Optimising production, inventory and procurement control in manufacturing industry: two case studies of companies with computerised management information systems

The paper outlines an approach to the simultaneous control of production schedules, stock levels and purchase costs based on a dynamic analysis of the management-information systems involved in the production-planning process. The problems of simultaneously reducing production costs, controlling the impact of high stock levels on company cash flow, and purchasing economically, are modelled within the framework of an integrated management-information system for production planning. It is shown that a combination of economic ordering, accurate forecasting, and stable updating of production plans as market conditions vary, can improve the performance of the manufacturing plant. Two case studies of actual manufacturing companies with computerised systems are examined: one a precision-engineering product manufacturer with a high degree of manual intervention in the computerised planning process, the other a fashion product manufacturer operating in a volatile market with an entirely computerised and automatic production-planning system. Results from the dynamic analyses of both cases show that manual intervention is an important factor in the success of any computerised system. The conclusions drawn are that integrated dynamic analyses of the individual components of the production system are necessary to ensure the overall objectives of the manufacturing plant are achieved.