This document discusses various topics related to production planning and control including demand forecasting, aggregate production planning, scheduling, workforce planning, materials requirement planning, capacity planning, production control using just-in-time, and shop-floor control. It addresses decisions around acquiring, utilizing, and allocating limited production resources to meet objectives while considering constraints. The key goals are to generate medium-term production plans, establish product mix, anticipate bottlenecks, and align capacity and workforce.

1.  The need for 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
1Oct-16

2. 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. 2Oct-16

3. Main objective is to take appropriate decisions.
Typical decisions
Work force level
Production lot sizes
Assignment of overtime
Sequencing of production runs
3Oct-16

4. Process
Planning
Scheduling
Loading
Combining
Functions
Dispatching
Follow – up
Corrective
Action
Re-planning
Functions of
PPC
4Oct-16

5. Objective
To predict 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
5Oct-16

6. Qualitative Demand Forecasting
Prediction Market
Delphi Technique
Game Theory
Intentions and Expectations Surveys
Conjoint Analysis
6Oct-16

7. Quantitative Demand Forecasting
Discrete Event Simulation
Quantitative Analogies
Neural Networks
Data Mining
Causal Models
Segmentation
7Oct-16

8. 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. 8Oct-16

9. 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
9Oct-16

10. 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…
10Oct-16

11. 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
11Oct-16

12. 12
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
Oct-16

13. 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
13Oct-16

14. Production
Demand
14
Units
Time
Oct-16
Level plans

15. Units
Time
Series1
15Oct-16
Production
Demand
Chase plans
Series1

16. 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
16Oct-16

17. 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
17Oct-16

18. 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
18Oct-16

19. To find out and direct
Right people
Right place
Right time
Right price
19Oct-16

20. Issues
Basic Staffing Calculations and labor hours
Working Environment
Flexibility/Agility
Quality
20Oct-16

21. 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
21Oct-16

22. 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.
22Oct-16

23. 23Oct-16

24. 24Oct-16

25. 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
25Oct-16

26. Wrong Capacity
26Oct-16

27. Classes of capacity planning
Lead strategy
Lag strategy
Match strategy
27Oct-16

28. Issues
Stand-alone capacities and congestion effects
Capacity Strategy
Make-or-Buy
Flexibility
Scalability and learning curves
28Oct-16

29. 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
29Oct-16

30. Pull production and kanban
JIT is associated with pull systems.
Toyota was the first developer of kanban system.
Examples
McDonalds'
Office Xerox Paper
30Oct-16

31. Issues
JIT Interdependencies
Implementing Issues
JIT purchasing
Expected Outcomes
31Oct-16

32. Objective
To control flow of work through plant and coordinate
with other activities (e.g., quality control, preventive
maintenance, etc.)
32Oct-16

33. Material Flow
Control
33Oct-16

34. 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…
34Oct-16

35. 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
35Oct-16

36. 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…
36Oct-16

37. Issues
Simplicity
Departures from simple mechanisms must be
carefully justified.
37Oct-16

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