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MANUFACTURING AND PRODUCTION INFORMATION SYSTEMS

The important thing about information systems is that they collect data and supply information.
Information is data processed with a purpose. What purposes can we have for manufacturing and
production? IS exists to facilitate decision making.
Information Systems
Who

Makes what decisions

Top Management

Develop strategic plans


New acquisitions and mergers

Human resource managers

Recruitment and selection


Training and development
Salary and administration

Marketing Managers

Market research
Advertising and promotion
Pricing and selling
Distribution and logistics

Accounting and financial


managers

Analysing investments
Capital formation
Accounts payable, accounts receivable, payroll and so on

Engineering and research and


development managers

New product development


Technology forecasting
Process engineering

Operations managers

Materials management
Production planning and scheduling
Capacity planning and facility layout
Cost containment
Quality

Based on Operations m anagem ent - Vonderem bse and W hite

Note that the term is facilitate. ICT can never make decisions. What is does is support the making
of the decision by ensuring that facts and options are known. It would be nice to say known and
understood. It is particularly important to recognise that the information dealt with is likely to be
imperfect. That is to say, it is incomplete, or the uncertainty involved is greater than the size of the
quantity being measured. Under these circumstances, decision support can help you make the best
decision possible, allowing for the uncertainty. A downside here is that, in the absence of perfect
information, there has been a tendency to go by gut-feel. Early computer systems which were slow
and unreliable did nothing to assist here.

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Levels of information
Information is required at many levels in an organisation. We normally think of three:
Strategic
Tactical
Operational
Manufacture and production are operational areas, so that it is natural that we think first of operational
levels, but the tactical and strategic levels must not be omitted.
In designing organisational information systems, each function will have its own operational issues
that need to be handled, leading to specialist modules being used in modern information systems.
However, for higher level decision making, there is a need to integrate information. Hence the need
for a single company wide information system, of which the modules form a part.
Production planning and scheduling
This is in many ways the core of the operations activity. It starts with the nature of the requirement.
What are we required to produce? What production assets and labour are available? What can
therefore be produced, when? This leads to the development of production schedules that detail
what will be produced when. Note that scheduling is by no means an exact science. There are
scheduling rules and methodologies that can be used, but once the number of steps in an operation
exceeds three, then modelling is the only option. Optimisation routines give a best sequence, but
these require an understanding of what is meant by best in the circumstances. Uncertainties in timing
can have a significant effect here. A major problem is calculation of (and reduction of) lead times.
What determines lead time?
The schedule will provide information about the tooling requirements.
Materials management
Information is required about the obtaining and holding of materials. Logically this comes after the
production of a schedule, as only then can you know what material you will need when. This requires
knowledge of suppliers lead times. MRP systems are an obvious example of one form of software
that is used here. However, you will also have systems for controlling inventory, and for tracking WIP.
Inventory systems will depend on the nature of the reordering process. Fixed order quantity and
periodic review systems are common. Computer based systems assume that all stock is checked
in and checked out, of course. It is important to have physical checks to confirm the stock. The
advantage of computer systems is that it is possible to combine approaches for given items. It is also
possible to use the historic data for other analyses, such as ABC and to derive things such as safety
levels from the system, given the policy constraints. However, automated systems can be too
dynamic, and accelerate things like the Forester effect.
Capacity planning and facility layout
Production must be able to produce the required capacity. Unfortunately, different parts of the
operation will have differing capacities, capacity will be incrementable in differing amounts, and so
on. Planning capacity therefore requires compromises to get the best result. In any case, there is
the issue of demand management. This may well require discussion with the marketing department.
If it is possible to control demand to match available capacity, for instance through price, then
capacity is not just an operational decision. It may not be, and there may also be questions of the
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service requirements of customers. The nature of competitor activity is also an important


consideration. If a company is making super-normal profits, then, unless there are barriers to entry,
competitors will come into the market. Capacity therefore becomes a complex balancing act which
may well take place at the strategic level.
On the operation level, the facility layout will also have an effect on the operation of the company.
Again, with the number of possible variable, this sort of issue is likely to be modelled, with various
options be tried to enable an optimal solution to be reached for the current time.
Cost containment and quality
I take these two together because in modern companies they are interlinked. Looking at lean supply,
the requirement is to reduce the seven wastes. This requires knowledge of what they are. For
quality, too, there is now a desire to calculate the costs of quality failure.
Quality systems will include SPC, and the ability to produce control charts and other visible
information for operators. TQM seeks improvement, which requires knowledge of what might be most
profitably improved.
GIGO
Garbage in, garbage out. It is important that any information system has correct information (note
that it may not be certain, or may be unavailable, but should be correct in its uncertainty). An
important part of the system is therefore the interface where data is entered. Early systems had
problems, in that the inputting of data required actions on the part of people who did not see the
benefits. This lead to poor data control.
As far as possible, data capture should be automatic, or simple, and with automated validity checking
(eg barcodes and scanners). The company needs to have a culture that accepts the need for
accurate data. This is aided, of course, by ensuring that systems a re simple, do not require clearly
foolish levels of accuracy, or multiple entry of the same data. There must be some provision for
correction of system errors. Feedback loops can be very beneficial.

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