The Impact Of Production Planning And Control On Productivity In Nigerian Bottling Company

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The Impact Of Production Planning And Control On Productivity In Nigerian Bottling Company


Abstract


The basic aim of the study is to show the impact of production planning and control on productivity in Nigeria bottling company. However, all essential elements of the significance of planning and control in an organization will fully be considered. A cross sectional survey was used in the course of the study. This comprised of employees and customers of Nigeria bottling company., Kaduna, Kaduna State. Purposive sampling was also used to select only respondents for the researcher to attain the purpose of the study. A sample size of 20 was used in this study. Data was collected using both primary and secondary sources. Primary sources included responses from Nigeria bottling company employees and customers through self administered questionnaires. Secondary sources included textbook, journals, newspapers and reports. For the purpose of this research work, the method used in analyzing data is chi-square test of independence. Findings indicated that the planning and control used in Nigeria bottling company were effective and satisfactory. Findings rhyme with studies by Coopers and Lybraud (1993) who argued that there was need to consider whether the following control objectives are met; management conveys the message that integrity and ethical cannot be compromised, the organization structure provides a moral framework for planning, directing, and controlling operations, management ensures that appropriate responsibility and delegation of authority is assigned to deal with goals and objectives and the Board of Directors and audit committee are sufficiently independent from management to construct a challenge to management decision and take an active role in ensuring that an appropriate “tone at the top exists”.


Chapter One


Introduction

1.1 Background of the Study

Production Planning and Control are terms that though commonly used have witnessed a lot of changes both in meaning and scope in the past four years, for example, based on the extended view of production to include the tradition of all of production services both as discipline of study and as a profession can now be practiced in all organizations. As in other field of management, planning and control forms the primary function of the production management. It is for this reason that this research has decided to take a critical look into production planning and control as practical in beverage industrial sector of the Nigerian economy. This is informed by the variety of major product and beverage products in industry as exemplified by Nigerian Bottling Company (NBC), Kaduna.

Buffa (2002) defined production as the process by which goods and services are created. Production can be regarded as the central focus of any manufacturing concern. It is that stage where the real action takes place i.e. the transformation of raw materials (input) into finished product (output).

The Planning and Control operation are necessary because in every manufacturing unit there are people, machine and materials for production. There is the need to plan all expensive resources required for production in order to make effective use of them and maximize profit for the organization.

Modern production is complex hence both technologically related operation and administrative activities must therefore be planned carefully to make account of all the possible restructure, constraint and advantages. For planning to meet order at less cost, there must be production planning.

According to Mayer (2002), there is a logic behind the operation of the production process, it starts from the types of technology as well as the type of production in the particular manufacturing process.

Wild (2002) defined production as a managerial function that tends to design, plan what to produce, when to produce, where to produce and for whom to produce, the quantity, the quality to produce and for whom to produce. These function attempts to define the key decision model involved in production i.e. the long-term and the short term planning as well as identify the procedure and control in a cost effective way.

Apple (2002) defines production as the activity of transforming raw materials or components into finished product. However, the definition is clear that production essentially entails the transformation of raw materials into finished goods and services.

Production planning involve not only the types of operations to be used but the order of these operations as well as a time or duration the operation would take and how the plan should be laid out.


1.2 Statement of Problem

Most organization production processes are slow and the time given to complete a given task is always exceeded. This study intends to investigate and know the reasons behind slow productivity among the employees.

And most time, the use of quantitative techniques in assigning a job in an organization is not properly maintained, there is shortage of materials due to lack of good stock control. The scope and concept of production management is not fully known by some managers. The problem and solution of production planning and control will be discussed in this research work.

Lastly, the study intends to know the problems associated with the activities of planning and control in relation to Coca-Cola production and suggest possible solutions.


1.3 Objectives of the Study

The following are the objectives of this study:

  1. To assess the impact of Production Planning and control in Nigerian Bottling Company.
  2. To determine how effective planning and control enhance the productivity of Nigerian Bottling Company.
  3. To identify the strategy for enhancing the productivity of Nigerian Bottling Company.
  4. To assess adequate measures in controlling materials in Nigerian Bottling Company.

1.4 Statement of Hypothesis

H0: Effective Production Planning and Control does not enhance the productivity of Nigerian Bottling Company.

H1: Effective Production Planning and Control enhances the productivity of Nigerian Bottling Company productivity.


1.5 Significance of the Study

The significance of this study cannot be overemphasized, because it helps managers and organizations to minimize the time and cost of production by revealing to a production manager when to assign task, which staff to assign the task, on which equipments or method to apply at any given situation or circumstances. It will also help Nigerian Bottling Company to maximize the efficiency of the operation and reduce production cost thereby maximizing profit through effective use of plant and machine sand by taking corrective measures. Nigerian Bottling Company will see its own lapses and improve on them so as to meet its own objective and also other organizations will take correction on their production system.


1.6 Scope of the Study

Production Planning and Control being a complex and dynamic concept has a wide area of coverage so it is clear that research of this nature cannot hold without problem. As such, this work is limited to the areas that are relevant to the problem under investigation that is effective production planning and control taking Nigerian Bottling Company into consideration.

The major areas covered are the bottling line where the actual production scheduling and programming activities mostly take place. It covers other departments in relation to production because they are all interrelated.


1.7 Limitation of the Study

In the course of writing this work, some limitations were encountered. For instance, the high cost of transportation limited the movement of the researcher. Also time constraint is another factor. Finance, inadequate answers to question from the organization (Nigerian Bottling Company).

Another problem encountered is the respondents attitude while administering the questionnaire. Some of the employees showed non-challant attitude towards this work. Despite these problems faced, the researcher was lucky to gather adequate materials necessary for the successful completion of this project.


1.8 Historical Background of the Case Study

Coca-Cola first arrived Nigeria in (1951), that same year, the Nigerian Bottling Company Ltd (NBC) was incorporated to bottle and sell carbonated beverages. NBC has the sole franchise to bottle Coca-Cola products in Nigeria.

Coca-Cola was an instant hit with the Nigerian consumer and has remained so over the last six decades. NBC has continued its journey in keeping its promise of refreshing consumers, straightening its communities, enhancing the workplace and preserving the environment while recording many memorable milestones along the way. To mention a few:

1953: Production of Coca-Cola began at a bottling facility in Ebute-metta, Lagos State. The same year the company opened its first bottling plant in Apapa.

1960: The year Nigeria gained independence, NBC executed the one million cases a year mark.

1961: Commissioned its second bottling facility at Ibadan, Oyo State and rapidly expanded its operation over the next couple of years.

1972: Listed its shares on the Nigerian stock exchange market and became a publicly quoted company.

1991: Acquired the Eva Premium Water and Schweppes brands.

2000: Became a member of the newly formed Coca-Cola Hellenic Bottling Company S.A. (an anchor bottling group which operates in 28 countries worldwide).

2001: Commissioned the first ultra-modern fully automated NBC plant in Benin.

2003: Launched the Five-Alive juice brand.

2004: Launched Polyethylene Terephthalate (PET) packaging for its sparkling soft drinks category.

2006: Launched the energy drink, Burn.

2007: Launched on-the-go can packaging for core brands Coca-Cola, Fanta and Sprite in 2006.

2008: Introduced the more environmentally friendly ultra glass packaging for its returnable glass bottle product segment.

2010: Today the operation stands at 13 facilities and 59 depots across the country.

2011: The company was recognized for its corporate social responsibilities as the most Socially Responsible Company in Nigeria and most Environment Friendly Company at the Social Enterprise Reporting Awards. The company obtained Nigeria’s Fast Food Safety System Certification (FSSC) 22000.


1.9 Definition of Terms

i) Production Schedule:

Is a project plan of how the production budget will be spent over a given time scale for every phase of production. It is also a time-table for the use of resources and processes required by a business to produce goods or provide services.

ii) Process Layout:

It is also known as functional layout or job-shop layout, it involves a group of all similar types of equipment or functions called the lathe machines in one area, all drilling machines in another area, while all assembly work are done on another area.

iii) Line Layout:

It is completely specified by the sequence of activities needed to perform a given transformation. It is also the sequence line machines and equipment needed to make a specified or specific product as set out in the same areas.

iv) Intermittent Production:

Is sometimes described as job production which defines a situation whereby a whole project or job is considered as one operation and work is completed on each product before passing on the next segment.

v) Inventory:

The raw materials, work-in-progress goods and completely finished goods that are considered to be the portion of a business asset that are ready or will be ready for sale.

vi) Material:

Refers to substances or components with certain physical properties that are used as inputs to production or manufacturing.

vii) Production:

Is the transformation of raw materials into finished goods in order to satisfy human want or needs.

viii) Planning:

Is forecasting future circumstances and requirements through deciding objectives, making long and short-term plans, determining polices to be followed and standard to be set.

ix) Control:

It involves setting standard and correcting deviation to follow plan where necessary.


Chapter Five


Summary, Conclusions and Recommendations of Findings

5.1 Introduction

This chapter presents a summary of the study, the conclusions that are drawn from the findings and the recommendations appropriately.


5.2 Summary

Chapter one of this study contains the Introduction, background of production planning and control on organizational productivity. It also emphasis on the concept of production planning and control on organizational productivity on manufacturing industry which prudential guidelines means as – hazard experience by as a result of improper check on capital utilization. The statement- of problem deals with the company’s policy, toward’ hazard management, company’s resources/ facilities and employee’s productivity and company’s asset safety and management. The main objective of the study is to examine the effectiveness of production planning and control used in the company and to establish the level of productivity in the company using any suitable techniques available. It also contains the significance of the study; the scope, of the study is limited to the areas only, and finally a hypothesis and chapter scheme.

Literature review of this study involves the reservoir if information existing in books, journals and articles as well as assertion written by various authors which have some relationship with our areas of study. It highlights several ways of production planning and control to a bearable-limit as opine by Lambo (1987), Coso (1994). Teener (1993) Palmer (1993). Methodology employed by the research work to obtain the necessary data analyzing the data, was obtained from the secondary source which includes historical and record studying method. Chapter four deals with data analysis which was obtained during the course of the research work. It contains the interpretation of the discussion of the results as well as the testing of hypothesis. The last chapter five mainly summarizes the research work, present findings and conclusions, from which recommendations were made.


5.3 Findings and Conclusion.

Findings indicated that the production planning and control used in Nigeria Bottling company were effective and satisfactory. Findings rhyme with studies by Coopers and Lybraud (1993) who argued that there was need to consider whether the following control objectives are met; management conveys the message that integrity and ethical cannot be compromised, the organization structure provides a moral framework for planning, directing, and controlling operations, management ensures that appropriate responsibility and delegation of authority is assigned to deal with goals and objectives and the Board of Directors and audit committee are sufficiently independent from management to construct a challenge to management decision and take an active role in ensuring that an appropriate “tone at the top exists”.

  1. The findings revealed a high level of organizational productivity in Nigeria Bottling company. Findings are in agreement with studies by Brown (1996) who argues that productivity measures in organizations must focus, attention on what makes, identifies and communicates the drivers of success, support organizations learning and provide a basis for assessment and reward. Further more, Dixion (1990) adds that appropriate productivity measures are those which enable organizations to direct their actions towards achieving their strategic objectives. This is because according to him a firm’s productivity is central to the future well being and prosperity of any enterprise.
  2. The results in the table above indicate a significant positive relationship between controls and organizational productivity of Nigeria Bottling company (r = 0.618**, P value < 0.01), These findings, relate well with previous studies by Coso (1992) who provided a criteria against which effectiveness of production planning and control can be assessed. He contends that internal control can be judged effective if the entity’s operations objectives are being achieved; published financial statements are being prepared, reliable and applicable ‘laws and regulations are being complied with. While production planning and control is a process, its effectiveness is a state or condition of the process at a point in time. Accordingly, the effective functioning of components of production planning and control provides a reasonable assurance regarding achievement of one or more of the stated categories of objectives to ensure high levels of organizational productivity. From the study findings, it is concluded that; the study findings indicated that the production planning and control used in Nigeria Bottling company were ‘effective and satisfactory, the level of organizational productivity was found to be inadequate and a significant positive relationship between production planning and control and organizational productivity was established to exist.

5.4 Recommendations

  1. The management of Nigeria Bottling company should design effective. production planning and control systems by ensuring that adequate asset listings is done by management, capital assets purchased are approved by appropriate level of management and asset numbering is done to show location and protection of the assets.
  2. The management of Nigeria Bottling company
    should ensure that it strengthens strategies aimed .at improving organizational productivity in all categories of staff and this should continuously be used to ensure that productivity levels are satisfactory.
  3. The management of Nigeria Bottling company should appreciate the findings in the relationship between production planning and control and organizational productivity to ensure its continued production in a competitive industry in Nigeria.

The Impact Of Production Planning And Control On Productivity In Nigerian Bottling Company


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