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PRODUCTION PLANNING SYSTEM - Coggle Diagram
PRODUCTION PLANNING
SYSTEM
Balance the Priority (Demand) and Capacity (Resources)
Manufacturing Planning and Control System (MPC)
5 levels:
Strategic business plan
Production plan (sales and ope plan)
Master production schedule (MPS)
Material requirements plan (MRP)
Purchasing & production activity control (PAC)
Capacity Mgt
Business Plan:
Statement of Objectives (Consider Production Plan, Financial Plan, MKT Plan, Engineering Plan)
(2-10 years - Review: 6 months - 1 year)
Production Plan:
Quantities of each product in each period
Desired inventory levels
Resources
Resources availability
-> Meet the demand
(6-18 months - Review: 1 month - a quarter)
MPS:
Plan for production of each product
Input: Production Plan, forecast, sales orders, inventory, capacity
(3-18 months - Review: weekly, monthly)
MRP:
Production and purchase plan for components
(3-18 months)
Purchasing and production activity control:
Purchasing: control the flow of raw materials into plant
PAC: control the flow of work through of plant
(1 day-1 month || Review: daily)
Capacity mgt:
Balance
priority
(producing which product and when) and
capacity
Production Plan is the result of S&OP
Sales and Operations Planning (S&OP)
Involve: Sales, MKT, Product dev, ope, senior mgt
-> Develop Production Plan
Manufacturing Resouce Planning (MRP II)
Coordination between MKT, finance and production
Managers base on MRP II to review the Production plan and MPS to adjust plan following the changes of demand or resources
Enterprise Resource Planning (ERP)
Consider resource not only the manufacturing as MRP II, but also the whole business
Collaborate: IT and integration between nodes in SC
Making Production Plan
Scope:
Inventory Level
Backlogs
Market demand
Customer service
Low cost operations
Labor relations
Period: 6 - 18 months.
Done monthly or weekly
Inaccurate and expensive when care for individual products
-> Create product groups (based on the
similarity of manufacturing process
)
Consider to alter sth when there are changes in demand
Consider:
Personnel, OT, working shift
Inventory (built up in slack period and sold or used in periods of high demand)
Subcontract work or lease extra equipment
Basic Strategy
Chase strategy: Demand matching
Used in the industry that requires goods/ services immediately when the demand occur
Ex: Farmer, Post office, restaurants
No stock in slack season, must have enough resources in the peak season
Production leveling
Produce following the average demand and build up inventory
Subcontracting
Produce min demand level
Buy extra amounts and turn away extra demand (ex: increase price, extend the leadtime)
Hybrid strategy
Make-to-stock production plan
Total Production = Total forecast + Back orders + Ending inventory - Opening inventory
Make-to-order production plan
Assemble to order
Backlog
Total Production = Total forecast + Opening backlog - Ending backlog
Resource Planning
Resource bill (critical resources needed)