Best practices
S&OP - Sales & Operations Planning
MPS - Master Production Schedule
Scheduling
Planning is an essential activity of industrial operations. A good planning system makes it possible to improve the service level, to launch new markets with confidence, and to improve productivity while reducing the stock level.
Why plan?
Planning is an essential activity of industrial operations. A good planning system makes it possible to improve the service level, to launch new markets with confidence, and to improve productivity while reducing the stock level.
Planning well therefore means improving the 3 pillars of a company's performance (throughput, costs, stock) presented by Eliyahu M. Goldratt in the manufacturing best-seller "The Goal".
When to plan?
In order to put in place the right production strategy, it is necessary to set up decision-making routines that make it possible to define plans over different horizons:
Long term with S&OP (Sales & Operations Planning)
Medium term with the MPS (Master Production Schedule)
Short term with Scheduling
Here is a short summary of the challenges and best practices for each of these horizons.
Horizon: 6 months to 5 years
Who should be present:
The Industrial Director
The Sales Director
The Operations Director
The Supply Chain Director
The Master Planner
Data provided:
Sales history, sales strategy, sales forecasts, architecture of the industrial apparatus.
Objectives of the exercise:
Obtain a consolidated vision of forecast demand, make investment or divestment decisions.
Example of decisions made:
Industrial investment in a new production line, increase in sales efforts on a market segment (region, product, customer type).
❌ A few classic mistakes to avoid:
Making a model that is too complex and understood only by one or a few people.
✅ Best practices to go further:
Validate the main assumptions with each contributor / stakeholder ahead of the meeting.
Prepare the thinking on the remaining 2/3 key decisions in advance.
Horizon: 12 weeks to 12 months
Who should be present:
The Production Director
The area managers
The Supply Chain Director
The Planner
The Scheduler
Data provided:
Real customer demand (firm and forecast), the upcoming availability of people and machines, the initial stock levels.
Objectives of the exercise:
Establish a forecast resource-allocation plan.
Example of decisions made and information collected:
The recruitment of a temporary worker, the relocation of a resource, the subcontracting of an operation or a product, the postponement of an order, the risk of a shortage on a product.
❌ A few classic mistakes to avoid:
Confusing the load-capacity balance and scheduling. The objective of the load-capacity balance is to answer the question "does it fit or not?" and not "in what order does it fit?".
Not involving production. They are the ones who know the workshop's constraints (absences, work-in-progress, machine problems).
✅ Best practices to go further:
Compare the planned capacity to the demonstrated capacity, which represents the historical throughput observed in the workshop. This often avoids being too optimistic.
Horizon: 1 to 4 weeks
Who should be present:
The Scheduler
The workshop manager or the area manager
Data provided:
The list of needs to carry out (work orders), the priority levels, the availability of production resources (operator, raw material, tooling, machines).
Objectives of the exercise:
Establish a production schedule for the coming days / weeks.
Example of decisions made:
Transferring a work order from one machine to another, grouping certain work orders to maximize production, relocating an operator.
❌ Classic mistakes to avoid:
Fine-grained scheduling should only be carried out on the one or few bottleneck workstations of the workshop. The non-bottleneck workstations can be managed according to queue-management methodologies (e.g. FIFO, CONWIP, polca).
Using the same visual to make the plan and to communicate it to the workshops. The scheduler and the workshop have very different roles and also work in different environments (desktop PC vs. workshop). They therefore do not have the same visualization needs.
✅ Best practices to go further:
Have a simple and visual display of priorities.
Set up a frozen horizon over which the priorities are fixed.
Leave a certain autonomy to the workshop to adjust production according to their experience.
