Production Planning. Geoff Williams
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1 Geoff Williams
2 Structure Overall Planning Process apacity Planning Operational Planning Annual Weekly Daily production slot constraints Feasibility checking
3 Overall Planning Process
4 Traditional Planning Process Based on Sales Forecast OMPONENT SUPPLIER MANUFATURER DEALER/ NS omponent Supply Planning Production Programme Planning SALES FOREAST omponent Production Inbound Logistics Factory Sequenced Order Bank Manufacturing ustomer Order Outbound Logistics
5 Future Planning Process Based on ustomer Orders OMPONENT SUPPLIER MANUFATURER DEALER/ NS omponent Supply Planning Production Programme Planning Sales/Order Forecast omponent Production Inbound Logistics Factory Sequenced Order Bank Manufacturing USTOMER ORDER Outbound Logistics
6 apacity Planning
7 What is apacity? Alternatives 2 shift 5 day week or 10 shifts 110% More 3 shift 7 day week 21 shifts (Average utilisation of capacity: 71% E (1997) )
8 From Punter to Bookmaker on Sales Forecasting Punter Selects one horse Bets on one outcome BETTING ONE SALES FOREAST Bookmaker Spreads risk across horses Assesses overall risk to maximise return RISK MANAGEMENT RANGE OF FOREASTS
9 Probability Range of Sales % probability Sales Volume per annum
10 ost Assessment millions Plant capacity Expected income Plant ost Profit
11 apacity onsiderations Vehicle Assembly Manning level Multi- product Multi- plant Production holidays Plant efficiency
12 apacity onsiderations Sales Markets Number of derivatives/specs Alternative prices Seasonal variation in demand Sales volume change through life cycles
13 Managing multi- product life cycles apacity Product B Product A Product FULL APAITY Product Product B Product A
14 apacity onsiderations omponent Suppliers Multi- franchise Scrap (throughout onward supply chain) Type of machinery for flexibility hangeover time Breakdowns Everybody needs a computer programme!
15 Annual Operational Planning
16 Principle Minimise risk on production manning level Retain ability to produce maximum orders received in a week onvert sales forecast into weekly order forecast Set production so that maximum overtime in week meets maximum order level Normal production rate generally below average order input level
17 Operational Planning: Annual PRODUTION Maximum Overtime 5Day 4Day VOLUME PER WEEK ORDERS Maximum Average Minimum Taking into account: possible sales levels & demand management
18 Operational Planning: Indicative Weekly Plan (Quarterly) Number of days working Weeks Holiday Effect
19 Weekly Operational Planning Based on Orders
20 Weekly Operational Planning Assume minimum acceptable fixed notice of work pattern is 1 week prior to change 1 week fixed at each decision point Possible alternative Permanent labour: base production level ontract labour: day to day variation on pre-agreed terms
21 Weekly Operational Planning DEISION POINT FIXED WEEK 1 TO BE DEIDED WEEK 2
22 Two factors to consider 1. Order input 2 Requirement for next Peak sales period Production holiday
23 Production Sequence Order ategories : External External Orders : Straight into sequence 3Dayar customers (assigned day) All to be built and delivered in 3 days Retail ustomer orders (assigned day ) i.e. 95% will wait 1 week 70% 2 weeks 30% 4 weeks Fleet Orders ( built across day/week/month)
24 Production Sequence Order ategories : Internal In buffer, placed in schedule at start of week of must build Showroom cars : must be built in 2 weeks Demonstrators : must be built in 4 weeks Employee cars : must be built in 2 months
25 Orders available for build in next 2 weeks : 2 categories 3 Day ar Retail Fleet Showroom Demonstrator Employee Must be an be built in built in next 2 wks next 2 wks As last resort
26 Order Input ORDERS ALREADY AT FATORY DEISION POINT Production Volume WEEK 1 WEEK 2 ORDERS EXPETED MUST build AN build
27 Operational Planning : Week 2 PRODUTION Overtime Levels 5 days 4 days Volume per week ORDERS AN BUILD MUST BUILD
28 Meeting the next sales peak Sales Stock Sales Peak Month
29 Operational Planning : Week 2 PRODUTION Overtime Levels 5 days 4 days ATUAL BUILD LEVEL Volume per week MUST BUILD FOR PEAK ORDERS AN BUILD MUST BUILD
30 Operational Planning: Week 2 Volume level decision : Next production level up from maximum of Orders which must be built Must build level for next sales peak or production holiday ( Used for simulation but needs further refinement ) Good knowledge of order input pattern vital
31 Daily Vehicle Assembly Production Slot Planning onstraints WEEK 4 WEEK 3 WEEK 2 WEEK1 ommitted Production 6 MONTHS FORWARD IN WEEKS OMPONENT APAITIES: AIRONDITIONING 1.3 ENGINE 1.3 AIRONDITIONING
32 Production Feasibility Planning
33 3 Phases of Feasibility Planning 3 days and below: check hourly real time situation 3 days to 28 days: check daily plans + in supply chain Above 4 weeks: check weekly plans
34 Feasibility hecking: 3 Days Forward - Volume TIER 2 SUPPLIER PB ST TIER 1 SUPPLIER Planned build Production Stock Delivery Sequenced T ST PB P omponents currently in production ST T ST Supplier Hub T S VEHILE ASSEMBLY TRAK
35 Feasibility hecking: 3 Days Forward - Volume and Time TIER 2 SUPPLIER TIER 1 SUPPLIER DAY 3 Planned build Production PB Reduce to 36 hours Transport Stock P DAY 2 Sequenced DAY 1 T S VEHILE ASSEMBLY TRAK
36 Feasibility hecking: Daily - Weekly heck all suppliers at all tiers v vehicle assembly Plan component production taking into account: Actual componentry in supply chain Agreed stock levels (for demand variation)
37 Requirement for Feasibility hecking omputerised data base Red flag indication for constrained components Real time means identification technology on componentry and vehicles All supplier tiers linked to vehicle manufacturer Automatic programming on component machinery
38 onclusion is vital to success of 3Dayar Plant capacity and manning levels must be calculated at more sophisticated levels Order input knowledge is essential The total supply chain must be measurable in terms of volume and time
39 The End
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