1. Production Planning &
Control(PPC) and
Material Management
Abu
Bashar

2. Introduction
 Planned production is an important feature of the
small industry.
 Planning and control involve generally the
organization and planning of manufacturing process.
 The ultimate objective is the organization of the
supply and movement of materials and labour,
machines utilization and related activities, in order to
bring about the desired manufacturing results in
terms of quality, quantity, time and place.

3. Objective of PPC
 Optimum Utilization of Capacity
 Inventory control
 Economy in production time
 Ensure quality
 To sum up we may say that PPC is of immense value to
the entrepreneur in capacity utilization and inventory
control.
 More importantly it improves his response time and
quality. As such effective PPC contributes to time,
quality and cost parameters of entrepreneurial success.

4. Process of PPC

5. Planning
 Production planning may be defined as the
technique of foreseeing every step in a long series of
separate operations, each step to be taken at the
right time and in the right place and each operation
to be performed in maximum efficiency.
 It helps entrepreneur to work out the quantity of
material manpower, machine and money requires for
producing predetermined level of output in given
period of time.

6. Routing
 Under this, the operations, their path and sequence are
established.
 To perform these operations the proper class of
machines and personnel required are also worked out.
The main aim of routing is to determine the best and
cheapest sequence of operations and to ensure that this
sequence is strictly followed.
 Routing procedure involves following different activities.
 An analysis of the article to determine what to make and
what to buy.
 To determine the quality and type of material
 Determining the manufacturing operations and their
sequence.
 A determination of lot sizes
 Determination of scrap factors

7. Scheduling
 It means working out of time that should be required to
perform each operation and also the time necessary to
perform the entire series as routed, making allowances for
all factors concerned.
 It mainly concerns with time element and priorities of a job.
 The pattern of scheduling differs from one job to another
 Production schedule: The main aim is to schedule that
amount of work which can easily be handled by plant and
equipment without interference.
 Its not independent decision as it takes into account
following factors.
 (1) Physical plant facilities of the type required to process the
material being scheduled.
 (2) Personnel who possess the desired skills and experience

8. Loading
 The next step is the execution of the schedule plan as
per the route chalked out it includes the assignment of
the work to the operators at their machines or work
places.
 So loading determines who will do the work as routing
determines where and scheduling determines when it
shall be done.

9. Production control
 Production control is the process of planning
production in advance of operations, establishing the
exact route of each individual item part or assembly,
setting, starting and finishing for each important item,
assembly or the finishing production and releasing
the necessary orders as well as initiating the
necessary follow-up to have the smooth function of
the enterprise.

10. Dispatching
 Dispatching involves issue of production orders for
starting the operations. Necessary authority and
conformation is given for:
 Movement of materials to different workstations.
 Movement of tools and fixtures necessary for each
operation.
 Beginning of work on each operation.
 Recording of time and cost involved in each
operation.
 Movement of work from one operation to another in
accordance with the route sheet.
 Inspecting or supervision of work

11. Follow up
 Every production programme involves determination
of the progress of work, removing bottlenecks in the
flow of work and ensuring that the productive
operations are taking place in accordance with the
plans.
 It spots delays or deviations from the production plans.
It helps to reveal detects in routing and scheduling,
misunderstanding of orders and instruction, under
loading or overloading of work etc.
 All problems or deviations are investigated and
remedial measurer are undertaken to ensure the
completion of work by the planned date.

12. Inspection
 This is mainly to ensure the quality of goods. It can
be required as effective agency of production
control.

13. Corrective measures
 Corrective action may involve any of those activities
of
 adjusting the route,
 rescheduling of work
 changing the workloads,
 repairs and
 maintenance of machinery or equipment,
 control over inventories of the cause of deviation is
the poor performance of the employees.
 Certain personnel decisions like training, transfer,
demotion etc. may have to be taken. Alternate
methods may be suggested to handle peak loads.

14. Material Management
 We can define Materials Management as the
function responsible for the coordination of planning,
sourcing, purchasing, moving, storing and controlling
materials in an optimum manner so as to provide a
pre-decided service to the customer at a minimum
cost.
 Planning and controlling the flow of materials
 Objectives:
 Maximize the use of the firms resources
 Provide the required level of customer service

15. SCOPE OF MATERIALS
MANAGEMENT
 Materials Management strives to ensure that the
material cost component of the total product cost be
the least. In order to achieve this, the control is
exercised in the following fields.
 1. Materials Planning.
 2. Purchasing.
 3. Store Keeping.
 4. Inventory Control.
 5. Receiving, Inspection and Dispatching.
 6. Value Analysis, Standardization and Variety
Reduction.
 7. Materials Handling & Traffic.

16.  The function of material planning department is to
plan for the future procurement of all the required
materials as per the production schedule.
 At the time of material planning, the budget allocated
for the materials will also be critically reviewed, for
better control.

17. Objectives
 However, within the broader management objectives
of any industry or business, Materials Management’s
contribution towards objectives may be divided into
two categories:
 1) Primary and
 2) Secondary
 The former contributes directly to the Materials
Management function and the latter, helps other
departments to achieve their objectives.

18. Objective of material management
Primary
•Right price Secondary
•High turnover •Forecasting
•Low procurement & storage cost •Inter-departmental harmony
•Continuity of supply •Product improvement
•Consistency in quality •Standardization
•Good supplier relations •Make or buy decision
•Development of personnel •New materials & products
•Good information system

19. Four basic needs of Material
management
1. To have adequate materials on hand when needed
2. To pay the lowest possible prices, consistent with quality and value
requirement for purchases materials
3. To minimize the inventory investment
4. To operate efficiently

20. Basic principles of material
management
1. Effective management & supervision
 It depends on managerial functions of
• Planning
• Organizing
• Staffing
• Directing
• Controlling
• Reporting
• Budgeting
 2. Sound purchasing methods
 3.Skillful & hard poised negotiations
 4.Effective purchase system
 5.Should be simple
 6.Must not increase other costs
 7.Simple inventory control programme

21. Functional areas of material management
 1. Purchasing
 2. Central service supply
 3. Central stores
 4. The print shops
 5. The pharmacy
 6. Dietary

22. Purchasing
 After material planning, purchasing is to be done.
Purchasing department buys material based on the
purchase requisitions from user departments and
stores departments and annual production plan.
 There are four basic purchasing activities.
 a) Selecting suppliers, negotiating and issuing
purchase orders.
 b) Expediting delivery from suppliers.
 c) Acting as liaison between suppliers and other
company departments.
 d) Looking for new products, materials, and suppliers
that can contribute to company objectives.

23. Points to remember while
purchasing
• Proper specification
• Invite quotations from reputed firms
• Comparison of offers based on basic price, freight & insurance,
taxes and levies
• Quantity & payment discounts
• Payment terms
• Delivery period, guarantee
• Vendor reputation
 (reliability, technical capabilities, Convenience, Availability,
after-sales service, sales assistance)
• Short listing for better negotiation terms
• Seek order acknowledgement

24. Purchase Management
Parameters
 Purchasing items with right price.
 Purchasing with right quality.
 At right time.
 Purchasing from right
source(Vendor).
 Purchasing items in right quantity.

25. Purchase Management
Purchase systems
 Pre-purchase system
 Requirement Programs.
 Selection of Suppliers.
 Obtain quotation & later
evaluating.
 Making Requisition.

26. Purchase Management
Purchase systems
 Ordering Systems
 Once the rates are fixed. The
order is placed with selected
vendors.

27. Purchase Management
Purchase systems
 Post Purchase System
 Includes follow up procedures.
 Receipt.
 Checking invoices.

28. Stores Management
 Receives raw material, tools, equipments &
other necessary materials & accounts them.
 Preservation of items in good condition for later
use.
 Minimization of obsolescence and damage
through handling.
 Disposal & efficient handling.

29. Stores Management
 Maintenance of stores record.
 Proper location & stocks of Material.
 Reconciling the material with book figures.
 Maintains a proper account on issue of items
on demand from shop floor / production
division.
 Information reports to support purchase
activities to take place at right time.

30. Stores Management
System
 Receipt System
 Maintains proper document about
item which are received at the store.
 Details on pending orders arranged in
chronological order of dates.
 Accordingly schedule the labour
force unload items when they are
received at stores.

31. Stores Management
System
 Stocking System
 Necessary measures are taken to
check quality, quantity & weight of the
items before accepted in the store.

32. Stores Management
System
 Issue System
 For maintaining accounts of issues
made to internal division or external
divisions.
 Helps timely reordering to replenish
stock.
 In issuing to external divisions (sub
contract), controls are formal and
adequate enough to take care of
payments and claims.

33. Storage
• Store must be of adequate space
• Materials must be stored in an appropriate place
• in a correct way
• Group wise & alphabetical arrangement helps in
• identification & retrieval
• First-in, first-out principle to be followed
• Monitor expiry date
• Follow two bin or double shelf system, to avoid
• Stock outs
• Reserve bin should contain stock that will cover
• lead time and a small safety stock

34. Thank you Very
Much