enterprise wide information systems manufacturing planning and execution (cont.) instructor: ...
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University of Southern California
Enterprise Wide Information Systems
Manufacturing Planning and Execution (cont.)
Instructor: Richard W. Vawter
University of Southern California
Topics
Organizational Elements and Master Data Business Process for Manufacturing Planning and
Execution Reporting and Analysis
University of Southern California
Manufacturing Planning and Execution
Manufacturing Planning is the process of using forecasts and customer demand to create production and procurement schedules for finished products and component materials.
Manufacturing Execution is the process of producing finished products and component materials and recording all shop floor activities and inventory movements.
University of Southern California
Manufacturing Planning and Execution The overall manufacturing planning process comprises:
Forecast values and requirements are first determined Master schedule items are planned Material requirements planning is then calculated
The overall manufacturing execution comprises: Production orders are first released Materials are issued next Completion confirmations are then performed Goods are finally received into stock
The manufacturing process affects capacity, costing, inventory, reporting, and analysis
University of Southern California
Five Phases of the Manufacturing Processes
Sales InfoSales InfoSystemSystem
ForecastingForecasting
CO/PACO/PA
Sales & OperSales & OperPlanningPlanning
DemandDemandMgmtMgmt MPSMPS MRPMRP Manufacturing
ExecutionOrder
Settlement
Inventory Costing
Capacity
Production Master Data
Reporting and Analysis
ProcurementProcurement
Planning processExecution process
S O P ProductionOrder exec.
1.
2. 3. 4.
5.
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Sales and Operations Planning (Phase 1)The forecast values and/or requirements from customer order management, sales information system, and controlling are inputs to the sales and operations planning phase.
ForecastingSales & Oper
PlanningDemandDemand
MgmtMgmt MPSMPS MRPMRP ManufacturingExecution
OrderSettlement
Planning processExecution process
S O P
University of Southern California
Sales and Operations Planning (cont.)
The main steps in sales and operations planning are:1. Creating a sales and production plan
2. De-aggregating the planning values
3. Transferring the planning values to demand management
There are four ways to create a production plan: Based on sales Based on target inventory Based on current days on sales supply Based on running down the inventory to zero
University of Southern California
Demand Management (Phase 2)Demand Management links top-level requirements planning (SOP) with materials planning (MPS and MRP).
ForecastingForecastingSales & OperSales & Oper
PlanningPlanningDemand
Mgmt MPSMPS MRPMRP ManufacturingExecution
OrderSettlement
Planning processExecution process
S O P
University of Southern California
Demand Management (cont.)
Demand Management... 1. Determines the requirements dates and quantities for important
assemblies and
2. Specifies the strategies for planning and producing or procuring finished products.
The result of Demand Management is the demand program.
University of Southern California
Demand Management (cont.)
Demand programDemand program
MPS or MRPMPS or MRP
Maintainplanned
independentrequirements
Copy fromsales plan
Copy fromproduction
plan
Copy fromforecast
Maintaincustomer
independentrequirements
Requirements Input:
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Master Production Scheduling (Phase 3)The independent requirements from Demand Management initiate the master scheduling process for process for MPS designated items. The master production schedule is the anticipated build schedule.
ForecastingForecastingSales & OperSales & Oper
PlanningPlanningDemandDemand
MgmtMgmt MPS MRPMRP ManufacturingExecution
OrderSettlement
Planning processExecution process
S O P
University of Southern California
MPS Drives MRPMotorcycle
PowerTrain
Chassis
Motor Gear Exhaust FrontWheel
RearWheel
Frame Brake
Run MPS atthis level
Run MRP atthis level
Independent Requirement
University of Southern California
MPS RunMPS creates planned orders for top-level items to satisfy independent requirements from Demand Management.
MotorcyclePower Train Chassis
Planned order for themotorcycle creates dependentrequirements for all components
There are no plannedorders at this level, onlydependent requirements.
Independent Requirement
University of Southern California
Material Requirements Planning (Phase 4)In material requirements planning (MRP), the system calculates the net requirements while considering available warehouse stock and scheduled receipts from purchasing and production.
ForecastingForecastingSales & OperSales & Oper
PlanningPlanningDemandDemand
MgmtMgmt MPSMPS MRP ManufacturingExecution
OrderSettlement
Planning processExecution process
S O P
University of Southern California
Material Requirements Planning (cont.)
In material requirements planning (MRP), the system calculates the net requirements while considering available warehouse stock and scheduled receipts from purchasing and production.
MRP requires exact requirement quantities, which allows you to work with particularly low safety stocks.
The output of MRP is either a planned production order, a purchase requisition, or a planned purchase order.
Note: The purpose of MPS and MRP is to guarantee material availability !
University of Southern California
Material Requirements Planning (cont.)
Converting Planned OrdersM P S
Conversion depends on therequirement type and thespecial procurement key.
PurchaseOrder
ProductionOrder
PurchaseRequisition
PlannedOrder
M R P
?
Summary of the Four Planning Phases of the Manufacturing Process.
Each step in the manufacturing planning process corresponds to a different material planning level.
Each planning level provides input to the next level.
Forecasting (Profitability Analysis)- Revenue forecasting- Sales forecasting (quantities)
Sales and Operations Planning- Sales plan- Production plan
Master Production Scheduling- Demand program- Adjusted master plan
Material Requirements Planning- Dependent requirements- Planned production- Procurement plan
Planning Steps Planning Levels
Parts for 1 Parts for 2
Assembly of 2Assembly of 1
Product 1 Product 2
Product group
Co. Region 1 Co. Region 2CO/PA
SOP
MPS
MRP
OK?
OK?
OK?
OK?
Feed
back
/ R
epla
nnin
g
University of Southern California
Manufacturing ExecutionManufacturing Execution is initiated by releasing each production order to the shop floor.
ForecastingForecastingSales & OperSales & Oper
PlanningPlanningDemandDemand
MgmtMgmt MPSMPS MRPMRP ManufacturingExecution
OrderSettlement
Planning processExecution process
S O P
Execution Phase
University of Southern California
Production Orders: Contents
ProductionOrder
1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 29 30 31
1999
Production CostsIncurred
Raw Materials
When to Execute
Quantity of FinishedGoods
Resources
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Production Order Execution ProcessProduction orders go through a series of steps:
PurchaseRequisition
PlannedOrderMRPMRP
ProductionOrder
OrderRelease
GoodsIssue
CompletionConfirmation
GoodsReceipt
OrderSettlement
Planning
Execution
University of Southern California
Topics
Organizational Elements and Master Data Business Process for Manufacturing Planning and
Execution Reporting and Analysis
University of Southern California
Standard Reporting
The standard production reports and analyses provide an overview of production transaction data.
Examples of standard reports and lists displays for each category include:
Master Data Sales and Operations Planning Master Planning Material Requirements
Planning
Production Control Capacity Planning Kanban Product Costing
University of Southern California
Logistics Information System (LIS)
SalesInformationSystem
PurchasingInformationSystem
InventoryControlling
Shop FloorInformationSystem
MaintenanceInformationSystem
QualityManagementInformationSystem
Logistics Information Systems
Sales and Distribution
(SD)
MaterialsManagement
(MM)
ProductionPlanning
(PP)
PlantMaintenance
(PM)
QualityManagement
(QM)
SAP’s Logistics Processing Modules
LIS Planning functionality is combined with sales and operations planning (SOP) to form one central planning and forecasting tool.
University of Southern California
In Summary:
Manufacturing Planning is the process of using forecasts and customer demand to create production and procurement schedules for finished products and component materials.
Manufacturing Execution is the process of producing finished products and component materials and recording all shop floor activities and inventory movements.
The output of MRP can be planned orders or purchase requisitions. Planned orders are converted into either production orders or purchase requisitions.
University of Southern California
In Summary (cont.)
The reporting tools used in the manufacturing environment are: Standard Reporting - e.g. Lists Logistics Information Systems - e.g. Shop floor information
systems
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