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An Introduction to Manufacturing Planning & Control (MPC) By:- Israr K. Raja Visiting Faculty:-International Islamic University, Quaid-i-Azam University, Preston University, Islamabad, Pakistan
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Manufacturing Planning & Control (MPC) A Manufacturing Planning and Control(MPC) system is concerned with planning and controlling all aspects of manufacturing, including Materials, Scheduling machines and people Coordinating suppliers and customers. An effective MPC system is critical to the success of any Business.
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Manufacturing Planning & Control (MPC) Manufacturing planning and control are administrative processes that are inextricably linked. Without both sides of the equation, a business can run into challenges turning raw materials into actual products. Production planning and control coordinates different processes, departments and people to ensure they are all making efficient and cost-effective use of time. Production planning is the process through which a business determines its production needs and plans for how to meet those needs. Such planning is an ongoing process that begins before production starts and encompasses every aspect of production. It includes planning the purchase and maintenance of tools and materials for production, ranging from metal and wires to large machines. It includes planning for sufficient personnel to complete and oversee each step of the process. It also includes knowledge of how much demand there is for a specific product, how much people will pay for it and how much it costs to make.
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MPC manage these aspects of manufacturing Costs, both internal and external. Quantities. Needed materials and machinery. Schedules, including the manufacturing sequence and production timetable. Start and completion dates. Job assignments. Processes.
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Objectives of Manufacturing Planning & Control (MPC) Acquiring materials Continuous production Effective use of resources Meeting deadlines Improved communication Keeping costs down Quality control Inventory control Morale boost
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Steps to execute Manufacturing Planning & Control (MPC) Strategic Business Plan ( SBP) Sales & Operations Plan ( S& OP) Master Production Schedule ( MPS) Material Requirements Planning ( MRP) Purchasing & Production Activity Control (PAC)
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Strategic Business Plan ( SBP) Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. It may also extend to control mechanisms for guiding the implementation of the strategy. Also outlines an organization's overall direction, philosophy, and purpose, It examines its current status in terms of its strengths, weakness, opportunities, and threats (see SWOT Analysis), It sets long-term objectives, and It formulates short-term tactics to reach them.
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Sales & Operations Plan ( S& OP) Sales and operations planning (S&OP) is an integrated business management process through which the executive/leadership team continually achieves focus, alignment and synchronization among all functions of the organization. Companies that have an effective sales and operations planning process are improving their visibility across their enterprise. They are able to improve product management, improve promotional planning and minimize unnecessary build-ups of inventory.
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Sales & Operations Plan ( S& OP) The Sales and Operations Planning process is about turning strategy into revenue and is critical to the success of any supply chain. It is a process that binds together the various functions that support the effective planning and delivery of products and services to your customers. Done well, Sales and Operations Planning will have a positive impact on every key performance indicator in the business. Any part of the process done poorly will decouple the entire supply chain, negatively affecting the Voice of the Customer and financial performance.
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Master Production Schedule (MPS) MPS is the process that helps manufacturers plan which products and related quantities to produce during certain periods. MPS is proactive in that it actually drives the production process in terms of what is manufactured and what materials are procured. MPS also serves a bridge to sales as it informs them about what is available to promise to customers and when deliveries can be made.
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MPS is a Crucial Planning Function As part of a fully integrated ERP system, MPS typically provides a crucial planning function, extracting actual supply and demand data, as well as forecasts, to deliver accurate and timely production plans that help manufacturers achieve their production objectives and minimize procurement costs. MPS also takes into account the manufacturing capacity of the plant in its calculations. Once production orders have been analysed and approved, the MRP process is initiated and purchase orders can be generated. MPS also provides protection against shortages, unexpected scheduling snafus and inefficient allocation of resources.
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The Benefits of MPS Ability to make adjustments to fluctuations in demand and still minimize waste Helps prevent shortages and scheduling mishaps Improves efficiency in the location of production resources Provides more effective cost controls and more accurate estimates of material requirements and delivery dates Reduces lead times throughout the year Provides an effective communication conduit with the sales team for planning purposes
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Master scheduling is the detailed planning process that tracks manufacturing output and matches this against customer orders that have been placed. The process where the master schedule is generated and reviewed and adjustments are made to the master production schedule to ensure consistency with the production plan. The master production schedule (the line on the grid) is the primary input to the material requirements plan. The sum of the master production schedules for the items within the product family must equal the production plan for that family.
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OBJECTIVES OF MASTER SCHEDULING The master scheduler considers the following objectives when developing the MS: Achieve the desired customer service level either by maintaining finished goods inventory or by scheduling completion of the item or service to meet the customer's delivery needs. Make the best use of the company's resources: material, labor, and equipment. Ensure that the inventory investment is at the appropriate level.
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Master Scheduling
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Material Requirements Planning (MRP)
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Material requirements planning (MRP) is a system for calculating the materials and components needed to manufacture a product. It consists of three primary steps: taking inventory of the materials and components on hand, identifying which additional ones are needed and then scheduling their production or purchase.
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MRP Basics MRP uses information from the bill of materials (a list of all the materials, subassemblies and other components needed to make a product, along with their quantities), inventory data and the master production schedule to calculate the required materials and when they will be needed during the manufacturing process. MRP is useful in both discrete manufacturing, in which the final products are distinct items that can be counted -- such as bolts, subassemblies or automobiles - - and process manufacturing, which results in bulk products -- such as chemicals, soft drinks and detergent -- that can't be separately counted or broken down into their constituent parts.
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Objectives of Material Requirements Planning The primary objective of MRP is to make sure that materials and components are available when needed in the production process and that manufacturing takes place on schedule. Effective inventory management and optimization is another goal of MRP. While MRP is designed to ensure adequate inventory at the required times, a company can be tempted to hold more inventory than is necessary, thereby driving up inventory costs. MRP can also improve manufacturing efficiency by using accurate scheduling to optimize the use of labour and equipment. MRP can help achieve a better matching of supply and demand. This achievement, in turn, can reduce product costs and increase revenues as customer demand is fully met and no revenue opportunities are lost from missed ship dates or inventory shortfalls.
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Production Activity Control (PAC) is responsible for executing the master production schedule and the material requirements plan. At the same time, it must make good use of labour and machines, minimize work-in-process inventory, and maintain customer service. The material requirements plan authorizes PAC: To release work orders to the shop for manufacturing. To take control of work orders and make sure they are completed on time. To be responsible for the immediate detailed planning of the flow of orders through manufacturing, carrying out the plan, and controlling the work as it progresses to completion. To manage day-to-day activity and provide the necessary suppor
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Vendor Order Management Vendor Order management is the collection of processes and actions involved in the successful delivery of a product to a client. Vendor order management is the process of taking purchase requests from customers and organizing, tracking, and fulfilling them. It is the administration of all business processes related to orders for products or services. Put simply; it means keeping track of orders and managing customers, individuals, processes, and whatever we need to fulfil them.
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The Benefits of Order Management Management by exception Dashboard reports Supplier scorecards Real-time information Automated customer, agent, and supplier communication Streamlined EDI integration Customized supply chain milestone management Vendor/PO consolidation management Dedicated team of Shapiro supply chain experts
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References:- https://bizfluent.com/about-5142109-production- planning-control-definition.html https://bizfluent.com/about-5142109-production- planning-control-definition.html http://www.businessdictionary.com/definition/strategic -business-plan.html http://www.businessdictionary.com/definition/strategic -business-plan.html https://www.optiproerp.com/blog/inventory- management-101-master-production-schedule-mps- explained/
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