Some companies are
always behind schedule. It seems that these companies never can
build a product on time or even worse, cannot ship the product on
time and as promised. If one thinks that Friday afternoons are bad,
Monday mornings are worse. The job of master scheduling and
manufacturing is hard enough just dealing with the current week's
expected production. When the work not completed the prior week is
added to the current work load, it soon becomes an overloaded
There is an
important principle here: time that passes is gone forever. The
inexperienced master scheduler may have the past due load remain
past due or simply move it to the current period. Although the
second solution seems to be better (it should be against the law to
allow the master schedule to go past due), it still leaves much to
be desired. What now exists is a master schedule that cannot be met.
surface when the master schedule is overloaded. Production
inefficiencies become the norm; poorly timed line changes occur;
downtime due to material shortages are common; stress is everywhere;
mixed priority signals are sent to production; product is not
shipped as promised; partially built product remains in
work-in-process; financial problems occur daily. But that's not all!
The list continues.
As costs are being
driven higher through overtime, expediting, and air freight,
compensations are being made to irate customers. The planning and
control system is probably in shambles, budgets are a joke,
confusion is in the minds of everyone, coordination issues run
throughout the plant, capacity problems are not solved, quality goes
tends to lead to false forecasts which are based on bias as well as
false order placing (asking for more than what is needed and asking
for it earlier than is needed). Sales, marketing, and management in
general discount production capabilities and fall into the trap of
overloading the master schedule. This is a natural response to lack
of performance. Fortunately or unfortunately, the master scheduler
also knows the game that's being played. The issue here is that the
game is being played for some pretty high stakes.
Management must create an environment of honesty about the numbers.
Sales and manufacturing must form partnerships if the company is
ever to get out of the overloaded master schedule. The fear of being
wrong or making a mistake must be removed if the "blame game" is to
* Actual Demand Falls Short of Forecast
Someone once said,
"those who tell, don't know and those who know, don't tell." When
expected sales are forecasted, people jump into action. The master
scheduler creates a schedule that triggers material purchases. That
schedule also triggers manufacturing to commence building
components, engineering to work on new designs, and finance to look
into securing the required money to pay for all this activity.
What's then needed are customer orders! What
When this starts happening, several events occur. Marketing starts
to wonder why the forecast was so far off. Sales management begins
to panic and thoughts turn to "let's make a deal." Manufacturing
also moves into action. Sometimes the master scheduler looks for
work to pull up to take care of some idle capacity. This may be okay
for the current period, but what about the periods that follow. The
optimist may continue to build product in the hopes that orders
will materialize. The pessimist may start to immediately reduce
capacity by laying off people prematurely.
looks at all the available alternatives. Maybe the right thing to do
is to build some sets of common parts. Some of the material
scheduled may be able to be rescheduled to a later date. Looking at
the manufacturing resources available, maybe some of the people can
be redeployed to other useful work. Of course, this requires
flexibility in the hands of the master scheduler.
Another key point
is for the company to decide whether it wants to "sell what's made"
or "make what's sold." Production oriented companies work technical
capabilities, slow production down, but rarely stop, and invest in
sales/ marketing tool sets (price flexibility, attractive financing,
warrantee extensions) while sales/marketing oriented companies
answer brisk sales with a "yes" production response (you've done it
before attitude); if sales are off, production reduces accordingly.
These sales driven companies are generally not in the business to
push predefined products...
To be Continued
For balance of this article, click on the below link:
Lean Manufacturing Articles and go to Series 02
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