Business Basics
Home Page


Who is Bill Gaw?
And why should we
listen to him?

 

Bill Gaw's 3-Step, World Class
Manufacturing Training Program
World Class Manufacturing

Increase the effectiveness of your
Lean Manufacturing Program

Manufacturing Simulation Game 

Availability to Promise
Part 3 of 4


privacy policy

Lean Manufacturing, Basics, Principles, Techniques

For my latest
Goggle.Knol article:
Click Here

 To review Bill's training
 programs, click on 
  the links below: 

Lean Manufacturing Solutions

Performance
Management Training

Production Quality

Supply Chain
Management
Training

Lean Six
Sigma Process

Strategic Planning
Training

World Class Manufacturing

Kaizen Training

     Other Options:   

Manufacturing Simulation Game

Thinking Outside the Box

Implementation, Methodology, and Excellence Improvement Training

Balanced Scorecard Training Program

Kaizen Blitz Event

Lean Manufacturing Operations 

Six Sigma Management

Manufacturing Supply Chain Management

Strategic Planning Management

Quality
M
anufacturing

Lean Management
Certification Program

Lean Manufacturing Seminar

Lean Manufacturing Jobs

Process Improvement Training

Best of Gaw Lean Management Articles

ATP SCENARION

When a customer order is ready to be entered, there are a number of situations and decisions that ATP can prompt. The actions taken and decisions made may vary by company or product. One factor may be the degree of importance of the item to the customer (such as a lifesaving drug). The fierceness of the competition or the importance of con­trolling costs may also come into play. Available to promise does not make products available. It simply tells you if they are planned to be available when a customer requests them. If not, there are usually two options: change the plan and make them available or promise delivery at a different time when they will be. Anything else is wishful think­ing.

Scenario #1. The customer asks for 100 units of an item at a particulardate and there are 100 or more available. Action: Promise the delivery as requested.

Scenario #2. The customer asks for 100 units of an item at a particular date and only 50 units are available to promise.

Possible Actions: Ask the customer if a partial delivery at the requested date and a second delivery when ATP shows more available will be acceptable. If this is not acceptable, contact the master scheduler to see if there is a way to adjust the schedules to satisfy the customer.

Scenario #3. The customer asks for 100 units of an item at a particular date and the system shows that there are exactly 100 available to promise. However this is a new customer and the 100 have been planned based on forecasts from important existing customers. Af­ter checking with the master scheduler, it is determined that if they are given to the new customer, the replenishment cannot be avail­able for several weeks. Possible Actions:

1.        Give them to the new customer and take the heat from the rest.

2.   Call the existing customers and check on their needs. Negotiatewith both to split the quantity until more can be made available.

3.        Buy the product from another customer who has it or from a competitor to satisfy both customers.

4.        Save the product for the customer who gave you the forecast andturn down the new business.

Scenario #4. The U.S. marketing organization has worked diligently to provide a reasonably accurate forecast for the domestic demand. The international marketers provide a very inaccurate forecast and sometimes forget to forecast at all. They assume that the plant can make whatever they need. So the manufacturing planners forecast international demand based on history. There are 100 units avail­able to promise. They were produced to satisfy a U.S. forecast of 80 units and an international forecast of 20. An international order comes in for 75 units. A replenishment order cannot be available for several weeks.

Possible Actions:

1.        Give them to the international customer and hope U.S. marketing
understands the situation.

2.        Call the U.S. marketing and ask them if they are willing to share.
Negotiate with both to split the quantity until more can be made
available.

3.        Have international marketing call U.S. marketing and ask them if
they are willing to share. Let them negotiate and keep manufactur­
ing out of the middle.

4.        Save the product for the U.S. customer who gave you the good
forecast and tell international that it is important to provide a good
forecast if they want product availability at short notice.

Scenario #5. There are 100 units in inventory in the finished goods warehouse. A customer requests 65 but the system shows only 50 are available to promise. This is because another customer previ­ously ordered 50 but requested delivery three weeks later. The next supply order is not due until week 5.

Possible Actions:

1.        Ship 65 on the new customer order and assume that manufacturing will be able to respond.

2.   Call the master scheduler before shipping and ensure that manufacturing can respond. Then ship the 65 on the new order.

3.   Try to make a partial shipment on the new customer order and de­
liver the remainder in week 5.

To Be Continued


STAY CONNECTED

To stay current on Lean Management Basics and Best Practices, subscribe to our weekly MBBP Bulletin... and we'll send you our PowerPoint presentation, "Introduction to Kaizen Based Lean Manufacturing™." All at no cost of course. 

 

First Name:
Your E-Mail:

 Your personal information will never 
be disclosed to any third party.


privacy policy

Here's what one of our 13,000 plus subscribers
wrote about the MBBP Newsletter:

"Great manufacturing articles. Thanks for the insights. I often share portions of your articles with my staff and they too enjoy them and fine aspects where they can integrate points into their individual areas of responsibilities. Thanks again."

               Kerry B. Stephenson. President. KALCO Lighting, LLC


"Back to Basics" Training for anyone ... anywhere ... anytime

Business Basics, LLC
6003 Dassia Way, Oceanside, CA 92056
West Coast: 760-945-5596 

© 2001-2009 Business Basics, LLC