Manufacturing Planning and Control for Supply Chain Management

Title
Table of Contents
1 Manufacturing Planning and Control
	The MPC System Defined
		Typical MPC Support Activities
	An MPC System Framework
		MPC System Activities
	Matching the MPC System with the Needs of the Firm
		An MPC Classification Schema
	Evolution of the MPC System
		The Changing Competitive World
		Reacting to the Changes
	Concluding Principles
	Discussion Questions
	Chapter 1A Enterprise Resource Planning (ERP)
	What Is ERP?
		Consistent Numbers
		Software Imperatives
		Routine Decision Making
		Choosing ERP Software
	How ERP Connects the Functional Units
		Finance
		Manufacturing and Logistics
		Sales and Marketing
		Human Resources
		Customized Software
		Data Integration
	How Manufacturing Planning and Control (MPC) Fits within ERP
		Simplified Example
		Supply Chain Planning with mySAP SCM
		Supply Chain Execution with mySAP SCM
		Supply Chain Collaboration with mySAP SCM
		Supply Chain Coordination with mySAP SCM
	Performance Metrics to Evaluate Integrated System Effectiveness
		The “Functional Silo” Approach
		Integrated Supply Chain Metrics
		Calculating the Cash-to-Cash Time
	What Is the Experience with ERP?
		Eli Lilly and Company—Operational Standards for Manufacturing Excellence
	Concluding Principles
	Discussion Questions
	Problems
2 Demand Management
	Demand Management in MPC Systems
	Demand Management and the MPC Environment
		The Make-to-Stock (MTS) Environment
		The Assemble-to-Order (ATO) Environment
		The Make (Engineer)-to-Order (MTO) Environment
	Communicating with Other MPC Modules and Customers
		Sales and Operations Planning
		Master Production Scheduling
		Dealing with Customers on a Day-to-Day Basis
	Information Use in Demand Management
		Make-to-Knowledge
		Data Capture and Monitoring
		Customer Relationship Management
		Outbound Product Flow
	Managing Demand
		Organizing for Demand Management
		Monitoring the Demand Management Systems
		Balancing Supply and Demand
	Collaborative Planning, Forecasting, and Replenishment (CPFR)
		Nine-Step CPFR Process Model
		Steps 1 and 2 of the CPFR Model
		Steps 3 through 9 in the CPFR Model
	Concluding Principles
	Discussion Questions
	Problem
3 Forecasting
	Providing Appropriate Forecast Information
		Forecasting for Strategic Business Planning
		Forecasting for Sales and Operations Planning
		Forecasting for Master Production Scheduling and Control
	Regression Analysis and Cyclic Decomposition Techniques
		Example
		Decomposition of a Time Series
		Additive Seasonal Variation
		Multiplicative Seasonal Variation
		Seasonal Factor (or Index)
		Example
		Example
		Decomposition Using Least Squares Regression
		Error Range
	Short-Term Forecasting Techniques
		Moving-Average Forecasting
		Exponential Smoothing Forecasting
		Evaluating Forecasts
	Using the Forecasts
		Considerations for Aggregating Forecasts
		Pyramid Forecasting
		Incorporating External Information
	Concluding Principles
	Discussion Questions
	Problems
	Case: Forecasting at Ross Products
4 Sales and Operations Planning
	Sales and Operations Planning in the Firm
		Sales and Operations Planning Fundamentals
		Sales and Operations Planning and Management
		Operations Planning and MPC Systems
		Payoffs
	The Sales and Operations Planning Process
		The Monthly Sales and Operations Planning Process
		Sales and Operations Planning Displays
		The Basic Trade-Offs
		Economic Evaluation of Alternative Plans
	The New Management Obligations
		Top Management Role
		Functional Roles
		Integrating Strategic Planning
		Controlling the Operations Plan
	Concluding Principles
	References
	Discussion Questions
	Problems
	Case: Delta Manufacturing Company’s Integrated Sales and Operations Planning Process
4A Advanced Sales and Operations Planning
	Mathematical Programming Approaches
		Linear Programming
		Mixed Integer Programming
	Company Example: Lawn King Inc.
		Company Background
		Deciding on a Planning Model
		The Linear Programming Model
		Developing the Planning Parameters
		Solving the Linear Programming Model and Understanding the Results
		Sales and Operations Planning Issues
		Using Microsoft Excel Solver
	Concluding Principles
	Discussion Questions
	Problems
5 Master Production Scheduling
	The Master Production Scheduling (MPS) Activity
		The MPS Is a Statement of Future Output
		The Business Environment for the MPS
		Linkages to Other Company Activities
	Master Production Scheduling Techniques
		The Time-Phased Record
		Rolling through Time
		Order Promising and Available-to-Promise (ATP)
	Planning in an Assemble-to-Order Environment
	Managing Using a Two-Level MPS
	Master Production Schedule Stability
		Freezing and Time Fencing
	Managing the MPS
		The Overstated MPS
	Concluding Principles
	Discussion Questions
	Problems
	Case: Customer Order Promising at Kirk Motors Ltd.
	Case: Hill-Rom’s Use of Planning Bills of Materials
6 Material Requirements Planning
	Material Requirements Planning in Manufacturing Planning and Control
	Record Processing
		The Basic MRP Record
		Linking the MRP Records
	Technical Issues
		Processing Frequency
		Bucketless Systems
		Lot Sizing
		Safety Stock and Safety Lead Time
		Low-Level Coding
		Pegging
		Firm Planned Orders
		Service Parts
		Planning Horizon
		Scheduled Receipts versus Planned Order Releases
	Using the MRP System
		The MRP Planner
		Exception Codes
		Bottom-up Replanning
		An MRP System Output
	System Dynamics
		Transactions during a Period
		Rescheduling
		Complex Transaction Processing
		Procedural Inadequacies
	Concluding Principles
	Discussion Questions
	Problems
6A Advanced MRP
	Determining Manufacturing Order Quantities
		Economic Order Quantities (EOQ)
		Periodic Order Quantities (POQ)
		Part Period Balancing (PPB)
		Wagner-Whitin Algorithm
		Simulation Experiments
	Buffering Concepts
		Categories of Uncertainty
		Safety Stock and Safety Lead Time
		Safety Stock and Safety Lead Time Performance Comparisons
		Scrap Allowances
		Other Buffering Mechanisms
	Nervousness
		Sources of MRP System Nervousness
		Reducing MRP System Nervousness
	Concluding Principles
	Discussion Questions
	Problems
7 Capacity Planning and Management
	The Role of Capacity Planning in MPC Systems
		Hierarchy of Capacity Planning Decisions
		Links to Other MPC System Modules
	Capacity Planning and Control Techniques
		Capacity Planning Using Overall Factors (CPOF)
		Capacity Bills
		Resource Profiles
		Capacity Requirements Planning (CRP)
	Scheduling Capacity and Materials Simultaneously
		Finite Capacity Scheduling
		Finite Scheduling with Product Structures: Using APS Systems
	Management and Capacity Planning/ Utilization
		Capacity Monitoring with Input/Output Control
		Managing Bottleneck Capacity
		Capacity Planning in the MPC System
		Choosing the Measure of Capacity
		Choice of a Specific Technique
		Using the Capacity Plan
	Concluding Principles
	Discussion Questions
	Problems
	Case: Capacity Planning at Montell USA Inc.
	Case: Capacity Planning at Applicon
	Case: Capacity Planning with APS at a Consumer Products Company
8 Production Activity Control
	A Framework for Production Activity Control
		MPC System Linkages
		The Linkages between MRP and PAC
		Just-in-Time Effect on PAC
		The Company Environment
	Production Activity Control Techniques
		Basic Shop-Floor Control Concepts
		Lead-Time Management
		Gantt Charts
		Priority Sequencing Rules
		Theory of Constraints (TOC) Systems
		Vendor Scheduling and Follow-up
		The Internet and Vendor Scheduling
	Concluding Principles
	Discussion Questions
	Problems
	Case: Theory of Constraints (TOC) Scheduling at TOSOH
8A Advanced Scheduling
	Basic Scheduling Research
		The One-Machine Case
		The Two-Machine Case
		Dispatching Approaches
		Sequencing Rules
	Advanced Procedures
		Due Date–Setting Procedures
		Dynamic Due Dates
		Labor-Limited Systems
		Group Scheduling and Transfer Batches
	Concluding Principles
	Discussion Questions
	Problems
9 Just-in-Time
	JIT in Manufacturing Planning and Control
		Major Elements of Just-in-Time
		JIT’s Impact on Manufacturing Planning and Control
		The Hidden Factory
		JIT Building Blocks in MPC
	A JIT Example
		Leveling the Production
		Pull System Introduction
		Product Design
		Process Design
		Bill of Materials Implications
	JIT Applications
		Single-Card Kanban
		Toyota
	Nonrepetitive JIT
		A Service-Enhanced View of Manufacturing
		Flexible Systems
		Simplified Systems and Routine Execution
	Joint-Firm JIT
		The Basics
		Tightly Coupled JIT Supply
		Less Tightly Coupled JIT Supply
		JIT Coordination through Hubs
		Lessons
	JIT Software
		The MRP-JIT Separation
		JIT Planning and Execution
	Managerial Implications
		Information System Implications
		Manufacturing Planning and Control
		Scorekeeping
		Pros and Cons
	Concluding Principles
	Discussion Questions
	Problems
10 Distribution Requirements Planning
	Distribution Requirements Planning in the Supply Chain
		DRP and the MPC System Linkages
		DRP and the Marketplace
		DRP and Demand Management
		DRP and Master Production Scheduling
	DRP Techniques
		The Basic DRP Record
		Time-Phased Order Point (TPOP)
		Linking Several Warehouse Records
		Managing Day-to-Day Variations from Plan
		Safety Stock in DRP
	Management Issues with DRP
		Data Integrity and Completeness
		Organizational Support
		Problem Solving
	Concluding Principles
	Discussion Questions
	Problems
	Case: Abbott Laboratories
10A Management of Supply Chain Logistics
	A Framework for Supply Chain Logistics
		The Breadth of Supply Chain Logistics
		The Total Cost Concept
		Disign, Operation, and Control Decisions
	Supply Chain Logistical Elements
		Transportation
		Warehouses
		Inventory
	Warehouse Replenishment Systems
		ROP/EOQ Systems
		Base Stock Systems
		Distribution Requirements Planning
	Warehouse Location Analysis
		Simulation
		Heuristic Procedures
		Programming Procedures
	Vehicle Scheduling Analysis
		Traveling Salesman Problem
		Solution Methodologies
	Customer Service Measurement
		Make-to-Stock Companies
		Make-to-Order Companies
	Concluding Principles
	Discussion Questions
	Problems
11 Order Point Inventory Control Methods
	Basic Concepts
		Independent- versus Dependent-Demand Items
		Functions of Inventory
	Management Issues
		Routine Inventory Decisions
		Determining Inventory System Performance
		Implementing Changes in Managing Inventory
	Inventory-Related Costs
		Order Preparation Costs
		Inventory Carrying Costs
		Shortage and Customer Service Costs
		Incremental Inventory Costs
		An Example Cost Trade-Off
	Economic Order Quantity Model
		Determining the EOQ
	Order Timing Decisions
		Using Safety Stock for Uncertainty
		The Introduction of Safety Stock
		Continuous Distributions
		Probability of Stocking Out Criterion
		Customer Service Criterion
		Time Period Correction Factor
		Forecast Error Distribution
	Multi-Item Management
	Concluding Principles
	Discussion Questions
	Problems
12 Strategy and MPC System Design
	MPC Design Options
		Master Production Scheduling Options
		Detailed Material Planning Options
		Shop-Floor System Options
	Choosing the Options
		Market Requirements
		The Manufacturing Task
		Manufacturing Process Design
		MPC System Design
	The Choices in Practice
		Moog Inc., Space Products Division
		Kawasaki U.S.A.
		Applicon
	Integrating MRP and JIT
		The Need to Integrate
		Physical Changes That Support Integration
		Some Techniques for Integrating MRP and JIT
	Extending MPC Integration to Customers and Suppliers
	Concluding Principles
	Discussion Questions
	Problems
Appendix Areas of the Standard Normal Distribution
Index