OPERATIONS PLANNING AND SCHEDULING

Master scheduling

Material requirements planning

Order schedulingWeekly workforce andcustomer scheduling

Daily workforce

Process planning

Strategic capacity planning

Sales and operations (aggregate) planning

Longrange

Intermediaterange

Shortrange

ManufacturingServices

Sales plan Aggregate operations plan

Forecasting & demand management

Required Inputs to the Production Planning System

Planning for

production

External capacity

Competitors’behavior

Raw material availability

Market demand

Economic conditions

Currentphysical capacity

Current workforce

Inventory levels

Activities required for production

External to firm

Internal to firm

4

A Basic Frame Work

Customer Orders Demand Management

Aggregate Production Plannig

Master Production Schedule

Material Requirement Planning

Detailed Capacity Planning

Purchasing

Vendors

Engineering Design

Engineering Changes

Bill of Materials

Process Planning

Rough-Cut CapacityPlanning

Inventory Management

Shop-FloorControl

Finished Products

5

AGGREGATE PRODUCTION PLANNING:

In a high-variety, discrete manufacturing environment, demand for product may fluctuate considerably.

On the other end, the resources of the company (number of machines, number of workers, etc.) remain constant during the planning horizon (normally 12 months).

The best approach to obtain feasible solutions is to aggregate the information being processed.

6

MASTER PRODUCTION SCHEDULE:

The primary use of an aggregate production plan is to level the production schedule so that the production costs are minimized.

However, the output of an aggregate plan does not indicate individual product. This means that the aggregated plan must be disaggregated into individual product. The result of such a disaggregation methodologies is what is known as master production schedule.

Overview of the MRP System

Product Structure File

Master Production Schedule

Inventory Master File

Material Requirements

Planning

Manufacturing Orders

Purchase Orders

Various Reports

What is MRP?Computerized Inventory Control

Production Planning System

Management Information System

Manufacturing Control System

When to use MRPJob Shop ProductionComplex ProductsAssemble-to-Order Environments

Discrete and Dependent Demand Items

What can MRP do?Reduce Inventory

LevelsReduce Component

ShortagesImprove Delivery

PerformanceImprove Customer

ServiceImprove ProductivitySimplified and

Accurate Scheduling

Reduce Purchasing Cost

Improve Production Schedules

Reduce Manufacturing Cost

Reduce Lead TimesLess Scrap and

ReworkHigher Production

Quality

What can MRP do?Improve

CommunicationImprove Plant

EfficiencyReduce Freight

CostReduction in

Excess Inventory

Reduce OvertimeImprove Supply

SchedulesImprove

Calculation of Material Requirements

Improve Competitive Position

Three Basic Steps of MRPIdentifying Requirements

Running MRP – Creating the Suggestions

Firming the Suggestions

Inventory Master FileOn-Hand QuantitiesOn-Order QuantitiesLot SizesSafety StockLead TimePast-Usage Figures

An ExampleResource Planning:Assume that a jewelry manufacturing

company decided to open three manufacturing sites (US, Ireland and Singapore).

 Each plant is going to run one shift

except plating area which will be run 2 shifts due to high investment requirement.

Example Cont’dDemand Management: Demand is forecasted for different product families and different plants as follows: US plant Ireland plant Singapore

plant Earrings 300000units/yr 200000units/yr 150000units/yr Pendants 350000 225000 200000 Rings 150000 100000 75000

Example Cont’dProduction Plans: US Plant Months 1 2 3 4 5 6 7 8 9 10 11 12 Earring 20K 20K 20K 20K 20K 20K 30K 30K 30K 30K 30K 30K Pendant 20K 20K 20K 20K 20K 20K 30K 40K 40K 40K 40K 40K Ring 10K 10K 10K 10K 10K 10K 15K 15K 15K 15K 15K 15K PRODUCTION PLAN IS PREPARED FOR IRELAND AND SINGAPORE PLANTS AS WELL.

Example Cont’dDemand Management: Following manpower and resources requirements are estimated for each plant:

US plant Ireland plant Singapore plant

Manpower 300 200 150 Machine Type X

50

40

30

Machine Type Y

100

120

50

Machine Type Z

150

40

70

Example Cont’dMaster Production Schedule: US Plant – Earring Family – 1ST Month

Weeks 1 2 3 4 Gold Earring 1K 1K 1K 2K Gold Earring with red stone

1K 1K 2K 1K

Silver Earring 1K 2K 1K 1K Silver Earring with red stone

2K 1K 1K 1K

TOTAL 5K 5K 5K 5K MASTER SCHEDULE IS PREPARED FOR EACH MONTH (POSSIBLY FOR THE 1ST COUPLE OF MONTHS, NOT FOR THE ENTIRE YEAR) AND PRODUCT FAMILY.

Example Cont’dRough-cut Capacity Planning: Manpower and machine requirements are revised.

US plant Manpower 330 Machine Type X

55

Machine Type Y

95

Machine Type Z

190

Example Cont’dMaterials Planning: Detailed material plans are prepared for subassemblies and parts to be manufactured; components and raw materials to be purchased. Weeks 1 2 3 4 5 6 7 8 9 10 11 12 Gold 3kg 3kg 2.5kg 2.5kg … Silver 5kg 5kg 4kg 4kg … Red Stone

3K 2K 3K 2K …

Plated parts

5K 5K 5K 5K …

Example Cont’dCapacity Requirements Planning: Weeks 1 2 3 4 5 6 7 8 9 10 11 12 Manpower 320 310 330 322 … Machine X

52 55 60 57 …

Machine Y

90 92 98 95 …

Machine Z

178 163 172 170 …

Example Cont’dPurchasing: Contact vendors, evaluate quotes and cut purchase orders. Shop Floor Control: Assign parts to be plated to different plating lines Load manufacturing cells with products and determine start and completion times Cell1 Job1 Job 3 Job 7 Cell2 Job 2 Job 4 Cell3 Job 5 Job 8 Job 6 0 5hr 7 10 22 25 34 38

Planning vs. Control

planning no control yes

Plans

OK?

Stop

Revise

Repetitive

Matching PPC with the Needs of the Firm

Number ofSubparts

Seconds Minutes Days Weeks Months

Time between successive units Examples: Oil, food, drugs, watches, TV, trucks, planes,

houses, ships

Flow

Just-in-TimeMRP CPM/PERT

Matching PPC with the Needs of the Firm1. Flow-Oriented Manufacturing

SystemsVery short time between successive unitsA few components neededFlow rate is the measureEx: Chemical, food, petroleum

Matching PPC with the Needs of the Firm (Cont’d)2. Repetitive-Nature Manufacturing

SystemsShort time between successive unitsAssemble similar productsFlow Rate or Assembly Rate is the measureEx: Televisions, Radios, Watches, Cars

Matching PPC with the Needs of the Firm (Cont’d)3. Just-in-Time

High production volumeLow Product VarietyReduced Inventory and LeadtimeEx: Cars, Computers, Jewelry, Copy Machines

Matching PPC with the Needs of the Firm (Cont’d)4. Materials Requirements Planning

(MRP)Batch production High product varietyLow production quantity Ex: Electric Motors, Fans

Matching PPC with the Needs of the Firm (Cont’d)5. CPM/PERT

Long leadtimes Low production quantity Ex: Airplanes, ships

PPC Functions Material : Procurement, storage, inventory

control and issue Methods : Processes , operations and their

sequences. Machines and equipments : Selection of m/cs,

maintenance policies, loading of jobs and proper utilization.

Manpower : Manpower planning Routing : Sequence of operations to be

performed. (Route sheet – It defines each step of the production and lays down precise path or route through which product will flow during the conversion process)

Contd.. Estimating : Estimation of processing time

both set up time and operations times and establishing performance standards.

Loading and scheduling : Time table of production, priority sequencing and machine loading.

Dispatching : Execution of plan – production orders and instructions are released.

Expediting and progressing : Follow up or keeping track of progress providing feedback to the PPC manager to prompt review of targets and schedules

Contd..

Inspection : Checking quality in production and of evaluating the efficiency of the processes, methods and workers so that improvements can be to achieve the desired level of quality.

Evaluating and controlling : To improve the performance

Gantt Chart

Operations Scheduling

Work CenterA work center is an area in a business

in which productive resources are organized and work is completed

Can be a single machine, a group of machines, or an area where a particular type of work is done

Capacity and Scheduling

Infinite loadingFinite loadingForward schedulingBackward scheduling

Typical Scheduling and Control Functions

Allocating orders, equipment, and personnel

Determining the sequence of order performance

Initiating performance of the scheduled work

Shop-floor control

Work-Center Scheduling Objectives

Meet due dates

Minimize lead time

Minimize setup time or cost

Minimize work-in-process inventory

Maximize machine utilization

Priority Rules for Job Sequencing 1. First-come, first-served

(FCFS)

2. Shortest operating time (SOT)

3. Earliest due date first (EDD)

Example of Job Sequencing: First-Come First-Served

Jobs (in order Processing Due Date Flow Timeof arrival) Time (days) (days hence) (days)

A 4 5 4B 7 10 11C 3 6 14D 1 4 15

Answer: FCFS Schedule

Jobs (in order Processing Due Dateof arrival) Time (days) (days hence)

A 4 5B 7 10C 3 6D 1 4

Suppose you have the four jobs to the right arrive for processing on one machine

What is the FCFS schedule?

No, Jobs B, C, and D are going to be late

Do all the jobs get done on time?

Example of Job Sequencing: Shortest Operating Time

Jobs (in order Processing Due Dateof arrival) Time (days) (days hence)

A 4 5B 7 10C 3 6D 1 4

Answer: Shortest Operating Time Schedule

Jobs (in order Processing Due Date Flow Timeof arrival) Time (days) (days hence) (days)

D 1 4 1C 3 6 4A 4 5 8B 7 10 15

Suppose you have the four jobs to the right arrive for processing on one machine

What is the SOT schedule?

No, Jobs A and B are going to be late

Do all the jobs get done on time?

Example of Job Sequencing: Earliest Due Date First

Jobs (in order Processing Due Dateof arrival) Time (days) (days hence)

A 4 5B 7 10C 3 6D 1 4

Answer: Earliest Due Date FirstJobs (in order Processing Due Date Flow Time

of arrival) Time (days) (days hence) (days)D 1 4 1A 4 5 5C 3 6 8B 7 10 15

Suppose you have the four jobs to the right arrive for processing on one machine

What is the earliest due date first schedule?

No, Jobs C and B are going to be late

Do all the jobs get done on time?

Example of Job Sequencing: Johnson’s Rule (Part 1)Suppose you have the following five jobs with time requirements in two stages of production. What is the job sequence using Johnson’s Rule?

Time in HoursJobs Stage 1 Stage 2 A 1.50 1.25 B 2.00 3.00 C 2.50 2.00 D 1.00 2.00

Example of Job Sequencing: Johnson’s Rule (Part 2)First, select the job with the smallest time in either stage.

That is Job D with the smallest time in the first stage. Place that job as early as possible in the unfilled job sequence below.

Drop D out, select the next smallest time (Job A), and place it 4th in the job sequence.

Drop A out, select the next smallest time. There is a tie in two stages for two different jobs. In this case, place the job with the smallest time in the first stage as early as possible in the unfilled job sequence.

Then place the job with the smallest time in the second stage as late as possible in the unfilled sequence.

Job Sequence 1 2 3 4Job Assigned D A B C

Time in HoursJobs Stage 1 Stage 2 A 1.50 1.25 B 2.00 3.00 C 2.50 2.00 D 1.00 2.00

SCHEDULING N NUMBER ON JOBS ON N NO OF MACHINES

Assignment method – transportation method of linear programming.

SCHEDULING N NUMBER ON JOBS ON N NO OF MACHINES

Computer simulation

Shop-Floor Control:Major Functions

1. Assigning priority of each shop order

2. Maintaining work-in-process quantity information

3. Conveying shop-order status information to the office

Shop-Floor Control:Major Functions (Continued)

4. Providing actual output data for capacity control purposes

5. Providing quantity by location by shop order for WIP inventory and accounting purposes

6. Providing measurement of efficiency, utilization, and productivity of manpower and machines

Tools for Shop floor controlDaily dispatch listStatus and exception reports,

◦Anticipated delay report,◦Scrap reports◦Rework reports◦Performance summary reports◦Shortage listInput/output control report- monitor

workload capacity relationship

Input/Output Control

Planned input should never exceed planned output

Focuses attention on bottleneck work centers

Input OutputWorkCenter

Principles of Work Center Scheduling

1. There is a direct equivalence between work flow and cash flow

2. The effectiveness of any job shop should be measured by speed of flow through the shop

3. Schedule jobs as a string, with process steps back-to-back

4. A job once started should not be interrupted

Principles of Job Shop Scheduling

5. Speed of flow is most efficiently achieved by focusing on bottleneck work centers and jobs

6. Reschedule every day7. Obtain feedback each day on

jobs that are not completed at each work center

8. Match work center input information to what the worker can actually do

Principles of Job Shop Scheduling (Continued)

9. When seeking improvement in output, look for incompatibility between engineering design and process execution

10. Certainty of standards, routings, and so forth is not possible in a job shop, but always work towards achieving it

Personnel Scheduling in Services

Scheduling consecutive days off

Scheduling daily work times

Scheduling hourly work times