Chapter 8 - System Integration and Implementation

 Proper implementation of selected
approach is another critical activity that

must be carefully planned and executed.
 There have many critical points dealing

with both selection and implementation of
the planning and control system
 Both must be designed to meet the needs

and resource constraints of the individual
organisation.
At the end of this chapter, student should be able to:
 Understand general system design

and selection in production planning
and control
 Apply the concept of “push” and

“pull” or somewhere in between
which influences production
activities
 Explain the general implementation

approaches.
DQP 3023: Production Planning and Control

Prepared by: Muhamad Zaki Bin Yusup
 Operations strategy must support
overall strategy of organisation and
operations
 Structure and infrastructure must

align with the market
 Accomplished by understanding what

the order winners and order qualifiers
are.
 Dimensions of competition and

design trade offs must be made to
clear understanding of these market
drivers.

ISSUES THAT MUST BE CONSIDERED:
Sales and Master Scheduling Production Theory of

Operations Planning Activity Constraints
 Include service production environments.
 Purposely to plan resources of the organisation in

support of strategy, business plans, and
marketing/sales plans.
 Length of the planning horizon is important
 Constraints:
i. Markets
ii. Products
iii. Market drivers (order winners and qualifiers)
 Types of resources needed

i. Labor skills
ii. Material
iii. Equipment.


 Large or small, service or manufacturing has a

master schedule.
 Formally or informal based on structure and time

horizon


 Every business needs to provide type of

measurement and control over the production
activity
 Design and selection of scheduling system
 Detail planning and execution system
 Scheduling prioritization systems


 Every organisation defined output will have some

constraint
 Applicable in stable processes and predictable

demand.
 issues of process variability
 Difficult in product mix changes frequently

 To determine the communication patterns used in an integrated production
environment.
 "Push," represented by mrp

 Intense need for timely and accurate data collection
 "Pull," represented by kanban.

 Effectively with low cost efficiency
 Operate in stable design and demands
 Combine with the other principles of lean production can deliver production
very cost effectively with good delivery speed and reliability.

 Condition for effectively plan and execute production depends:
i. Frequent design changes
ii. Swings in market demands
iii. Many products with small or volatile demands
 Many production facilities have mix of market and product environments
 Result many organisations have developed "hybrid" systems
 Allow take advantage of certain aspects and strengths of both types of

systems, depending on the environments.

HYBRID SYSTEM:
1. HYBRID SYSTEM #I
 MRP with lean principles
2. HYBRID SYSTEM #2
 KANBAN with MRP planning
3. HYBRID SYSTEM #3
 using MRP for capacity and long lead time items
4. HYBRID SYSTEM #4
 PULL system with MRP "spike" control

HYBRID SYSTEM:
1. HYBRID SYSTEM # I (MRP WITH LEAN PRINCIPLES)
 Demand patterns more stable and design
changes less frequent changes
 Use level of volatility to call for planning and

execution by MRP
 Due to stability, able to utilize some of lean

production principles
 Use setup reductions to reduce lot sizes and

inventory
 Layout changes and supplier relationship

bring good benefits in time, cost, and quality.
 Statistical process control tools use for

additional quality benefits.

HYBRID SYSTEM:
2. HYBRID SYSTEM # 2 (KANBAN WITH MRP PLANNING)
 Allows to plan design changes effectively
 Used in some improvement in the volatility of demand.
 Works by programming the MRP system to determine total component demand and
calculate the number of KANBAN cards
 Example:
i. The item is on the dispatch list, but there is no unattached KANBAN card.
 Unattached KANBAN card exists indicates that part is not yet being used.
 Without a "free" KANBAN card will only build excess inventory
ii. The item has an unattached KANBAN card, yet is not on the dispatch list.
 Subjected to design change, should be "phased out" to avoid having obsolete
inventory
 When there is no future demand

HYBRID SYSTEM:
3. HYBRID SYSTEM # 3 (USING MRP FOR CAPACITY ANF LONG LEAD TIME ITEMS)
 Used when design of product is stable, but demand patterns still too volatile.
 System pull production control (e.g. KANBAN) used, but MRP system used to plan
three aspects of production:
1. Long lead time items.
 Steady replacement frequency cause stock out problems.
 MRP alert suppliers for the proper replacement quantity.
2. Capacity requirements.
 Demand mix changes
 Different levels and types of capacity
3. Number of Kanban cards.

 Demand impact number of Kanban cards
 MRP projected demand for each component
i. Defined time period
ii. Calculating the "right" number of Kanban cards

HYBRID SYSTEM:
4. HYBRID SYSTEM # 4 (PULL SYSTEM WITH MRP “SPIKE” CONTROL)
 Special case for hybrid system #3
 Closer to stable demand patterns but still have

a chance for extra inventory and/or capacity
 MRP used to project such spikes.
 Allow for pure pull production control under

normal situations
 Example of “spike” action:

i. Seasonality
ii. Advertising campaigns
iii. Marketing promotions.

HYBRID SYSTEM:

5. FOCUS ON THE POINT OF CUSTOMIZATION
 Use approaches of TOC and concepts of  Downstream from the buffer.

"front office / back office" approach i. variations in design from specific
customer requests
 Effectively by service industries ii. focus on the customer and customer
design requests
 Example: iii. customer service play the rule.
 Automobile service activity
 Upstream from the buffer.
 Can determine point of customization i. volatility from customer requests in design
from individual customer product design is protected to some degree by the buffer
requirements of capacity or inventory.
ii. to replace product being used from the
 Once determined, a buffer of inventory, buffer.
capacity, or a combination can be built to iii. stability and predictability in design, pull
protect the "upstream" portion of systems to minimize cost and increase
production system from unknowns of replacement speed.
customer design requirements

 Changes in planning and control system :
i. growth of service organisations
ii. changes in manufacturing (productivity gains and automation in operations)
iii. Increased global competition
iv. Continual, rapid increases in the capability of computer hardware and software
v. New technologies rapid increase for product and process design changes
vi. Internet (allow new forms of communication and information gathering)
 Many companies and software suppliers managed to combine some of the best features
of MRP and JIT,
 Latest advances have generally become known as ERP (enterprise resource planning)
systems.

ISSUE
1. Customer issues
i. Volatility in demand patterns
ii. Customer influence on product design (e.g., MTS, ATO, MTO)
iii. Delivery lead time expectations
iv. Customer communication issues, such as order status
2. Product design/engineering issues

i. Bill of material structuring
ii. Engineering design change procedures
3. Processing requirements
i. Approaches to capacity flexibility and capacity buffers
ii. Details required for production activity control
iii. Timing issues for data flows
iv. Expected changes to plans frequency and extent
v. Necessary data outputs managerial reports, accounting, etc.
vi. Managerial policies with respect to inventory management

ISSUE
4. System performance expectations

i. Selected / designed to meet the needs and expectations of :
ii. Organisation
iii. Suppliers
iv. Customers
v. Avoid select far exceeds the needs.
vi. Benefit analysis required
vii. Commitment from top or her key personnel.

MAJOR PROCESS STEPS IN IMPLEMENTATION
 Modem planning and control systems are computer based

 Required Information Systems group:
i. Understand software
ii. Databases
iii. Communication needs
iv. Hardware requirements
 Two major areas should be analyzed and altered are:

i. Business processes
ii. Database accuracy.

1. Business Processes
 Developed in response to a crisis or some special situation
 Have a complete process mapping of major business and operational processes
(improvement / reengineering)
 Concept of value stream mapping heavily used
2. Database accuracy
 Related to the business process improvement activity
 Audit, improve, and control in different functional responsibilities
 Key databases:
i. Inventory : raw material, WIP, finished goods inventory levels
and locations.
ii. Bills of material and routing : design change procedures.
iii. Other engineering data : setup times, maintenance schedules, tooling &
fixture inventory.
iv. Accounting and cost data : job standards and product cost information.
v. Item masters : lead times and supplier information.
vi. Order entry data : all customer orders and forecasts.
vii. Supplier databases : approved suppliers with lead times
viii.Customer data : contact information and order information.
ix. Production order status data: location, work completed, work remaining, and any
quality reject problems.
x. Worker reporting system : production times, worker skills & absenteeism.
3. Developing the Implementation Project
 Associated aspects of the processes should also be evaluated.
1. Job designs
2. Performance evaluation
3. Measurement systems
4. Reporting points (data collection)
5. Timing of data flow
6. Organizational structures (functional & communication responsibility, reporting channels
7. Communication channels (internal and external to suppliers and customers)
 Critical actions for a successful implementation project:

1. Selection of a project leader and a project team. 5. Be flexible expect problems
 project lead should not be a top manager
6. Should outside consultant be
 team more manageable
 Functional area: master scheduling, production control, used? Value:
materials management, sales, accounting, purchasing,  bring different approaches to
and engineering. solve problems
 no "political agenda,”
2. Commitment from management is critical.
 No concern "chain of command"
 realistic goals and schedule, proper resources
in issues needing attention.
3. Development of a realistically timed project plan.  Have much attention
 adequate resources available
7. Avoid premature system cut over.
4. Development of an education program.
8. Patience must be maintained
 supporting business processes

 There are some of the more important aspects of implementation for planning
and control systems.
 Implementations are typically large in scope and can imply significant

structural and infrastructural changes to the organisation
 Carefully planned and managed are needed for the efficient planning and
control


Chapter 8 - System Integration and Implementation

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Chapter 8 - System Integration and Implementation

Uploaded by

Copyright:

Available Formats

 Proper implementation of selected

approach is another critical activity that

 There have many critical points dealing

 Both must be designed to meet the needs

 Understand general system design

 Apply the concept of “push” and

 Explain the general implementation

DQP 3023: Production Planning and Control

 Structure and infrastructure must

 Accomplished by understanding what

 Dimensions of competition and

DQP 3023: Production Planning and Control

Sales and Master Scheduling Production Theory of

 Include service production environments.

 Purposely to plan resources of the organisation in

 Length of the planning horizon is important

 Types of resources needed

DQP 3023: Production Planning and Control

Sales and Master Scheduling Production Theory of

 Large or small, service or manufacturing has a

 Formally or informal based on structure and time

DQP 3023: Production Planning and Control

Sales and Master Scheduling Production Theory of

 Every business needs to provide type of

 Design and selection of scheduling system

 Detail planning and execution system

 Scheduling prioritization systems

DQP 3023: Production Planning and Control

Sales and Master Scheduling Production Theory of

 Every organisation defined output will have some

 Applicable in stable processes and predictable

 issues of process variability

 Difficult in product mix changes frequently

DQP 3023: Production Planning and Control

 "Push," represented by mrp

 "Pull," represented by kanban.

DQP 3023: Production Planning and Control

 Many production facilities have mix of market and product environments

 Result many organisations have developed "hybrid" systems

 Allow take advantage of certain aspects and strengths of both types of

DQP 3023: Production Planning and Control

DQP 3023: Production Planning and Control

 Use level of volatility to call for planning and

 Due to stability, able to utilize some of lean

 Use setup reductions to reduce lot sizes and

 Layout changes and supplier relationship

 Statistical process control tools use for

DQP 3023: Production Planning and Control

 Used in some improvement in the volatility of demand.

DQP 3023: Production Planning and Control

3. Number of Kanban cards.

DQP 3023: Production Planning and Control

 Special case for hybrid system #3

 Closer to stable demand patterns but still have

 MRP used to project such spikes.

 Allow for pure pull production control under

 Example of “spike” action:

DQP 3023: Production Planning and Control

DQP 3023: Production Planning and Control

 Use approaches of TOC and concepts of  Downstream from the buffer.

DQP 3023: Production Planning and Control

DQP 3023: Production Planning and Control