MNO 3701 Production & Operations
Management
Chapter 6
General Nature of Planning and Control in Operations
General nature of planning and control in operations
What is planning and control
o Planning and control is the reconciliation of the potential of the operation to supply
products and services, and the demand of its customers on the operation. It is the set of
day to day activities that runs the operation on an ongoing basis
What is the difference between planning and control
o A plan is a formalization of what is intended to happen at some time in the future. Control
is the process of coping with changes to the plan and the operation to which it relates.
Although planning and control are theoretically separable they are usually treated together
o The balance between planning and control changes over time. Planning dominates in the
long term and is usually done on an aggregated basis. At the other extreme in the short
term, control usually operates within the resource constraints of the operation but makes
interventions into the operation in order to cope with short term changes in circumstances
How does the nature of demand affect planning and control
o The degree of uncertainty in demand affects the balance between planning and control.
The greater the uncertainty the more difficult it is to plan and greater emphasis must be
placed on control
o This idea of uncertainty is linked with the concepts of dependent and independent
demand. Dependent demand is relatively predictable because it is dependent on some
known factor. Independent demand is less predictable because it depends on the changes
of the market or customer behaviour
o The different ways of responding to demand can be characterized by differences in the P:
D ratio of the operation. This is the ratio of total throughput time of goods or services to
demand time
What is involved in planning and controlling
o Loading – dictates the amount of work allocated to each part of the operation
1
Management
Chapter 6
General Nature of Planning and Control in Operations
General nature of planning and control in operations
What is planning and control
o Planning and control is the reconciliation of the potential of the operation to supply
products and services, and the demand of its customers on the operation. It is the set of
day to day activities that runs the operation on an ongoing basis
What is the difference between planning and control
o A plan is a formalization of what is intended to happen at some time in the future. Control
is the process of coping with changes to the plan and the operation to which it relates.
Although planning and control are theoretically separable they are usually treated together
o The balance between planning and control changes over time. Planning dominates in the
long term and is usually done on an aggregated basis. At the other extreme in the short
term, control usually operates within the resource constraints of the operation but makes
interventions into the operation in order to cope with short term changes in circumstances
How does the nature of demand affect planning and control
o The degree of uncertainty in demand affects the balance between planning and control.
The greater the uncertainty the more difficult it is to plan and greater emphasis must be
placed on control
o This idea of uncertainty is linked with the concepts of dependent and independent
demand. Dependent demand is relatively predictable because it is dependent on some
known factor. Independent demand is less predictable because it depends on the changes
of the market or customer behaviour
o The different ways of responding to demand can be characterized by differences in the P:
D ratio of the operation. This is the ratio of total throughput time of goods or services to
demand time
What is involved in planning and controlling
o Loading – dictates the amount of work allocated to each part of the operation
1
