How to Fine Tune Your ERP Production Planning

    5/8/19 10:00 AM

    erp-production-planning

    ERP production planning options

    All modern ERP manufacturing solutions contain planning modules to assist in managing your inventory, supply chain, and production scheduling. But how each solution helps you perform these functions can differ. To begin, let’s review two of the common modules you would likely use for ERP in production planning:

    • Material Requirements Planning (MRP) & Scheduling

    MRP is the most common production module for material planning in ERP. The functionality can vary slightly, but the basis for MRP is simply back-dating lead time days from the due date to calculate a release date (assuming there is no stock or open purchase orders). 

    MRP will create release dates prior to today. For example, if today is May 10, and you have a material that is needed on May 15 with a lead time of 10 days, MRP will create a planned order to release a purchase order (PO) on May 5 (May 15 minus 10 days of lead time). Scheduling will assume you can still get the material on May 15, until the planned PO is released and a real due date is entered. Once this happens, scheduling will then use the PO due date for the materials when planning operation start times.

    MRP & Scheduling run independently, although they do rely on each other for inputs and outputs. For the purpose of this ERP in production article, we won’t go into specifics on those interdependiencies and run processes.

    • Advanced Planning & Scheduling (APS)

    APS is a nice step up from typical MRP & Scheduling in that it combines both production planning ERP processes in a single run. So, it will always take into account both resource capacity and material availability. It will not plan in the past, even if the lead time of the material is not enough to meet the due date. APS will reschedule operation start times to allow for enough material lead time, even if it means it will schedule the order to be late (which is reality). 

    The other advantage of APS is that it can incrementally plan and schedule new orders in the existing plan as they are entered. This allows you to utilize Capable To Promise (CTP) functionality at the time of order entry.

    Again, there are many options and parameters you can use in order to personalize the behavior of APS, but that would be beyond the scope of this discussion. 

    Related: How to use Infor ERP Correctly in Advanced Planning and Scheduling

    Fine tuning your ERP production planning

    There are certain elements within the manufacturing process we can fine tune in order to get the best results from whichever method of planning and scheduling. This is not a full list, but it does include the more common parts that just about all manufacturers would utilize.

    • Clean up open sales orders
      • Run an open sales order report and make sure all orders are indeed open. Many times orders will ship short and stay open, or get cancelled without actually changing the status. If you are planning any of the items on the order with MRP, it will not know the items aren’t needed.
    • Clean up open purchase orders
      • Similar to sales orders, many purchase orders are left in an open status when received short, or cancelled to the vendor but not in the production module in the ERP. This will cause the supply side of the planning process to expect that supply is coming and perhaps not order more.
    • Due dates
      • One of the most common mistakes I come across is the lack of due date maintenance on both sales and purchase orders. MRP, Scheduling, and APS all use these due dates to calculate need and start dates for operations and materials. There must be a process in place to be sure the due dates are correct when created and updated when changed.
    • Work center/operation run times
      • Let’s assume your BOM/Routing templates are accurate as far as proper sequence of operations and materials. To fine tune how planning and scheduling react to a job copied from these templates, you need to be constantly verifying the setup and/or run times defined at each operation. Time studies can be done the old-fashioned way, with someone actually using a stopwatch at an operation to verify run times, or you can use operator labor tickets to compare standard times to actual times. Then you’ll make the decision to update the standard time if it is determined the actual time is correct. This can be very time consuming, but vital to the fine-tuning process.
    • Operation overlap
      • This is a scheduling function. Can a subsequent operation in a job start running before the previous operation is complete? You can tell the schedule to start the next operation after a certain quantity or number of hours has been completed on the previous operation.
    • Move Hours
      • By default, a schedule will start a subsequent operation the moment the previous operation has scheduled enough time to be completed. In a work cell, or continuous production cycle, this is fine. However, in many shops a material handler or operator needs time to move the completed work from one operation to the next. To have a more realistic schedule, you want to tell your system the expected number of hours it generally takes to move material between operations.
    • Update planning policies by item
      • If you are constantly changing quantities and dates of planned purchase or job orders before releasing them, your planning policies aren’t set up correctly to have your MRP/APS system generate the proper plan. The goal for the production module in ERP is to have MRP and APS think the way you would think. Look at these planning options (your ERP system may differ in terminology):
        • Safety Stock. This is the quantity you always want available on the shelf. MRP/APS will create a plan to keep you from going below this safety stock quantity.
        • Min\Max\Multiple. Is there a minimum quantity you need to buy or make? Is there a maximum that you would put on one order? Do you make or buy this item in multiples (e.g. how many in a box)?
        • Days of Supply. How many days do you look into the future to combine demand for the same item into a single supply order? This is one of the more common ways to have the planning module act the way you would act when combining orders.

    Related: Most Used ERP Modules and Their Functions

    Conclusion

    There are many ways to fine tune the planning and scheduling processes in your ERP software. Above are just a few with the biggest initial impact. Infor CloudSuite Industrial and Infor VISUAL are very flexible ERP solutions that can meet the needs of all of these different planning and scheduling scenarios—and much more.

    Questions? At Visual South, we can help lead you down the right path when looking to implement or improve your Infor ERP manufacturing process. We are a full service Infor gold channel Partner ERP provider.

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    Nick Mendolia

    Written by Nick Mendolia

    Nick is the VP of Professional Services at Visual South and has been in the Manufacturing industry for over 30 years. He has been involved in many ERP implementations as both a customer and as a consultant. Nick has been with Visual South since 2003.