When companies realize they need more powerful tools to manage their production, they often turn their attention to detailed scheduling solutions.
What is production planning?
Production planning is a complex process that is carried out by manufacturing companies to organize their production department and plan for future production. This process employs tools and people to plan machinery and operator activities in the near or far future.
Production planning is the capacity modeling process available in order to effectively balance the company’s workloads while keeping synchronized with changes in demand. Production planning is based on demand signals received from annual forecasts that are translated into supply or replenishment signals based on available inventory, lead time and capacity. The planning team members work together with the scheduling team members to balance workloads across work centers and manufacturing plants to ensure that all resources are loaded at optimum levels.
Production planners control and adjust workloads even beyond the planning time window (cumulative lead time) in which changes can be made without changing existing operations. Production planners are also responsible for setting and adjusting planning parameters that affect how the MRP calculates things like production batch, update frequency, planning horizon, and the choices between MTO and MTS ( Make-To-Order and Make-To-Stock).
In many cases the production planner is left with his own device and must therefore organize himself to manage the process in off-line mode; Excel spreadsheets are often used as they are compatible with many ERP management systems to upload and download data. Today, manufacturing companies can manage these processes in a modern and effective way thanks to production planning software.
What is production scheduling?
Production scheduling is an executive-type scheduling of activities. This activity is characterized by a focus on the short term and a more practical and operational organization.
Schedulers monitor and adjust MPs load planning within the planning horizon, convert planned orders into work orders to be distributed to the production plan for execution, and monitor their fulfillment, ensuring the presence of materials , manpower and resources to meet the production schedule without interruptions or delays.
Within the company, they are in contact with the managers of various departments – for example, production, plants, new product development, purchasing, distribution and demand – to be ready to intervene and solve problems that could influence the planning, timing and execution of production scheduled in the respective areas of competence. They also represent the link between the front office and the production department to ensure that plans are communicated and implemented effectively. And they work with maintenance teams to incorporate the appropriate amount of scheduled downtime for any preventative equipment maintenance.
Today, companies can effectively schedule their production thanks to production scheduling software, also known as APS or Advanced Planning and Scheduling software.
The detailed scheduling, through finite capacity reasoning, improves the performances of the production plan by supporting planning to:
- Improve throughput (or volume, or range);
- Reduces delivery times and inventories;
- Reduces the variability of delivery times;
- Reduce manual efforts;
- Increase the frequency of issuing new programs;
- Create reliable shipping lists;
- Identify problems before they actually happen;
- Enables better informed decisions;
- Make planning less dependent on the skills and experience of operators.
A detailed planning program (DTSC) uses the ERP output including work orders, operations and material along with additional information (about machines, tools, operators, optimal sequence rules, configuration tables). So what are the differences between planning and scheduling?
What are the differences between Production Planning and Scheduling?
The two processes of production planning and detailed scheduling are often complementary but in some cases companies can mainly use only one of the two, the choice mainly depends on the type of production. Let’s find out the differences between the two processes.
The main difference is that production planning works with orders planned by the MRP and fixed orders planned by the MPs outside the cumulative lead time window, while scheduling works by converting the orders planned by the MRP into fixed planned orders with the MPs and, finally, in work orders once they enter the production time window or within the cumulative lead time.
Planning horizon
In the manufacturing industry, the planning horizon is a future time period (usually a business year) during which departments supporting production schedule production work and determine how much material is needed.
Planning horizons are divided into time intervals during which certain activities take place:
- Execution window: it is the number of days or weeks in which there are work orders scheduled and issued to the production plan;
- Scheduling window: the cumulative lead-time established minus the execution interval;
- Schedule window: coincides with all days/weeks outside the cumulative lead-time window.
Time Fences
There are different types of time fences which depend on the organization and the ERP package in use. The two main ones are the demand time fence and the planning time fence.
The demand time fence is the time by which the forecast is no longer included in the total demand and forecasted inventory calculations, so only customer orders are considered within this period. Beyond this period and depending on the chosen consumption forecasting technique, it could happen that the total demand becomes a combination of actual orders and forecasts.
During MRP regeneration, the planning time fence does not allow to make changes to the schedule without an assessment of the feasibility of the change and the collaboration of executive decision makers. In fact, changing schedules during this period of time can be expensive for the company as it can cause delays or shortages in shipments to consumers, disrupt the availability of raw materials and amplify a chain reaction throughout the entire supply chain.
A major need of manufacturing companies is the need to stabilize production loads and make product flow in and out of their facilities without interruption. This requires the combination of a good demand management process, a balanced production plan, well-trained schedulers, a statistically calculated security stock and buffer/kanban.
Despite these advantages, far too few companies use the finite capacity scheduling solution to create their plan, relying rather on Excel spreadsheets. For companies that adopt a scheduling solution, in some cases the result of implementing a DTSC turns out to be unsatisfactory and with a consequent abandonment and return to manual programming via Excel. But what are the reasons for this failure?
Why do some scheduling projects fail?
There are two main reasons that lead to the failure of a detailed scheduling project. One is about the technologies behind some systems and one is about the input data.
Technology of scheduling systems
The first reason is related to the technology of the scheduling system that is implemented. Today, most planning systems are based on operations research algorithms in which it is sufficient to click on the command called “execute”, wait and then find an optimal plan. Implemented the operations research based scheduler, this generates a production plan that comes very close to the optimal plan, but you must be careful as this only remains true for a short time. The passage of time, new products and processes, the variation of mix and demand, lead these results to degrade very quickly. At some point the quality of the generated plan is so low that planners are forced to go back to Excel with the many risks associated with this tool. This happens because schedulers based on operations research must be modeled and optimized for the specific case in order to give a high quality result while maintaining an acceptable computing time. If anything changes in the production environment the model needs to be re-tuned. This need for re-tuning cannot be foreseen and requires the execution of a person skilled in operations research and the implemented system. This causes a systematic delay in realigning the model with production as the plan cannot wait days or weeks to be released. This explains why there are so few programmers based on operations research in use for discrete production.
Schedule input
The second problem limiting the spread of DTSC relates to the plan that arrives and is transmitted to the scheduler: the scheduler uses the goal defined by planning to guide and optimize the plan. If those goals are unfeasible, confusing or lack of materials then the scheduler is unable to create a usable program. In fact, if the plan is not adequately balanced in the medium-long term and is not integrated with the detailed schedule, then the scheduler plans with a “blind horizon”. In this case, the plan released today is continuously and almost entirely changed the following day.
Long-term planning simulation and balancing technologies
The recommendation for discrete production companies that intend to invest time and money in a scheduling project is to discuss the two issues mentioned above with their consultant. Following such a comparison, in our experience, 9 out of 10 companies decide to solve their planning problems before committing to a detailed scheduling project. This is because long-term planning lays the necessary foundation for a successful detailed scheduling project and because long-term planning alone solves 80% of the problems that were thought to be solved through detailed scheduling.
Find out how to manage production planning and scheduling
CyberPlan is the famous APS for managing planning and scheduling processes in an integrated way and with simulation technology. Request more information or a demo to understand its potential in your reality.
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