EVALUATION OF PRODUCTION PROCESS AND CAPACITY UTILIZATION

CHAPTER ONE

INTRODUCTION

BACKGROUND OF THE STUDY

Production management refers to those activities that involve planning, organizing, directing, integration, controlling, and evaluation of the entire process of manufacturing goods or providing services at the right cost and in its right time, quantity, quality and place.  Production management is about in the way organization produces goods and services. For instance, everything you eat sit on, read and knock about on the sport field comes to you, courtesy of the production managers who organized its production.  Every book you borrow from the library, every treatment you receive at the hospital, every service you expect in the shops and every lecture you attend at school, all have been produced. Production is all evolving.  Which the people who supervised their production may not always be called production manager, but that is what they really are (production manager but that is what they really are) production management is concerned with the organization of the use of equipment and their resources.  Production management is utilization of the highest production resource at the least cost.

        E. U. L. Imaga said that the performance of the managerial activities entailed in selecting. Designing, operating, controlling and updating productive systematically defined production management that it should be pointed out that production first like any other field of study has many definitions as there are participate in the field.

        Mayer (1982), defined production with references to goods as the fabrication of a physical object through the use of labour, material and equipment whereas with reference to service, production is the discharge of the function, which is utility. In either case something is being produced which did not exist earlier from the above explanation, production is the transformation of resources into finished goods and services. He also pointed out that any organization which transforms inputs is engaged in production. 

        Buffa E. S. (1973) said that production is process by which goods and services are created. He also stated further that production process are found in factories, offices and hospitals.  The primary aims of the production management is to optimized the production system, the consequent result of optimization is production efficiency.

        The dictionary of business management defined production as any activity that adds value to goods and services including transportation and warehousing until it is used. Utility is the ultimate satisfaction derived from the consumption of a particular goods and services.

        Devck Labley (1974) said that the process of converting raw or base material originally extracted from the earth, sea or atmosphere into form which yield utility or satisfaction to consumer at a time and place convenience to the consumer.  The emphasis is still on the ultimate satisfaction of the consumer which is what production is to bring about this transformation. In some circumstance it is appropriate to produce goods by employed labour to the other factors of production.

        Production capacity according to Jerry Rosenbery is the available equipment, the maximum quantity at unit that can be made on stated period the full capacity of production is predetermined and install before the commencement of production process, adequate planning and forecast is made to that effects.

        The Dryder Press (1990), said that capacity widely understood by many people can be seen as a ability of a unit to produce that which consumer require and clearly there must be some match between needs characterized by market forecast and ability characterized capacity. In this regard capacity can be by differentiated into three level and they are as follows:

i.             potential capacity

ii.            Immediate capacity

iii.          Effective capacity

Potential capacity is that capacity which can be made available with current budget period.

        Immediate capacity is that capacity which is used within the current budget period.

        Therefore, production management modifies production policies and some times aids the production engineer to modify design as well since production engineering is more concern with the design of physical equipment.

STATEMENT OF THE PROBLEM  

Productivity in a country as Nigeria as a matter of fact is low and as such as describe as a developing economy. In countries where productivity is high we say such countries have developed economy.  In view of this, this research set to examine the following problem:

i.             What are the problems encountered when putting the raw materials used in the production process in Nigeria Breweries plc.

ii.            What are the problems of inventory management in Nigeria Breweries and what are the problems of inventory management policies of the company?

iii.          What are the problems encountered in the utilization of the installed capacity in the Nigeria Breweries Plc?

iv.          What are the problems in production process in Nigeria Breweries plc?

 PURPOSE OF THE STUDY

 The purpose of this research work area as follows:

i.     To determine the process of production of Nigeria Breweries.

ii.    To ascertain to what extent the install capacity of the Nigeria Breweries is utilized.

iii.  To find out how the Nigeria Breweries cope with the management of its inventories.

iv.  To ascertain how the raw materials used in the production process are sourced and substituted.

v.   To make recommendations.

SCOPE OF THE STUDY

The research intend to under study the production process and capacity utilization of the Nigeria Breweries Plc Enugu. The Nigeria Breweries is a very big company with network of branches in some part of the federation.  Carrying out a study in all the Nigeria Breweries as a whole will be very time consuming and cumbersome i.e it will entail traveling to some parts to obtain facts about the Nigeria Breweries. Hence the research tried to cover production process and capacity utilization in the Nigeria Breweries Plc., Enugu.

 RESEARCH QUESTIONS

i.      How does Nigeria Breweries structure their product design to meet the demand of present and potential customer.

ii.      How does Nigeria Breweries handle certain factors that can hinder or affect the design of a product?

iii.     Since material handing are costly by nature how has Nigeria Breweries plc minimize the handle of materials?

iv.     In what way has Nigeria Breweries plan and design their production to reflect the operating strategy for the business.

v.     How does Nigeria Breweries estimate long range capacity production in relation to the industry capacity.

SIGNIFICANCE OF THE STUDY

The significance of this study is to analyze and evaluate the process of production and capacity utilization in Nigeria Breweries as its seek to achieve a high degree of efficiency of product.  This study also analyze various resources needed in production process and factors affecting its growth, tends to attract in increasing interest of economist, industrialist and statisticians in research.  Prior to the attempt to analyze was the method by which efficiency or problem of its evaluation as mathematically concerned. It is important to give at least a brief but well concerned concept applicable to the topic under review.  There are many concept of efficiency. The term has practice significance not only in enormous but also in sociology, enology and other branches of sciences.  The context of its study in a particular area of study a research into production and capacity utilization (is necessary) is necessary because man’s existence on earth cannot be assured with production.  Effective utilization of resources leads to less wastage of resources and elimination of the facilities. The researcher considers it important to carry out an investigation on the process of production and capacity utilization because of its importance in an organization.

DEFINITION OF THE STUDY

Optimization: Is the process of achieving the best thinking doing.

Capacity:   This is the ability of an organization to contain or hold the needs aid wants of its prospective customers.

Utilization:       This is the ability of a firm to make use of its available resources to produce good and services for the satisfaction of human needs and wants.

Productivity:     This is the rate of efficiency of work done, that is the output per unit of a factory production.

Installation:     This is the process of position new production in an organization with the aim of making profit.

Integrate: This is the act of combining different factors or parts to make a whole.