Production Management: Definition, Tools, & Processes

What is Production Management?

Production management is the process that oversees the activities undertaken throughout the progression of converting your production inputs – such as raw materials, human resources, and other assets – into finished goods. It involves the planning, coordination, monitoring, and administration of your production processes.

Production management aims to monitor and improve your manufacturing performance. It helps to ensure the resources necessary for producing your goods are being managed efficiently, and that you’re meeting the essential quality and quantity expectations.

Different disciplines are required to facilitate efficient production management processes including scheduling, planning, process improvement, production inventory management, and quality control.

What is The Difference Between Production and Operations Management?

Aspect	Production Management	Operations Management
Primary Focus	Activities directly involved in producing goods.	Broader business operations across manufacturing & service delivery
Scope	Planning, coordinating, and controlling the production of physical products.	Overarching management of systems, processes, and administration.
Objective	Ensure efficient production, resource use, and on-time delivery.	Improve overall organisational efficiency and performance.
Typical Responsibilities	Scheduling, quality control, equipment maintenance, and inventory management.	Supply chain management, HR processes, financial controls, and customer service.
Relationship	A subset of operation management	Encompasses production management as one of its divisions.

What Are The Functions of Product Management?

Production management contributes directly to cost control, production quality and resource optimisation. Its core functions are broken down into the following steps:

1. Planning – Defining what needs to be produced, in what quantity, and by when, including raw materials and resource requirements.  

2. Organising – Allocating materials, labour, equipment and workflows to support production activities. 

3. Staffing – Ensuring the right personnel with the required technical skills are deployed.  

4. Directing – Managing daily production tasks, supervising work, and resolving operational issues.  

5. Controlling – Monitoring production progress, quality and performance metrics to maintain efficiency. 

The Scope of Production Management

The scope of production management extends across the entire manufacturing process, from the acquisition of inputs through to the delivery of finished goods, including:

• Product design and development 

• Process planning and optimisations  

• Facility layout and workflow design  

• Production scheduling and control 

• Maintenance management  

• Inventory and materials management 

• Quality assurance and inspection

These areas collectively ensure that manufacturing operations remain cost-efficient, scalable and aligned with business goals.

What is The Production Management Process?

“The key to successful production management lies in embracing technological solutions, investing in employee training, and fostering clear communication channels to ensure both efficiency and quality are maintained.”

– Daniel Chabert, CEO & Founder of PurpleFire

The production management process can be broken down into five stages:

1. Planning
2. Scheduling
3. Control
4. Equipment maintenance and repairs
5. Inventory management

Let’s explore these processes in more detail.

1. Production planning

Production planning is the initial stage of the production management process. It involves deciding where, when, and how production will ensue.

Planning outlines the step-by-step process of producing your product from start to finish. It creates a process map to help identify the raw materials needed to produce a product and guides production schedules and the allocation of resources.

A production plan should also inform the amount of goods to produce and specify a deadline for production.

2. Production control

Production control is the decision-making phase of production management. It focuses on managing day-to-day operations, scheduling production runs, and controlling quality and costs. Here you are monitoring the production process to ensure that it follows the plan and meets the objectives of the plan.

Controlling production revolves around many variables such as raw materials, machinery and equipment, your workforce, and workflows. Production control ensures that your production team can achieve the expected target with efficient use of resources.

3. Production scheduling

Production scheduling is the forecast and planning of when products will be manufactured. Scheduling aims to avoid stockouts while maximising manufacturing efficiency.

An effective production schedule will help you:

• Organise your employees and ensure they have the necessary skills and training.
• Estimate budgets for parts and labour.
• Eliminate potential workflow disruptions.
• Maintain par levels of raw materials and inventory stock used to produce your goods.
• Implement contingencies in times of changing supply and demand.
• Monitor processes, improve efficiency, and identify opportunities for improvement.
• Improve visibility across manufacturing dashboards.

Production schedules are dynamic documents that may include certain variances relevant to the current production cycle. A successful production schedule should be supported by key manufacturing performance indicators.

4. Equipment maintenance and repairs

Managing the maintenance and repairs of machinery and equipment is an important function of any production system. Equipment and maintenance repairs are those tasks necessary to maintain your company’s assets while managing both time and costs.

The role of your plant maintenance team is to ensure that your manufacturing processes are operating at maximum efficiency. Working to keep all production assets in good working condition to reduce any lost time due to production stoppage.

Equipment maintenance generally falls into three categories: Reactive, Preventive, and Predicative.

1. Breakdown or reactive maintenance

Reactive maintenance is undertaken after an equipment failure or when your machinery is showing signs of damage. This is an old-school approach to maintenance and has been around for a long time. Reactive maintenance is only performed after a production asset has broken down, with the focus on restoring it to operating conditions as fast as possible.

2. Preventative maintenance

Preventative maintenance involves the regular servicing of machinery and equipment required for production. It’s where your maintenance team anticipates what is most likely to wear or break down. It also requires a level of production inventory management to ensure that the spare parts needed for maintenance tasks are on hand when needed.

3. Predictive maintenance

Predictive maintenance uses a variety of technologies – such as artificial intelligence, machine learning, and the Internet of Things – to gather data from your machinery and equipment. According to a 2024 Deloitte paper, predictive maintenance reduces overall maintenance costs by 5-10%, while cutting maintenance planning time by 20-50%. 

Predictive maintenance technology gathers data from your connected resources to secure valuable information on the current condition of your machinery and equipment. This information is then delivered to your maintenance team.

5. Production inventory management

“Production managers must adapt to changes in market demand, supply chain fluctuations, and advancements in technology, all while keeping the workforce motivated and skilled. A reliable inventory management software should be the top priority for any business.”

– Ryan Mckenzie, Co-Founder & CMO of Tru Earth

Production inventory management is crucial to ensuring you have sufficient stock on hand for your manufacturing processes. Effectively managing your production inventory means you can control inventory levels to avoid production downtime and meet your customer demand.

Inventory management software helps you to optimise production operations with accurate real-time visibility of inventory levels to prevent inventory over-stocking or understocking of goods.

Production process improvement

Production process improvement is a team approach to evaluating the current processes of your team and revising them as necessary. Production process improvement techniques aim to increase productivity, streamline workflows, and increase profitability.

Process improvement in manufacturing operations seeks to optimise the many workflow and production tasks to efficiently improve productivity while also reducing costs and limiting waste.

Seven of the best production process improvement methodologies your team can employ are:

1. Six Sigma
2. Kaizen
3. Lean manufacturing
4. PDCA cycle
5. The 5 whys
6. Business process management
7. 5S process improvement

We explore each of these in detail below.

Six Sigma

Six Sigma is a technique used in manufacturing to minimise product defects and inconsistencies. It aims to reduce the number of variations made to get to your finished product by using statistical data to measure how well your processes are working.

Each process that produces fewer than 3.4 defects per one million cycles is deemed to be improved.

Six Sigma uses two methods to achieve this goal.

It first defines the area for improvement by measuring the performance of your current processes. The Six Sigma technique analyses these processes to improve defects and identify their root cause so you can improve and assess future activities to correct any variances.

Secondly, it also looks at total quality management which is a customer-focused approach to continuous improvement over time. This technique largely relies on data-driven decisions and key performance indicators (KPIs) using problem-solving and success metrics to ascertain how your processes can be improved.

Kaizen

Kaizen, also called continuous improvement, focuses on making small changes to continually improve your processes. Whether you’re making small or large enhancements to your processes, continuous improvement helps your team and your business to become more effective.

Kaizen aims to eliminate:

• Wasteful practices that consume resources without adding value
• Overproduction that leaves excess product or waste
• Overburdening resources such as employees or machinery and equipment

To successfully implement kaizen, you need to continually collect and analyse data to understand how well your processes are performing. This data will help you to identify where inefficiencies are occurring and the areas you should be focusing on for improvement.

Integrating the Production Process into a Business Plan

To create a viable and sustainable manufacturing business plan, the production process must be integrated into key strategic areas. This ensures that operational capabilities align with market expectations, financial projections, and long-term growth objectives.

Key considerations to include:

• Production Capacity Planning – Identify required throughput levels, equipment needs, and staffing requirements to meet forecast demand.  

• Cost Structure Analysis – Map out fixed and variable production expenses to support accurate pricing and profit forecasting.  

• Workflow and Process Design – Define how raw materials move through each production stage to minimise bottlenecks and inefficiencies.  

• Quality and Compliance Requirements – Outline processes for quality control, certifications and regulatory compliance across the production workflow.  

• Technology & Equipment Strategy – Include plans for production management software, machinery, maintenance frameworks, and automation pathways.  

• Inventory & Supply Chain Integration – Ensure material procurement, lead times and stock levels support uninterrupted production cycles.  

• Risk & Contingency Planning – Build resilience by planning for supply chain disruptions, equipment failures, and sudden demand changes. 

Lean Manufacturing

Lean manufacturing is a production process improvement technique that seeks to deliver sustainable improvements in manufacturing operations through the reduction of waste.

The first step in lean manufacturing is defining what your customers value and how your products meet those values. Next, create a visual guide of all the elements required to deliver your product and analyse each of these to establish how best to optimise your entire process.

To maintain maximum operational efficiency, you need to establish your production flow. This is a stream of sequential steps where the completion of one step leads to the start of another step.

Scheduling tools and software can assist you in accurately tracking your production process flow. Alternatively, a lean pull system creates a workflow of eliminating waste activities by only producing products based on actual demand.

Implementing continuous improvement will assist you in identifying and optimising processes to achieve lean manufacturing.

PDCA Cycle

PDCA stands for plan–do–check–act. This production management method helps to control the general improvement of products and processes.

The PDCA cycle is an interactive approach to problem-solving. As you might’ve guessed, it can be broken down into four stages:

• Planning: This is where you determine the problem to be solved and develop a plan to solve it.

• Doing: This is when you implement the plan on a small scale to test.

• Checking: This is the revision stage in which you assess how well the ‘doing’ test performed.

• Acting: This final step is where you decide, based on the check results, whether to implement the change on a larger scale.

In the PDCA improvement cycle, each step can be repeated until you achieve your desired outcome. This makes it a sustainable approach to process improvement.

The 5 Whys

The 5 Whys of lean manufacturing is an improvement technique used to identify the root cause of a problem. It simply asks: “Why did this go wrong?” and repeats the question five times to diagnose and resolve any production issue.

For example, if you have an increase in customer returns due to damaged products, the 5 whys ask:

• Why did this happen? The packaging was inadequate to properly protect the products.

• Why was the packaging inadequate? The packaging was not tested to ensure it was sufficient to protect the shipped goods.

• Why was the packaging not tested for these goods? The standard packaging currently used appeared to be sufficient for similar goods.

• Why did the current standard packaging appear to be sufficient? The standard packaging used for a similar product had not resulted in damage to goods or product returns.

• Why was a new process to test packaging not undertaken? The procedure for launching the new product did not include a stress test to ensure the current packaging was appropriate for the new product.

In the 5 Whys approach, you continue to ask the question until you have identified what went wrong, why it went wrong, and how it can be remedied.

Business Process Management

Business process management (BPM) analyses business processes to identify where improvements can be made. It helps to identify production bottlenecks and opportunities to automate manual processes.

This approach works well in times of business growth to identify which, if any, processes can be scaled efficiently.

BPM analyses and maps current processes from beginning to end. You then draft a model of how you would like your processes to look and then put this model into practice.

Once your model has been implemented, you must monitor the process to ascertain if it has been successful or not. It’s important to set KPIs prior to the implementation stage to measure the model’s success and continually optimise processes as you go.

5S Process Improvement

5S process improvement is based on the five Japanese principles of sort, set in order, shine, standardise, and sustain.

Here’s how it works:

1. Sort the production area and remove any unnecessary items and tools not required in the space.
2. Set in order the items you have sorted and arrange them neatly, organising them for ease of identification and easy-to-find locations.
3. Shine simply means cleaning the production area and removing rubbish to maintain a clean uncluttered operating space.
4. Standardise your activities and schedule regular cleaning of the production area.
5. Sustain maintains the 5S process through the regular undertaking of the sort, set, shine, and standardisation of tasks.

Now that we’ve covered some of the processes you can implement to optimise production management, let’s look at some helpful tools that facilitate process improvement.

Production Management Tools for Improving Manufacturing Efficiency

As the delivery expectations of consumers rise with the evolution of shipping and production technologies, so does the demand for effective manufacturing optimisation resources.

Adoption of digital technologies in manufacturing has moved beyond early experimentation. A recent UK innovation diffusion survey reports that 56% of businesses are already adopters of at least one advanced technology, such as AI, cloud computing, big data, IoT or robotics. At the same time, the latest Make UK & PwC Executive Survey shows manufacturers entering 2024 with renewed optimism and a stronger appetite to invest in digital technologies as a core lever for competitiveness and resilience. All this underlines how critical production management tools and digital infrastructure have become for modern manufacturing operations.

All this to say: the need for production management tools in modern manufacturing is more apparent than ever.

Production Management Software

Production management software helps manufacturers efficiently manage production operations with real-time visibility into each step of the production process, from sales orders to work order processing, inventory management, and order fulfilment. Production management software gives you an end-to-end manufacturing solution for your entire manufacturing operations.

Production Management Hardware

Production management hardware is the physical equipment that facilitates more efficient manufacturing.

This can include:

• Machinery
• Tooling
• Moulds
• Fixtures
• Test equipment
• Warehouse vehicles
• Robotics

Production management hardware should be fit for purpose, as this equipment is typically rigid and costly to adapt to any changes in your production processes.

Hardware runs on a longer cycle than software which can be easily updated. Managing production hardware requires an understanding of how the equipment can be tailored to changes in the customisation of products. It’s also important to determine how compatible each hardware component is with the integration of software solutions.

Production management courses and training

Many technical institutes offer a variety of accredited production management courses and training. Short courses, certificates, and diplomas in production management provide the skills and knowledge necessary to plan, direct, and coordinate production activities in manufacturing.

Production management training provides you with the skills to plan, schedule, track, analyse and direct production operations. It also arms you with the knowledge to implement lean practices and improve production processes.

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