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Production Planning and Control
 

Production Planning and Control

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    Production Planning and Control Production Planning and Control Presentation Transcript

    • PRODUCTION
      PLANNING
      & CONTROL
      Group
    • 2
      Dec-10
    • Topics to be covered
      • The needfor Production Planning
      • Demand Forecasting
      • Aggregate Production Planning
      • Strategies of Aggregate Planning
      • Scheduling
      • Workforce Planning
      • Materials Requirement Planning
      • Capacity Planning
      • Production Control using JIT
      • Shop-Floor Control
      3
      Dec-10
    • The need for Production Planning
      Addresses decisions on
      • Acquisition
      • Utilization
      • Allocation
      of limited production resources
      Resources include the production facilities, labor and materials.
      Constraints include the availability of resources, delivery times for the products and management policies.
      4
      Dec-10
    • The need for Production Planning
      Main objective is to take appropriate decisions.
      Typical decisions
      • Work force level
      • Production lot sizes
      • Assignment of overtime
      • Sequencing of production runs
      5
      Dec-10
    • The need for Production Planning
      Functions of
      PPC
      6
      Dec-10
    • Demand Forecasting
      Objective
      • Topredict demand for planning purposes
      Laws of Forecasting
      • Forecasts are always wrong
      • Forecasts always change
      • The further into the future, the less reliable the
      forecast will be
      7
      Dec-10
    • Demand Forecasting
      Qualitative Demand Forecasting
      • Prediction Market
      • Delphi Technique
      • Game Theory
      • Intentions and Expectations Surveys
      • Conjoint Analysis
      8
      Dec-10
    • Demand Forecasting
      Quantitative Demand Forecasting
      • Discrete Event Simulation
      • Quantitative Analogies
      • Neural Networks
      • Data Mining
      • Causal Models
      • Segmentation
      9
      Dec-10
    • Aggregate Production Planning
      Objective
      • To generate a medium-term production plan
      • To establish rough product mix
      • To anticipates bottlenecks
      • To align capacity and workforce plans.
      It is usually done for next 2 to12 months.
      Demand changes over a period of time at a faster rate than the resources. Aggregate planning offers strategies to absorb these fluctuations.
      10
      Dec-10
    • Aggregate Production Planning
      Guidelines for Aggregate Planning
      • Determine demand for each period
      • Consider company policies that may have impact
      • Determine capacities for each period
      Regular time, overtime, subcontracting, etc.
      • Identify backorder or inventory amount
      • Determine costs of operation
      • Continue through time horizon to calculate total cost
      • Develop alternate plans and compute cost for each
      • Select the plan that meets objectives
      11
      Dec-10
    • Aggregate Production Planning
      Assumptions in Aggregate Planning
      • The regular output capacity is the same in all
      periods.
      • Cost is a linear function composed of unit cost
      and number of units.
      • Plans are feasible : sufficient inventory capacity
      exists to accommodate a plan, subcontractors with
      appropriate quality and capacity are standing by,
      and changes in output can be made as needed.
      Contd…
      12
      Dec-10
    • Aggregate Production Planning
      Assumptions in Aggregate Planning
      • All costs associated with a decision option can be
      represented by a lump sum or by unit cost that are
      independent of the quantity involved
      • Cost figures can be reasonably estimated and are
      constant for the planning horizon
      • Inventories are built up and drawn down at a
      uniform rate and output occurs at a uniform rate
      throughout each period
      13
      Dec-10
    • 14
      Aggregate Production Planning
      Output of Aggregate Planning
      • Production quantity from regular time, overtime
      and subcontracted time
      • Inventory held for determination of how much
      warehouse space and working capital is needed
      • Backlog or stock-out quantity for determining the
      customer service levels
      Dec-10
    • Strategies in Aggregate Planning
      Level plans
      • Use a constant workforce & produce similar
      quantities each time period
      • Use inventories and backorders to absorb
      demand peaks & valleys
      Chase plans
      Minimize finished good inventories by trying to keep pace with demand fluctuations
      15
      Dec-10
    • Strategies in Aggregate Planning
      Level plans
      Production
      Demand
      Units
      Time
      Dec-10
      16
    • Strategies in Aggregate Planning
      17
      Chase plans
      Production
      Demand
      Units
      Time
      Dec-10
    • Strategies in Aggregate Planning
      Hybrid or Mixed Strategies
      • Build-up inventory ahead of rising demand and
      use backorders to level extreme peaks
      • Layoff or furlough workers during lulls
      • Subcontract production or hire temporary
      workers to cover short-term peaks
      • Reassign workers to preventive maintenance
      during lulls
      • Influencing Demand
      18
      Dec-10
    • Scheduling
      • Concerned with timetable of production
      Scheduling arranges the different manufacturing operations in order of priority, fixing the time & date for the commencement & completion of each operation.
      Types of scheduling
      • Forward scheduling
      • Backward scheduling
      19
      Dec-10
    • Scheduling
      The pattern of scheduling differs from one job to another which is explained as below.
      • Master Schedule
      • Production Schedule
      • Manufacturing Schedule
      • Scheduling of Job Order Manufacturing
      20
      Dec-10
    • Workforce Planning
      To find out and direct
      • Right people
      • Right place
      • Right time
      • Right price
      21
      Dec-10
    • Workforce Planning
      Issues
      • Basic Staffing Calculations and labor hours
      • Working Environment
      • Flexibility/Agility
      • Quality
      22
      Dec-10
    • Materials Requirement Planning
      MRP is a production planning and inventory control system used to manage manufacturing processes.
      An MRP system has 3 major objectives
      • Ensure materials are available for production and
      products are available for delivery to customers
      • Maintain the lowest possible level of inventory
      • Plan manufacturing activities, delivery schedules
      and purchasing activities
      23
      Dec-10
    • Materials Requirement Planning
      MRP steps
      • Takes output from the planning phase (master plan)
      • Combines that with the information from the
      inventory record and product structure records
      • Determines a schedule of timing and quantities for
      each item
      The basic idea is to get the right materials to the right place at the right time.
      24
      Dec-10
    • Materials Requirement Planning
      25
      Dec-10
    • Materials Requirement Planning
      26
      Dec-10
    • Capacity Planning
      • The process of determining the production
      capacity needed to meet changing demands
      • Maximum amount of work that an organization is
      capable of completing in a given period of time
      27
      Dec-10
    • Capacity Planning
      Wrong Capacity
      Dec-10
      28
    • Capacity Planning
      Classes of capacity planning
      • Lead strategy
      • Lag strategy
      • Match strategy
      29
      Dec-10
    • Capacity Planning
      Issues
      • Stand-alone capacities and congestion effects
      • Capacity Strategy
      • Make-or-Buy
      • Flexibility
      • Scalability and learning curves
      30
      Dec-10
    • Production Control using JIT
      JIT is the technique for reducing inventories and elimination of waste in the production system.
      Objectives
      • To eliminate waste
      • To improve quality
      • To minimize lead time
      • To reduce costs
      • To improve productivity
      31
      Dec-10
    • Production Control using JIT
      Pull production and kanban
      JIT is associated with pull systems.
      Toyota was the first developer of kanban system.
      Examples
      • McDonalds'
      • Office Xerox Paper
      32
      Dec-10
    • Production Control using JIT
      Issues
      • JIT Interdependencies
      • Implementing Issues
      • JIT purchasing
      • Expected Outcomes
      33
      Dec-10
    • Shop floor Control
      Objective
      To control flow of work through plant and coordinate with other activities (e.g., quality control, preventive maintenance, etc.)
      34
      Dec-10
    • Shop floor Control
      WIP
      Tracking
      Throughput
      Tracking
      Material Flow
      Control
      Status
      Monitoring
      Work
      Forecasting
      Capacity
      Feedback
      Quality
      Control
      35
      Dec-10
    • Shop floor Control
      Functions
      • Gross Capacity Control
      • Match line to demand by staffing (workers/shifts)
      • Varying length of work week (or work day)
      • Using outside vendors to augment capacity
      Contd…
      36
      Dec-10
    • Shop floor Control
      Functions
      • Bottleneck Planning
      • Handling of bottlenecks
      • Cost of capacity is the key
      • Stable bottlenecks are easier to manage
      • Span of Control
      • Physically or logically decompose system
      • Span of labor and process management
      37
      Dec-10
    • Shop floor Control
      Issues
      • Customization
      SFC is often the most highly customized activity in
      a plant.
      • Information Collection
      SFC represents the interface with the actual
      production processes and is therefore a good
      place to collect data.
      Contd…
      38
      Dec-10
    • Shop floor Control
      Issues
      • Simplicity
      Departures from simple mechanisms must be
      carefully justified.
      39
      Dec-10
    • THANK YOU
    • Bibliography
      41
      • Management Science II, by Dr.T.T. Narendran, IIT
      Madras (pdf format)
      • Shop floor Control, by Wallace J Hopp and Mark
      J Spearman, 1996-2000
      • www.factory-physics.com
      • Production Planning and Control, Lesson 8, Abha
      Kumar
      • Production and Inventory Control, by Dr. Lotfi K.
      Gaafar, 2005 (ppt format)
      • Manufacturing Planning and Control, by Stephen
      C. Graves, MIT Boston, Nov1999 (pdf format)
      Dec-10
    • Bibliography
      42
      • http://en.wikipedia.org/wiki/Aggregate_planning
      • http://www.slideshare.net/birubiru/aggregate-
      planning-2069281
      • http://www.buec.udel.edu/murphys/2009%20SLIDE
      %20PACKET/Chapter13AggPlanFINAL.pdf
      • http://www.scribd.com/doc/11590350/Aggregate-
      Planning
      • Production Planning and Inventory Control, 2nd Edition,
      by Seetharama L. Narasimhan, Dennis W. Mcleaveyand
      Peter J. Billington
      Dec-10