Gibson Chapter 4

primary purpose of scheduling

- the effective timing of operations

S& Op is often called "___"

''organized common sense."

the collective effect of multiple forecasts and market-driven challenges include rather unpleasant outcomes: (4)

- Lost sales due to poor mismatch of supply and demand - Limited flexibility to respond to changing market conditions, - unreliable delivery performance - low forecast accuracy

What are 3 short term planning tools that companies use to make critical planning decisions that affect product availability and demand satisfaction?

- Sales and operations planning - materials and requirements planning - production scheduling and sequencing

Two downsides of forward scheduling:

- produces feasible schedule but may miss dates - may result in excessive work-in-process inventory

what does competitive advantage do for effective scheduling(4)

-faster movement of goods - better use of assets @ lower cost - increased capacity from faster input -improve customer service through faster, more reliable deliveries

how long has S&Op been around as a concept

30 years

How many supply chain jobs are listed on Linked In?

468

Planning is discussed extensively in what article?

7 principles of supply chain management

scheduling

Allocation of resources to activities over time so that demands are met in a timely and cost-effective manner

Who said this: "By failing to prepare, you are preparing to fail"

Ben Franklin

S&OP leads to multiple plans T/F

F; 1 plan

S&op is easy T/F

F; it is hard and companies struggle at being good at it

MRP Benefits (5):

Helps managers cut down on supply chain problems: 1. avoid stock-outs 2. minimize inventory 3. reduce manufacturing cost 4. reduces expediting 5. avoid production schedule changes

Who said this "unless commitment is made, there are only promises and hopes, but no plans."

Peter Drucker

Key planning challenges include: 4

Pricing pressures, Product lifecycle reduction, Customer fragmentation, and Market volatility.

acronym for sales and operations planning

S & OP

primary purpose of S&OP

S&OP drives the optimal allocation of critical resources: people, capacity, materials, time and money. (drives the optimal allocation of critical resources)

This 5 step S&OP process is iterative. It may take multiple attempts and several adjustments to create a plan that is acceptable to all parties. T/F

T

what does MPS do

The master production schedule details the amount of product to be produced along with the timing of production to meet customer demand. (what needs to be made and when)

How does an MRP work?

You put the information - demand, ingredients needs, and current inventory - into the MRP system. It kicks out multiple reports, one of which identifies the needed ingredients that I don't have - a recommended purchase schedule.

What is an analogy to the Bill of Materials?

a list of ingredients to make cookies

analogy to inventory master file:

a list of materials you already have-> ingredients you already have for cookies

what is MRP?

a production planning and inventory control system used to manage manufacturing processes. (normally software based)

Proper resource planning leads to effective scheduling of ______, ______, and ________ to produce desired output.

activities, people, and purchases

forward scheduling

begin scheduling as soon as requirements are known. Purpose is to create a go-forward schedule that is feasible

backward scheduling

begin with the end state. Work back through necessary processes to determine what must be accomplished and when to meet the deadline.

What analogy that Gibson used for how running out of a key component can lead the whole production to stop?

being out of eggs when baking cookies

BOM

bill of materials

Why is this important? Effective and efficient scheduling can help you build a ______

competitive advantage

what do companies do for complex products? For a car example

create product structure trees: They relate the dependent demand items (the parts) to the independent demand item (the car). This ensures nothing is forgotten

Scheduling goal

create smooth process flows. Smooth flows are more effective and less expensive than erratic flows.

analogy Gibson used for scheduling and sequencing:

creating a to-do list what you you need to do before a friends wedding to properly manage your time

3 demand signals for MPS

customer orders, internal demand forecasts, and warehouse orders to replenish stock or build up seasonal inventory.

Two primary inputs to S&Op include?

demand plan and an operating plan

what is principle 6? (from the 7 principles of supply chain management)

develop a supply chain-wide technology strategy that supports multiple levels of decision making and gives a clear view of the flow of products, services, and information

Short term planning focus: driving optimal process performance through...(3)

driving optimal process performance through minimal idle time, bottlenecks, and demand fulfillment delays.

Company that we watched a video on to execute the 4 must-haves:

e2open

S&Op promotes what? 3

focus, alignment, and engagement

according to the article, successful companies identify what 3 things for supply chain planning?

funding, leadership, and expected results

MPS

master production schedule

MRP Software captures the relevant information from what 3 things?

master production schedule, the inventory file, and the bill of materials

What does scheduling and sequencing have to do to maximize throughput and meet customer demand?

minimize process bottlenecks that constrain flows

How do the 4 sequencing methods impact success?

move more units with less idle time (throughput)

What caused issues with the proliferation of plans across business units? (4)

multiple forecasts that conflicted with each other: - financial forecast - manufacturing forecast - marketing forecast - distribution forecast

difference between scheduling and planning in terms of horizon

multiple stages medium term for planning vs one stage short term for sheduling

short term planning actives transform a strategic plan to an ________

operating plan

ad we watched about needing more accurate information:

oracle

difference between scheduling and planning in terms of information

planning: aggregate scheduling: detailed

difference between scheduling and planning in terms of objective

planning: money scheduling: time

difference between scheduling and planning in terms of time frame

planning: takes months to weeks scheduling: weeks days, hours

MRP provides the ability to be _____ rather than ______ in the management of inventory levels, material flow, and production scheduling.

proactive; reactive

Inventory master file:

provides accurate status information about the availability of every item controlled by the MRP system.

at its core, scheduling is similar to solving a _____

puzzle

It is a cross-functional planning process that reconciles conflicting business plans, links strategic planning and operational planning, and aligns company resources to create and leverage a single plan.-->

sales and operations planning

which department is responsible for understanding demand and developing a sales plan?

sales department

S&Op is essential for matching what two things?

supply and demand

success comes from _____ across the planning spectrum

synchronization

Sales and operations planning, materials requirements planning, scheduling, and sequencing complement and feed from...

the longer range issues of capacity planning and demand planning

MRP technology manages...

the wide range of components that go into complex goods

Why is S&Op getting harder? (4)

the world is changing through 1. globalization 2. outsourcing 3. partners 4. shrinking product lifecylces and this leads to fragmentation of information

scheduling and sequencing must maximize ______ and meet _____

throughput; customer demand

Effective S&OP activities will produce a ____

unified, demand-driven operating plan.

MRP systems enable supply chain nodes to have:

what they need and when they need it

To achieve optimal short term planning focus performance:

you must properly schedule and sequence activities

two goals of sequencing

•Faster, more consistent, and more cost efficient throughput. •Maximize the utilization of resources while minimizing the completion time to get the work done.

MRP systems simultaneously pursue 3 objectives:

1. Ensure the availability of materials for production and finished products for customer delivery 2. Maintain the lowest possible level of inventory 3. Plan purchasing, manufacturing, and delivery activities

3 MRP processes that drive the MRP system

1. MPS 2. BOM 3. Inventory master file

4 different methods of sequencing:

1. first come, first serve 2. earliest due date 3. shortest process time 4. longest process time

5 step process to achieve a unified plan:

1. forecast future sales 2. demand planning activity: review and adjust sales forecast in light of product plans 3. supply planning phase: analyze forecast in light of existing capacity 4. Pre- S&Op meeting: review sales forecast and capacity 5. executive S&Op meeting: finalize decisions

two types of scheduling

1. forward scheduling 2. backward scheduling

Key S&Op benefits: 6

1. greater visibility of demand and supply across company 2. Improved Product Life cycle Management 3. Better promotional planning 4. Improved inventory management 5. More predictable revenue management 6. more accurate budget forecasting

4 must-haves for S&OP

1. integrate - data, processes, and people 2. plan - translation, granularity, and optimization 3. align - everyone on same page, saves time 4. execute - one plan = improved efficiency

MRP outputs (4)

1. recommended production schedule: tells us what orders should be released to production 2. recommended purchase schedule: help us create purchase orders that identify the quantities of material needed from suppliers and when they should be delivered 3. exception reports: highlights problems and provides reschedule notices about order changes 4. performance report: provides metrics on how well production is working

Provide execution definitions for the following: scheduling--> loading--> sequencing

1. scheduling: assign jobs to workcenters 2. loading: validate workcenter capacity 3. sequencing: select order in which jobs will be done

three additional priorities of S&OP:

1. striking a balance between the varying needs and constraints of supply chain partners 2. coordinating partners' activities. 3. presenting the plan in plain and simple terms that everyone can understand.

MRP stands for

Material Requirements Planning

sequencing

Order of occurrence; process of following a specific order to ensure quality

what are the 3 things that encompass a unified, demand-driven operating plan?

This plan includes an accurate and complete picture of forecasted demand, supply capacity and corresponding financial information.

How can production problems like material shortages be avoided?

Through a tool called materials requirements planning