Professional Documents
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DATA
INFORMATION
The three-output subsystem exerts an influence on the firms money flow. The forecasting subsystem projects the firms long-range activity in an economic environment. The funds management subsystem manages the money flow as it occurs, seeking to keep it balanced and positive. With the control subsystem, managers can get effective use from resources of all types that are made available to them.
Materials Management:
The term material management is concerned with the determination of policy with regard to procurement of materials (quality, quantity and price etc.) and disbursement of the same to the respective jobs as and when it is required without any delays. In other words, material management is concerned with control of materials in such a manner which ensures maximum return on working capital. Material Management is the planning, directing, controlling and coordination of all those activities concerned with material and inventory requirements, from the point of their inception to their introduction into manufacturing process. L. J. De Rose: Material Management is concerned wit the location and purchase of needed materials, their storage and movement (internal). It also arranges to keep an account for them. It is also responsible for planning their movement through manufacturing processes, store rooms (or stock rooms or warehouses) and distribution channels. The scope of the term materials management is very broad which includes purchases of material, its transportation, storekeeping, inventory control, materials handling and inspection of material. These are also known as elements of materials managements. These are explained in details in the subsequent pages. Significance of Materials Management: In case of non-manufacturing business undertaking (i.e. trading concerns) handling of cash is of utmost importance. Similarly the efficient handling of materials is of vital significance in the manufacturing business. The importance of materials management has been nicely highlighted by Bethel, Atwater and others. According to them If materials are not adequate to meet the needs of manufacturing operations and marketing divisions of the company problems of inefficiency and skyrocketing costs, frequent manufacturing delays and broker delivery promises are inevitable. Thus, materials management is a continuous struggle between too much and too little, too soon and too late. The utility of materials management increases with the proportion of material cost of the product to the total factory cost. Benefits derived from an efficient system of material management cant enumerate as follows:(i) (ii) (iii) (iv) (v) (vi) Material management can be used as an effective co-reduction device. It is easy to handle and control materials a compared to labor. By introducing material management devices, inventory losses are minimized. Production time is minimized. It ensures proper and effective utilization of available equipment. Problems relating to overstocking and under stocking are promptly tackled. Savings in the time of direct labor is ensured.
Computer Applications in materials management: Material management is an area in which the computers can be put to beneficial use. Since computerization of inventory control will provide better control and profitability, there is rich potential for computerization in materials management field. Materials management has emerged as an independent function. Top management has been gradually giving greater importance to this area. As the realization of the tremendous profit-making potential of this function has grown so have the expectations from it. Materials management is, therefore, faced with new challenges. How well it will convert opportunities into results will naturally depend on how well it uses the resources at its command. There are many resources available to materials management of which information plays a very vital role. Integrated Computer system for Materials Management: With their increasing variety and the heavy demand made on them, materials are today assuming every important role in the operational efficiency of an organization. Computers could be utilized to guide all the activities involved in getting the materials to the factory. This integrated computer system would involved the active participation of line personnel and would be more useful for operational information-management report could however be obtained as a by-product. The present use of computers in materials management is only to make computations easier and faster. The integrated computer system should be utilized for the sake of an integrated information system, which would result in the smooth operation of the materials functions. The main objective of such an integrated system should be accuracy in reporting demand and inventory. The integrated system also ensures a fast reaction to environmental changes changes in either supply or price of materials or changes in customer taste and measurement of functions such as inventory, purchasing and vendors. Sales Forecast Maintenance and Other Department
Design
Production Planning
Computer
Production
Purchase Department
Material
PRODUCTION MANAGEMENT Meaning of Production: Production is concerned with the creation of goods and services. It is concerned with transforming the inputs in form of raw materials, labour, machines, management and money into output i.e. goods and services with the help of certain production processes. Production function is the most important function in an organization around which all other activities of an enterprise viz; marketing, financing, purchasing and personal etc. It is pertinent to note that production function should be managed in an efficient and effective manner for the achievement of the organizational goals. Functions and Responsibilities of Production Management: Following functions are performed by production manager. (i) Production Planning. Production planning is the first function performed by the production manager. Production planning is concerned with thinking in advance what is to be produced, how it is to be produced and by what time should it be produced. It is concerned with deciding about the production targets to be achieved by keeping in view the sales forecast. Production Control. Production planning cannot be properly achieved without an effective system of production control. It is infact concerned with successful implementation of production planning. It aims at completing well in time and also with lesser costs. A proper system of production control ensures continuous production, lesser work-in-progress and minimization of wastages. Quality Control. The production manager is also concerned with maintaining required quality of the product. Quality control is concerned with (controlling the negative variables which affect the ultimate quality of a product. It is concerned with use of all the ways and means where by quality standards could be maintained. Method Analysis. There are many alternative methods for manufacturing a product. Some methods are more economical than others. The production manager should study all the methods in detail by analyzing them in detail and select the best alternative out of them. The process of selecting the best alternative is known as methods analysis. Methods analysis is considerably helpful in minimizing the cost of production and improving productivity of the concern. Inventory Control. The next important function to be carried by a production manager is to exercise proper control over the inventory. He should determine economic order size, maximum, minimum, average and danger levels of materials so that problems of overstocking and under stocking do not arise. This also helps in minimizing wastages of materials. Plant layout. Plaint layout is primarily concerned with the internal set up of an enterprise in a proper manner. It is related to orderly and proper arrangement and use of available resources viz., men, money, machines, materials and methods of
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production inside the factory. In other words it is concerned with maximum and effective utilization of available resources at minimum operating costs. (vii) Work Measurement. Work measurement methods are concerned with measuring the level of performance of work by a worker. Time and motion studies techniques can be used for work measurement. If a worker work below the level fixed by workmeasurement techniques, his performance must be improved through positive or negative incentives.
(viii) Other Functions. Apart from the above mentioned functions, the production also carries certain other functions viz., cost control, standardization and storage, price analysis and provision of wage incentives to workers etc. Production management information system: The objective of production management (PM) function is to provide manufacturing services to the organization. This involves the manufacture of products of a certain specific quality and within certain costs in a stipulated time fulfilling the promises given to the customers. Computers are playing important role in all stages of product design and manufacturing. Basic research, part and assembly design, material storage and retrieval, product manufacture, inspection and testing for quality control-all are being helped by computer based facilities. There is growing recognition in the product design sector of the economy that computer potential needs to be exploited to the full if companies are t survive in the modern competitive environment. Inputs of Production Management Information System: The production management is conducted through innumerable transactions. They relate to planning, issuing and controlling the various tasks involved in the course of production. The details are listed as under: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Process planning sheet. Quality assurance rating form. Production schedule. Job card. Finished goods advice. Materials requisition. Customer order. Breakdown advice. Material requirement. Production programme
The production management also uses standards and norms extensively developed over a period of time as inputs in the system. These are generally known is production rate, available capacity, labour complement, material usage standards, rejection norms etc. The transaction documents mentioned above are indicative and may be more or less different, depending upon the type of production, nature of production and industry. The input data in each transaction would also vary from industry to industry as would the production methodology adopted by the organization. The system and procedures used by the organization in performing the production function also vary respectively.
Components of Production Management Information System: The components of production management information system include: 1. Sales department finds out what the customer wants and compares this with what the firm can provide. It must then decide, in conjunction with the design department designs, to meet the customers particular demands, or in the case of standard catalogue items, take the order and pass it directly to the drawing office. Design department designs new equipments and makes modifications to established items either to bring them up to date or to make them meet a specific requirement of the customer. This results in drawings and parts lists which can be either standard or particular to the job. The drawings will also contain parts, lists or bills of materials which can be used for the stores and purchasing functions. Purchasing department buys the materials required at the best possible price and on the most reliable delivery to make the various items either on a one off basis for individual jobs or to replenish materials held in the stores on maximum and minimum levels. Manufacturing process sees that the parts are produced as economically as possible for delivery at the time required by the customer and to the standard set by the design department. The goods are then passed back through dispatch to the customer. The duty of dispatch is to break the items down into packages of reasonable size by volume or weight for handling by lorry, ship or aircraft.
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reports, the results of mathematical simulations, electronic communications and knowledgebased system advice. It is important that you realize that the output subsystems draw on each of the CBIS subsystems- AIS, MIS, DSS, the virtual office, and knowledge based systems contain all types of CBIS software. Database: The data that is used by the output subsystems come from the database. Some of the data in the database in unique to the marketing function, but much is shared with other functional areas. Input Subsystems: The accounting information system gathers data describing the firms marketing transactions. The marketing intelligence subsystem gathers information from the firms environment that has a bearing on marketing operations for the purpose of learning customer needs and improving marketing efficiency. Accounting Information System: Marketing plays a role in the firms AIS by providing sales order data. Perhaps the sales representatives enter the data from customer offices, using laptops. Or sales order personal at headquarters may take order data over the phone or by mail and enter it into keyboard terminals. In some cases customers enter order data directly into the firms computer, perhaps using the Internet. The data is used to prepare information in the form of periodic and special reports. The data also provides the input for mathematical models and knowledge-based systems. Market Research and Intelligence Information System: Market research and intelligence information system can be discussed under following sections:1. Customer Research (CR): CR is broader and more analytic than customer analysis associated with the sales information system. CR utilizes the information from sales order entry system and then provides information about the market environment as a context for it. And also uses information about customers financial and operating conditions and about there selling and purchasing dealings with the organizations competitors. Market Research (MR): MR is broader than CR. In that, if focuses on the entire market place for the organizations products. One purposes of MR is to access the overall size of the market for each product line and for each product within a product line. Competitor Intelligence: A Company should gather information about its competitors. This includes information about the specification of (i) (ii) (iii) Competitors Products Competitors operating strengths and weaknesses. Competitors customer service level and customer policies.
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Competitors financial structure and strength. Competitors new product plan Marketing goals and strategies.
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Internal Sources
Data Base
Promotion Subsystem
USERS
Price Subsystem
The CBPIS should be comprehensive enough to suffice the needs of personnel department of any organization. The following should be an integral part of any CBPIS:1) Personnel Records: This relates to identification of data, current and past salary, allowances data and various employee attributes. Training Records: Data relating to each employees qualifications, skills and experiences and the training received by the employees at different times and levels. Establishment: It relates to setting up of Budgets for staff levels throughout the organization. The system should be efficient enough to encompass between the projected or the budgeted staff members and the actual staff members. Absence: The system should allow for the recording of various absence types, i.e., sick leave, earn leave, annual leave or special leave with or without pay. Industrial relations and manpower planning data: The system should hold data to assist management in negotiations and in planning for alternative strategies. Pension Records: The System should maintain all details of services entitlements of employees, contributions by both the employees and the organization to the pension scheme, details of dependents, spouse and children and details of entitlements of employees who have become pensioners.
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Management Information for strategic Planning policy formulation And decision-making Management information for tactical Planning and decision making Management information for day-to-day planning Decision making and control Transactional processing general enquiry facilitates.
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Recruitment: Details of all vacancies and applicants should be held by the system. This should show the status of each vacancy and of each applicant should be able to correlate the two.
Inputs
Demographic System
Computer Program
Training data