Lecture 6 - Master Product Scheduling (Continued). The contents of this chapter include all of the following: Types of production-planning and control systems, pond-draining systems, push systems, pull systems, focusing on bottlenecks, synchronous manufacturing,...
Lecture 6 Master Product Scheduling (Continued) Books • Introduction to Materials Management, Sixth Edition, J. R. Tony Arnold, P.E., CFPIM, CIRM, Fleming College, Emeritus, Stephen N. Chapman, Ph.D., CFPIM, North Carolina State University, Lloyd M. Clive, P.E., CFPIM, Fleming College • Operations Management for Competitive Advantage, 11th Edition, by Chase, Jacobs, and Aquilano, 2005, N.Y.: McGrawHill/Irwin Objectives • • • • Types of ProductionPlanning and Control Systems Developing MPS Evaluation MPS Planning links to MPS Types of ProductionPlanning and Control Systems Types of ProductionPlanning and Control Systems • • • • PondDraining Systems Push Systems Pull Systems Focusing on Bottlenecks PondDraining Systems • • • • Emphasis on holding inventories (reservoirs) of materials to support production Little information passes through the system As the level of inventory is drawn down, orders are placed with the supplying operation to replenish inventory May lead to excessive inventories and is rather inflexible in its ability to respond to customer needs Push Systems • • • Use information about customers, suppliers, and production to manage material flows Flows of materials are planned and controlled by a series of production schedules that state when batches of each particular item should come out of each stage of production Can result in great reductions of rawmaterials inventories and in greater worker and process utilization than ponddraining systems Pull Systems • • • • Look only at the next stage of production and determine what is needed there, and produce only that Raw materials and parts are pulled from the back of the system toward the front where they become finished goods Rawmaterial and inprocess inventories approach zero Successful implementation requires much preparation Focusing on Bottlenecks • • • Bottleneck Operations – Impede production because they have less capacity than upstream or downstream stages – Work arrives faster than it can be completed – Binding capacity constraints that control the capacity of the system Optimized Production Technology (OPT) Synchronous Manufacturing Synchronous Manufacturing • • Operations performance measured by – throughput (the rate cash is generated by sales) – inventory (money invested in inventory), and – operating expenses (money spent in converting inventory into throughput) . . more Synchronous Manufacturing • System of control based on: – drum (bottleneck establishes beat or pace for other operations) – buffer (inventory kept before a bottleneck so it is never idle), and – rope (information sent upstream of the bottleneck to prevent inventory buildup and to synchronize activities) New Order • Suppose we get an order for 200, can we accept this for delivery in period 5? Worksheet for New Order for 200 Period 10 11 12 Forecast 50 50 50 50 75 75 75 75 50 50 50 50 Customer Orders 35 25 25 20 200 15 0 10 0 10 Projected Available 60 10 85 35 125 125 110 Available to Promise MPS 50 80 125 125 Fit in the order for 200 (can’t change MPS) 125 New Order for 200 Period 10 11 12 Forecast 50 50 50 50 75 75 75 75 50 50 50 50 Customer Orders 35 25 25 20 200 15 0 10 0 10 Projected Available 60 10 85 35 -40 -115 -65 -15 -65 -115 -40 -90 110 Available to Promise MPS 50 80 -90 125 115 115 125 125 125 125 125 Negative number in Projected Available = might be a problem in the future • Negative number in Available to Promise= always a problem Solution? • Split up New Order for 200 Period 10 11 12 Forecast 50 50 50 50 75 75 75 75 50 50 50 50 Customer Orders 45 25 105 20 110 15 0 10 0 10 125 125 Projected Available 110 Available to Promise MPS 125 Check to see if this is OK 125 125 Can you now take 2 more orders? Period 10 11 12 Forecast 50 50 50 50 75 75 75 75 50 50 50 50 Customer Orders 45 25 105 20 110 15 50 10 0 40 Projected Available 60 10 30 -20 -5 -80 -30 110 Available to Promise MPS • • 40 0 125 125 125 125 50 units to be delivered in Period 8 30 units to be delivered in Period 12 125 Time Fences Time Fences • • • • Frozen: no changes are possible with a certain period of time (i.e. 8 weeks) Time Fence (length of period schedule is frozen, liquid, etc.) Demand Fence: MPS numbers do not change and focus is on orders not forecast Planning Fence: Master Production Scheduler is planning more MPS Roughcut capacity planning • • An estimate of the plans’ feasibility Given the demonstrated capacity of critical resources (e.g.: direct labor & machine time), have we overloaded the system? RoughCut Capacity Planning • Determine required resources & proposed workload: Planning Factors Model W Model M Direct labor 0.40 0.30 Machine time 0.12 0.08 MPS QRT QRT QRT QRT Total Model W 6,000 5,500 9,500 6,500 27,500 Model M 10,000 12,000 7,500 10,100 39,600 Hour s/ uni t Calculate Required Labor Hours Model Labor Factor Model W 0.30 Model M • 0.40 QRT QRT QRT QRT Total MPS Quantity 6,000 5,500 9,500 6,500 27,500 Hours Required 1,800 1,650 2,850 1,950 8,250 MPS Quantity 10,000 12,000 7,500 10,100 39,600 Hours Required 4,000 4,800 3,000 4,040 15,840 Labor Capacity Required 24,090 Compare with hours available Calculate Required Machine Hours Model Machine Factor Model W 0.08 Model M • 0.12 QRT QRT QRT QRT Total MPS Quantity 6,000 5,500 9,500 6,500 27,500 Hours Required 480 440 760 520 2,200 MPS Quantity 10,000 12,000 7,500 10,100 39,600 Hours Required 1,200 1,440 900 1,212 4,752 Machine Capacity Required 6,952 Compare with hours available Summary • MPS Major Functions – To form the link between production planning and what manufacturing builds – To plan capacity requirements. The MPS determines the capacity required – To plan material requirements. The MPS drives the material requirements plan – To keep priorities valid. The MPS is a priority plan for manufacturing Summary • MPS Links Between Sales and Production – To aid in making order promises. The MPS is a plan for what is to be produced and when. As such, it tells sales and manufacturing when goods will be available for delivery – To be a contract between marketing and manufacturing. It is an agreedupon plan Summary • The MPS must be realistic and based on what production can and will do. If not, the following may be the results – Overload or underload of plant resources – Unreliable schedules resulting in poor delivery performance – High levels of workinprocess (WIP) inventory – Poor customer service – Loss of credibility in the planning system End of Lecture 6 ... Orders 35 25 25 20 200 15 0 10 0 10 Projected Available 60 10 85 35 -4 0 -1 15 -6 5 -1 5 -6 5 -1 15 -4 0 -9 0 110 Available to Promise MPS 50 80 -9 0 125 115 115 125 125 125 125 125 Negative number in Projected Available = might be a problem ... Flows? ?of? ?materials are planned? ?and? ?controlled by a series? ?of? ?production schedules that state when batches of? ?each particular item should come out? ?of? ?each stage of? ?production Can result in great reductions? ?of? ?rawmaterials ... 50 50 50 50 60 10 85 35 85 10 -6 5 125 125 Continue, Until Complete Week BI Forecast Projected available MPS 110 10 11 12 50 50 50 50 75 75 75 75 50 50 50 50 60 10 85 35 85 10 60 110 60 10 85 35