Standardization in Production and Operation Management

Standardization means producing maximum variety of products from the minimum variety of materials, parts, tools and processes. It is the process of establishing standards or units of measure by which extent, quality, quantity, value, performance etc., may be compared and measured.

1. Advantages of Standardization

All the sections of company will be benefited from standardization as mentioned below.

Benefits to Design Department

1. Fewer specifications, drawings and part list have to prepared and issued.
2. More time is available to develop new design or to improve established design.
3. Better resource allocation.
4. Less qualified personnel can handle routine design work.

Benefits to Manufacturing Department

1. Lower unit cost.
2. Better quality products.
3. Better methods and tooling.
4. Increased interchangeability of parts.
5. Better utilization of manpower and equipment.
6. Accurate delivery dates.
7. Better services of production control, stock control, purchasing, etc.
8. More effective training.

Benefits to Marketing Department

1. Better quality products of proven design at reasonable cost leads to greater sales volume.
2. Increased margin of profit.
3. Better product delivery.
4. Easy availability of sales part.
5. Less sales pressure of after-sales services.

Benefits to Production Planning Department

1. Scope for improved methods, processes and layouts.
2. Opportunities for more efficient tool design.
3. Better resource allocation.
4. Reduction in pre-production activities.

Benefits to Production Control Department

1. Well proven design and methods improve planning and control.
2. Accurate delivery promises.
3. Fewer delays arise from waiting for materials, tools, etc.
4. Follow-up of small batches consumes less time.

Benefits to Purchase and Stock Control Department

1. Holding of stock of standard items leads to less paper work and fewer requisitions and orders.
2. Storage and part location can be improved.
3. Newer techniques can be used for better control of stocks.
4. Because of large purchase quantities involved, favourable purchase contracts can be made.

Benefits to Quality Control Department

1. Better inspection and quality control is possible.
2. Quality standards can be defined more clearly.
3. Operators become familiar with the work and produce jobs of consistent quality.

Other Benefits

1. Work study section is benefited with efficient break down of operations and effective work measurement.
2. Costing can obtain better control by installing standard costing.
3. More time is available to the supervisors to make useful records and preserve statistics.
4. Reduced reductions and scrap.
5. Helps supervisors to run his department efficiently and effectively.

2. Disadvantages of Standardization

Following are the disadvantages of standardization:

1. Reduction in choice because of reduced variety and consequently loss of business or customer.
2. Standard once set, resist change and thus standardization may become an obstacle to progress.
3. It tends to favour only large companies.
4. It becomes very difficult to introduce new models because of less flexible production facilities and due to high cost of specialised production equipment.

Source: KumarAnil, Suresh N. (2009), Production and operations management, New Age International Pvt Ltd; 2nd Ed. edition.