In today’s manufacturing landscape, legacy ERP systems alone are simply not enough. Best-in-class organisations are therefore recognising the importance of leveraging advanced planning and scheduling (APS) solutions by using them to augment their ERP and/or MES operational systems. Indeed, APS represents a revolution compared to traditional planning systems, most notably manufacturing resource planning (MRP), which is also the grandfather of ERP.
Traditional planning and scheduling systems originated in the 1960s with the advent of Manufacturing Resource Planning (MRP) which evolved into MRP II and finally into ERP, where a financial component was introduced. In those days, the demands placed on manufacturers were very different from today. The principal objectives of planning were to synchronise all levels of production backwards from the customer due date; align all work orders according to date order; and provide a target date for bought-in parts. The primary inputs to the planning process were bills of material, bills of routing orders, inventory, and work-in-process (WIP).
With these planning and scheduling capabilities built into ERP systems, manufacturers were able to meet business demands as they were at the time. Since then, ERP systems have been refined, but they are still based on the same concepts and iterative processes as they once were. The planning engine in an ERP system is thus essentially the same today as it was in the early years. Typically, these tools have a transactional focus and aren’t easily used for decision support, including ‘what if’ or scenario analysis.
(Do you suspect your legacy ERP system is no longer up to the task? Read the blog How do you know it’s time for an ERP revamp? to find out if you’re ready for a next-generation ERP system.)
APS supports lean manufacturing techniques and can realistically simulate your throughput by taking into account bottlenecks in your supply chain and manufacturing process. As such, APS is well-suited for complex manufacturing environments, including:
- Made-to-order (MTO) and engineer-to-order (ETO)
- Production of highly engineered products that consist of many components
- Production of multiple products in one factory
- Production plants with frequently changing schedules and requirements
The following diagram depicts the evolving integration of lean concepts and APS:
Before you begin
Selecting and committing to an IT partner, and deciding on an APS system, are important prerequisites for the further optimisation of planning processes. But before you take such a step, you first need to have the following four capabilities in place for effective production scheduling:
1. Real-time view of work in progress
If you don’t know how you’re doing on your current list of things to do, you can’t possibly prioritise what’s coming next. You need real-time information about what jobs have started, what has finished, what is on hold and why. An integrated manufacturing execution system (MES) will provide this level of intelligence on your factory floor.
2. Accurate time tracking for task completion
To enable realistic scheduling, you need to know how long it takes to complete specific tasks. For best results, you need to collect actual data from the shop floor.
3. Realistic capacity planning model
For any system to derive an accurate production schedule, it needs to know about the constraints in your factory. These include everything that restricts your ability to make, such as work hours, labour, shift patterns, materials, floor space, power constraints, and so on.
4. A process to share, monitor and update
Having generated a plan, it’s of no use if it’s stored somewhere on a spreadsheet or printed on a piece of paper. Any planning schedule will evolve with time. So for a plan to be effective, it must be shared with everybody involved in its execution, preferably in real time. Only then will you have visibility of adherence to plan and an opportunity to immediately address any causes of slippage.
Research indicates that using advanced planning and scheduling tools that can accurately model your manufacturing and work processes will lead to improvements in one or more of the following areas:
- 80% improvement in delivery performance
- Up to 25% increase in plant productivity
- 80% reduction in scheduling labour overhead
- Up to 50% reduction in raw material stock and WIP
APS can rightfully be regarded as the pacesetter of a production or manufacturing facility. It seeks optimised solutions for entire demand and supply chains rather than for individual processes and sub-processes. It also provides frameworks for collaborating with vendors and customers. And when information is exchanged on a planning level across multiple systems, both inside and outside your business, you are one step closer to true global optimisation.
|The TRACC framework helps organisations build standardised and integrated good practice and performance capacity across their Plan, Source, Make and Deliver functions. Simultaneously it accelerates their collaboration and alignment capacity to build world class end-to-end value chains, enabling the organisation itself to become the ultimate source of sustainable competitive advantage.|