Manufacturing Planning and Control Vollman/Berry/Whybark/Jacobs: Manufacturing Planning and Control for Supply Chain Management, 5/e (2005)

Manufacturing Planning and ControlVollman/Berry/Whybark/Jacobs: Manufacturing Planning and Control for Supply Chain Management, 5/e (2005)http://www.pom.edu/mpc/index.htm

Chapter 1

Vollmann, Berry, Whybark & Jacobs

Definition

A Manufacturing Planning and Control system is a methodology designed to manage efficiently the flow of material,

the utilization of people and equipment, and to respond to customer requirements by utilizing the capacity of our suppliers,

that of our internal facilities, and in some cases that of our customers to meet customer demand.

A Context for Thinking about Manufacturing Planning and Control (MPC)

What are processes?

Processes define how we do things! Step 1 Step 2 Step 3 etc.

So, what is the role of MPC?

The MPC system tells the processes what to work on.Plans the resources that processes use (i.e. people, equipment, material).Plans for what processes will be doing in the future.

Definition

Mfg Planning andControl System

Manage theefficient flow ofmaterials

Plan the use ofpeople

Efficient useof our capacityand that of oursuppliers.

Possibly even our customers.

Driven by customerdemand and otherCustomer requirements

Often part of a company’s ERP system.

Agenda What influences the MPC system

design? What are the typical support

activities? (LT, MT, ST) Performance indicators MPC Framework (FE, E, BE) Matching MPC system with Needs Classification Schema Evolution & Responses

Key Areas of Influence on MPC system design

Degree of InternationalizationSempre più elevato per la spinta ad esternalizzare il

processo di produzione e concentrarsi su progettazione e mercato. Nike. Macintosh. Dell (cfr. Chase).

Role of the customer in the systemVariabilità della dimensione e tipologia della domanda che

richiede flessibilità produttiva ottenuta abbassando scorte, tempi di risposta e costo delle transazioni nel sistema informativo con SC molto diversificate e sparse

Increasing use of Information Technology.Necessario per supportare Lean SC con dati e procedure

comuni per unità organizzative funzionalmente, geograficamente e culturalmente disparate e differenti

Typical Support Activities

Long Term

Intermediate Term and

Short Term.

Long Term (Piano di Produzione=>MPS)

The system is responsible for providing information to make decisions on (cfr. Variabili strategiche, p.13 Seminario)): The appropriate amount of capacity (intende

quantità per ogni tipo di capacità produttive) - including supplier capacity - to meet the market demands of the future.

Provide the appropriate mix of human resource capabilities (profili tecnici e/o professionali), technology, and geographic locations.

Intermediate Term

The fundamental issue is matching supply and demand in terms of both volume and product mix.Planning for the right logistics.Providing customers with information on

correct quantities and location to meet market needs.

Planning of capacity to determine employment levels, budgets, overtime and subcontracting needs, etc.

Short Term

There is a need for detailed scheduling of resources to meet production requirements.Involves time, people, material,

equipment and facilities.Involves people working on the right

things.Involves tracking the use of resources

and execution results.Provide problem-solving support.

Performance Indicators

Output results Equipment utilization Cost associated with different

departments, products, labor utilization, and project conditions.

Measures of customer satisfaction such as late deliveries, product returns, quantity and quality errors.

Costs and Benefits of MPC systems

The costs of an MPC are substantial but so can be the

Rewards (see examples).

Common to see ERP system costs measured at 5-10% of cost of goods sold.

An MPC System Framework

Front End (cfr. p.14 e segg. del Seminario) Set of activities and systems for overall direction

setting (Demand Management, Sales & Operations Planning, Resource Planning and MPS)

Engine Material Requirements Plans (MRP): Systems for

detailed material and capacity planning. Back End

Depicts the MPC execution systems

ResourcePlanning

Sales and operationsplanning

Demandmanagement

Master productionscheduling

Detailed capacityplanning

Detailed materialplanning

Shop-floorsystems

Suppliersystems

Enterprise R

esource Planning (E

RP

) S

ystem

Front End

Engine

Back end

Manufacturing Planning and Control System

Material Requirements Plans (MRP)

Front End

Demand ManagementPrevisione di domanda del cliente finale. Ordini. Rapporti

interaziendali. Specifiche su parti di ricambio.

Sales & Operations PlanningCoordinamento delle risorse produttive disponibili per

rispondere ai piani di vendita (sales/marketing planes).

Resource PlanningPrevisione delle risorse produttive e loro coordinamento

Master Production Schedule (MPS)Cosa bisogna produrre e in quali tempi

ResourcePlanning


Demandmanagement

Master productionScheduling (MPS)



Material andcapacity plans

Shop-floorsystems

Suppliersystems

Enterprise R

esource Planning (E

RP

) S

ystem

Front End

Engine

Back end


Front EndSet of activities and systems for overall direction setting (Demand Management, Sales & Operations Planning, Resource Planning and MPS)

Engine

Detailed Capacity Planning (DCP)Determina in dettaglio quali risorse produttive (persone,

macchine, …) occorrono per la produzione

Detailed Material Planning (DMP)Determina in dettaglio quali parti e materie prime occorrono per

la produzione in base alla “esplosione” (BOM: Bill Of Materials) dei prodotti finali

Material Requirements Plans (MRP):Determina in dettaglio in quali tempi occorrono le parti e le

materie prime, in base al coordinamento delle risorse produttive e ai BOM dei prodotti finali

ResourcePlanning


Demandmanagement





Shop-floorsystems

Suppliersystems

Enterprise R

esource Planning (E

RP

) S

ystem

Front End

Engine

Back end


EngineSystems for detail material and capacity planning.

Back End (execution systems)

Supplier systemsCoordinamento tempi e quantità delle parti e delle materie prime

con I fornitori

Shop-floor systemsCoordinamento e scheduling dettagliato delle operazioni per le

attività produttive

ResourcePlanning


Demandmanagement





Shop-floorsystems

Suppliersystems

Enterprise R

esource Planning (E

RP

) S

ystem

Front End

Engine

Back end


Back EndMPC execution systems – Track progress and collect data.

Matching MPC System with the Firm needs (A DYNAMIC PROCESS)

As competitive conditions, customer expectations, supplier capabilities, and internal needs change the MPC should change. Di conseguenza anche l’importanza relativa dei vari moduli dell’MPC cambia nel tempo.

The trend is towards on-line data access and systems (principale cambio tecnologico: intra e inter unità organizzative).

Physical changes influenzano l’MPC: Outsourcing mfg (manufacturing). Hollowing (ricercando) out of corporation (?), etc.

Providing information at the level where decision are made, in appropriate time and frames, directly from the shop floor

Firms competing in product variety strength MPS and DMP Firms competing on delivery speed need to improve

execution.

MPC Classification Schema(enfasi degli approcci dell’MPC a seconda della complessità, cioè numerosità dei componenti, e cadenza dei prodotti)

Flow(quantità)

Repetitive(Beni discreti)

Just-in-time

MRPProjectManagment

Num

ber

of

Sub

part

s

Seconds Minutes Days Weeks Months

Time between successive units

Da destra a sinistra diminuiscono: tempi dei cicli e di risposta, immagazzinato e simili

MPC Classification Schema

Flow

Repetitive

Just-in-time

MRP

Project

Num

ber

of

Sub

part

s



Flow (chemical plants, food, etc.)


Flow

Repetitive

Just-in-time

MRP

Project

Num

ber

of

Sub

part

s



Repetitive Mfg. (automobiles, high volume consumer products (i.e. TVs)


Flow

Repetitive

Just-in-time

MRP

Project

Num

ber

of

Sub

part

s



Just-in-Time systems (feedback management for shorter life cycle products – e.g. fashion items). Focus on minimizing inventory in the supply chain.


Flow

Repetitive

Just-in-time

MRP

Project

Num

ber

of

Sub

part

s



MRP (feedforward management for

management of complicated longer

life products, i.e. machines, electronic equipment).


Flow

Repetitive

Just-in-time

MRP

Project

Num

ber

of

Sub

part

s



Project (unique; long term), buildings, one of a kind (satellites).


Flow (chemical plants, food, etc.) Repetitive Mfg. (automobiles,

watches, personal computers) Just-in-Time systems (shorter

production cycles) MRP (management of complicated

parts product) Project type (unique; long time).

Principles

The framework for the MPC is general and all 3 phases must be performed but specific applications must reflect particular firm conditions and objectives.

In SC environments, the MPC must coordinate the planning and control efforts.

MPC systems should support the strategy and tactics pursued by the company.

Principles

Different Manufacturing processes dictate the need for different designs of the MPC.

The MPC should evolve to meet changing requirements in the market, technology, products, and processes.

The MPC should be comprehensive in supporting the management of all manufacturing resources.

Principles Different Manufacturing processes

and Supply Chains need different designs of the MPC. … one size does not fit all.

The MPC must evolve to meet changing requirements in the market, technology, products, and processes.

Major problem – the conflict between the flexible and changing needs of companies and the inflexibility of ERP systems.

ERP CompaniesSAPOracleMicrosoft

My Interest in the Topics Syllabus – Next Class

Principles

An effective MPC can contribute to competitive performance by lowering costs and providing greater responsiveness to the market.

In firms that have an integrated ERP system and database, the MPC system should integrate with and support cross-functional planning through the ERP system.

Documents

Manufacturing Planning and Control Vollman/Berry/Whybark/Jacobs: Manufacturing Planning and Control for Supply Chain Management, 5/e (2005)