Production and Operations Management knowledge and capabilities can be used to create wealth in a better world when there is no limit to information and understanding.
Production Management has its strategic and tactical dimensions and there are also systemic and circular dimensions. Logistics and supply chains are part of these dimensions.
When we say Supply Chain and Logistics in Production Management the first thing that comes to is the idea that supply chain cannot be part of the production because that’s the information people have been fed with over the years, since Keith Oliver invented the word in 1982.This probably may be viewed as an anachronism in a modern management era but the truth is that supply chain is a system view of production.
WHAT IS SUPPLY CHAIN?
The supply chain is the integration of production processes to maximize value for all the stakeholders. . The supply chain is the dimension of Production that emphasizes the integration of sourcing, transformation and distribution for greater efficiency, speed, and lower costs.
WHAT IS LOGISTICS?
Logistics is the process of getting resources be they human, goods, services and information from their place of origin to their final destination in the form intended on time and at optimal cost.
Logistics includes the facilitation of movement of goods and services by employing different modes of transportation, materials handling, storage, warehousing, distribution and delivery with security and safety considerations.
Production logistics is critical to the business or organisational efficiency.
The Production model of inputs- process- output has been politicized as a factory or manufacturing domiciled model but this mathematical model of production processes is applicable in service organisations, retail marketing, projects and general administration. Input-output modeling of production processes are not limited to manufacturing but extends to supply chains, logistics and other functions in private or public sector organisations.
WHAT ARE PRODUCTION PROCESSES?
By production processes, we are referring to the series of actions and steps taken by an organisation to acquire resources, make and deliver quality products and services to
meet market demand at a profit.
Production and Operations Managers need to administer global supply chains for a progressive, secure, and sustainable world. But their capacity to think and perform can be dwarfed by the oppression of management discretion orchestrated by the abuse of business models and the pontification of twisted etymology.
SUPPLY CHAIN AS PART OF PRODUCTION.
The supply chain is part of Production and not the other way round.Supply chain is a model of Production or Production Organisation.
The entire organisation is about production. Production takes place in different ways or forms. The Cosmos is a form of production system…..yes, just the way you and I are a product of a production system! Every nation or organisation is another form of the production system. And within each organisation and divisions or departments, you will find different production systems.
PRODUCTION MAY BE PART OF SUPPLY CHAINS.
Some production processes come within the scope of supply chains and this is what is mostly referred to when people say that supply chain involves manufacturing, which is a type of Production. At a level some forms of production come under supply chains but at a higher level all supply chains come within Production chains.
CORPORATE GOVERNANCE AFFAIRS AND BUSINESS MODELS.
Even at that, supply chain functions come under the control of Plant Managers and Manufacturing Directors in many organisations. It all depends on a corporate governance strategy, culture and business models.
The entire world and all organisations can be seen as production systems where input value largely determine output value.
Over the years attempts have been made by academics to project or teach Production Management as if it were an adjunct or subordinate to Operations Management and Supply Chain Management. This urgly trend has led to limitations imposed on the status of many Production Managers especially in organisations where the organisation structure has made it difficult for a change of the status quo.
In the same vein, different titles are being adopted. For instance an organisation has a Manufacturing Director or a Supply Chain Director at the top management level but keeps a Production Manager at the Middle or Senior management level. Is manufacturing broader than production literally or simply contextually?
Plant managers, factory managers and manufacturing managers are the “new normal” for general manager of production in many manufacturing industries.
This oddity is glaring especially when viewed against the backdrop of the true meaning of Production. Literally and etymologically Production is wider than Manufacturing. Manufacturing production is just one form of Production. Using production as a blanket word is an abuse of generalization. Production means a whole lot of things.
But even most dictionaries and many interpretations are limiting. Worse still, one might be accused of being too theoretical when the aim is meant to reform an aberration.
VALUE CHAIN AND SUPPLY CHAIN ARE PART OF THE TOTAL PRODUCTION SYSTEM.
Value chain and supply chain are models for the total production system.A production system is not just about the activities within the factory. Production systems encompass the operations in the offices and indeed in various locations and sites. While value chain is about how value originates from the source such as the raw materials and how additions are made until it gets to the final consumer or the end user, supply chain is a production system beyond manufacturing as it involves all persons and organisations such as the suppliers, logistics service providers, distributors and retailers who work together to ensure that customer satisfaction is achieved at optimal efficiency.
WHAT IS A PRODUCTION SYSTEM?
People talk about Ford Production System (FPS) and Toyota Production System ( TPS) but they forget how these organisations succeed by adopting wholistic and integrative approaches rather than operating in cubicles of limited knowledge and capabilities.
A system has components or elements. There are sub-systems.The essence of every system is Production. Supply Chain networks are part of the Global Production Chain.
Production and Operations Managers including Supply Chain Managers should stop operating with limited knowledge. They are to manage supply chains globally.
Every one involved in value creation and value additions and in all value processes are production people.Every one involved in order fulfillment processes from purchasing and procurement of materials, manufacturing, transportation, warehousing to distribution, delivery and after sales services are part of the Production System..not only those who convert raw materials into finished goods.Production is beyond conversion process in a particular unit or section of a business. Production takes place in every department including engineering and human resources.
Production starts before manufacturing and it extends beyond consumption. Before Procurement or purchasing there must be production whether it is agricultural, mining, energy, construction, manufacturing or services.
Suppliers and customers- distributors, retailers and agents are all involved in Production. Manufacturing is just a part, and sometimes not necessary in a typical Total Production System.
A Production System can be defined as interconnected operation, activities, methods, approaches or procedures involved in the acquisition and transformation of resources and the delivery of marketable products and/or services for customer satisfaction and sustainable stakeholders’ value.
SUSTAINABLE PRODUCTION SYSTEMS.
Every Production Manager should see the job of managing production beyond the job description of a typical Production Manager. Production Management should be viewed as all-encompassing area of knowledge involving supply chains and logistics.
PRODUCTION AND RESOURCE MANAGEMENT.
Production Managers should be concerned about resource acquisition and utilization- from sustainable sourcing of raw materials, forging strategic alliances and partnerships with suppliers and customers, collaborating with Government agencies, manpower acquisition, learning, development, compensation and motivation to technology and plant acquisition and utilization, dynamics of local and international markets vis- a- vis consumerism, market volatility and disruptions, changing tastes and fashion, quality, safety and reliability standards.
