OPERATIONS PLANNING

• Supply Chain Visibility - visibility regarding the location and status of supply chain inventory and resources
• Supply Chain Visibility - Implies not only being able to trach supply inventory and resources but also information regarding available resources can be effectively evaluated and managed

  • highlights resources status and visibility
• Resource Consideration - This requirement is needed to simultaneously consider supply chain demand, capacity, material requirements and constraints.
• Resource Consideration - Supply chain design must consider customer demand for product quality, delivery timing and location.
• Resource Utilization - Functional management must focus on resource utilization within its scope of responsibility
• Resource Utilization - Final driver of planning system development is te need for a coordinated approach that considers service requirements while minimizing combined supply chain resources.
• Demand Planning - The increasing complexity of product offerings and marketing tactics in conjunction with shorter product life cycles requires increased accuracy, flexibility, and consistency in determining inventory requirements. Demand Management Systems seek to provide such capabilities
• Demand Management

  • Develops the forecast that dives anticipatory supply chain process.
  • Forecast are the projections of monthly, weekly or daily demand that determine production and inventory requirements.
• Demand Management Integrates historically based forecasts with other information regarding events that could influence future sales activity such as the following;

  • Promotional plans
  • Pricing changes
  • New product Introductions
• Demand Management System

  • Considered as the information technology component of the Sales and Operations Process to develop unconstrained marketing plan.
  • Begins with base forecast and then incorporates such factors as product life cycle, change in the distribution channels, pricing and promotional tactics and product mix variations.
• Demand Management System - Rationalizes the detailed logistics plans, unique forecasts for each warehouse and product, with the aggregate product group and national plans.
• Production Planning - Uses the statement of requirements obtained from demand management in conjunction with manufacturing resources and constraints to develop a workable manufacturing plan.
• Production Planning - Statement of Requirements defines what items are needed and when are they needed.
• Response Based Practices

  • Make-To-Order Manufacturing

  • A manufacturing process in which manufacturing starts only after a customer's order is received.

  • Assemble-To-Order Manufacturing

  •A business production strategy where products that are ordered by customers are produced quickly and are customizable to a certain extent. It typically requires that the basic parts of the product are already manufactured but not yet assembled.
• Production Planning System

  • Matches the production plan with the production constraints.
  • The objective is to satisfy the necessary requirements at the minimum total production cost while not violating any constraints.
• Logistics Planning - Coordinates Transportation, warehousing and inventory within the firm and between supply chain partners.
• Logistics Planning - Integrates overall movement demand, vehicle availability, and relevant movement cost into a common decision support system that seek to minimize overall freight expense.
• Inventory Deployment

  • Represents one of the major enterprise integrators of sales, marketing and financial goals.
  • A technique for strategically positioning inventory to meet customer service levels while minimizing inventory and storage levels.
• Strategic Objectives - Typically developed for a multiyear planning horizon that often includes quarterly updates.
• Long-Term Elements - Focuses on annual and quarterly plans with the objective of coordinating the marketing and financial plans to achieve enterprise goals.
• Short-Term Elements - Focuses on weekly and daily plans with the objectives of coordinating supply chain and logistics resources to ensure that specific customer requests can be satisfied.
• Sales and Operation - A process that contributes demand and supply plans across the organization. The process incudes information sharing and accountability to systematically develop a common and consistent plan
• Period Demand

  Forecast + Customer Order + Promotions = Period Demand
• Period Demand - Inventory-on-hand - Planned Receipts = Period Logistics Requirement
• Operations - Detailed Forecast Few Products Long Runs Stable Schedules Long Leadtime Maximize Production
• Sales - Aggregate Forecast Many Product Variations Rapid Response High Service Maximize Revenue