How to Plan Production

In manufacturing and services, productivity inevitably requires a solid production plan. Effective planning is essential in any business. This is a complex process, which covers a wide range of activities designed to ensure that materials, equipment and human resources are available to accomplish the work.

Production planning is a bit like a road map that tells you how to get to your destination. It helps you determine where you are heading and how long it will take to achieve your goal.

These are some of the benefits of an effective production planning and scheduling:

  • Reducing labour by eliminating wasted time and improving workflow
  • Decrease inventory costs resulting from the reduction of the need to maintain safety stocks and excess inventory of products.
  • Optimization of the use of equipment and capacity maximization
  • Optimal utilization of human resources
  • Improved on-time delivery of products and services

Key factors of a production plan
Effective planning is based on an understanding of the key activities that entrepreneurs and business managers should apply through the planning process.


Forecast market expectations: To develop an effective plan, you must estimate potential sales with some accuracy. Most companies do not have exact figures in regard to their sales or services. However, they may establish sales forecasts from historical data, market trends and / or controls established.

Stock Control: You must establish inventory levels to ensure reliable supply of the production chain, and establish a rigorous inventory system.

Availability of equipment and human resources: We are talking about "operational time", which is the interval between specified processes to allow all orders to be routed from one end to another of your production chain or service. Production planning helps you manage the open time to make sure it is used wisely while taking care not to cause delays. Planning should maximize your operational capacity, but not exceed it. Your plan should also leave a margin for the unexpected and potential changes.

Standardized steps and time: Usually the most effective way to determine your stages of production is to map the process in the order they occur, and then to indicate the average time it takes to get the job done. Remember that the stages are not all sequential and that many of them can occur simultaneously.

Having mapped your processes, you will know how long it takes to complete the entire job. When activities are repetitive or similar, it is best to standardize the work and time required. Document similar activities for future use and use them as a reference point to establish the workflow / travel and time in the future. This will accelerate your planning process.

Mapping your processes might reveal sources of waste. You can apply the principles of operational efficiency / lean manufacturing to eliminate waste, shorten the process and improve the delivery and cost. Lean Action consultants can help companies who want to map their processes or apply other principles and tools to increase their operational efficiency.

Risk Factors: Assess them by collecting historical data relating to similar work already performed, and be sure to list the execution time, the materials used and the failures that occurred. When the risks are considerable, it would be wise to perform a failure modes and effects analysis (FMEA) and ensure that controls are in place to eliminate or minimize them. This method allows you to study and identify ways to mitigate potential problems within your operations. Such analysis is more common in enterprises in manufacturing and assembly industries.

How to plan the work
All other activities are initiated from the production plan and each sector depends on their interaction. Generally, a plan covers the materials, equipment, human resources, training and capacity as well as workflow or methods to complete it within a number of hours predetermined (standard time). To prepare accurate sales forecasts, you should rely on the organizations order history.

Initially, the production plan must address the specific key elements well before production is started to ensure the uninterrupted flow of work.

    Control equipment. Equipment and services where the replenishment time is long or that are shipped a long distance - so-called "phased delivery orders" - should be ordered well before the start of production. Suppliers should deliver the materials on a periodic basis to ensure uninterrupted supplies of the production chain.

    Purchase of equipment. The acquisition of specialized tools and equipment to start the production process may require more time. It is indeed possible that the equipment must be custom made or it is simply difficult to assemble and install. It is also possible that specialized training is necessary for it to function.

    Bottlenecks. These are constraints or restrictions affecting the workflow which should be evaluated in advance so as to circumvent or eliminate them before starting production. When evaluating potential bottlenecks, do not forget that they can move to another area of the process. Managing bottlenecks represents an ongoing challenge for any company.

    Acquisition of human resources and training. Key positions may require specialized or advanced training in respect of specialized equipment, technical processes or regulatory requirements. Candidates for these positions should be subject to in-depth interviews regarding their abilities. At the time of hire, allocate sufficient time for training and be sure that the employee masters skills before starting work. This way you will ensure the smooth running of your processes or your service

The production plan provides a basis for work scheduling and planning details of current activities. As you receive orders, you must treat them individually, according to their priority and this will determine the flow of work and when it will be executed. You should then evaluate if you are ready to start production or offering the service. You will need to determine the following:

Are inventories available at the location where the work is started? If this is not the case, reschedule it for when supplies become available. It is useless to plan a job you will not be able to complete.

What about your resources? Do you have the necessary staff to do the job? Are the machines already in use?  

Does the predetermined number of hours (standard time) coincide with the operational time allocated? If not, the job should be rescheduled

You should take great care to minimize risk factors, leaving too much room for assumptions ("What if ...?") may delay delivery and be counterproductive

Communicate the plan
Having established that all criteria are met to start production, you must communicate the plan to employees who will be implementing it. You can plan production using spreadsheets, databases or software, which usually speeds the process. However, it is preferable to use a visual representation to communicate production schedules for shop labor. Some companies post production orders on tables or use computer monitors to present the schedule of work. It must be made available to employees in advance and maintained.

Reflect changes
One of the many challenges of planning and scheduling of production lies in tracking changes to orders. Changes occur every day, you can run out of materials, the delivery date may be advanced or it may be necessary to adjust the working parameters. You will need to adjust your plan so that it is consistent with these changes and inform the relevant staff. Coping with change is not always easy and may require as much effort as the initial creation of the production plan. You will need to follow up with departments concerned to rectify any problems. In addition, production monitoring systems and software can be useful to monitor changes, inventory, human resources and equipment.

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