Bài giảng Quản trị kinh doanh - Chapter 4: Manufacturing planning and control

Manufacturing Planning and ControlMPC 6th EditionChapter 4Sales and Operations PlanningThe Sales and Operations Planning (SOP) process is used to develop an overall business plan to integrate the functional planning efforts within the company. SOP links strategic goals to production and coordinates the planning efforts of various groups such as marketing, finance, operations, and human resources.SOP is top management’s handle on the business.AgendaWhat is SOP?SOP links with MPCSOP activities and techniquesCritical SOP issuesState-of-the-art SOPPrinciplesSOP FunctionsSOP provides the key communication links for top management to coordinate the various planning activities in a businessStrategic PlanningMarketing PlanningResource PlanningFinancial PlanningDemand ManagementRough-Cut Capacity PlanningSales & Operations Planning (Volume)Sales Plan Operations PlanMaster Production Scheduling (Mix)Front EndMPC BoundarySOP FundamentalsThe role of SOP is to balance supply and demand at the volume levelSales and Operations PlanningDemandSupplyVolumeMixBalance between supply and demandSOP CommunicationThe plan must be expressed in terms that are meaningful to non-manufacturing executivesThe operations portion of the plan must be stated in terms that MPC functions can useAggregate units by product line, dollar value, etc.Value of SOPThe SOP process provides visibility of the interactions between sales, marketing, production, and financeCritical trade-off decisions are documentedManufacturing performance is controlled in a clear fashionThis leads to better integration among functional areas and better response to the marketplaceSOP ProcessRun sales forecast reportsDemand planning phaseSupply planning phasePre-SOP meetingExecutive SOP MeetingEnd of monthStatistical forecastsField sales worksheetsManagement forecastFirst-pass spreadsheetsRecommendations and agendaCapacity constraintsSecond-pass spreadsheetsDecisions and game planSOP Process – Key ActivitiesUpdating the sales forecastReviewing the impact of operations plan changes–can current capacity and materials support the changes?Identifying alternatives where problems existFormulating recommendations for top managementCommunicating the information to top managementSOP DisciplineFor the SOP process to be routine and effective, replanning must occur when conditions indicate the needMechanisms for maintaining support for the plans are importantSenior executive involvement is a minimum requirementCommunicating SOP Information–DisplaysInformation can be conveyed in several waysCharts (monthly forecast, cumulative production, alternative plans)Tabular displays (easily captured and communicated using spreadsheets)SOP Tabular DisplayA planning factor is used to convert sales $ to unitsThe display includes both history and the planUsing a chase strategy can lead to large variations in planned productionPlanning assumptions are clearly displayedFinancial results of the plan are calculated and displayedProduction StrategiesChase–production output is changed to match sales quantitiesLevel–production is constant, resulting in inventory build-up and depletion over timeMixed–combination of chase and level designed to result in acceptable levels of flexibility and inventoryChase StrategyCalculate end-of-month inventory targetsInventoryt = Target days x Expected Demandt+1/Working dayst+1Calculate the operations plan (in units)Planned productiont = Forecast salest – Inventoryt-1+InventorytCalculate the number of employees requiredEmployeest = Planned productiont/Employee productivityCalculate hires and fires each periodIf Employeest > Employeest-1 then Hirest = Employeest – Employeest-1 else Firest=Employeest-1 - EmployeestA spreadsheet with these calculations can be found here.Level StrategyCalculate the number of employees neededInventoryT = Expected DemandT+1/Working daysT+1Total production required = Total forecast demand – Beginning inventory + Ending inventoryTPlanned production each period = Total production required/Number of periodsEmployees required each period = Planned production each period/Employee productivity per dayCalculate ending inventory levels and days of supplyInventoryt = Inventoryt-1 + Planned productiont – Forecast demandtDays of supplyt = Inventoryt/(Expected demandt+1/Working dayst+1)A spreadsheet with these calculations can be found here.Management ObligationsCommit to the SOP processEstablish the SOP frameworkPut the right team togetherSet meetingsParticipate in the processModify performance measures and reward structures to align with the planForce resolution of trade-offs between functionsLead the cultural changeFunctional RolesThe primary obligation for all functions involved is to “hit the plan”A cross-functional team approach is importantExecutive champion/sponsor–keep top management focused on the process, clear major obstacles, and acquire resourcesSOP process owner–provide leadership for the SOP process and implementationDemand planning team–provide demand data and represent forecasting, marketing, and sales functionsSupply planning team–provide supply system information and represent manufacturing and purchasing functionsPre-SOP team–manage cross-functional development of SOPExecutive SOP team–upper management representative of each functional areaDefining Product FamiliesSOP is best performed at an aggregate levelAggregation levels should be convenient for all functional areasStructure by product type, product characteristics, brand, market segment, etc.Fundamental question–How do you go to market?Product family groupings that are consistent with sale’s and marketing’s view of the market are generally bestSelect appropriate unit of measure for each family (units, pounds, cases, etc.)Integrated PlanningIntegration among sales, marketing, and production is keySales and marketing need to sell what is planned (overselling is just as bad as underselling)Opportunities need to be evaluated via changes to the SOPManufacturing’s job is to achieve the plan–exactly (overproduction and underproduction are equally bad)The end result is good customer serviceBreakdowns in the plan must be quickly reported by the functional area responsibleStrategic PlanningA direction-setting activityCan be an extension of budgetingMore recently, plan is based on products and markets rather than organizational unitsSOP must support strategic plansOperations Plan ControlThe SOP process should be widely understoodPlanned results for each functional area should be clearly communicatedThe seriousness of the plan must also be reinforcedKey issuesWhen and how to change the plan?How stable should the plan be from period to period?PrinciplesThe operations plan isn’t a forecast. It is a statement of desired production output.The operations plan is included in the SOP process to maintain agreement with other functional plans.Trade-offs required to frame the operations plan must be made prior to final approvalTop management involvement is imperative in the SOP process. The SOP process should relate directly to the strategic plan.PrinciplesThe MPC system should be used to perform routine activities and provide routine data, allowing management time to be devoted to important tasks.The MPC system should facilitate what-if analysis at the SOP level.Reviews of performance against SOP are needed to prompt replanning when necessary.Quiz–Chapter 4The four fundamental issues in Sales and Operations Planning are __________.Sales and Operations Planning balances supply and demand at the ______ level.Many key Sales and Operations Planning linkages are outside the Manufacturing Planning and Control (MPC) system. (True/False)A strategy which matches monthly supply to forecasted demand is ________.A strategy which maintains a consistent monthly output is _________.The primary obligation for any functional area is to “hit the plan.” (True/False)