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PLANNING ENGINE Presented by: Dave Parker Sr. Business Analyst
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Agenda Overview of Planning Process Net Change vs. Regenerative Planning Planning Triggers Explained Avoiding ‘Clutter’ Typical Planning Cycle Curveballs Q&A
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Overview Independent Demand = Forecast or Sales Order Line Infinite Capacity Planning Model MPS (Master Production Schedule) Prioritize (Color, Allergens, Setup, etc.) Heel-to-Toe Schedule Dependent Demand based off MPS; also Component Forecasts Infinite Capacity Planning Model MRP (Material Requirements Planning)
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Balance Supply vs. Demand Demand Supply
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MPS Inputs MPS Calculation Planning “Triggers” Sales Orders Production Forecast (Sales) Inventory Stock Levels Open Documents (Backorders)
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MPS Outputs FG Production FG Purchases FG Transfers MPS Suggestions
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MRP Inputs MRP Calculation Planning “Triggers” Production Forecast (Component) Demand from MPS Inventory Stock Levels Open Documents (Backorders)
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MRP Outputs WIP Production RM/PKG Purchases RM/PKG Transfers MRP Suggestions
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Net Change vs. Regenerative Net Change Plan – Direct changes to the demand requirements Ex: Change in forecast, sales order, production order – Changes to standard data or planned supply Ex: Change to BOM, safety stock, inventory, purchase order – Saves time and system resources Only re-plans items with demand or supply changes since last plan
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Net Change vs. Regenerative Regenerative Plan – Plans for ALL items Starts by deleting all ‘planned’ supply orders that are currently loaded Consumes more time and system resources to execute – Necessary if there are changes to capacity or standard data that would affect the total plan Ex: Change to shop calendar, overall safety lead time
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Planning Policies Blank – do not include in planning Maximum Inventory – what is needed to get to value of Maximum Inventory Order – separate supply per demand instance Fixed Reorder Quantity – when need is identified, always suggest value of Reorder Qty. Lot-for-Lot – whatever supply is needed within the Reorder Cycle
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Planning Triggers Vendor Lead Times – “No matter WHAT I buy from this vendor, it takes x days.” Item Lead Times – “No matter WHO I buy this item from, it takes x days.” Vendor Item Catalog – “Item A from vendor A takes x days. Item B from vendor A takes y days.” Safety Lead Times (Manufacturing Setup, Item Card) – Added to any other lead times - Lead Times
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+ Lot Acc. Per. (6D) Looks out 6 days past the first demand date and suggests 25 cases. Planning Triggers - Lot Accumulation Period
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+ Lot Acc. Per. (7D) Looks out 7 days past the first demand date and suggests 30 cases. Planning Triggers - Lot Accumulation Period
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Planning Triggers - Lot Accumulation Period
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- Reorder Point vs. Safety Stock Reorder Point – Reactive response to an inventory level Safety Stock – Proactive response to an inventory level Planning Triggers
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Reorder Point Inventory Lead Time Replenishment (Reorder Quantity) Time Quantity
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Safety Stock Inventory Lead Time Replenishment Time Quantity
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- Order Quantity Manipulators How to ensure orders are at least a full batch (or full pallet)? – Minimum Order Quantity How to ensure orders are in full batch (or full pallets) increments? – Order multiples How to ensure orders are split into standard run sizes? – Maximum Order Quantity Planning Triggers
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Avoiding ‘Clutter’ If this is all you do, it’s not enough! Now you’ve doubled your supply – and the Cancel will be back again next time!
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Avoiding ‘Clutter’ Scenario: Cancel one date, New order for another WHY does this happen? A) Demand changes (unavoidable!) B) The new supply needed is further away from original supply than the Reorder Cycle.
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Avoiding ‘Clutter’ – How? Planning Flexibility – Any supply can be set to ‘None’ and the plan will leave it alone
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Avoiding ‘Clutter’ – Planning Flexibility option Purchase Lines Transfer Lines Prod. Order Lines Req. Worksheet Planning Worksheet
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Avoiding ‘Clutter’ – How? Planning Flexibility Dampeners – Plan only suggests change outside of a ‘tolerance’ (date or qty) – In 2013, these are at Item / SKU level, not overall Manuf. Setup
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Avoiding ‘Clutter’ - Dampeners
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Avoiding ‘Clutter’ – How? Planning Flexibility Dampeners Rescheduling Period – Plan will use ‘Reschedule’ if within the period (as opposed to Cancel + New)
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Avoiding ‘Clutter’ – Rescheduling Period For NAV 2013, Reorder Cycle split into two fields: - Lot Accumulation Period - Rescheduling Period
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Planning Engine What does a typical planning process look like?
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STEP 1 – Plan FG Production Filter for which FG to include Dates - Longest lead time component 1.1. MPS Firm plan next week Plan everything else 1.2 Carry Out Action Shortage report / meet with purchasing Early detection of packaging issues 1.3 Shortage Analysis
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STEP 2 – Schedule FG Production Primary work center/machine center Sort by Item Scheduling Property Throughput based on routing setup/run times Heel-to-toe prioritizing 2.1 Capacity Task List
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STEP 2 – Schedule FG Production Heel-to-toe prioritizing 2.1 Capacity Task List
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STEP 2 – Schedule FG Production
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STEP 3 – Plan WIP Production Dates - Longest lead time component Suggestions align with FG schedule 3.1 MRP (WIP) Firm plan next week Plan everything else 3.2 Carry Out Action Shortage report / meet with purchasing Early detection of component issues 3.3 Shortage Analysis
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STEP 4 – Plan RM/PKG Dates - Longest lead time component Suggestions align with FG/WIP schedule 4.1 MRP (RM/PKG) Create PO for order date of today/tomorrow Ignore everything else 4.2 Carry Out Action Shortage report / meet with purchasing Double check plan 4.3 Shortage Analysis
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- Planning Make-to-Order Environment – Will need to combine MPS and MRP Co-pack / Subcontracting Environment – Will need to insert Subcontracting Worksheet into the process – Links a production order and a purchase order Multi-location Environment – Transfer order suggestions may not represent your reality Curve Balls
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Schedule WIP instead of FG – Production Order Linking WIP Requirement is Line Specific – May need to use variants to trigger production suggestions by line Batch Sizes Change by Line – Alternate Routings (or versions) with different batch UOMs Routing or BOM Changes Based on Production Location – Routing versions by Location Curve Balls- Scheduling
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Characteristics of successful implementations Maintain accurate data input – Forecasts, orders, inventory levels, BOMs, routings Proper treatment of expedited orders – Additional resources, multiple lines Close collaboration between sales/marketing and production – The forecast is a key contributor to successful planning Accurate and timely shop floor feedback and tracking
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Questions?
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Thank you!
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