Manufacturing Planning Systems Use for Strategic Planning

David L. Olson, University of Nebraska-Lincoln, dolson3@unl.edu

Bongsug (Kevin) Chae, Kansas State UniversityChwen Sheu, Kansas State University

Manufacturing Planning Systems

• 1960s 1970s– Continue to evolve

• 1990s – ERP– Integrated systems– Expensive

• MANY VARIANTS

• MPS specific systems can handle planning, logistics functions– Not integrated– More affordable

GMRG Data

• Global Manufacturing Research Group• Since 1985– Four rounds to date– Same survey applied to manufacturers in 17

countries• Our dataset– 964 responses– 736 answered question concerning ERP system

used

Respondent Categories by Country None Small In-house BOPSE TotalAlbania 8 3 11Australia 4 17 9 20 50Austria 1 7 6 14China 1 8 29 15 53Croatia 55 4 7 66Finland 11 94 15 13 133Germany 2 2 4Hungary 9 16 15 10 50Ireland 3 15 4 9 31Italy 8 26 4 3 41Korea 3 9 19 17 48Macedonia 2 2Mexico 38 8 11 57Sweden 23 1 6 30Switzerland 12 6 8 26Taiwan 4 31 10 45US 5 45 15 10 75Totals 55 371 160 150 736

Are there significant differences across systems in application to strategic planning?

Degree of use of manufacturing planning & control systems for strategic planning (1-7 scale)

Avg prob(diff) 1-tail

small In-house BOPSE n

none 1.679 .001*** 0.000*** 0.000*** 28

small 2.861 0.000*** 0.000*** 359

In-house 3.626 0.200 171BOPSE 3.925 147

What types of systems are used for different functions?

Degree of use of manufacturing planning & control systems

Category Material Planning

Inventory Control

Labor Planning

Shop Floor Control

Cost Planning

None Manual Desktop Manual Manual Desktop, Manual

Small Modified Commercial

Commercial Commercial, Manual

Modified commercial, Manual

Commercial, Desktop

In-House Custom Custom Desktop, Custom

Desktop, Custom

Desktop, Custom, Commercial

BOPSE Commercial Commercial Commercial, Desktop

Commercial, Desktop

Commercial

Are there significant differences across systems in assessment of operations benefits?

Degree of operations benefits obtained (1-7 scale)

Avg prob(diff) 1-tail

small In-house BOPSE N

None 4.172 0.000*** 0.053* 0.037** 29

Small 4.662 0.027** 0.108 359

In-house 4.442 0.743 165BOPSE 4.483 143

Are there significant differences across systems in assessment of operations costs?

Degree of operations costs (1-7 scale – 7 low cost)

Avg prob(diff) 1-tail

small In-house BOPSE n

None 4.069 0.006*** 0.372 0.891 29

Small 3.714 0.021** 0.003*** 360

In-house 3.945 0.410 165BOPSE 4.049 143

Are there significant differences across systems in assessment of information systems data quality?

Satisfaction with IS data quality (1-7 scale)

Avg prob(diff) 1-tail

small In-house BOPSE N

None 3.429 0.003*** 0.004*** 0.001*** 7

Small 5.051 0.914 0.313 39

In-house 5.023 0.124 88BOPSE 5.323 62

Conclusions

• There are a variety of ways to get MPS• Vendor systems better for strategic planning– In-house systems not significantly inferior

MPS use by Function

• Manual systems or desktop used by those without formal MPS

• Desktop systems used by all• Custom software more common in in-house

systems• Major vendor systems move away from

manual, custom software, desktop

Operations Benefits & Costs

• Major vendor systems provide more benefits– But not significant except against None category

• Small systems have cost disadvantage– Perceived overall costs of Major Vendor systems

rated as reducing cost

Data Quality

• Major Vendor Systems rated best– Small, In-House systems not significantly inferior