Planning production is about much more than maximising facility efficiency – developing the optimal plan requires the balancing of more factors than ever.
As well as being able to respond to the threat of low cost sourcing options, organisations require manufacturing to have the flexibility to meet changing market conditions. As such, production plans that generate the best outcomes for an organisation need to balance efficiency and utilisation against the need to rapidly respond to customer requirements, volatile demand, and evolving risk management plans in the most appropriate manner while managing physical constraints and capacities.
As such, production planning raises questions including:
- What items should we be producing, in what quantities, when and how often?
- Do we have the capability and capacity to manage the fluctuations in demand via our manufacturing facilities?
- When should we consider running overtime or outsourcing? What is the true impact of this?
- What are the impacts of equipment downtime v the consequences of overproducing?
- What opportunities exist to improve manufacturing results? Are we focused on the right things?
- What are the expected returns from capital investment?
- Do we do operate at best practice, or could someone else do it better for us?
Developing your production planning capability will help your organisation plan, schedule and execute production in an optimal manner. By utilising a process that uses an integrated demand plan and identifies long-term constraints as well as managing short-term issues, this process provide your organisation with the visibility, flexibility and control to make what you need, when and at what cost.
GRA will work with you to solve Strategic, Tactical and Operational Production Planning problems appropriate to your organisation in order to develop your Production Planning capability. These include,
At the strategic level determining:
- Long-term facility and capacity plans
- Long term utilisation
- Capital investment requirements and appropriate technology levels
- Manufacturing and inventory strategies (make-to-order, make-to-stock, make or buy)
At the tactical level understanding:
- Production and capital requirements
- Gaps between supply and demand
- Production runs that generate optimal results
- Material and labour requirements
At the operational level:
- Generating item and line schedules and material requirements
- Responding to changes in demand
- Resolving exceptions and issues
Developing a mature production planning process will result in a plan that is –
- Based on all relevant inputs including: Labour and costs; Capacity Constraints; Materials; Yields; Sequencing Restrictions; and Changeover times
- Allows: Exception management; Informed fact based decision-making to manage trade-offs and risks; Visibility of future issues and requirements; Flexible Scenario planning; and Organisation Engagement
- And generates: – A reliable, integrated, time-phased production plan – one set of numbers for the organisation to plan to – + Optimised production parameters and policies – optimised based on cost, inventory, service, performance and capacity trade-offs to meet organisational goals
Typical benefits resulting from undertaking a Production Planning improvement project include:
- Increased OEE (Overall Equipment Effectiveness)
- Fewer unanticipated schedule changes and improved Scheduled Attainment & Adherence
- Improved fixed asset (facilities) and current asset (working capital) efficiency
- Improved profitability by reducing fixed and variable operating costs
- Improved supply chain responsiveness and better trade-off management
- Greater consistency and transparency in the production plan
– BACK TO CONSULTING
I have and would continue to recommend GRA to companies reviewing either their supply chain strategy or day to day operations.
– Mark Chapman, Supply Chain & IT Director at Pepkor
- 20-40% inventory investment reduction
- increased service levels ranging up to 99.9%
- 10%-15% reduction in supply chain operating costs
- 5%-20% spend management savings
- the ability to fund business initiatives from operating cash flow (OCF) improvements
- improved return on capital employed (ROCE)
- a minimum 3:1 ROI (10:1 to 30:1 typical)