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Production management is the direction and control of the processes that create products and services.TypesProduction management is primarily associated with management of manufacturing processes. The term is occasionally applied to other types of management such as the management of a production IT environment.
ElementsProduction management is the process of taking inputs such as parts and creating outputs such as products. This involves elements of production planning, budget management, management accounting, process improvement, performance management, quality control and distribution.
ObjectivesProduction management is often focused on efficiency, productivity and quality. Manufacturing processes are typically highly optimized to eliminate wasted labor, capital, materials, energy, space and time. Other common objectives are sustainability, workplace health & safety and compliance.
Management accounting is the numerical analysis of business processes. It has its roots in production management efforts to improve processes to be highly efficient at scale. If you're producing 1 million units a month, shaving unit cost can have significant payback. Management accounting can be used to model every inefficiency and risk on a production line.
If you're shipping a large number of complex products each week, an unnoticed quality problem can result in damage to your reputation and sales. Shipping a defective product can also result in liability, compliance issues and numerous costs such as reverse logistics. As such, the quality control process of detecting and quickly resolving non-conformances to specifications is a primary production management concern.|
| Type | | | Definition | The management of the processes that create products and services. | | Related Concepts | |
Management
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The definition of production management with examples.
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