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Figure 4 shows the core elements of planning and control and execu­tion systems. Master planning, including strategic, business, and sales and operations planning, is a function of top management. It sets the direction and scope of the business. Master production schedules (MPS) must be valid, matching the goals of master planning, and be tested for realism by rough-cut capacity requirements planning, ensuring that needed resources will be available. They drive detailed planning for both material and capacity requirements and provide management with a handle on detailed operations. Execution has elements for both prior­ity and capacity control.

Material requirements planning (MRP) embodies manufacturing's basic logic:

•      What products will be made? How many? When?

•      What resources are required?

•      Which are now available for use?

•      Which are now on order?

•      Which others are needed? How many? When?

A typical MRP format. The MPS at the top shows the desired schedule of a product to be made. Major and subassemblies (and other components down to raw materials) are defined by bills of material (BOM). At each level, the basic logic is applied, indicated here as require, have now, will get, need, and start. Unfortunately, most MRP programs use less clear and definitive terms. This powerful technique can apply to batch production, continuous production, with rates in each time period instead of specific orders, and even to make-to-order. It is a part of all commercial software of planning and control computer systems.

Capacity requirements planning has three objectives:

•      Determine resources needed to produce what's planned.

•      Initiate actions to get them.

•      Control production lead times.

Manufacturing has four types of capacity: that required by the MPS; theoretical, based on time utilizing available machines, equipment, and direct labor; that demonstrated in actual operations; and effective, that being utilized on items produced and used promptly.

Sound planning with computer systems requires

   •      input from a team of knowledgeable people in the major functions

•      a complete core system as just described

    •      necessary subsystems integrated with the core to serve
      all func
tions involved

•      accurate data with NO SIGNIFICANT errors

•      a short planning horizon

•      an agile, responsive production facility

•      fast, disciplined execution to serve customers' real needs.


Part 1  Part 2   Part 3  Part 4  Part 5  Part 6  Part 7

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