Posted in Operations and Supply Chain Terms, Total Reads: 822

Definition: Dispatching

It refers to assigning the order related to manufacturing or problem resolution to the desired operating point (say, worker) depending upon capacity availability and production planning. It ensures that plans are getting executed without hindrance. It’s done by a dispatcher who knows the capacities of different operating points and keeps track of orders in the system. Dispatching creates a link between production and sales.

There are two different kinds of dispatching:

1. Centralized dispatching: Order dispatching takes place from a centralized location that has complete view of capacities across production department and maps order to the worker based on the requirement of individual order. It has greater control, greater flexibility and effective co-ordination among several facilities. It also has effective utilization of man power and other resources.

2. De-centralized dispatching: It’s done at the shop floor level. It reduces communication gap and time to solve day to day problems. As shop floor person has better knowledge about local operation, he dispatches accurately and intuitively. It also reduces duplication of dispatching of same order.

Example: suppose there’s a tire manufacturing company that manufactures based on make to order strategy, has got an order of 100 tires from its distributor. It has several shop floors that have different unused capacity. Now dispatcher comes into play who knows exactly where there’s sufficient capacity to fulfill the order and hence, dispatches the order to respective operating point.



Looking for Similar Definitions & Concepts, Search Business Concepts