1. Introduction to Production Planning and Production Management

2. The Three Basic Functions
The Organization
The Three Basic Functions
Organization
(R&D)
Finance
Operations
Marketing
Business organization typically have three basic functional areas:
1. Finance is responsible for financial resources at favorable prices and allocating those sources throughout the organization as well as budgeting, analyzing investment proposals, and providing funds for operations
2. Marketing is responsible for assessing consumer wants and needs and selling and promoting the organization’s goods or services
3. Operations is responsible producing goods or providing services offered by the organization. This consists of PPC, PE, QA, and SC (and R&D; Thai industries do not focus on R&D because most of them just follow customers’ designs or R&D of the headquarter located in other countries)
PPC QA SC

3. The operations function involves the conversion of inputs into outputs
Value-Added Process
The operations function involves the conversion of inputs into outputs
Value-added
Inputs
Outputs
Transformation/
Land
Goods
Conversion
Labor
Services
process
Capital
If a business organization is a car, operations would be its engine. And Just as the engine is the core of a car does, in a business organization, operations is the core of what the organization does. Operations management is the management of systems or processes that create goods and/or provide services. The essence of the operations function is to add value during the transformation process. In for-profit organization, the value-added of outputs is measured by the prices that customers are willing to pay for those goods or services.
Feedback
Control
Feedback
Feedback

4. Value-Added & Product Packages

5. Value-Added & Product Packages
Value-added is the difference between the cost of inputs and the value or price of outputs.
Product packages are a combination of goods and services.
Product packages can make a company more competitive.

6. Goods-service Continuum
Goods (manufacturing)
Service
Surgery, teaching
Song writing, software development
Computer repair, restaurant meal
Automobile Repair, fast food
Home remodeling, retail sales
Automobile assembly, steel making

7. Manufacturing or Service?
Tangible
Act

8. The Kinds of Products and Services
Make-to-order: products and services are made to customer specifications after an order has been received
Make-to-stock: products and services are made in anticipation of demand
Assemble-to-order: products and services add options according to customers specifications

9. Processes Classification for Manufactured Product

10. Processes Classification for Services

11. Food Processor Inputs Processing Outputs Raw Vegetables Cleaning
Canned vegetables
Metal Sheets
Making cans
Water
Cutting
Energy
Cooking
Labor
Packing
Building
Labeling
Equipment

12. Hospital Process Inputs Processing Outputs Doctors, nurses Examination
Healthy patients
Hospital
Surgery
Medical Supplies
Monitoring
Equipment
Medication
Laboratories
Therapy

13. Types of Operations Operations Examples Goods Producing
Farming, mining, construction ,
manufacturing, power generation
Storage/Transportation
Warehousing, trucking, mail
service, moving, taxis, buses,
hotels, airlines
Exchange
Retailing, wholesaling, banking,
renting, leasing, library, loans
Entertainment
Films, radio and television,
concerts, recording
Communication
Newspapers, radio and television
newscasts, telephone, satellites

14. % employed population in manufacturing & some service sections in TH-VN-USA

15. Change in the number of manufacturing Jobs in US
Productivity
Increasing productivity allows companies to maintain or increase their output using fewer workers
Outsourcing
Some manufacturing work has been outsourced overseas (e.g. Thailand, Vietnam, China) to reduce operation cost