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Om pp&c



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  • 2. A Good Planning System Must Answer These Questions  What are we going to make?  What does it take to make it?  What do we have?  What do we need?  These are the questions of priority and capacity.
  • 3. Operations Planning Overview  Long-range planning  Greater than one year planning horizon  Intermediate-range planning  Six to nine months  Short-range planning  One day to less than six months
  • 4. Production Planning - Inputs  Quantities of each product group that must be produced in each period.  Desired inventory levels.  Resources of equipment, labor, and material needed in each period.  Availability of resources.
  • 5. Inputs and Outputs For Production Planning Production Planning Company Policies Financial Constraints Strategic Objectives Units or dollars subcontracted, backordered, or lost Capacity Constraints Size of Workforce Production per month (in units or $) Inventory Levels Demand Forecasts External/Internal to firm : Economy,Political situation,Natural/manmade calamities,unions, Multi-skills,Vendor capacity,Raw material availability, Competitors plans…
  • 6. Product Structure – Bill of Material  Standard tree (more subassemblies than products and more components than subassemblies, large BOM).  Modular (Fewer subassemblies or modules than final products, small BOM).  Inverted (Process industries).
  • 7. BILL OF MATERIAL STRUCTURE A B(4) C(2) D(2) E(1) D(3) F(2) Independent Demand Dependent Demand Independent demand is uncertain. Dependent demand is certain. ASSEMBLY SUB-ASSLY COMPONENTS
  • 8. Type of Demand Response  Make-to-Stock (MTS)  Assemble-to-Order (ATO)  Make-to-Order (MTO)
  • 9. Lead Time Engineering Procurement Fabrication Assembly Delivery Make to Stock Assemble to Order Make to Order Engineer to Order Inventory Investment Low High
  • 10. Marketing Planning Strategic Planning Financial Planning Aggregate Production Planning Resource Planning Demand Management Master Production Schedule (MPS) Rough-Cut Capacity Planning (RCCP) Material Requirements Planning (MRP) Capacity Requirements Planning Production Activity Control Capacity Control Production Planning and Control
  • 11. Hierarchical Production Planning Annual demand by item and by region Monthly demand for 15 months by product type Monthly demand for 5 months by item Forecasts needed Allocates production among plants Determines seasonal plan by product type Determines monthly item production schedules Decision ProcessDecision Level Corporate Plant manager Shop superintendent
  • 12. Hierarchical Planning Process Items Product lines or families Individual products Components Manufacturin g operations Resource level Plants Individual machines Critical work centers Production Planning Capacity Planning Resource Requirements Plan Rough-Cut Capacity Plan Capacity Requirements Plan Input/Output Control Aggregate Production Plan Master Production Schedule Material Requirements Plan Shop Floor Schedule All work centers
  • 13. Aggregate Production Planning Master Production Scheduling Is Capacity OK ? MRP NO YES Revise MPS or Expand Capacity
  • 14. Output of Planning Process  Production schedule for a family of products  Master Production Schedule (MPS).  It specifies  the sizing and timing of specific item production quantities.  the sizing and timing of manufactured or purchased components.  allocation of resources to individual operations.
  • 15. Master Production Schedule (MPS)  Time-phased plan specifying how many and when the firm plans to build each end item Aggregate Plan (Product Groups) MPS (Specific End Items)
  • 16. Example Umbrella Durable Line Compact Line Executive Line
  • 17. MPS for Umbrellas April May 1 2 3 4 5 6 7 8 Executive 150 150 Durable 120 120 Compact 200 200 200 200 Aggrgate 550 790 production plan