Master Production Scheduling Chapter 6 Master Production Schedule

Master Production Scheduling Chapter 6

Master Production Schedule l A master production schedule (MPS) is a production plan (anticipated build schedule) for an individual product, a customer order, or a product option and common parts • Make-to-stock: finished product • Make-to-order: customer order • Assemble-to-order: product option and common parts

MPC System

Master Production Scheduling l Effective MPS provides the basis for: ØMaking customer delivery promises ØUtilizing plant capacity effectively ØAttaining firm’s strategic objectives (from production plan) ØResolving trade-offs between production and marketing

MPS Activities l l Operational level—processing MPS transactions, maintaining MPS records and reports, having a periodic review and update cycle (“rolling through time”), responding to exception conditions, and measuring effectiveness of schedules Daily basis—marketing and production coordinate through order promising (shipment date for a customer order)

MPS Techniques—Time-Phased Record l Record (by periods) § Forecast § Available: projected inventory balance at the end of the period. [available from prior period + MPS – forecast] § MPS: quantity and time of completion of production § On hand: beginning inventory for the first period.

MPS Techniques—Time-Phased Record l Strategies: • Leveling: MPS constant. Excess inventory to meet future forecasts • Chase: MPS matches forecast. No inventory except safety stock • Mixed (hybrid): lot-sizing approach that falls between the two strategies. Inventory for future periods called cycle stock

MPS Techniques—Rolling through Time l MPS is periodically updated—changes in forecast, orders, production, etc. , may require adjustments for future periods l One “pointer” would be negative available balances l A counter-balancing force would be feasibility of change

MPS Techniques—Order Promising l l l Available-to-promise: deduct existing booked orders from available inventory. (See Figures 6. 8, 6. 9, 6. 10) Time-phased MPS record convention—use the greater of forecasts or booked orders to calculate available inventory balance. Accurate order promising helps a firm to reduce inventory by using buffer delivery promise dates instead.

MPS Techniques—Consuming the Forecast l Forecast estimates versus actual booked orders. l Negative Available—need a MPS lot (if feasible). l ATP calculated by using only actual orders and scheduled production. l Use both available and ATP rows for MPS planning: negative available quantities represents a “potential” problem, but a negative ATP is a real problem.

BOM Structuring for the MPS l l BOM—engineering document specifying subordinate components. • Single-level BOM. • Indented BOM. Assemble-to-order may represent almost unlimited number of end items (options multiply), leading to other BOM options for MPS planning.

Modular Bill of Materials l Establish the MPS at option or module level. BOM links options/modules to components but not to end items. Not Buildable. l MPS can be stated in fewer units. • Hill-Rom example (p. 231): 160 end item possibilities, but only 19 time-phased MPS records needed. l Customer order—a unique end item.

Planning Bill of Materials l l l Planning Bill: Created expressly forecasting and master scheduling Unique configuration, not buildable Store in BOM file Revise with engineering changes Phantom Bill: A bill for a subassembly whose components are consumed during the assembly of its parents

Super Bill of Materials l Super bill: describes the options or modules that make up an average end item. • Is used as the MPS unit: the plan would be to build per the average option proportions. l Adds complexity to order entry (ATP logic must be applied to each option in the order).

Final Assembly Schedule (FAS) l States exact set of end products to be produced over give time period (final assembly lead time). l MPS—anticipated build schedule; FAS is actual build schedule. In assemble-to-order MPS stated in super bills and options, FAS stated in end items per customer order. l Hill-Rom example, Figures 6. 16 -6. 19.

Master Production Scheduler (Master Planner) l Consolidate all sources of requirements – forecasts, customer orders, interplant orders, service parts orders, etc. l Carefully evaluate MPS changes to see effect on material and capacity plans. (Resolving competing demands. ) l Issue production and assembly orders.

Master Production Scheduler (Master Planner) l Understand trade-offs between customer needs and MPC system objectives. l Resolve conflict on production requirements among functions. l Report performance and problems to top management.

MPS Stability l Firm planned orders—quantity, timing are set by the master planner, not adjusted automatically by the software. l Frozen time periods—no changes in the stated time periods are possible. l Time fencing—specify periods in which differing types of changes are possible (e. g. , ice, slush, water zones)

Managing the MPS and Data Base l MPS Data Base • Maintain data integrity • Define clear functional responsibilities • Proper control of changes to BOM l Have a realistic MPS; do not overstate the MPS

Managing the MPS and Data Base l Stability and proper buffering l Force the sum of the MPS’s to equal the production plan. l Measures: § Output/period (dollars or units) vs. the MPS or the budget. § Customer service (hitting order acknowledgement or promise dates).

Concluding Principles l The MPS should reflect the company’s approach to the business environment in which it operates. l The MPS is one part of an MPC system—the other parts need to be in place as well for a fully effective MPS system. l Time-phased MPS records should incorporate useful features of standard MRP record processing.

Concluding Principles l Customer order promising activities must be closely coupled to the MPS. l Available-to-promise information should be provided to both the master planner and the sales department. l A final assembly schedule (FAS) should be used to convert an anticipated build schedule (MPS) into an actual build schedule.

Concluding Principles l The master planner must keep the sum of the parts (MPS) equal to the whole (production plan). l The MPS activities must be clearly defined in an organization. l Firm planned orders can be used in the MPS. l Stability should be designed into the MPS. l The MPS should be evaluated with a formal performance measurement system.

Chapter 6 Assignments l Problems 6. 4, and 6. 12 a & b, and 6. 14 l Due Tuesday, Sept. 24 l Use Excel to do Problems 6. 4 & 6. 14