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Production planning hierarchy
1. 1
Production Planning and Control HierarchyProduction Planning and Control Hierarchy
Strategic and Business Planning
Demand
Management
Sales and Operations Planning
(S&OP)
Master Production Scheduling
(MPS)
Material Requirements Planning
(MRP I)
Capacity Requirements Planning (CRP) Vendor Requirements Planning (VRP)
Realistic?
Make Buy
Shop Floor Control (SFC) Purchase Planning and Control
Yes Yes
No No
• Rough Cut Capacity
Planning
• Vendor/Material
Limitations
• Management Decisions
Realistic?
Supply Chain Management
Just in Time
Push and Pull Mfg
6. 6
Planning and ControlPlanning and Control
Definition:
Planning is the act of looking aheadahead and setting
a set of actionsactions to achieve an objectiveobjective.
Production Planning is about matchingmatching needed
production to available resources.
Control involves making events conform toconform to
planplan, i.e., compare actual vs. planned
7. 7
Production Planning and ControlProduction Planning and Control
Definition:
Production Planning and Control (PPC) is the
set of functions concerned with the effective
utilization of limited resources and the
management of material flow through these
resources, so as to satisfy customer demands
and create profits.
8. 8
Modes of ProductionModes of Production
1. Primary industries (extraction)
Extraction of materials from their natural source
e.g. Agriculture, hunting, fishing, mining, forestry
2. Secondary industries (construction,
manufacturing, public utility)
e.g. Refinement, conversion, fabrication, assembly
3. Tertiary industries (services)
e.g. transportation, sales, trade, distribution, government, education, health, retailing,
catering
16. 16
Production Planning & Control DecisionsProduction Planning & Control Decisions
• What should be produced, how much, and when
(forecasting/demand management, aggregate
planning/sales & operations planning, master
production scheduling)?
• How much can we produce (capacity
requirements planning)?
• How much do we have and how much do we
need (inventory management / material
requirement planning / just in time)?
• When should we produce (scheduling/shop floor
control)?