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INTRODUCTION

In this conventional period one can rarely talkof manufacturing operations without consider-ation given to production planning and controlregardless of the size of the organization.

Production planning is the process of formulatinga resource transformation system that willeffectively and efficiently meet the forecasteddemand for goods and services (Kreitnar, 1995).It is therefore inferred that production planninginclude making a demand forecast, estimating theresource needs of the factory that will help meetthe forecasted future demand efficiently.Production planning and control are closelylinked and interdependent (Wild, 1997). In factthe decisions reached during planning determinesthe problems and the nature of control,experiences during control influences futureplanning. Moreso, the essence of control is toensure implementation of plans so that production

objectives are realized with minimum resources.Thus the people involved in controlling seek tomonitor activities with a view to ensuring that

Kamla-Raj 2004 J. Soc. Sci., 9(1): 57-62 (2004)

Production Planning and Control Practices Influencing

Consumer Satisfaction in Nigerian Manufacturing IndustryJ. O. Adetayo*, E. A. Dionco-Adetayo and A. A. Oladejo

Department of Management and Accounting, Obafemi Awolowo University, Ile-Ife,Osun State, Nigeria

KEYWORDS Quality control; capacity utilization; waiting time

ABSTRACT The study examined the influence of production planning and control practices on consumer satisfactionin the manufacturing industry. It specifically looked into the capacity utilization, short-term scheduling techniques,waiting time and processing, and quality control of the firms to enhance customer satisfaction. Twenty-two respondentsthat were directly concerned with production and were top officers were involved in the survey. The respondents wererandomly selected from among the top corporation in the southwestern part of Nigeria. Primary and secondarysources of information were fully exploited. Structured questionnaire was designed using Likert scale to ferretpertinent information from the respondents. Data were analyzed using simple descriptive and parametric statistical

tools to test the hypotheses. The results revealed that capacity planning practices of the firms lead to efficient useof facilities and equipments at computed t value 1.6862, reduction in waste and increased profit computed t value0.7884. Short term scheduling, which is necessary in minimizing process and customer waiting time was revealed att value 0.3942. The quality control was revealed at t value 0.25667 indicating consumer satisfaction. The studyconcluded that the production planning and control practices has impacted on the efficient utilization of theresources, waste reduction reduced waiting time and processing, thus contributing to the profitability of the industry.It is concluded further that effectives production planning and control practices contribute significantly to theconsumer satisfaction.

these activities correspond to some intendedsituations.

Everybody will almost agree with methat business organizations are out to make profitand not on the basis of altruism. And in fact acompany that is pursuing customer satisfaction

will correspondingly make profit although it mightnot be able to maximize it, which is currently thegoal of many business firms of today. Howeverthe manufacturing sector of the economy is facedwith various challenges which management hasto pay attention to in order to remain competitivein the business environment. Thus far, some ofthe prima problems facing the management are;market demand for the company products, theunits of products to manufacture in order to meetthe market demand, how to reduce cost ofproduction and maximize profit while offering/providing affordable product; more so themanagement is also faced with an assessment oforganizations capacity to respond to this

opportunities. By determining how productionfacilities could be arranged for the manufactureof a given product. To cream it all, managementcannot brush aside the decision on what type ofproduction control techniques should be usedto ensure consumer satisfaction. Apparently,customer satisfaction requires strategic planningand control of the manufacturing process in order

*Address for correspondence: Dr. J. O. Adetayo,P.O.Box 1084, OAU Post Office, Obafemi AwolowoUniversity, Ile-Ife, Osun State 220005, NigeriaTelephone: 234 8037175961

E-mail: [email protected]

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58 J. O. ADETAYO, E. A. DIONCO-ADETAYO AND A. A. OLADEJO

to have a comparative advantage over thecompetitors. On these premises the study

accentuated to address questions in order toachieve the following objectives:i. The extent on which capacity planning has

contributed to the efficient use of facilitiesand equipments.

ii. The extent to which production planning andcontrol practices has enhanced wastereduction and increased profit.

iii. The extent to which short term schedulingtechniques employed by industries hasenabled them minimize customer waiting timeand processing.

FRAMEWORK FOR ANALYSIS

Organizations may be profit or non profit, areviable only if they provide satisfaction to thecustomers. This simple statement, of course,generates as many questions as it producessolutions, but what satisfies may be eitherphysical or intangible or both. The strong questfor customer satisfaction brought about theconcept of production management. Thus,production management referred to thoseactivities necessary to manufacture products. Theareas include such activities as purchasing,warehousing, transportation and other operationsfrom the procurement of raw materials throughvarious activities until a product is available to

the buyer. Taylor (1981) focused their interest onimproved productivity and to manufactureproducts most efficiently, while still recognizing,the importance of the human factor as anindispensable input.

Chase (1977) defines production planning asconcerned with developing a specific course ofactivity for the production system over anextended time. More so the authors were of theview that production planning entails forecastingthe demand for the firms product time andselecting that combination of human and nonhuman resources that can produce the necessaryoutput to meet that demand in the most efficientway. Banjoko (1994) is not left out, he was of the

opinion that production planning is essentiallyconcerned with making adequate plans fordetermining the aggregate level of production, itfurther helps the management to take appropriatedecisions on products to produce, how, whenand where to produce them.

Buxxey (1989) in his study indicated that

production planning involves forecasting futuredemand for a company product and estimatingthe medium to long term resources needs of thefactory, that is aimed at meeting the forecastedfuture demand. Chase et al. (1977) were of theopinion that two roles could be adopted inplanning for production; both are viewed aspassive and active. The former role holds thatfirm simply responds to and tries to satisfyproduct demand while the latter attempts toinfluence demand. Since the production planningaims at attaining the production of the quantitiesof a given product, forecasting cannot be brushedaside, its role must be emphasized in productionplanning and control. Broom (1959) regarded,forecasting as a technique for translating past

experience into productions of things to come. Itrequires making estimate of the magnitude andsignificance, both are relative and absolute offorces that will influence future operatingconditions. Moreso demand forecasting is animportant prerequisite for proper and efficientproduction planning as it enables an organizationto estimate an expected level of demand.

Gilon (1962) emphasized that the purpose offorecasting in continuous production, is toprovide management with factual informationabout future sales. Oxenfeldt (1957) is not left outin the race, he postulated that a good forecast isbound to be based on both micro and statisticalapproaches, in the sense that in the final analysis,

a compromise is reached between the two. In thesimilar vein Brown (1959) suggested that if aforecast is to be usable by production, it mustmeet up with the following conditions: the forecast must define expected demand

in physical units. the forecast should also include an

indication of the probable variation aroundthe expected demand.

it should be available in time to scheduleall task required to achieve the necessaryoutput.

the forecast must be made repeatedly duringthe future periods to permit necessaryadjustments in production and lastly

it must be reliable because forecast errorscan cost considerable amount of money.

Forecasting is a harbinger of successfulproduction planning and control, so the forecastermust be fully equipped with a profoundknowledge of the series of economic indices, inorder to make an accurate forecasting. Leonard

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59PRODUCTION PLANNING AND CONTROL PRACTICES INFLUENCING CONSUMER

et al. (1973) buttressed the concept of accuracyof forecasting by stating that the accuracy of any

forecast depends on the following: the method or methods used in forecasting. the type and quality of data made available

for forecasting and adequacy of such data. the expertise of the forecaster or the

forecasting team either within theorganization or outside it.

As aforementioned, a business organizationis out to deliver quality product to its customers.Hence, in the quest of the organization to achievethis laudable objective and be in the race, theinfinitesimal role of production control cannot beoverlooked. Production control is concerned withmonitoring the progress of jobs and priority or

making any necessary modification to masterproduction schedule and material requirementplanning.

Charles (1949) in his study looked atproduction control as the coordination of a seriesof function according to a plan, which willeconomically utilize the plant facilities and regulatethe orderly movement of goods through theirentire manufacturing cycle; from the procurementof all materials to the shipping of finished goodsat a predetermined rate. Moore (1951) argued thatthe nature of the industry and the size of thecompany will affect the way production controlis done, but the fundamental functions whichhave to be done are almost identical in all

manufacturing plants.According to Garvett (1973), production

planning is a process specifying how theproduction resources of the firm are to beemployed over some time period in a mannerthat would support either the intermediate or longterm sales forecast of an organization. It simplyimplies that once an organization has made reliabledemand forecast for its products, it canrealistically make long term planning in terms ofhuman and material resources required to meetthe forecast demand level. Hence an organizationstands a better chance in using demand forecastto determine optimum work force required,

adequate machine capacity, optimum inventorylevel to keep the operation.Gaither (1980) in his study pointed out

emphatically two important reasons why planningcould be a useful production management tool.Hence, the bases, he gave include: * facilitationof long term and efficient allocation of productionfacilities with a view to avoiding overloading and

under utilization of capacity and* enhancing orderly and systematic transition

of productive capacity to meet peaks and valleyof consumers expected demand.

However, Dervitsities (1987) perceived qualityas tangible and intangible attributes inherent inthe design of product or service and its perfor-mance under normal use and that organizationcan achieve this through effective quality controlsystem.

METHODOLOGY

The study was carried out in the south-western part of Nigeria. Following the multistagesampling technique, twelve companies thatbelong to the top twenty corporations were

randomly selected and from each company 2productions officers were likewise selected whohave served as the respondents of the study. Thestudy extensively explored both the primary andsecondary sources of information. Pertinentinformation was gathered from the respondentsusing a structured questionnaire. Likert scalingmethod was used in measuring the variables ofthe study. The structured questionnaire has twosections. The first segment covered the variablescharacterizing the various production planningand control practices such as demandforecasting, inventory, capacity utilization, andscheduling techniques while the last segment is

purely on quality control practices. Unstructuredpersonal interview was also conducted with theaid of an interview guide in order to augment theresponses that were not explicitly cleared in thequestionnaire.

The data gathered for the study were analyzedusing simple, arithmetic means and percentages.Parametric statistical tool (t-test) was employedto analyze the postulated hypotheses.

RESULTS AND DISCUSSION

The objectives of the study were to determinethe significance and magnitude of associationthat exist between variables of interest. That is,

the strength and direction of linear relationshipexisting among the variables as well as the amountof variation. The results in Table 1 and 2 showthat the calculated t value on the basis of a twotailed test at a 0.05 level of significance and at 46degree of freedom, is 1.6862. Since the computedt value falls within the range of the table tvalue, it can be inferred that capacity planning

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Variables Assigned Frequency FE FE 2

Value (E) (f)

Very often 5 1 5 25Often 4 6 24 96Averagely 3 2 6 18Not often 2 5 10 20Rarely 1 8 8 8

Total - 22 53 167

Table 1: Distribution of respondents on the useof master schedule

Source: Survey 2001._ = fE =

53 = 2.409f 22

Table 2: Distribution of the respondents as tomachine IDLE time.


Value (E) (f)

Very often 5 6 30 150Often 4 4 16 64Averagely 3 4 12 36Not often 2 3 6 12Rarely 1 5 5 5

Total - 22 69 267

__ fE 69 = 3.136 = f = 22

Source: Survey 2001.

leads to the efficient use of facilities andequipments.

The results of a two tailed test in Tables 3 and4 at 5% level of significance and 40 degree offreedom show a computed t value of 0.7884,

which could be inferred that the productionplanning and control practices of the firmscontributed to the reduction in waste andcorresponding increase in the profit level. It isgermane to say that production planning andcontrol practices resulted in the reduction inwaste and increase profit

The analysis of the data in Tables 5 and 6

using a two tailed test analysis at 5% level ofsignificance of which the degree of freedom is 19,

the results show that the computed t value 0.394remains within the range of table value t = 1.96.This is a clear indication that production planningand control practices influenced the schedulingtechniques and the process time. This could beinferred that short-time scheduling is paramountin minimizing process and customer waiting time.

The study based on a two tailed test at 5%

Table 3: Distribution of respondents perception oncost of production


Value (E) (f)

Strongly Agree 5 8 40 200

Agree 4 10 40 160Undecided 3 2 6 18Disagree 2 1 2 4Strongly Disagree 1 - - -

Total - 21 88 382


=fE = 88 = 4.19042 f 21

382

21

__(4.190422 =

= 0.7940

Table 4: Distribution of respondents on percep-

tion of profit marginVariables Assigned Frequency FE FE 2

Value (E) (f)

Strongly Agree 5 8 40 200

Agree 4 8 32 128

Undecided 3 2 6 18

Disagree 2 2 4 8

Strongly Disagree 1 - 1 1

Total - 21 83 355


= fE =

83= 3.95238

f 21

355

21

__(3.95238)2 =

0.7942

21

__+ 1.132892

21

= + 0.7884

t = 4.1904 3.95238

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61PRODUCTION PLANNING AND CONTROL PRACTICES INFLUENCING CONSUMER

level of significance and 42 degree of freedom,revealed a computed value of t = 0.25667 as

shown in Tables 7 and 8. This could be inferredthat production planning and control practicesof the firms indicate that products and customerscomplaints are handled effectively by theirpractices specifically on product quality. In otherwords it is inferred that product quality controlplayed a vital role in customer satisfaction.

Table 6: Distribution of respondents perception

on the process time


Value (E) (f)

Very Highly 5 1 5 25Highly 4 6 24 96Averagely 3 3 9 27Partially 2 - - -Very Slightly 1 - - -

Total - 10 38 148


= fE

=38

= 3.8 f 11

148

10

__(3.8)

2 = = 0.6

0.66792

21+ 0.62

10

t = 3.909 3.8

= +0.394

Table 5: Distribution of respondents perception onprocess techniques


Value (E) (f)

Very Highly 5 2 10 56

Highly 4 6 24 96

Averagely 3 3 9 27

Partially 2 - - -

Very Slightly 1 - - -

Total - 11 43 173


= fE = 43 = 3.909 f 11

173

11

__(3.90909)

=

Table 7: Distribution of respondents perceptionon defective products

Table 8: Distribution of respondents perceptionon customer complaints.


Value (E) (f)

Very often 5 - - -Often 4 - - -Averagely 3 2 6 18Not often 2 12 24 48Rarely 1 8 8 8

Total - 22 38 74


= fE

=38

= 1.7272 f 22

74

22

__(1.7272)2 =

0.554892

22+ 0.61672

22

t = 1.6818 1.7272

69

22

__(1.6818)2 =


Value (E) (f)

Very often 5 - - -Often 4 - - -Averagely 3 1 3 9Not often 2 13 26 52Rarely 1 8 8 8

Total - 22 37 69


= fE

=37

= 1.6818 f 22

CONCLUSION

From the field work it was noted that there arevarious factors that hinder the capacity utilizationof the manufacturing companies, but the commonthread is the epileptic power supply from NEPA.The erratic power supply constitutes a seriousproblem for the manufacturing sector of theeconomy, since it halts their operations most ofthe time. However, for the business organizationto stay put in the business environment they wereforced to rely on power from fuel drivinggenerating sets. Moreso, the cost of runningpower generating sets are so high that made this

2

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alternative not to be cost effective as it addssubstantially to the cost of production. On this

premise, it is recommended that another alter-native source of power for manufacturing organi-zation should be researched upon. Furthermore,privatizing NEPA should be considered as anoption since this may ginger NEPA to be moreaccountable and efficient in their services to thenation as a whole.

Another predicament that limits the capacityutilization although with less frequency is equip-ment breakdown; which contributed to labour andequipment idle time, vis--vis the productivehours. Therefore the management shouldembrace preventive breakdown mainte-nance.Apparently, scheduling maintenance of machines

should be carried out before the machines arelikely to breakdown.Conventionally, ensuring quality product has

been the primal concern of the productiondepartment, but with the inception of total qualitymarketing, quality has been the watch dog of allmembers of the organization. Even the customersand consumers associations are being very vocalin demanding for better product quality.Consequently, the workers should be accordedbetter working context in order to aim at greaterheights in product quality improvement. Aboveall it is strongly recommended that the policymakers should enact a by law that will imbibe theconcept of total quality management in the

organization. As quality in every decision isnecessary to enhancing the growth and survivalof the organization.

REFERENCES

Banjoko, S.A. 1994. Production and OperationsManagement. Ibadan, Nigeria: Wisdom Publishers.

Brown, M. 1980. Operations Management: Productionof Goods and Services. Englewood Cliffs. N.J.:Prentice Hall, Inc.

Buxxey, G. 1989. Production scheduling: practice andtheory: European Journal of Operational Research,39(1): 62-69.

Chase, R.B and N. J. Aquilano. 1977. Production andOperations Management., Illinois, USA: Richard D.Irwin. Inc.

Dervitsiotis, K.N. 1987. Operations Management. NewYork: McGraw Hill, Book Company, p. 645-47.

Gaither, N. 1980. Production and OperationManagement. Illinois: The Dryden Press.

Gavett L.J. and M. Silver. 1973. Production ManagementAnalysis. 2nd Ed. New York: Harcourt BraceJoranovich Inc.

Gilon, L. 1968. Production and Operations ManagementNew York: Harcourt Brace and World Inc.

James L. R. 1976. Production Systems: Planning Analysisand Control. 2nd Ed. New York: John Willey andSons Inc.

Kotler, P. 1991. Marketing Management. New York:Prentice Hall Inc. Englewood Cliffs.

Kreitner, R. 1995. ManagementBoston: HoughtonMifflin Company.

Moore, F.G. 1961. Manufacturing Management. Illinois:Richard D. Irwin Inc

Oxenfeldt, M. 1983. Operations Management. New York:McGraw-Hill.

San-jin, N. and L. Rasaratam. 1992. AggregateProduction Planning: A Survey of Models andMethodologies European Journal of Operational

Research, 16(3): 256.Taylor F. 1981. Management. Illinois: Richard D. Irwin

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New York: Cassell Educational Ltd.

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