Management of industrial enterprises is a long and rather laborious process, involving the presence of systematic thinking among managers, as well as the comprehensive provision of a management system with information regarding the state of the object. At the same time, the set of basic tools and regulatory mechanisms must comply with the requirements that put forward the conditions of the enterprise’s functioning environment and its internal organizational architecture.
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There are several types of industrial enterprises that can be grouped based on the characteristics of the organization of the production process. There are three main strategies, such as Material Requirement Planning (MRP), Just-in-time (JIT), and Theory of Constraints (TOC), but MRP is the most effective in regards to product flow due to clear planning.
The given theories are based on modern research by Western experts and created to manage industrial enterprises should have their management methods for each type of production. Different kinds of network models: TOC, JIT methods, as well as MRP management standards, which mainly include these network calculation methods, are used in enterprises (Zhang, Tang, Zheng, & Giret, 2018). MRP is a method that is used for the most effective resource planning of a manufacturing company. In the ideal case, it carries out financial planning in value units, operational planning in physical groups, and contains various modeling capabilities.
It consists of a large number of processes, each of which is associated with others. The procedures are forecasting sales and production operations, overviewing material requirements, business planning, setting up a support system for performance monitoring of capacities, general specifications, and developing a master production schedule (Xu & Chen, 2018). The result of the functioning of such systems is integrated with financial reports such as the shipment budget, inventory forecast in value terms, the report on procurement agreements, and a business plan.
It is obvious that the relationship between demand and supply is based on the degree of their correspondence with each other, thus, the higher it is, the less stock will be needed. If industrial manufacturers manage to eliminate inconsistencies between demand and supply, then shares will not be needed at all. The just-in-time conceptual framework is based on the given principle of timing (Wang et al., 2018).
This concept is based on the assumption that stocks arise due to poor management, ineffective coordination of work, and therefore, problems are linked to commodities. The given notion leads to the conclusion that it is necessary to look for the reasons that cause the difference between demand and supply. In addition, it is essential to improve the performance of operations, which will lead to the fact that stocks disappear.
Furthermore, the main feature of the TOC method is the ability to manage the overall terms of the project and monitor the duration of individual work. The key elements of the project are on the constraint path. This method allows manufacturers to calculate the possible predictive schedule for the implementation of the complex of works. It is done on the basis of the submitted logical structure of the network and the need for estimates of the execution time of each procedure or project component separately (Wang et al., 2018). Therefore, the TOC method based on the production schedule allows managers to establish a critical sequence of operations that limits the speed of any process. The given action is usually the longest step in the process, and improving the constraint path reduces the overall procedure.
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By product flow, the most plausible methods are MRP and JIT, depending on the type of manufacturing unit type. The main reason is that the MRP standard divides the areas of individual procedures and functions into two different levels, such as optional and necessary. For the software to be classified as an MRP class, it must carry out a certain amount of basic and essential procedures (Wang, Jiang, & Lu, 2018). Some software vendors use a different range of implementations of the optional part of the systems of this standard.
The basis of the principles of MRP is a hierarchy of plans, and plans for higher levels depend on programs for lower levels. It means that a higher-level plan provides inputs, targets, data, and some restrictive framework for lower-level projects. In addition, these plans can be interconnected so that the results of lower-level methods can have an inverse effect on higher-level programs.
This is the main area of application for these standards. In addition, the use of so-called machine-complete systems is a frequent occurrence for the world. In factories of the manufacturing type, which are mainly discrete, often use Just-In-Time methods that have become well-known for various versions of complete systems (Elkin et al., 2015). MRP methods can also be used, but the use of MRP of this type for fairly simple productions is equivalent to shooting a sparrow from a cannon.
However, while product sales and production are unsustainable, packaged methods and JITs stop working, and MRP is the only alternative. The TOC method was created by studying the possibility of efficient use of computers for planning and scheduling large complexes of work for the modernization of its plants. As a result, a rational and simple project management method using a computer was developed, which was called the critical path method.
It is important to note that various factors are influencing each type of strategy, but the most ineffective method is TOC due to the intricate complexity of integration. However, JIT is highly easy to implement, because it considers the enterprise as a set of various problems that do not allow for the efficient implementation of operations. For example, it can contain long lead times, instability of order delivery, limited capacity, unbalanced services, interruptions in work, defective materials, poor quality, unreliable suppliers, equipment breakdowns, too much paperwork, and limited capacity (Zhang et al., 2018). Managers are trying to solve these problems by acquiring additional capabilities, creating reserves, inviting specialists to eliminate the issues by installing backup equipment.
However, such actions can only obscure the causes of existing problems, and to identify real problems and solve them, a constructive approach is needed. Thus, JIT is not only a way to minimize reserves, but also an opportunity to improve coordination, increase operational efficiency, and eliminate waste for any kind of resources (Elkin et al., 2015). JIT, if it is considered as a management philosophy, focuses on the organization of defect-free production at the minimum possible costs.
Nonetheless, it is critical to understand that the Just-in-time method possesses a high expenditure load due to the increased coordination. The main reason is that in the process of its evolution, the JIT method generated a whole concept of industrial production management by relying on advanced technology. It substantially transformed the paradigm of the organization management process, creating a new direction in management theory, which is lean production.
The management concept, based on a steady desire to eliminate all types of losses, is lean manufacturing. Any delays and stagnations in the implementation of the work lying on the critical path will certainly cause a lag behind the terms of the project as a whole. The concept of the significant way ensures that the manager focuses on vital work, that is, helps to identify and manage bottlenecks in the production process. However, the main advantage of the critical path method is the ability to manipulate the timing of work that does not lie on the critical path.
The overall implementation process of the JIT is substantially quicker and easier. The primary reason is that the given strategy does not require advanced forecasting and can be done immediately. One of the most modern methods of managing industrial enterprises is MRP and its derivatives, such as MRP (Zhang et al., 2018). These concepts can be considered as technology, ideology, and organization of industrial enterprises management generally accepted in the Western nations.
It is important to note that MRPs are no longer algorithms. In addition, the concept of cellular manufacturing plays a critical role in JIT due to the fact that it provides a steady and continuous flow of production (Zhang et al., 2018). It minimizes the number of wasted resources by incorporating sectional assembly and manufacturing. At present, this is the most outstanding way in managing enterprises in a competitive market environment, meaningful, systematized, and implemented experience as a whole computer system.
MRP methods are already everywhere working in America, Europe, China, India, Japan, Zimbabwe, and in several other countries, in any ethnocultural, but certainly a market environment (Lei & Li, 2017). The strategic plan of the enterprise is drawn up for the next few years, and the main business goals are built, and it is based on macroeconomic indicators.
The financial plan of the enterprise is designed on the basis of the strategic plan and regulates the main indicators of costs, sales, and production. After that, they begin to develop a comprehensive production plan, which is an integral part of the sales and operations plan (Lei & Li, 2017). Based on this plan, a material procurement plan, a component production schedule, and a master production schedule are being developed. Based on the plans drawn up, it is already possible to solve the problems of calculating capacity utilization, dispatching production orders and purchase orders, as well as operational
In conclusion, the methods of managing industrial enterprises in different foreign countries, although they have much in common, still differ, and in key aspects. This is due, first of all, to the fact that various states strive to seize leadership in international markets. Therefore, adopting the concept of governance, which at some point in time is the most successful in the whole world, brings its own national, mental, and other features to it.
It allows making the logistics unique and applicable only in the specific socio-economic and public-political conditions of a given state. The given methodologies follow that the calculation of the management methods of industrial enterprises appropriate in various countries is acceptable. It is necessary to comprehend the conceptual approaches to the management of such enterprises. These systems should supplement the manufacturing processes with the most effective elements of domestic managerial thought in order to create new effective management methods.
Elkin, L. L., Harden, D. G., Saldanha, S., Ferguson, H., Cheney, D. L., Pieniazek, S. N., … Banks, M. (2015). Just-in-Time compound pooling increases primary screening capacity without compromising screening quality. Journal of Biomolecular Screening, 20(5), 577–587.
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Lei, Q., & Li, T. (2017). Identification approach for bottleneck clusters in a job shop based on theory of constraints and sensitivity analysis. Journal of Engineering Manufacture, 231(6), 1091–1101.
Wang, C., Jiang, P., & Lu, T. (2018). Production events graphical deduction model enabled real-time production control system for smart job shop. Journal of Mechanical Engineering Science, 232(16), 2803–2820.
Xu, Y., & Chen, M. (2018). An Internet of Things based framework to enhance just-in-time manufacturing. Journal of Engineering Manufacture, 232(13), 2353–2363.
Zhang, H., Tang, D., Zheng, K., & Giret, A. (2018). Production control strategy inspired by neuroendocrine regulation. Journal of Engineering Manufacture, 232(1), 67–77.