically and behaviorally feasible.

As Stoner, (1980) purports, work methods analysis to find the best way of performing tasks in a given job. Such environmental factors as temperature, air flow, and humidity, noise and lighting levels should be controlled to ease task performance and increase job satisfaction.

Once the job design has been completed, job production standards are then developed using work measurement technique. Such standards are established as a basis for comparison when measuring and judging output. Production standards specify what an average worker or group of workers can produce under average job conditions.

PRODUCTION FUNCTION IN CORPORATE ORGANIZATION

Production function entails the employment of the bulk of buyer utilization of the physical assets and engagement of the bulk of the financial resources. Pressures in the organization for solutions these problems are therefore very great; failure to deliver, an idle machine, a line of operators who are not producing, a breakdown in quality, an unsafe process/service, all demand attention in order to attain corporate objectives.

It has most often been observed that the production/operations management is not incorporated into corporate policy. A situation that always results in a lot conflicts in the organization. As (Lockyer, 1970) asserts that failure to incorporate production operations into corporate policy will inevitably lead to problems. To be presented with policies which require?

A reduction in training costs, a substantial reduction in error rates, quicker delivery of special order higher plant utilization and greater flexibility can only result in frustration and malfunction of the organization (keith, 1988).

This underscores the need of the manager to make good decisions aimed at solving these problems and exploring opportunities that arise in the production process. In production, the manager is responsible for producing the goods in required quantities and good quality to meet future demand. This, he has to do in an economical way so as to maximize profit. In order to actualize this, he has to be concerned with: production planning, production control, quality control, inventory control, work measurement and wage incentive.

2.5.1      PRODUCTION PLANNING.

This involves management decisions on the resources that the firm will require for its manufacturing operations and selection of these resources to produce the desired goods in the required amounts, at the least total cost. Production planning therefore involves setting the limits or levels of manufacturing operations in the future. Some of the decision to be made include deciding the size of the labor force during the period planned, and if hiring campaigns or layoffs are necessary when this will be settling plant and equipment capacities where these are flexible and setting the desired or objectives levels for inventory control. Production planning sets the frame work with which detailed schedule and inventory control schemes must operate (David, 1970).

Every successful manager must, therefore, plan, execute and control his work within the framework of the corporate plan. Indeed, unless the production/operation plan is part of the corporate plan, the total enterprise can only be a failure, or at best a sub-success. However, the production planning activity can be divided into two parts:

1. Forecasting future, demand for company products, and
2. Translating the demand of products to the demand it generates for various inputs, that is, determination of demand for various inputs.

Demand forecasting is the process of estimating future demand for an organization’s products or services. The reason is to get an idea of what will happen in future. The demand forecast in a manufacturing firm may involve projecting the numbers of product unite to be made each week. For a hospital, the same goal becomes one in projecting how many patients will be served each day. Meeting this demand generates requirements for people, equipment, raw materials and other resources. A good demand forecast helps develop appropriate plans for production and service operations. The more products to be manufactured or charts served, the greater the resource requirements. If demand is expected to increase, plans must be made to order more materials and supplies, buy more equipment and hire more people.

In summary demand forecasts are used in organization to:

1. Decide whether demand is sufficient to generate the desired returns for the organization. If demand exists but at too low a “price” to cover the costs the organization should reject the opportunity.
2. Determine long-term capacity needs for facility design. An accurate projection of demand for a number of years in the future can save the organization great expense in expanding or contracting capacity to accommodate future environment demands.

iii.   Identify short-term (1 week- 3 months) fluctuations in demand for use in production planning, work force scheduling, materials planning.

Forecasts should be based on levels of activity government expenditure, labor availability; possible changes in price structure, variations in living standard market potentials, technology changes and companies resources. A long-term forecast is particularly necessary when considerable expansion is required and when heavy capital expenditure is contemplated. However, some authorities believe that in view of political uncertainties, there can be little usefulness in forecasts of any kind over periods of longer than five years (Lockeyer, 1970)

            Furthermore, forecasting can be made for individual products or a group of products. If a group of products produced by the company is large, then it is more economical to group the products into a smaller number of groups according to use, type and forecast the demand for each group.

Forecasts for individual products can be made either in quantity units or in monetary units. The group forecasts in monetary units can be obtained by using different forecasting techniques such as collective opinion method, economic indicator method; time series analysis using regression or moving averages.

One of the functions of planning techniques in production is to give business management guides for use in settling the basic policies themselves. Management must make judgments about qualitative factors they find difficult to weigh. One method of helping to make these judgments about policy decisions to make impact on capacity/labor requirements, customer service and financial needs of alternative decisions in judgments areas.

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