Ch3 - Supply Chain Planning

long-range

involves planning for actions such as the construction of facilities and major equipment purchase

ref: Aggregate production plan (APP)

intermediate range

shows the quantity and timing of end items

ref: master production schedule (MPS)

short range

detailed planning process for components and parts to support the MPS

ref: materials requirement planning (MRP)

aggregate planning

establish production rates that will achieve management’s objective of satisfying customer demand by maintaining, raising, or lowering inventories while attempting to keep the workforce relatively stable

• horizon is at least 1 year

• rolled forward by 3mo every quarter

demand adjustments: influencing demand

so that it aligns with available production capacity

demand adjustments: backordering during high demand periods

accept demand greater than supply capabilities

demand adjustments: counter-seasonal product mixing

develop a product mix with antithetic (seasonal) trends that level the cumulative required production capacityS

Sales and Operations Planning (S&OP)

process to develop tactical plans that allow management to strategically direct the business by integrating customer-focused marketing plans for new and existing products

master production scheduling (MPS)

represents what the company plans to produce, expressed in specific product configurations, quantities, and dates

• statement of production, not demand

time fencing: firmed time period

established to signify the point when changes can no longer be made automatically by the planning system

• from current date out several weeks into the future

time fencing: planned time period

planning system is free to create or make changes to planned orders in this period based on data determined by company

• from end of firmed time period to end of planning horizon

chase production strategy

adjusts production rate and capacity to match demand

• works well for make-to-order items

level production strategy

constant production rate regardless of demand

• works well for make-to-stock items

hybrid production strategy

production set to match demand as closely as possible

• company uses combo of options to achieve demand plan

material requirements planning (MRP)

computer-based materials management tool that calculates exact quantities, need dates, and planned order releases for all aprts and materials required to manufacture a product

Bill of materials (BOM)

unit of measure, quantity per

enterprise requirements planning system (ERP)

info system connecting an organization’s functional areas and operations via a common software infrastructure and database

• provides real-time integrated management of central business processes

best-of-breed implementation

pick best application for each function

single integrator solution implementation

pick all desired apps from single vendor

data management

provides foundation for data analytics. collecting, storing, organizing, and securing data, ensuring that data is accurate, complete, and accessible d

data analytics

process of analyzing, exploring, and transforming data to find patterns and trends that can provide insights and help decision-making