Functions of Production Planning and Control - Importance

Functions of Production Planning and Control

Functions of production planning and control are listed and explained below.

The importance or functions of production planning and control:

1. Utilizes resources effectively.
2. Makes flow of production steady.
3. Estimates production resources.
4. Maintains necessary stock levels.
5. Coordinates departmental activities.
6. Minimizes wastage of resources.
7. Improves labor efficiency.
8. Helps to face competition.
9. Provides better work environment.
10. Facilitates quality improvement.
11. Customer satisfaction.
12. Reduces production costs.

Now let's discuss above listed functions of production planning and control.

1. Utilizes resources effectively

1. Production planning and control result in effective utilization of plant capacity, equipment and resources.
2. It results in low-cost and high-returns for the organization.

2. Makes flow of production steady

1. Production planning and control ensure a regular and steady flow of production.
2. All machines are put to their optimum use.
3. This helps in achieving a continuous production of goods.
4. This also helps to provide a regular supply of goods to consumers.

3. Estimates production resources

1. roduction planning and control help to estimate the resources like men, materials, machines, etc.
2. The estimate is made based on sales forecast.
3. So, production is planned to meet sales requirements.

4. Maintains necessary stock levels

1. Production planning and control prevent over-stocking and under-stocking of materials.
2. Necessary stocks are maintained.
3. Stock of raw-material is maintained at a proper level in order to meet production demands.
4. Stock of finished goods is also maintained to meet regular demands from customers.

5. Coordinates departmental activities

1. Production planning and control helps to co-ordinate the activities of different departments.
2. Consider, for an example, the marketing department co-ordinates with production department to sell the goods.
3. This results in profit to the organization.

6. Minimizes wastage of resources

1. Production planning and control ensure proper inventory of raw-materials and effective handling of materials.
2. This helps to minimize the wastage of raw materials.
3. It also ensures production of quality goods. This results in minimal rejects.
4. So, it results in minimum wastage.

7. Improves labor efficiency

1. There is maximum utilization of manpower.
2. Training is provided to the workers.
3. The profits are shared with the workers in form of increased wages and other incentives.
4. Workers are motivated to perform their best. This results in improved labor efficiency.

8. Helps to face competition

1. Production planning and control help to give delivery of goods to customers in time.
2. This is because of regular flow of quality production.
3. So, the company can face competition effectively, and it can capture the market.

9. Provides better work environment

1. Production planning and control provide a better work environment to workers.
2. They get better work facilities, proper working hours, leave and holidays, increased wages and other incentives.

10. Facilitates quality improvement

1. Production planning and control facilitate quality improvement because the production is checked regularly.
2. Quality consciousness is developed among the employees through training, suggestion schemes, quality circles, etc.

11. Customer satisfaction

1. Production planning and control help to give a regular supply of goods and services to consumers at competitive market price.
2. This results in customer satisfaction.

12. Reduces production costs

1. Production planning and control make optimum utilization of resources, and it minimizes wastage.
2. It also maintains an optimal level of inventories.
3. Overall, this reduces the production costs.