Production Planning

PRODUCT PLANNING

Jonalie Eridao

RESEARCH & DEVELOPMENT

R E S E A R C H

Work devoted tolearning the laws andidiosyncrasies of nature.

Classification of

Research:

• Pure research- undertaken withoutregard for how the knowledgegained will be used.

• Applied research- endeavors to findbasic answers to more or lessspecific problems.

D E V E L O P M E N T

A technical activity concernedwith nonroutine problems whichare encountered in translatingresearch findings or othergeneral scientific knowledgeinto products and processes.

MANAGEMENT OF R & D

Abilities of a good R & D

manager:

• To speak the language of theresearcher

• To select either projects orapproaches

• To motivate his subordinates

• To do these things with an eyetoward profit

Planning for Research

and Development

Two steps:

1. The determination of the totalbudget amount

2. The selection of specifiedprojects.

Several ways to assists

planning project

budgeting

1. It requires that each projectbe concretely planned and beformally reviewed on adefinite schedule.

2. It helps coordinate researchactivities by:

a. Clearly showing how theactivities within the programare balanced to fulfill thepresent and long range plansof the economy.

b. Encouraging the exchange ofinformation between researchand operating personnel.

Controlling Research and

Development Activities

Truth about researchers:

1. Would rather work under relativelyclose administrative controls.

2. Have urgent need to know preciselywhat management expects of them

3. Exhibit the personal traits foundgenerally in ambitious nonscientificpersonnel

4. Resent being classified as businessfreaks

Four purposes of comparisonBudget vs. Actual Costs

1. To show how much money hasbeen spent and what relationshipthis amount has to the original R& D plan

2. To provide valuable assistance inappraising the R & D program andthe proportion of the companiesresources spent in the variousareas.

3. To assemble and report costswhich can be valuable as abasis for projecting future R &D operations.

4. To enable technical R & Dpersonnel to present a statusor accomplishment report inphysical and qualitative terms.

Organizing the Research

and Development Group

Two basic types of corporatestructure:

The functional and thedivisional

D I V I S I O N A L I Z E D

Organization

There is usually a corporate level officer in charge of the overall research and development activities of the company.

F U N C T I O N A L

Basis

A vice president is in charge ofall research and developmentactivities of the firm.

Table5-1 Product Research and Development Model

M A R K E TSOURCES

RAW

IDEAS

SCREENING

COMMITTEE

AP

PR

OV

E

D ID

EA

S

PRODUCT

ENGINEERINGBLUEPRINT

SPECIFICATION

MODELS

PROCESS

ENGINEERING

PROCESSES

TOOLING, LAY-

OUT, ETC.

MANUFACTURING

DEPARTMENT

FINISHED

GOODS

Directing Research and

Development

For strong programs, totalappropriations are determined asfollows:

1. Managers must established ageneral target figure on “howmuch to spend”, guided by thefollowing:

a. Competitive levels of research spending.

b. a predetermined per cent of sales or capital base.

c. Projected rates of return for each project.

d. Growth rate standards.

• 2. Managers must select projects which achieve a proper balance between research which simply protects the profits of present products in existing markets and research which creates technology to open profitable new markets for the company.

• 3. Finally, managers must see that the fundamental research program is active in those scientific areas.:

a. Where basic technological break through is most likely to influence the operations of the company.

b. Where knowledge is needed for the further developmental and applied research.

Figure 5-2

Organization for Research and Development

DEVELOPMENT

MNGR.

SERVICES

MANAGER

PERSONNEL

LIBRARY

PATENTS

MAINTENANCE

VICE PRES. R & D

RESEARCH

MANAGER

SUB-

DEPTS.SUB-DEPTS.

MARKET

ANLYSIS

NEW PRODUCT

DEVELOPMENT

RESEARCH

DRAFTING

RESEARCH LAB.

PRODUCT

IMPROVEMENT

VICE PRES. R & D

PATENTS PRODUCT

ENGR.

ENGINEERING

STANDARD