How To Understand Production Management

Transcription

1 Production Management II - - Assistant: Dipl.-Ing. T. Höhne T.Hoehne@wzl.rwth-aachen.de WZL Aditec 208 Phone: 0241 / Slide 1 Overview of the tasks of ERP systems in production planning and control Knowledge of the historical development of IT-systems for production planning and control Classification of the scopes of duties of ERP systems within the operational process Distinction of the different task focuses of ERP systems when used in different company types L3 Page I

2 Lecture Landscape of the Department of Production Engineering (SS 2004) Production Management I Basics Methods and auxiliary means/devices Process & construction organization Manufacture and Assembly Compatible Construction Construction task in small group Construction examples Construction regulations Production Site Planning Workshop facility planning Storage & transportation planning Human resources planning Production Management II L1 IT in Production Management L2 Customer Relations Management L3 L4 I L5 II L6 Supply Chain Management I L7 Supply Chain Management II L8 Product Lifecycle Management I L9 Product Lifecycle Management II L10 Product Lifecycle Management III L11 Digital Production site planning and simulation L12 Methodology for system selection Innovation Management with Dr. Wiedeking Integrated management task/job Product and product program planning Organization and staff conduct/behavior Cost Management in Workshops Cost accounting Investment appraisal & evaluation Balances Technical Investment Planning Workshop facility planning Technology planning Cost accounting Quality Management Quality assurance systems Quality planning Product liability Slide 2 L3 Page II

3 Table of contents of lecture 3: 1. Short summary of lecture L3 page 1 2. Survey of ERP-systems L3 page 2 3. Exercise E3 page Task 1: Making a throughput time diagram E3 page Task 2: Determination of the order range E3 page Task 3: Evaluation of the planning quality of PPC E3 page System presentation E3 page Sample solutions E3 page Sample solution of task 1 E3 page Sample solution of task 2 E3 page Sample solution of task 3 E3 page 17 L3 Page III

4 References : Eversheim; Schuh Infor business solutions AG Infor business solutions AG Betriebshütte Produktion und Management. Springer- Verlag. Berlin, Heidelberg, New York. ISBN infor:mes Manufacturing Execution System. Produktinformationsschrift, Friedrichsthal 2003 infor:com Produktbeschreibung Produktinformationsschrift, Friedrichsthal 2003 Nyhuis Supply Chain Monitoring mit FAST/log Logistikcontrolling. GTT Hannover. Produktinformationsschrift Scheer Der computergesteuerte Industriebetrieb, Springer, Berlin/Heidelberg, 1990 L3 Page IV

5 Short summary of lecture 3: ERP-systems (ERP = Enterprise Resource Planning) are among other things used to support production planning and control (PPC). In the course of the development of IT-systems the functionality has been extended from a mere quantity planning to a companywide information integration. The system presentation with the ERP-system infor:com provides an insight into the classic tasks of PPC, that are typically performed. The exercise on the creation of a throughput time diagram shows how these can be used in order to identify planning correlations quickly and draw conclusions from sources of failure. L3 Page 1

6 Classification of the Lecture Episode ERP into the Context Products Suppliers PLM Customers SCM Company CRM ERP Resources Slide 3 L3 Page 2

7 Enterprise Resource Planning for Production Planning and Control Production Planning and Control (PPC) Production Planning pre-plans the workflow during the creation of a product for a certain time considering certain general conditions and realizing predetermined objectives. Production Control tries to realize the planning as completely as possible in spite of unavoidable changes concerning the order quantity and the order date as well as disturbances by machine failure or loss of manpower, delays in delivery, and scrap. Enterprise Resource Planning (ERP) ERP is a holistic, process-oriented software solution, which performs the task of production planning and control. ERP makes the required information available to all related divisions of the company. Characteristic features: Has consequences for various divisions of a company, such as production, distribution, logistics, staff, and administration. Many default basic functions Provides a basis for further management software tools (source: Eversheim, 1996; BH 14.5) Slide WZL22 ERP systems support the classic tasks of production planning and control. They are supported by an integrated data base. This makes it possible for the management to use a consistent data base with consistent rules for companywide evaluation. This avoids single divisions of the company doubting the correctness of data. Furthermore, ERP systems support companywide standardisation of production processes with the help of consistent evaluation standards. Moreover, the use of a consistent IT system increases productivity and saves time. L3 Page 3

8 PPC: Allocation of the Production in a Simplified Company Administration & Staff Sale Development Purchase Product creation Manufacturing Assembly Customer Suppliers Logistics Distribution Material flow Information flow Slide 5 The Product creation as center of the value-added chain can be seen in the company s heart. Further supporting areas are the sale and administration and staff. L3 Page 4

9 Task Structure of PPC: PPC/ERP-Model from Aachen Core tasks Cross-sectional tasks Production program planning Production requirements planning Procurement planning and control In-plant production planning and control Order coordination Storage PPC-Controlling Data management (source: Eversheim) Slide 6 L3 Page 5

10 Task Structuring of PPC/ERP (1) Core tasks Production program planning Production requirements planning Procurement planning and control In-plant production planning and control Sales planning Stock planning Primary requirement planning Resource rough planning (order anonymous) Gross secondary requirement determination Net secondary requirement determination Classification of type of procurement Throughput time scheduling Capacity requirement determination Capacity coordination Order account Order entry/evaluation Selection of supplier Order release Order control Lot size calculation Detailed scheduling Detailed resource planning Planning of order succession Availability monitoring Order release Order control Resource control source: Luczak, Eversheim, 1997 Slide 7 L3 Page 6

11 Task structuring of Production Planning and Control PPC/ERP (2) Sectional tasks Order coordination Storage PPC Controlling Data management Order processing Order review Order rough planning Resource rough planning (customer specific) Order Management Stock logistics management Stock control Storage location management Batch management Stock inspection Stock taking Information editing Information evaluation Configuration Workpiece management Parts list management Work plan management Resource management Planning data management Order management Customer management Supplier management source: Luczak, Eversheim, 1997 Slide 8 L3 Page 7

12 MRP: Material Requirement Planning The initial MRP concept, i.e. the determination of quantity and material requirements, was developed in the fifties and represents the change from a consumption-oriented to a demand-oriented dispatching of material. MRP Quantity planning Time-phased production plan for final products primary requirements (manufactures) Explosion of bill of materials gross dependent requirements stocks net dependent requirements source: Scheer 1990 Slide 9 Tasks of MRP are the determination of material requirements, procurement, storage and allocation of raw materials, parts and components which are needed for the production-line. Starting point for MRP is a time-phased production plan for final products. Based on this plan, MRP determines lot sizes for all intermediate products with the help of explosion of bill of materials and forward calculation of order dates in such a way that a feasible overall plan is generated. All materials needed are supplied in the required quantities early enough to guarantee in-time production of final products. MRP only considers material quantity requirements; therefore, it does not guarantee that sufficient production capacities are available at each point of time to execute all orders planned. V3 Seite 8

13 MRP I: Material Resource Planning I In the middle of the sixties, the MRP I concept was developed as an MRP add-on, which also included the production capacity in planning for the first time. As all information about the exact production flow isn t always available at the time of dispatching of orders, it is common practice to feed back the results of a planning step to an earlier planning step. MRP I production program planning MRP capacity scheduling order initiation and control quantity planning time-phase production plan for final products primary requirements (manufactures) Explosion of bill of materials gross dependent requirements stocks net dependent requirements periodic aggregation calculation of order quantity production and assembling lots available capacity capacity scheduling fine scheduling of production orders & sequencing order initiation production progress monitoring source: Scheer 1990 Slide 10 L3 Page 9

14 MRP II: Management Resource Planning II In the eighties, the MRP II concept was finally developed, which also takes into consideration economic and strategic aspects of production planning. The MRP II concept is still widely used because it is the basis for most current ITsystems in this field. MRP II budgeting sales planning MRP I production program planning MRP order initiation and control quantity planning capacity scheduling time-phased production plan for final products primary requirements (manufactures) Explosion of bill of materials gross dependent requirements stocks net dependent requirements periodic aggregation calculation of order quantity production and assembling lots available capacity capacity scheduling fine scheduling of production orders & sequencing order initiation production progress monitoring source: Scheer 1990 Slide 11 MRP II is a technique for the planning of all resources within a manufacturing company. It integrates monetary budgeting, market-oriented production program planning, capacity and material requirements planning as well as production control, production data acquisition (PDA) and machine data acquisition (MDA). Planning is performed sequentially with a series of feedback loops. MRP II has evolved from MRP. We speak of MRP II if the results of MRP planning activities are fed back and used for the planning of the production program. MRP II denotes a higher level of integration of planning, the results of which are used for further steps of corporate planning. MRP II is suitable for well predictable production processes with continuous order entries. [source: Competence Site / Gabler Wirtschaftslexikon] L3 Page 10

15 Enlargement of Scope from ERP to ERP II Learning from MRP II: The maximisation of the resources utilisation results in the maximisation of profit. ERP / ERP II: integrated information supply and control, monitoring and coordination of all processes and activities within the company MRPII ERP ERP II Manufacturing control PDA/MDA/PTA Dispatching Distribution Purchasing Logistics Financial accounting Asset accounting Cost calculation Human resource mgmt. Controlling/MIS Project management Document management PDA: production data acquisition PTA: process time acquisition MDA: machine data acquisition e-procurement Supply Chain Management (SCM) Customer Relationship Management (CRM) (source: Infor business solutions AG) Slide 12 Differences between ERP and ERP II: The task of the traditional ERP is the internal optimisation of a company. ERP II systems, in contrast, optimise the whole value-added chain by collaboration with all business partners. Traditional ERP systems focus on production and logistics. ERP II systems are used by companies of all sectors and fields, including service companies, governments and heavy industry. In contrast to ERP systems, which were only used inside single companies, ERP II systems link all trading partners and thus work across the borders of single companies. While old ERP systems were designed monolithically and self-sufficiently, ERP II systems are internet based and open for integration with other systems. Their modular design allows users to choose program modules suitable for their needs. L3 Page 11

16 MES as Link between ERP and Process Level Coordination level ERP Operational level Manufacturing Execution System (MES) Production control center Transportation control Tool administration Process control Quality management Production data acquisition Process level Material administration Cells order management Cells order coordination Tool administration cell Machine driver Robot manager Robot driver Infor business solutions AG Slide 13 ERP-systems primarily support the rough production planning and control. On deeper company levels more detailed tasks are to be performed, which belong mainly to the autonomous resource administration and control. L3 Page 12

17 Enterprise Application Integration (EAI) Covers all Company Departments Administration & Staff Sale Development Purchase Product creation Manufacturing Assembly Customer Suppliers Logistics Distribution Slide 14

18 As a Part of EAI ERP Covers all Production Relevant Areas EAI Administration & Staff ERP II ERP Sale Development Purchase MRP II Product creation Manufacturing MRP I Assembly Customer CAD etc. MRP Suppliers MES Logistics Distribution EAI: Enterprise Application Integration ERP II: I ERP: Enterprise Resource Planning MRP II: Management Resource Planning MRP I: Material Resource Planning MRP: Material Requirement Planning MES: Manufacturing Execution System CAD: Computer Aided Design Slide 15 On the top level Enterprise Application Integration-Systems (EAI) integrate all used subsystems. This covers in addition to IT-systems of the product creation those of the product development and many more. L3 Page 14

19 SAP and infor:com Examples of Established ERP-Systems Integrated total solutions Open systems Client / Server architecture SD Projekt- Project system Sale MM Materials management PP Production planning QM Quality management PM Manage- Periodical maintenance Human HR resources management SAP R/3 FI Financial accouting Client / Server ABAP/4 IS Industry solutions CO Controlling WF Workflow TR Treasury PS Comprehensive functionality Industry neutrality Company Data model Multinationality see system presentation Slide 16 SAP R/3 and infor:com are two established ERP systems. According to the latest concepts, the open modular structure enables the selection as needed of all required components. infor:com will be presented in more detail in the system presentation. L3 Page 15

20 Polylemma of Production U, LT, C, OTD Utilization high utilization Max Max Lead Time on time delivery Min Min Costs low costs per unit size 0Min WIP LT On Time Delivery WIP C Work in Progress WIP U WIP PLA low lead time min min Choice of the optimal operating point N Positioning area max low work in progress Slide 17 The characteristic traits of production systems can be described clearly through several company characteristics. The production can be positioned on different operating points according to the prioritization of the strategic targets of a company and its type of interaction with the customer. L3 Page 16

21 Customer Decoupling Point Influence on PPC and the ERP System Supplier Customer Program manufacturer Variant manufacturer Order-specific manufacturer Procurement Manufacturing Assembly Delivery Program dependant stocking point Customer dependant Customer Decoupling Point Logistic targets Before the Utilization Stocks customer decoupling point Behind the Throughput times Adherence to delivery dates Source: Eversheim BH 14.4 Slide 18 The manufacturing of the products after the receipt of order shall be aimed at. In case this is impossible due to the product construction, the manufacturing times or the production structure, the products have to be prefabricated to a large extent. But this is not possible with products of a high number of variants or even less with customer specific solutions. L3 Page 17

22 Classification of the Relevant Characteristics to Describe Company Types Initial characteristics Product characteristics Type of order release Product spectrum Product structure Determination of the product/component requirement Disposition characteristics Release of the secondary requirement Procurement type Storage Manufacturing type Manufacturing characteristics Process type in the manufacture of components Process type in assembly Manufacturing structure Customer change influences during manufacture Source: Luczak, Eversheim, 1997 Slide 19 L3 Page 18

23 Typology Program Manufacturer" Structure sizes program bound producing company Type of order release Product spectrum Product structure Determination of the product/ component requirement Release of the secondary requirement Procurement type Storage Manufacturing type Production on order with individual orders Products after customer specification Multi-part products with complex structure According to requirement on result level Order orientated Production on order with blanket orders Typed products with customer specific variants Partly according to expectations, partly according to requirements on comp. level large external procurement No stocking of requirement positions Non-repetitive production Customer anonymous precustomer order related final production Standard products with variants Multi-part products with simple structure According to expectations on components level partly order orientated partly period orientated External procurement in a bigger scale Stocking of requirement positions on lower structure levels Unit and limitedlot production According to expectations on product level Stocking of requirement positions on upper structure levels Series production Production on store Standard products without variants Few-part products Usage orientated on product level Period orientated Little external procurement Stocking of products Mass production 9 Process type in the manufacture Workshop production Island production Batch production Continuous production 10 Process type in assembly Construction site assembly Group assembly Batch assembly Continuous flow assembly 11 Manufacturing structure Manufacture with large depth Manufacture with medium depth Manufacture with minor depth 12 Customer change influences during manufacture Many changing influences Occasional changing influences Few changing influences Source: Eversheim BH Slide 20 L3 Page 19

24 ERP Configuration Program Manufacturer" Production program planning Sales forecast Market Customer anonymous product development Resource disposition Order inducement Order control/supervision Customer Procurement Product creation Product spectrum Finished goods store Push control Main control loop Control loop Source: Eversheim BH Slide 21 L3 Page 20

25 Program Manufacturer: Use of ERP Systems Main production targets High and steady capacity utilization Low costs Planning focus No planning of indirect areas Permanent material availability Minimal control effort in order to save expenses Control focus Fault repair Control of efficiency and quality Equipment availability (material, tools, devices) Source: Eversheim BH Slide 22 L3 Page 21

26 Typology Order-specific Manufacturer" Structure sizes Order related producing company Type of order release Product spectrum Product structure Determination of the product/compone nt requirement Release of the secondary requirement Procurement type Storage Manufacturing type Process type in manufacture Process type in assembly Manufacturing structure Production on order with individual orders Products after customer specification Multi-part products with complex structure According to requirement on result level Order orientated Production on order with blanket orders Typed products with customer specific variants Partly according to expectations, partly according to requirements on comp. level large external procurement No stocking of requirement positions Non-repetitive production Workshop production Construction site assembly Manufacture with large depth Customer anonymous precustomer order related final production Standard products with variants Multi-part products with simple structure According to expectations on components level partly order orientated partly period orientated External procurement in a bigger scale Stocking of requirement positions on lower structure levels Unit and limitedlot production Island production Group assembly Manufacture with medium depth According to expectations on product level Stocking of requirement positions on upper structure levels Series production Batch production Batch assembly Production on store Standard products without variants Few-part products Usage orientated on product level Period orientated Little external procurement Stocking of products Mass production Continuous production Continuous flow assembly Manufacture with minor depth Customer change Many changing Occasional changing 12 influences during Few changing influences Source: Eversheim influences influences manufacture BH Slide 23 L3 Page 22

27 ERP Configuration Order-specific Manufacturer" Determination of delivery date Resource planning Supply confirmation Customer Customer order inducement and control Resource disposition Manufacture control (anticipated) Customer specific product development Procurement Product creation Product Main control loop Control loop Source: Eversheim BH Slide 24 L3 Page 23

28 Order-specific Manufacturer : Use of ERP Systems Main production targets Adherence to delivery dates Short throughput times Readiness to provide information Planning focus Coordination of product development and product creation Production start without exact specification of the product Consideration of insecure order offers Insecure capacity requirements and processing times Control focus Order inducement Order control/supervision Reaction on short-term plan deviations due to Customer s change preferences Source: Eversheim BH Slide 25 L3 Page 24

29 Typology Variant Manufacturer" Structure sizes Company producing variants Type of order release Product spectrum Product structure Determination of the product/compone nt requirement Release of the secondary requirement Procurement type Storage Manufacturing type Process type in manufacture Process type in assembly Manufacturing structure Customer change influences during manufacture Production on order with individual orders Products after customer specification Multi-part products with complex structure According to requirement on result level Order orientated Production on order with blanket orders Typed products with customer specific variants Partly according to expectations, partly according to requirements on comp. level large external procurement No stocking of requirement positions Non-repetitive production Workshop production Construction site assembly Manufacture with large depth Many changing influences Customer anonymous precustomer order related final production Standard products with variants Multi-part products with simple structure According to expectations on components level partly order orientated partly period orientated External procurement in a bigger scale Stocking of requirement positions on lower structure levels Unit and limitedlot production Island production Group assembly Manufacture with medium depth According to expectations on product level Stocking of requirement positions on upper structure levels Occasional changing influences Series production Batch production Batch assembly Production on store Standard products without variants Few-part products Usage orientated on product level Period orientated Little external procurement Stocking of products Mass production Continuous production Continuous flow assembly Manufacture with minor depth Few changing influences Source: Eversheim BH Slide 26 L3 Page 25

30 ERP Configuration Variant Manufacturer" Customer anonymous product development Production program planning Resource disposition Sale Sales forecast Order Order inducement Order control/supervision Customer Product spectrum Procurement Customer specific Product creation Product M Push Montage control Main control loop Control loop Source: Eversheim BH Slide 27 L3 Lecture 26

31 Variant Manufacturer : Use of ERP-Systems Main production targets High utilization Low stocks Readiness to provide information Planning focus Program planning Quantity planning Optimal product succession/order regarding the production system Control focus Fault repair Control of efficiency and quality Source: Eversheim BH Slide 28 L3 Page 27

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