Optimization of production planning in a small manufacturing company

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    Optimization of production in a small company

    Production planning represents the core of the manufacturing process. Production planning aims to organize the resources needed in managing production costs, time, and labour in manufacturing operations. Nowadays, more and more products have similar technological characteristics, so competitiveness in the market depends not on how unique they are but instead on effectively their production is organized. Companies that produce sophisticated goods, according to clients guidelines, for individual orders or as series production often face problems and have to compromise between customer needs, the complexity of the production process and effectiveness. That’s why optimization of production planning is essential, and many companies search for the best strategy to implement.

    Optimization of production planning processes – where to start?

    There are various factors to be considered in optimizing manufacturing operations. By viewing and implementing this, multiple things related to production costs, time, and labour in business operations will be more solid and practical. Streamlining complex manufacturing operations is necessary to map existing production processes, and it is often caused by some disruptions at the production hall. These include long production or delivery times, excessive inventory, lack of flexibility when committing an order. 

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    When can you benefit from optimization of production planning processes? 

    Each change regarding production planning in a small manufacturing company should be preceded by a thorough analysis of the situation, especially when the logistic concept requires adjustments because of:  

    • the company growth and changes made in the array of products on offer,  
    • the changes in the way products are made, followed by the changes in raw materials flow, 
    • changes of place (ex. a new location, an extended production hall).

    Other important factors which contribute towards the optimization of production planning processes include:  

    • global changes (economic, political, legal) ex. current situation with covid 19 pandemic,
    • adjust the production process to existing norms and standardize it (ex. audits, requirements of ISO norms),
    • the willingness to increase competitive value of the company on the market (or new rivals in the industry),
    • cost cutting, when the income is not proportional to spending,
    • the willingness to utilize better different resources (human, raw materials, company premises, etc.),
    • reduce the number of complaints and the amount of faulty goods (minimize errors), 
    • better time management,
    • better communication across the teams, improved morale, faster transition of new employees, 
    • creation of company know-how and database of products.

    No matter what is your motivation, the common feature is the need to optimize production processes to make them effective which in turn will help to:

    • reduce cost,
    • speed up production process,
    • increase customers satisfaction,
    • timely delivery of orders,
    • improved productivity,
    • integration of employees as they can feel the part of the company.

    Production planning processes – different methods of optimization 

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    The pace of change in manufacturing has never been so high. To meet new demands and remain competitive, you need faster responses, state-of-the-art technology, and connected processes from production planning and control to material requirements planning and logistics. At the same time, you need to ensure full traceability and documentation to comply with strict regulations. Sometimes it is not possible to introduce radical changes because it is financially risky or could create chaos at the production hall. There is an alternative solution in the form of the Kaizen method. The Japanese word kaizen means “change for better”, and it refers to any improvement, one-time or continuous, large or small, to finally achieve standardized programmes and processes within the company as well as: 

    • eliminate waste and redundancies, improve quality;
    • have clear criteria of assessment and appraisal and get employees involved in company;
    • reduce costs;
    • improved ergonomics of workstations.

    Another solution presents a Just-in-Time method, which allows us to synchronize different activities in the process. It is used as a strategy for managing inventory and/or production that links the ordering of raw materials to production schedules. Thanks to that, we save the space and the cost of storage and achieve:

    • Better information flow, supply tracking, goods distribution;
    • Employees skills are better utilized (multitasking, multi skilling);
    • Less waste and lower inventory costs, which result in increased profits for the organization;
    • Utilizing the raw materials in a timely way so as to fill orders on a timely basis (the risk of goods being damaged or out of date is minimized);
    • A company efficiently using raw materials, leaving little to no raw materials left over after production;
    • Shorten time of order delivery and completion.