Planning and control

From CEOpedia | Management online

Planning and control are the two of management functions. Planning involves setting the organization's goals and control, otherwise known as controlling process, involves ensuring that performance does not deviate from standards, that means it involves checking whether processes in the organization run in line with the plans. Controlling is about using organization's resources in extremely optimal, economical way and with checking if the resources are used according to the strategic plan of the organization. Planning provides predeterminated goals against which actual performance is compared. We cannot think of an effective system of controlling without existence of well thought plans (Dr.S.V. Shinde, 2018). A production planning and control system is the core and key technology of production management systems. As excellent production planning and control system is an important tool to improve the overall automation level of enterprise and provide significant economic benefits for enterprises. A production planning and control system can directly determine whether the manufacturer can complete specific tasks in accordance with the expected demand. Its core function is to manage production tasks and resource allocation and utilization in manufacturing systems, and to meet customer's demands in the best possible way. A production planning and control system should contain the following processes:

  • decomposing product tasks,
  • analyzing resource demands,
  • determining the operation sequence of a job,
  • allocating machines
  • and monitoring real-time task progress.

Meanwhile, this system should be able to deal with sudden changes in the actual manufacturing environment, such as lack of material, random machine breakdown, order changeover and rush orders (Jie Zhang, 2017).

Production planning and controlling mode

In a complicated and volatile production environment, the production planning and control strategy determines the information interaction and organization in the implementation of the production planning, scheduling and control activity so as to effect the efficiency and flexibility of the production planning and to control activity to a large extend. The typical production planning and control strategies include push and pull (Jie Zhang, 2017).

Push - a kind of production, which is developed on the basis of future demand predicted and actual orders received. It is a strategy, which is often used in a make-to-stock manufacturing system with a single product, stable demand and long delivery due date. Using this strategy can improve production efficiency, strengthen system stability and shorten the product delivery due date. This system cannot be applied in make-to-order and make-to-assembly manufacturing systems.

Pull - a kind of production planning and control strategy, which is to respond rapidly to customer's demand. It is a strategy, which is usually used in make-to order and make-to-assembly manufacturing systems. With this strategy, the production execution activity is driven by the response to customers orders. It can reduce inventory, improve system flexibility and rapidly respond to customer's demand (Jie Zhang, 2017).

Just-In-Time system

Just-In-Time (JIT) system is the typical representative of a pull-based production planning and control strategy, which developed for a make-to-order manufacturing system. The basic idea of the system can be summarized as when it is a needed, according to the amount needed to produce the desired product. The core of Just-In-Time system is to pursuit either a non-inventory manufacturing system or minimum inventory factoring system. The successful application of a JIT system depends on four basic principles: waste elimination, participation of employees in making decisions, involvement of suppliers, and comprehensive quality management (Jie Zhang, 2017). The overall aim of JIT system is to obtain a balanced manufacturing system, and a smooth and rapid material handling flow throughout the entire system:

  • To eliminate interruptions that are caused by low quality, machine breakdown, change of production schedule and delivery delay
  • To be flexible, adapt to changes as variety and capacity
  • To reduce production exchange time and production lead time
  • To minimize inventory
  • To eliminate waste

Examples of Planning and control

  1. *Resource Planning: Resource planning is a process of deciding how to allocate limited resources to meet the goals of the business. This involves assessing the current resources, estimating future needs and then balancing the supply and demand of resources in order to ensure that the organization is operating as efficiently as possible.
  2. *Production Scheduling: Production scheduling involves determining when and how to produce a product or service. It is important to ensure that resources are allocated efficiently to maximize the efficiency and profitability of production.
  3. *Quality Control: Quality control is the process of ensuring that products meet established standards of quality. This involves establishing quality standards, monitoring production processes and ensuring that products meet those standards.
  4. * Risk Management: Risk management is the process of identifying, assessing and managing potential risks that could impact the success of an organization. This involves assessing the potential risks and developing strategies to minimize or mitigate those risks.
  5. *Financial Planning: Financial planning is the process of setting financial goals and developing strategies to achieve those goals. This involves assessing the current financial situation and developing a plan to meet the organization’s financial goals.

Advantages of Planning and control

  • Planning and control are essential for successful management of any organization. The advantages of planning and control can be summarized as follows:
  • Planning allows for the development of strategies and processes that can be used to achieve organizational objectives. It helps to identify the resources needed to achieve these objectives and set the timeline for their accomplishment.
  • Control allows for the monitoring of progress towards the goals and objectives set during the planning process. It provides feedback on the effectiveness of the strategies and processes implemented, and allows for the identification and resolution of any problems encountered.
  • Planning and control can help to create a sense of accountability and responsibility amongst employees, as they will know that their performance is being monitored. This can help to ensure that everyone is doing their part to contribute to the organization’s success.
  • Planning and control can also help an organization become more efficient, as it can help identify areas of waste and inefficiency that can be addressed. This can lead to cost savings and improved performance.
  • Finally, planning and control can help to ensure that the organization is able to anticipate and respond to changes in the external environment. This can help the organization remain competitive and relevant in a rapidly changing world.

Limitations of Planning and control

  • Planning and control can be limited by the lack of resources, such as time, money, personnel and materials.
  • Planning and control can be limited by a lack of comprehensive information, such as accurate forecasting of customer demand.
  • Planning and control can be limited by a lack of clear objectives, meaning that it is difficult to identify what success looks like.
  • Planning and control can be limited by a lack of understanding of the environment in which the organization operates, such as changes in customer demand or competitive forces.
  • Planning and control can be limited by a lack of communication between departments or teams.
  • Planning and control can be limited by a lack of flexibility and responsiveness to changes, meaning that the organization is unable to adjust quickly to changing circumstances.
  • Planning and control can be limited by a lack of accountability, meaning that there is no one to take responsibility for the success or failure of the plans.

Other approaches related to Planning and control

  • Introduction: In addition to the Planning and Control, there are several other approaches that are useful to manage a business.
  • Strategic Management: Strategic management involves setting the organization's vision and mission and defining the organization's goals and objectives. It is the process of analyzing the environment to understand the opportunities and threats, and making decisions and taking actions that will help the organization achieve its desired results.
  • Financial Management: Financial management involves the use of financial resources to achieve the organization's objectives. It involves planning, budgeting, forecasting, and analyzing the financial performance of the business.
  • Human Resource Management: Human resource management is the process of managing the organization's people. It involves recruiting, training, and managing employees, creating and implementing policies and procedures, and providing compensation and benefits.
  • Operations Management: Operations management is the process of managing the operations of the business. It involves planning and scheduling activities, managing inventory and resources, and measuring performance.
  • Quality Management: Quality management is the process of ensuring that products and services meet customer requirements. It involves defining quality standards, measuring product and service quality, and taking corrective action to improve quality.
  • Project Management: Project management is the process of managing projects. It involves planning, organizing, and managing resources to achieve a specific goal.

Summary: Planning and Control are two of the most important management functions, but there are several other approaches that are useful in managing a business. These include Strategic Management, Financial Management, Human Resource Management, Operations Management, Quality Management, and Project Management. All of these processes are important in running a successful business.


Planning and control — recommended articles
Departmental planning — Management functions — Interdepartmental planning — Types of control system — Operational control — Budgetary control — Resource plan — Managerial controlling — Strategy deployment

References

Author: Beata Franczyk

Retrieved from "https://ceopedia.org/index.php?title=Planning_and_control&oldid=95268"