AgendaBasics of PPCElements of PPCProduction ControlProduction Management CycleBill of MaterialMaterial Requirement PlanningMRP, MRP II & ERPTrends in Planning

Operations Planning OverviewLong-range planningGreater than one year planning horizon

Intermediate-range planningSix to nine months

Short-range planningOne day to less than six months

A Good Planning System Must Answer These QuestionsWhat are we going to make?

What does it take to make it?

What do we have?

What do we need?

These are the questions of priority and capacity.

Production Planning & ControlProduction consists of a series of Steps ( Sequence of Operations) which transform material from a given form to a desired form.

The four factors Quantity, Quality, Time and Cost encompass the production system in which PPC is the nerve center or the Brain.

Stages of PPCPlanningOperations Control

Elements/ Classification of PPC FunctionsMaterials Raw materials, Components availability in right quantity and right timeMethods Machine and EquipmentsRoutingEstimatingLoading and SchedulingDispatchingExpediting or ProgressingInspectionEvaluating & Controlling

Factors Determining Production Planning ProceduresVolume of ProductionNature of Production ProcessesNature of Operations : Batch, Continuous ProductionManufacturing Approach

Make-to-Stock (MTS) : Automobiles, Watches, TypewrittersAssemble-to-Order (ATO): CraneMake-to-Order (MTO) : Custom Product,

Production ControlFunctions areProvide for Production of Parts, assemblies etc. in right quantity at right timeCo-ordinate , Monitor, and Feedback to Manufacturing ManagementProvide for optimum utilization of ResourcesHelp in low cost Production and excellent Customer ServiceElements of Production ControlControl of PlanningControl of MaterialsControl of ToolingControl of Manufacturing CapacityControl of QuantityControl of Material HandlingControl of Information

Production Management Cycle

Inputs and Outputs For Production Planning

ProductionPlanningCompanyPoliciesFinancialConstraintsStrategicObjectivesUnits or dollarssubcontracted,backordered, orlostCapacityConstraintsSize ofWorkforceProductionper month(in units or $)InventoryLevelsDemandForecastsExternal/Internal to firm : Economy,Political situation,Natural/manmade calamities,unions, Multi-skills,Vendor capacity,Raw material availability, Competitors plans

Product Structure Bill of MaterialStandard tree (more subassemblies than products and more components than subassemblies, large BOM).Modular (Fewer subassemblies or modules than final products, small BOM).Inverted (Process industries).

BILL OF MATERIAL STRUCTUREAB(4)C(2)D(2)E(1)D(3)F(2)

Independent Demand

Dependent DemandIndependent demand is uncertain. Dependent demand is certain. ASSEMBLYSUB-ASSLYCOMPONENTS

Marketing PlanningStrategicPlanningFinancialPlanningAggregate ProductionPlanningResourcePlanningDemandManagementMaster ProductionSchedule (MPS)Rough-Cut Capacity Planning (RCCP)Material RequirementsPlanning (MRP)Capacity RequirementsPlanning Production ActivityControlCapacityControlProduction Planning and Control

Output of Planning ProcessProduction schedule for a family of productsMaster Production Schedule (MPS). It specifiesthe sizing and timing of specific item production quantities.the sizing and timing of manufactured or purchased components.allocation of resources to individual operations.

Second Session

Master Production Schedule (MPS)Specifies what is to be made and whenMust be in accordance with the aggregate production planInputs from financial plans, customer demand, engineering, supplier performanceAs the process moves from planning to execution, each step must be tested for feasibilityThe MPS is the result of the production planning process

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Master Production Schedule (MPS)MPS is established in terms of specific productsSchedule must be followed for a reasonable length of timeThe MPS is quite often fixed or frozen in the near term part of the planThe MPS is a rolling scheduleThe MPS is a statement of what is to be produced, not a forecast of demand

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The Planning Process

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The Planning Process

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Master Production Schedule (MPS)A customer order in a job shop (make-to-order) companyModules in a repetitive (assemble-to-order or forecast) companyAn end item in a continuous (stock-to-forecast) company

Can be expressed in any of the following terms:

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Historical Perspectivemrp material requirements planning MRP II ManufacturingResource Planning Enterprise Resource Planning

Historical PerspectiveDatabaseServer(s) ApplicationServer(s)User PCs

Material Requirements Planning IIOnce an MRP system is in place, inventory data can be augmented by other useful informationLabor hoursMaterial costsCapital costsVirtually any resourceSystem is generally called MRP II or Material Resource Planning

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Enterprise Resource Planning (ERP)An extension of the MRP system to tie in customers and suppliersAllows automation and integration of many business processesShares common data bases and business practicesProduces information in real timeCoordinates business from supplier evaluation to customer invoicing

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Enterprise Resource Planning (ERP)ERP modules includeBasic MRPFinanceHuman resourcesSupply chain management (SCM)Customer relationship management (CRM)

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ERP and MRP

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ERP and MRP

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ERP and MRP

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Thank You

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