Real-Time Information for Production Planners and Schedulers

We’re following the idea that plant level business systems
like ERP, MOM and MES need to empower the people who really power
the plants, by providing accurate and timely exception information
needed for each individual job function and department, to make
their next decisions and actions better. 

We’ve looked at Sales and Customer Service so far, so
I’ll look at an example of another department next,
Production Planning and Scheduling, for a closer look at
today’s information needs of Planners and Schedulers and the
types of improvements that can result from the right person having
access to the right information, at the right time.

Example #2: Production Planners and Schedulers

The same accelerated speed of business that’s changing the
way Sales manages customer demand, one order at a time, is also
impacting the manufacturer’s ability
to supply the right product quantities,
with the right quality, at the right
time, for the right cost, at the
best possible market price. 

On the supply side of the manufacturer’s business,
new products are constantly being introduced into
mainstream production. Requests to minimize inventory
levels and related holding costs throughout the supply
chain means less ingredient, intermediates and finished
product inventories. This directly impacts production,
resulting in smaller production batch sizes for
standard products, and due to the fact products also now have
shorter lifecycles, as well. 

Being able to offer customer-specified products
means added sales flexibility and choice to a demanding market, at
a differentiated price. Providing creative value-added
services, such as make-to-order, special
packaging and pack-to-order options, as well as
consigned/ vendor managed inventory (VMI), are
also part of the erosion of traditional product
forecasting and fixed-schedule production batch
sizes, sequencing and lead times.

ERP helps planners and schedulers anticipate and
resolve material and capacity shortages, as well
as sequence production jobs to reduce the
loss of available production time. For
process manufacturers, automating material planning and production
scheduling has always required extra consideration to insure
rotation and selection of the right inventory lots
based on available shelf life, and qualifying
ingredient and intermediate inventory for further processing, given
the individual quality properties of each
warehouse lot and matching these
against the required
specifications needed to produce good finished
products.

So how can business systems help planners and
schedulers better manage production cycles,
increase the level of quality
output products and lower production
costs by matching the right
material and capacity with the right
production demand, at the right time to insure
perfect sales order performance? 

Again, it’s because the unexpected is
occurring more often, that planners and schedulers must raise the
level of their decision-making to match the frequent changes in
both the demand and supply picture – this is
the competitive necessity that drives business system providers to
offer new capabilities such as real-time visibility,
exception management, what-if simulation capabilities and
collaborative business process
workflows both internally between
departments, as well as with customers and
suppliers. 

• Visibility includes access to the
  current status for both sales and other production
  demand, as well as an in-process
  supply picture that provides measurable
  performance feedback about what’s going on in production
  right now.
• Exception management of what’s new and
  what’s changed, both from a demand and production supply
  perspective. For planners and schedules to make better
  choices about when to change over from
  making one product on a line, to another and what sequence
  of products is best for this day/shift/production line,
  they need to understand the
  current status of
  supply, and be able to quickly apply any new or
  changes in demand against available
  capacity – based on current operating
  performance and the value of the next
  decision to the overall business. Having planning and
  scheduling tools that allow for real-time matching
  and re-matching of prioritized demand based
  on value to the business, against the actual capacity and material
  supply available, is a marked change in the way planners
  and schedulers can now make improved decisions about the use of
  manufacturing assets to satisfy volatile demand.
• What-if simulation has traditionally meant
  taking different sales forecasts for make-to-stock products, and
  performing several automated material requirements explosions and
  rough cut equipment capacity checks, to determine which forecast to
  accept and drive production with. While this is still a best
  practice for the percentage of products that are manufactured based
  on this supply strategy, new planning and scheduling solutions are
  needed today to manage additional customer-driven
  strategies.                                     
• These new strategies now include custom, make to order demand,
  as well as value added customer services such as shorter lead
  times, reserved or prioritized production capacity and levels of
  product quality, based on pay-for-preferred status customer
  attributes and quality specifications. This means both planners and
  schedulers need to be able to count on their automated
  business tools that manage real time ad hoc
  simulation based on forecasts, customer
  orders and product attributes and preferences, not
  just “first come first serve” date and quantity
  sequencing.
• Role-based business process workflows are also
  key to embedding business rules that contain automated event
  triggers and notifications, to insure consistent behavior to
  production planning and scheduling exceptions. For example, when a
  customer changes the products, quantities and/or delivery date
  requirements for an existing sales order, this can have an
  immediate and direct impact on production that can be favorable or
  unfavorable to the business. Likewise, when a production line goes
  down, the lost capacity can also have an immediate impact on which
  products and customer orders are re-sequenced next. The ability to
  automate collaboration and timely notification of both supply and
  demand changes provides planners and schedulers with the ability to
  quickly re-plan based on the new information, in order to make
  better decisions about how to manage these changes, for the benefit
  of both the customer and one’s own company.

Feel free to add in your own thoughts and examples here –
this is meant to be a running dialogue, and not limited to one
point of view. In the future we’ll look at production
operations, and how business systems can power the people who make
the products manufacturers sell.