1. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Chapter 10 The nature of planning and control Source: Arup

2. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Operations strategy Design Improvement Planning and control Operations management Planning and control The operation supplies... delivered products and services The market requires … products and services delivered to requested time, quantity and quality Planning and control Source: Arup

3. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Planning is a formalization of what is intended to happen at some time in the future. A plan does not guarantee that an event will actually happen; it is a statement of intention. Although plans are based on expectations, during their implementation things do not always happen as expected. Control is the process of coping with any changes that affect the plan. It may also mean that an ‘intervention’ will need to be made in the operation to bring it back ‘on track’. Planning and control

4. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Planning is deciding Control is what activities should take place in the operation when they should take place what resources should be allocated to them understanding what is actually happening in the operation deciding whether there is a significant deviation from what should be happening (if there is deviation) changing resources in order to affect the operation’s activities Planning and control

5. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Significance of planning and control Time horizon Hours/days Days/weeks/months Months/years Long-term planning and control Uses aggregated demand forecasts Determines resources in aggregated form Objectives set in largely financial terms Medium-term planning and control Uses partially disaggregated demand forecasts Determines resources and contingencies Objectives set in both financial and operations terms Short-term planning and control Uses totally disaggregated forecasts or actual demand Makes interventions to resources to correct deviations from plans Ad hoc consideration of operations objectives PLANNING CONTROL

6. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Dependent and independent demand Dependent demand e.g. input tyre store in car plant Demand for tyres is governed by the number of cars planned to be made

7. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Dependent and independent demand Demand for tyres is largely governed by random factors ACE TYRES Independent demand e.g. tyre fitting service Demand for tyres is governed by the type of car arriving, the fluctuations in the number of cars arriving and how many tyres need replacing

8. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 P:D ratios Obtain resourcesProduce product / serviceDeliver to customer D P Produce to stock D P Part produce to order D P Produce to order D P Resource to order Customer orders

9. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Dependent demand Independent demand Resource to orderEach product or service is large compared with total capacity of the operation Make to stock Make to order Each product or service is small compared with total capacity of the operation P:D ratios

10. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Scheduling Loading Sequencing Monitoring and control When to do things? In what order to do things? How much to do? Are activities going to plan? The activities of planning and control

11. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Quality losses Slow- running equipment Equipment ‘idling’ ‘Breakdown’ failure Set-up and changeovers Not worked (unplanned) Valuable operating time Maximum available time Loading – The reduction of time available for ‘valuable’ operating time Not worked (planned)

12. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Finite and infinite loading of jobs on three work centres A, B and C Finite loading limits the loading on each centre to their capacities, even if it means that jobs will be late. Infinite loading allows the loading on each centre to exceed their capacities to ensure that jobs will not be late 1 2 3 4 5 6 0 Work centre ABC ABC Finite loading Infinite loading Weeks

13. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 In Accident and Emergency departments, patients arrive at random. Medical staff must rapidly devise a schedule. Patients with serious illness need urgent attention. Less urgent cases will have to wait. Routine non-urgent cases will have the lowest priority of all. The hospital triage system

14. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007

15. Process stage Week 12 Week 13 Week 14 Week 15 Week 16 Week 17 Week 18 Job A Job B Job CJob DJob E Job A Job B Job Y Job XJob AJob B Job Z Job X Job Y Job A Job B Job X Job C Gantt chart showing the schedule for jobs at each process stage Initial spec. Pre-coding Coding Compact. check Final test Job AJob B Job W Job C Job D

16. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 JOB Mon 5 Tue 6 Wed 7 Thur 8 Fri 9 Mon 12 Tue 13 Table Shelves Kitchen units Bed Scheduled activity time Actual progress Time now V V

17. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 JOB Mon 5 Tue 6 Wed 7 Thur 8 Fri 9 Mon 12 Tue 13 Wood preparation Assembly Finishing Paint Scheduled activity time Actual progress T B B T S K S S S K K T S B T Non-productive time V V Time now

18. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Pull and push philosophies of planning and control PUSH CONTROL Work centre Instruction on what to make and where to send it DEMAND FORECAST OR CENTRAL OPS. PLANNING AND CONTROL SYSTEM

19. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 PULL CONTROL Work centre DEMAND Pull and push philosophies of planning and control Work centre Request Delivery

20. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Shift allocation for the technical ‘hotline’: (a) on a daily basis; (b) on a weekly basis (a) Shift pattern (24-hour clock) Peter Jo Walter Jo MarieClaire Jo 04:00 08:00 12:00 16:00 20:00 Peter X X X X O O X Marie X X X X X O O Claire X X X X O O X Walter O X X X X X O Jo O X X X X X O Mon Tue Wed Thu Fri Sat Sun Number of staff required 3 5 5 5 3 2 2 (b) X O Full day Day off

21. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Operation or process Input Output Compare / re-plan Intervention Plans A simple model of control Monitor

22. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 The drum, buffer, rope, concept Stage or process B Stage or process A Stage or process D Stage or process E Buffer of inventory Stage or process C Bottleneck drum sets the beat Communication rope controls prior activities

23. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007

24. Key Terms Test Planning The formalization of what is intended to happen at some time in the future. Control The process of monitoring operations activity and coping with any deviations from the plan; usually involves elements of replanning. Dependent demand Demand that is relatively predictable because it is derived from some other known factor.

25. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Key Terms Test Independent demand Demand that is not obviously or directly dependent on the demand for another product or service. Resource-to-order Operations that buy-in resources and produce only when they are demanded by specific customers. Create-to-order or make-to-order Operations that produce products only when they are demanded by specific customers.

26. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Key Terms Test Make-to-stock Operations that produce products prior to their being demanded by specific customers. P:D ratio A ratio that contrasts the total length of time customers have to wait between asking for a product or service and receiving it (D) and the total throughput time to produce the product or service (P). Loading The amount of work that is allocated to a work centre.

27. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Key Terms Test Valuable operating time The amount of time at a piece of equipment or work centre that is available for productive working after stoppages and inefficiencies have been accounted for. Finite loading An approach to planning and control that allocates work to a work centre only up to a set limit (usually its useful capacity). Infinite loading An approach to planning and control that allocates work to work centres irrespective of any capacity or other limits.

28. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Key Terms Test Sequencing The activity within planning and control that decides on the order in which work is to be performed. Scheduling A term used in planning and control to indicate the detailed timetable of what work should be done, when it should be done, and where it should be done. Forward scheduling Loading work onto work centres as soon as it is practical to do so, as opposed to backward scheduling.

29. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Key terms Test Backward scheduling Starting jobs at a time when they should be finished exactly when they are due, as opposed to forward scheduling. Rostering A term used in planning and control, usually to indicate staff scheduling – the allocation of working times to individuals so as to adjust the capacity of an operation. Push control A term used in planning and control to indicate that work is being sent forward to workstations as soon as it is finished on the previous workstation.

30. Slack, Chambers and Johnston, Operations Management 5 th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007 Key Terms Test Pull control A term used in planning and control to indicate that a workstation requests work from the previous station only when it is required: one of the fundamental principles of just-in-time planning and control. Drum, buffer, rope An approach to operations control, derived from the theory of constraints (TOC), that uses the bottleneck stage in a process to control materials movement. Theory of constraints (TOC) A philosophy of operations management that focuses attention on capacity constraints or bottleneck parts of an operation; uses software known as optimized production technology (OPT).