Optimizing production management is important for manufacturers. In this article, we look at what it is, why it’s important, and how you can make it work.
Last updated: 31.03.2023
Perfecting your production management is essential for a successful manufacturing business.
Essentially, you can define your production management definition as an optimization problem. The ultimate objective of production management is to optimize your production line’s efficiency with your current resource capacity — manufacturers need production management.
In this article, we look into production management, operations management, the functions, why production and operations management are important, and how you can make it work for your business.
Perfect your production management
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Production management, or operations management, focuses on achieving a smooth production process with efficient planning and control of business operations.
The function of production management is to find the perfect balance:
Production management has the ultimate objective of optimizing your manufacturing efficiency with your current capacity. To achieve this, you need to find the best manufacturing process for your business.
This too relies on production lines. But the products that are produced by the manufacturer are varied, which requires the line to be set-up, and changed, depending on the products in production.
Job shop manufacturing
The humble manufacturer’s choice of manufacturing process management, which utilizes workshops and separate production areas to allow for bespoke products.
Batch manufacturing allows manufacturers to make products in the necessary number of batches needed to satisfy customer demand.
Another manufacturing process runs 27/7, although this process deals with raw materials such as gases, liquids, powders, or slurries, including areas like mining, where the products can be more granule.
So, process operations are defined as a process of production management that includes any of the above workflows, but let’s look at the functions of production management in more detail. The functions of production management systems will be:
Production Control Service
This is where you’ll monitor production to make sure everyone is executing the correct plans in the manufacturing process. The purpose is to react quickly if things deviate from the plan and make sure everything is running smoothly.
A critical function in any business. Production scheduling is when you plan when production will start and finish during a project run.
Finally, you’ll want to make sure all your tools and machinery are spic-and-span to avoid them underperforming or breaking down and stopping production completely.
PRO TIP: Production management is going to be the most important aspect for manufacturers when looking to get more control over their business. But, with so many tasks and responsibilities, it can quickly become overwhelming. That’s why it’s essential to find production management software that can help you automate these tasks.
What is operations management?
Operations management is pretty similar to production management, but is the day-to-day running of the business, ensuring operations and production within the business are carried out efficiently and smoothly — this also includes handling administrative, factory-level, and service management.
The focus point of your operations management is the customer. If the customer is satisfied, then you’re heading in the right direction. However, how you handle your resources is also the function of operations management, since you want to be improving customer satisfaction with the least amount of wastage with the maximum utilization of resources. But what are the functions of operations management?
From raw inventory management to routing manufacturing, under operations management, you’ll need to develop plans and tactics that will help you achieve lean inventory and a smooth production flow to get a competitive edge over your competitors.
Here is where you should investigate if your product caters to the need of the customers and follows the market trend. Yes, your product may have survived the prototype stage, but people’s needs and wants change, and you need to be ready to adapt your product with those shifts in manufacturing trends and predictions.
Demand planning will allow you to understand how your product is performing in the marketplace, and decide on how to proceed, be that increasing, decreasing, or even stopping production on a product.
And that’s the ins and outs of operations management, and as you can probably see, the difference between production management and operations management isn’t much. Regardless of if you struggle to set them apart or call it something else, here’s why it’s important to have your operations and productions management down to a tee.
Difference between production and operations management?
Production and operations management is an all-encompassing term that covers managing the manufacturing of your products and those finished goods and services.
You might be furling an eyebrow, “Aren’t those two technically different areas?” Traditionally speaking, a manufacturer would make its products and dispatch them to a third party, and that would be the end of it. But, as more businesses take more control over their company and brand, they’ve started to introduce services such as customization into their production.
And as we control more aspects of our business, we need to also balance production and operations management.
As manufacturers have drifted toward a direct-to-consumer brand, and even retailers now manufacture their own branded products, the line between production management and operations, products and services, has become increasingly blurred. Are you still confused? Production and operations management are very similar, but the main difference between the two is:
Production management – Monitoring and managing the manufacturing of products.
Operations management – The services which are on offer to the customer and the work that needs to be done to finish the production.
Natural Native is a CBD manufacturer producing a wide range of pain relief medicine in the form of creams, oils, and consumables, who quickly noticed that their impromptu approach to production management was leading to delays in their production.
“We did not have a manufacturing resource, inventory system, or a production tracking system,” Madeline from Natural Native.
By using Katana, Natural Native have:
Improved production management and increased their fulfillment rate by 80%
More control over their inventory with Katana’s smart auto-booking system
Developed a schedule using Katana’s task list, so team members can proceed with their jobs
Why is production and operations management important?
Production management and operations management is not just recommended to improve some areas of your business, but it is essential. Otherwise, you could find your business struggling to meet orders and lose customers. So, as a manufacturer, by understanding operations management and the importance of production management, you can:
1. Accomplish business objectives
By performing your production and operations analysis, you’ll be able to achieve business objectives by efficiently producing goods and services that meet the needs of the customer. This will increase customer satisfaction, in turn, increasing your sales and profit.
2. Boost brand image
Important for D2C manufacturers, with production and operations analysis, you’ll be able to raise your reputation as a business that delivers quality products and fair prices.
3. Reduce manufacturing costs
Essentially, a production management system is to achieve lean manufacturing. By optimizing your manufacturing output, you can expect to lower your manufacturing costs either by not having resources waiting idly by or figuring out the best way to keep inventory, such as using ABC inventory.
We now know what production and operations management is, and the benefits of practicing it.
However, it’s a lot of hard work, and perfecting your manufacturing can be argued as an impossible dream. That’s why it’s fundamental to find a tool that can help you get your operations and production management under control.
Automate your production management
Although it is possible to do your production management in a cumbersome spreadsheet, it’s not ideal since there’s so much you need to do, and you can’t afford to spend any time stuck doing mundane administrative tasks.
And this is where automation comes into play. Katana’s cloud manufacturing software is an all-in-one tool that has been built for manufacturers looking to get more control over their production management and operations. Katana helps manufacturers by giving them the power of automation by automatically:
Scheduling production and calculating deadlines
Tracking finished goods and raw materials in real-time and allocating them to sale orders and manufacturing orders
Calculating manufacturing costs
Katana can help you in this area by giving you access to:
A visual platform to monitor manufacturing
Katana’s intuitive and elegant platform allows manufacturers to see a breakdown of production status.
Once you’ve logged into Katana, the “Make” screen is where you’ll find the key elements that will help you with production management and give you an overview of your scheduled production, including the:
Material stock level status
Production status using our red, amber, green (RAG) system
Improved floor-level management
At the “Make” screen, under the “Tasks” you can see in more detail your floor-level progress, with a list of your workstations or team members and the jobs they’re working on, the operation being performed, and the status of that job.
If you’re a visual learner and want to understand how Katana’s automation can optimize your production management, be sure to check out the video below:
So, there you have it, an introduction to production management systems and operations management.
To quickly summarize production and operations management, to achieve this massive task, you need to plan production, decide how you’ll execute this plan, and the operations you and your team will need to do to finish production (whilst always asking yourself how what you’re doing adds value to the customer).
However, without the proper tools or software in place, this task can be extremely challenging without the use of automation, as so many things need to be monitored. That’s why it’s important to find a production management system that can centralize your entire business onto one visual platform.
Give Katana a go with a 14-day free trial and see for yourself how it can optimize your production management.
And until next time, happy manufacturing.
Katana gives thousands of manufacturers a live look at their business. Manage all the moving parts of your business and unite the apps and services you use in one visual platform.
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