Dispatching - Definition, Types & Example

Published in Operations and Supply Chain Terms by MBA Skool Team

What is Dispatching?

Dispatching is the process of 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.

Types of Dispatching

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 of Dispatching

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.

Hence, this concludes the definition of Dispatching along with its overview.

This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

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