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Production planning english

Shiju Nesamony
Shiju Nesamony

- The document discusses production planning and introduces key concepts like MRP, MRPII, and ERP systems. It explains that production planning prepares production plans using these systems to integrate materials planning, finance, and other functions. - Key aspects of production planning covered include bill of materials, machine/labor productivity, demand from orders/forecasts, available stock, lead times, safety stocks, and minimum order quantities from suppliers. - The full course on the Business Sense website provides more details on applying these concepts in detailed production planning.

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The Essentials - Production Planning - HASH MANAGEMENT SERVICES LLP CHENNAI PH: 91766 13965
Overview The Essentials series from Business Sense is an initiative to empower the students(freshers) and professionals in performing more efficiently and effectively in the organization This document is a part of the Certified Manufacturing Professional course offered by Business Sense This course is aimed at bridging the gap between the institutions and the industry by providing the fundamentals of manufacturing management which are not offered by any of our institutions/curriculum This course would immensely benefit students and professionals who are joining manufacturing organizations For more details, please visit www.businessense.in At Business Sense, we help clients through consulting engagements focusing on improving their Operations through Lean Manufacturing Implementation covering 5S, SMED, Kaizen and other tools. We also serve clients on Preparation of Detailed Project Reports, Market Assessments, and Supply Chain Re-engineering. You can subscribe to our bi-weekly newsletter here. Follow us: Copyright of Hash Management Services LLP www.businessense.in
Contents Section 1 Introduction to Planning Processes Section 2 Terminology Copyright of Hash Management Services LLP www.businessense.in
Introduction to Production Planning Production Planning function is responsible for preparing the Plan for the production Normally the planning is done through Manufacturing Requirements Planning (MRP) or Manufacturing Resource Planning (MRP2) Enterprise Resource Planning (ERP) is the automated & integrated version of MRP2 Nowadays a lot of ERP packages are in use widely, across industries For our easy understanding, the focus would remain on the MRP systems Copyright of Hash Management Services LLP www.businessense.in
Materials Requirement Planning (MRP) Material requirements planning (MRP) is a production planning and inventory control system used to manage manufacturing processes. Evolved in1960s An MRP system is intended to simultaneously meet three objectives: Ensure materials are available for production and products are available for delivery to customers Maintain the lowest possible material and product levels in store Plan manufacturing activities, delivery schedules and purchasing activities Copyright of Hash Management Services LLP www.businessense.in
Manufacturing Resource Planning (MRP2) MRP2 had evolved from MRP in the 80s It encompasses the same methodology but includes integrated materials planning, finance and human relations. It has a simulation capability to answer "what-if" questions Usage of Software is ideal for MRP2, since it is complex to build it manually Copyright of Hash Management Services LLP www.businessense.in
Enterprise Resource Planning (ERP) Integrated functions aids in better planning and execution ERP Both MRP and MRPII are still widely used, now independently and as modules of more comprehensive ERP systems MRP 2 1980s Automatically calculates the materials purchasing, production planning and delivery MRP schedules 1960s Copyright of Hash Management Services LLP www.businessense.in
Contents Section 1 Introduction to Planning Processes Section 2 Terminology Copyright of Hash Management Services LLP www.businessense.in
Terminology The following are the various factors that should be considered while planning for the production using an MRP system Supply Company Demand Bill of Materials Machine / Labor Productivity Copyright of Hash Management Services LLP www.businessense.in
Demand Side - Customer Order A confirmed order from the Customer specifying the following: Order No Product Required Quantity Delivery schedule Price Sample approval / Design / Technical drawings depending on the industry Copyright of Hash Management Services LLP www.businessense.in
Demand Side - Forecasted Demand For items which are manufactured based on the sales forecast, the following items are required for planning: Product Required Quantity Region-wise / other break-up ( depending on the company) Shipment date Copyright of Hash Management Services LLP www.businessense.in
Company Side Bill of Materials Bill of Materials (BoM) is the list of all items required to manufacture a product Bill of Materials (BoM) for X It includes all raw materials, consumables, 1. Copper rod 5 m 2. Steel rod 10 m 3. Plastic Case type A 2 nos packing materials with clear consumption 4. Plastic Case type B 1 no 5. Welding rod 2 no details to manufacture 1 product 6. OK Sticker 1no 7. Barcode label 1no 8. Packing box 1 no This must be created for each and every 9. Carton box 1/6 no ( 6 items in 1 box) finished product the company is delivering to the customers An example for a BoM is demonstrated here Copyright of Hash Management Services LLP www.businessense.in
Company Side Machine / Labor Productivity What is the time taken for manufacturing manufacturing lead time Lead time of all manufacturing processes Machine run time + idle time + transportation + documentation etc (refer 7 wastes explained in the production module) Copyright of Hash Management Services LLP www.businessense.in
Supply Side Stock in Hand This is the stock for the items present in hand Finished goods Raw materials For e.g. For a customer order of 500 items of X product, if we have 100 nos of X in stores, we can plan only for the remaining 400 nos Copyright of Hash Management Services LLP www.businessense.in
Supply Side Lead time, Safety stock & Minimum Order Quantity This has been clearly explained in the Purchase and Stores modules Lead time(LT) is the time an item takes to reach the factory gate from the time of raising a Purchase Order (PO) Safety Stock (SS) is the stock quantity/no of days of stock that should be planned to compensate for any uncertainty in the delivery Minimum Order Quantity (MOQ) There is a minimum order size and batch size for most of the items. for. E.g. the supplier of welding rods might accept the order only a minimum of 500 rods are ordered and the multiples will be in 100 Minimum order is 500 nos. After that multiples of 100 ( an order of 575 nos will not be accepted; either 600 nos or 500 nos should be ordered) Copyright of Hash Management Services LLP www.businessense.in
Supply Side Pending Order Status This refers to the pending Purchase Orders that are yet to be fulfilled by the suppliers/ vendors One has to take this also in to account while planning for the materials Detailed Production Planning and Step-by-Step examples are explained in the Certified Manufacturing Professional course. To access login to www.businessense.in Copyright of Hash Management Services LLP www.businessense.in
End of Free Content Please visit our website www.businessense.in to access the full course Certified Manufacturing Professional Our website also contains list of ready-to-use templates and report formats containing Charts and pivot tables. Templates and report formats are available for Purchase, Stores, Production, Quality, Maintenance and HR functions These templates come in excel /word and can be downloaded and used right away At Business Sense, we help clients through consulting engagements focusing on improving their Operations through Lean Manufacturing Implementation covering 5S, SMED, Kaizen and other tools. We also serve clients on Preparation of Detailed Project Reports, Market Assessments, and Supply Chain Re-engineering. You can subscribe to our bi-weekly newsletter here. Follow us: Copyright of Hash Management Services LLP www.businessense.in

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Production planning english

  • 1. The Essentials - Production Planning - HASH MANAGEMENT SERVICES LLP CHENNAI PH: 91766 13965
  • 2. Overview The Essentials series from Business Sense is an initiative to empower the students(freshers) and professionals in performing more efficiently and effectively in the organization This document is a part of the Certified Manufacturing Professional course offered by Business Sense This course is aimed at bridging the gap between the institutions and the industry by providing the fundamentals of manufacturing management which are not offered by any of our institutions/curriculum This course would immensely benefit students and professionals who are joining manufacturing organizations For more details, please visit www.businessense.in At Business Sense, we help clients through consulting engagements focusing on improving their Operations through Lean Manufacturing Implementation covering 5S, SMED, Kaizen and other tools. We also serve clients on Preparation of Detailed Project Reports, Market Assessments, and Supply Chain Re-engineering. You can subscribe to our bi-weekly newsletter here. Follow us: Copyright of Hash Management Services LLP www.businessense.in
  • 3. Contents Section 1 Introduction to Planning Processes Section 2 Terminology Copyright of Hash Management Services LLP www.businessense.in
  • 4. Introduction to Production Planning Production Planning function is responsible for preparing the Plan for the production Normally the planning is done through Manufacturing Requirements Planning (MRP) or Manufacturing Resource Planning (MRP2) Enterprise Resource Planning (ERP) is the automated & integrated version of MRP2 Nowadays a lot of ERP packages are in use widely, across industries For our easy understanding, the focus would remain on the MRP systems Copyright of Hash Management Services LLP www.businessense.in
  • 5. Materials Requirement Planning (MRP) Material requirements planning (MRP) is a production planning and inventory control system used to manage manufacturing processes. Evolved in1960s An MRP system is intended to simultaneously meet three objectives: Ensure materials are available for production and products are available for delivery to customers Maintain the lowest possible material and product levels in store Plan manufacturing activities, delivery schedules and purchasing activities Copyright of Hash Management Services LLP www.businessense.in
  • 6. Manufacturing Resource Planning (MRP2) MRP2 had evolved from MRP in the 80s It encompasses the same methodology but includes integrated materials planning, finance and human relations. It has a simulation capability to answer "what-if" questions Usage of Software is ideal for MRP2, since it is complex to build it manually Copyright of Hash Management Services LLP www.businessense.in
  • 7. Enterprise Resource Planning (ERP) Integrated functions aids in better planning and execution ERP Both MRP and MRPII are still widely used, now independently and as modules of more comprehensive ERP systems MRP 2 1980s Automatically calculates the materials purchasing, production planning and delivery MRP schedules 1960s Copyright of Hash Management Services LLP www.businessense.in
  • 8. Contents Section 1 Introduction to Planning Processes Section 2 Terminology Copyright of Hash Management Services LLP www.businessense.in
  • 9. Terminology The following are the various factors that should be considered while planning for the production using an MRP system Supply Company Demand Bill of Materials Machine / Labor Productivity Copyright of Hash Management Services LLP www.businessense.in
  • 10. Demand Side - Customer Order A confirmed order from the Customer specifying the following: Order No Product Required Quantity Delivery schedule Price Sample approval / Design / Technical drawings depending on the industry Copyright of Hash Management Services LLP www.businessense.in
  • 11. Demand Side - Forecasted Demand For items which are manufactured based on the sales forecast, the following items are required for planning: Product Required Quantity Region-wise / other break-up ( depending on the company) Shipment date Copyright of Hash Management Services LLP www.businessense.in
  • 12. Company Side Bill of Materials Bill of Materials (BoM) is the list of all items required to manufacture a product Bill of Materials (BoM) for X It includes all raw materials, consumables, 1. Copper rod 5 m 2. Steel rod 10 m 3. Plastic Case type A 2 nos packing materials with clear consumption 4. Plastic Case type B 1 no 5. Welding rod 2 no details to manufacture 1 product 6. OK Sticker 1no 7. Barcode label 1no 8. Packing box 1 no This must be created for each and every 9. Carton box 1/6 no ( 6 items in 1 box) finished product the company is delivering to the customers An example for a BoM is demonstrated here Copyright of Hash Management Services LLP www.businessense.in
  • 13. Company Side Machine / Labor Productivity What is the time taken for manufacturing manufacturing lead time Lead time of all manufacturing processes Machine run time + idle time + transportation + documentation etc (refer 7 wastes explained in the production module) Copyright of Hash Management Services LLP www.businessense.in
  • 14. Supply Side Stock in Hand This is the stock for the items present in hand Finished goods Raw materials For e.g. For a customer order of 500 items of X product, if we have 100 nos of X in stores, we can plan only for the remaining 400 nos Copyright of Hash Management Services LLP www.businessense.in
  • 15. Supply Side Lead time, Safety stock & Minimum Order Quantity This has been clearly explained in the Purchase and Stores modules Lead time(LT) is the time an item takes to reach the factory gate from the time of raising a Purchase Order (PO) Safety Stock (SS) is the stock quantity/no of days of stock that should be planned to compensate for any uncertainty in the delivery Minimum Order Quantity (MOQ) There is a minimum order size and batch size for most of the items. for. E.g. the supplier of welding rods might accept the order only a minimum of 500 rods are ordered and the multiples will be in 100 Minimum order is 500 nos. After that multiples of 100 ( an order of 575 nos will not be accepted; either 600 nos or 500 nos should be ordered) Copyright of Hash Management Services LLP www.businessense.in
  • 16. Supply Side Pending Order Status This refers to the pending Purchase Orders that are yet to be fulfilled by the suppliers/ vendors One has to take this also in to account while planning for the materials Detailed Production Planning and Step-by-Step examples are explained in the Certified Manufacturing Professional course. To access login to www.businessense.in Copyright of Hash Management Services LLP www.businessense.in
  • 17. End of Free Content Please visit our website www.businessense.in to access the full course Certified Manufacturing Professional Our website also contains list of ready-to-use templates and report formats containing Charts and pivot tables. Templates and report formats are available for Purchase, Stores, Production, Quality, Maintenance and HR functions These templates come in excel /word and can be downloaded and used right away At Business Sense, we help clients through consulting engagements focusing on improving their Operations through Lean Manufacturing Implementation covering 5S, SMED, Kaizen and other tools. We also serve clients on Preparation of Detailed Project Reports, Market Assessments, and Supply Chain Re-engineering. You can subscribe to our bi-weekly newsletter here. Follow us: Copyright of Hash Management Services LLP www.businessense.in