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In this episode, we discuss the controls associated with production. A major concern in this area is that the production staff is in the business of manufacturing goods, so any controls imposed on them will reduce their production efficiency. Consequently, controls generally need to be built into the production system, with little user interaction, or require the services of a separate group of people from those engaged in production. Key points made in the podcast are:
Issue work orders based on a production schedule, to control the flow of inventory and the assignment of labor
Have materials handlers compare what they pick up from the warehouse to what is stated on the pick list, to ensure that only required items are moved
Lock down access to the bill file, to avoid unauthorized access
Audit the bills of material and fix all problems found
Investigate excessive parts issuances from the warehouse, as well as requests for additional parts; usually implies that there are errors in the bills
Audit the labor routing records and fix all problems found
Lock down access to the labor routing file, to avoid unauthorized access
Fill out forms to document scrap levels, in order to improve inventory tracking
Track scrap forms with prenumbered forms, so that all completed forms are entered into the system
Use a just-in-time pull system to reduce data management issues and minimize scrap leve