ADDITIONAL STRATEGIES ARE
We have discussed
safety stock strategy
and shop loading
strategies. In addition, a strategy is
needed to mange
the manufacturing order and purchase
process. This strategy should have four
Lot size strategy
Supplier delivery strategy
loading strategy as outlined in mixed-model
(see as outlined in part C)
Expediting (or priority planning) strategy.
possible strategies (examples only) follow:
LOT SIZE STRATEGY
Lot size strategies need to be developed.
For example: business rules for
a lot size strategy for A items follow:
Run A items biweekly, or at a frequency
dictated by the minimum batch
size. If this batch size is more than X weeks of supply, this part
number becomes a prime candidate for setup reduction. Caution:
setups must be reduced prior to reducing lot sizes or severe
manufacturing inefficiencies will result as a company will
consume excessive capacity and
costs will rise.
B and C lot size strategies (business
rules) will also be needed.
A priority planning
process for parts will be needed,
when items fall
below daily safety stock coverage. Remember:
order point logic treats all planned orders
regardless of days of coverage or inventory
Examples of expedite business rules
items below 100% coverage—expedite within lead
items below 50% coverage—expedite today.
B items below 100% coverage—release job outside of
lead time (only if needed to load level manufacturing or supplers).
B items below 50% coverage—expedite inside of lead
C items below 25% coverage—expedite inside of lead
These priorities will be established in conjunction with
manufacturing, and manually managed each day
by production planners and supplier planners
Setup reduction at your suppliers, and on your machines,
will need special attention. Lot sizes are a primary cost issue for
factories and your suppliers. You pay for each
setup in your unit pricing. Therefore, the smaller the lot,
the higher the unit cost because of setup amortization.
You can't have low costs and small lots, without formal
setup reduction. When setups are one minute (transparent),
there will be no need for the mixed-model approach.
Once all the lead time, lot size, and safety stock strategies
(business rules) have been agreed to, they must be loaded
into the ERP database. This is the only way to synchronize
your business system with your "thoughtware."
This modified concept of mixed-model scheduling will
need a significant amount of
dedication for its initial implementation. People will need
to lock themselves in a room,
for hours at a time, deciding how to apply these concepts to
each product family and commodity group.
This process will also need to be
embedded into your formal MRP II/ERP and lean educational programs.