01 Introduction OPSC or MPC System

7/21/2019 01 Introduction OPSC or MPC System

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MPC FRAMEWORK

POM 3008

Jonathan SmithSome of the slides in this presentation come from

SAPs training material


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MPC FRAMEWORK

MPC is Manufacturing Planning and Control OPSC is Operations Scheduling, Planning and

Control

The information presented here is usuall for a

manufacturing en!ironment "ut can "e applied to

the ser!ices en!ironment# The $e o"%ecti!e is to

sho& the sstem and the logical flo& of thought

and acti!ities


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MPC FRAMEWORK

The MPC sstem pro!ides information toefficientlymanage the flo& of materials,

effectivelyutili'e people and e(uipment,

coordinateinternal acti!ities &ith those of

suppliers, and communicate&ith customersa"out mar$et re(uirements#

The MPC sstem does NOTma$e decisions or

manage operations# )o&e!er, it does pro!ide

the informationand supportto managersin!ol!ed in ma$ing operating decisions#


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MPC FRAMEWORK (contd.)

Tpical MPC Support Tas$s*

Plan materials Plan capacit Plan in!entories Schedule production acti!ities

Trac$ resources

Communicate and foster customer and supplier

relationships

Pro!ide information for sstems integration


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An effecti!e MPC sstem is essential to

perform these tas$s efficientl# Other&ise* poor customer ser!ice

e+cessi!e in!entories e+cessi!e o!ertimedo&ntime

large num"er of e+pediters

too man rush orders, schedule disruptions


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An effecti!e MPC sstem has man "enefits* reduced in!entories

reduced Manufacturing -ead Time .M-T/

reduced ccle time mpro!ed producti!it

impro!ed fle+i"ilit

increased profits and mar$et share


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Three phases of an MPC Sstem Creating the o!erall manufacturing plan

Performing the detailed planning of material and

capacit needs to support the plan 1+ecuting these plans on the shop floor

.Scheduling or PAC/ and purchasing PAC is Production Acti!it Control


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MPC FRAMEWORK(contd.)

Front End

Engine

Back End

Resource

Planning

Production

Planning

Demand

Management

Master

Production

Scheduling

Detailed

Material

Planning

Detailed

Capacity

Planning

Material/Capacity

Planning

Shop-Floor

Systems

Vendor

Systems


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MPC FRAMEWORK(contd.) A final acti!it tied to e+ecution is

measurement of actual results .performance

e!aluation/ rate and timing of actual production compared to

plans

shipments made to customers compared to

promised deli!er dates

actual capacit usedneeded compared to planned

capacit usage


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Key Decisions supported by the MPC Framework*

Production Planning.PP/* pro!ides $e

communication lin$s from top management to

manufacturing# Purpose is to focus on the detailed

production resources to achie!e the firms strategico"%ecti!es#

Master Production Scheduling.MPS/* detailed

production plan for each end product# t is useful to

ma$e customer deli!er promises, utili'e $e plantresources effecti!el, achie!e the $e strategic

o"%ecti!es, and resol!e manufacturingmar$eting

conflicts#


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Key Decisions (contd.* Materials Requirements Planning.M2P/* a tool

for planning detailed materials plans "ased on the

MPS# ts primar o"%ecti!e is to pro!ide the right

part at the right time in the right quantitytosupport the MPS#

Capacity Planning.CP/* a tool used to e!aluate

capacit re(uirements for the PP, MPS, and the

M2P sstem# The focus is to ensure that the PP,MPS, and M2P plans are all feasi"le in terms of

a!aila"le capacit#


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MPC FRAMEWORK(contd.) Key Decisions (contd.*

Production Activity Control.PAC/* A

mechanism to e+ecute the detailed materials

plans generated " the M2P sstem# t

integrates the shopfloor e+ecution and !endor

scheduling and follo&up modules of the MPC

frame&or$# This includes short term

scheduling of machines and other resources


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MPC FRAMEWORK(contd.) Enterprise Resource Planning.12P/ sstems

4rom a manufacturing perspecti!e, an 12P

sstem is a tool &hich integrates the decisions

made through the use of the MPC sstem &ith

other process areas of a compan .e#g#,Accounting, 4inance, Mar$eting, )uman

2esource Management, etc#/

One such sstem that is used " se!eral

companies is the SAP 23 sstem#


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1. Pre-Sales Activities1.Pre-Sales Activities

2. Sales rder Processing2.Sales rder Processing

!. "nventory Sourcing!."nventory Sourcing

#. $elivery#.$elivery%. Payment%.Payment

&. 'illing&.'illing

"nvoice

Customer Order Management ProcessOverview

Customer Order Management ProcessOverview


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Sales

Production

Purchasing

Salesorder

SP MPS MRPPlannedorder

Produc-tionorder

$elivery Customer'illing

Shop(loorcontrol

Requi-sition

)endorselection

Purchase order

*oodsreceipt

"nvoiceveri(i-

cation

+inancial controlling+inancial controlling

Resource controllingResource controlling

,ogistics controlling,ogistics controlling Sales Production Purchasing arehouseSales Production Purchasing arehouse

Customer

rder

CustomerPayment

)endorPayment

"nventorySourcing

PresalesActivity

Business Process Integration wit !AP R"# ($)Business Process Integration wit !AP R"# ($)


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rder (ollo/-up

Requirements

determination1.

)endor selection!.

rder Processing#.

&.

*oods receipt and

inventory management%.

"nvoice veri(ication

Purchase rder

0.

. Source

determination

2.Payment

)endor

invoice

Procurement Process OverviewProcurement Process Overview

TRUCKING


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Procurement ProcessOverview Purchase re(uisition is created* manuall or automaticall

from M2P Source of suppl is determined .245/

The re(uest is assigned to a !endor

A purchase order is created &ith reference to the P2

The sstem pro!ides automated e+pediting and follo&upreminders to ensure timel deli!er

6oods are recei!ed into the &arehouse !ia goods receipt

document referencing the PO

The in!oice is !alidated " comparing it to the PO price and

(uantit# Pament &ill "e "ased on terms and conditions specified in

the PO#


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Sales

Production

Purchasing

Salesorder

SP MPS MRPPlannedorder

Produc-tionorder

$eliveryCustomer

'illing

Shop(loorcontrol

Requi-sition

)endorselection

Purchase order

*oodsreceipt

"nvoiceveri(i-

cation

+inancial controlling+inancial controlling

Resource controllingResource controlling

,ogistics controlling,ogistics controlling Sales Production Purchasing arehouseSales Production Purchasing arehouse

Customer

rder CustomerPayment

)endorPayment

"nventorySourcing

PresalesActivity

Business Process Integration wit !AP R"# ($)Business Process Integration wit !AP R"# ($)


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%&E !AP R"# ERP !'!%EM (contd.)

3he Production Planning 4PP5 Module6 The PP module is used to

plan and control the manufacturing acti!ities of a compan#

Some of the $e 1lements of the PP module are*

Sales and Operations Planning .SOP/

Master Production Scheduling .MPS/ 7ills of Material .7OM/ Materials 2e(uirements Planning .M2P/

Shop 4loor Control .S4C/


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3he Production Planning 4PP5 Module 4contd.5

Other $e elements are*

2outings

or$ Centers Production Orders Product Costing, acti!it"ased costing

2epetiti!e manufacturing

9an"an

Production Planning for Process ndustries


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3he Materials Management 4MM5 Module* The MM application

module supports the procurement and in!entor functionsoccurring in a datoda "usiness operation#

9e elements of the MM module include*

Material procurement .purchasing/

n!entor management 2eorder point processing Material !aluation and n!oice !erification

:endor e!aluation and 1+ternal ser!ices procurement

arehouse Management

Purchasing nformation Sstem and n!entor Controllingnformation Sstem


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'usiness Processes and SAP R7! +unctionality

Manuacturing Planning

and E!ecution "MP#E$

Procurement

Customer %rderManagement

Financial/Management

&ccounting # Reporting

Making

Buying

Selling

&ccounting


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SAP A6

R

CapacityCapacity

"nventory"nventory CostingCosting

Production Master $ataProduction Master $ata

Reporting and AnalysisReporting and Analysis

ProcurementProcurement

+orecasting+orecasting

C7PAC7PA

Sales "n(o

System

Sales "n(o

System

Sales 8 per

Planning

Sales 8 per

Planning

$emand

Mgmt

$emand

Mgmt MPSMPS MRPMRPManu(acturingManu(acturing

E9ecutionE9ecutionrderrder

SettlementSettlement

Planning process

E9ecution process

Manu(acturing Planning and E9ecution ProcessManu(acturing Planning and E9ecution Process


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3he Manu(acturing Planning and E9ecution 4MP8E5Process 4contd.5

2efers to the process of recogni'ing demand, netting

re(uirements, planning for the production and procurement

of materials, and identifing the capacit to satisf demand#Thus, the MP;1 process encompasses the demand forecast

acti!it, the closed loop planning phase, and the control of

production acti!ities through in!entor !aluation, order

settlement, and product costing#


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SAP 23 application modules that support this process are*

Materials Management .MM/

4inancial Accounting .4/

Sales and


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SAP 23 functionalit includes*

Sales and Operations Planning .SOP/


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PROC%IO* P+A**I*,

Production Planning.PP/* pro!ides $ecommunication lin$s from top management to

manufacturing# Purpose is to focus the detailed

production resources to achie!e the firms

strategic o"%ecti!es# Also referred to as Sales and perations

Planning.SOP/ since the purpose it to

coordinate se!eral critical process acti!ities

&ithin a firm


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PROC%IO* P+A**I*,(contd.)

Key Linkages of Production Planning

Marketing

Planning

'op Management

('he )ame Plan*

Financial

Planning

Production

Planning

Resource

Planning

Demand

Management

Master Production

Scheduling Front End


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PROC%IO* P+A**I*, (contd.)

Production Planning .PP/ states the mission to "e

accomplished " the manufacturing function so as

to meet the mar$eting and financial o"%ecti!es set "

the firm

s it necessar to prepare a production plan= h

cant manufacturing simpl &or$ off the Master

Production Schedule=


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PROC%IO* P+A**I*,(contd.) PP process O"tainPrepare aggregate demand forecasts for

each product group or each product famil#

1stimateSpecif rele!ant production parameters* n!entor )olding7ac$order Costs

2egularO!ertime -a"or Costs

or$force Changing Costs .2ecruitment2etrenchment/

1stimated 7eginning n!entoror$force -e!els

Minimum Safet Stoc$ re(uirements

Ma+imum 2egularo!ertime capacit Su"contracting costs


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Documents

01 Introduction OPSC or MPC System