Production planning helps you gain complete control of your business by providing a detailed set of steps to follow from the operation’s beginning to its completion. When you start a new business, there are a lot of details to keep track of. It’s not enough to hire workers and buy equipment. We need a lot of things to be organized, like materials acquisition, inspections for quality control and forecasts showing how many units of each product you’ll need.
What is Production Planning?
More is needed to hire workers and purchase equipment when setting up a new business. You must work out how to acquire materials, conduct quality checks on the product, plan for demand, plan for supply and research other factors that will make your business successful.
The production plan allows you to set benchmarks for your operations. You can track production, locate current and future inefficiencies, and immediately adjust operations when there are sudden changes to processes.
Production planning offers many benefits to companies
To ensure a successful production process, you should consider covering these aspects: demand forecasting, inventory control, equipment resources, employee availability, standardized production steps and product delivery.
Greater Inventory Control: Your inventory will decrease, and you will only order materials for production when needed. Your finished products and WIP will be balanced, so there will be no surplus or shortages.
Improved Process Flow: You’ll better understand what equipment and workers are needed for every process, allowing you to streamline your production. You’ll be able to reduce waste by optimizing equipment usage and controlling labour costs.
Streamline Supply Chains: You’ll have more information about raw materials, finished products, and shipping schedules. You’ll be able to work with customers to ensure their orders are filled promptly and accurately.
Interdepartmental Collaboration: Production planning will help to ensure that each department is aware of its role in the company’s operations and what needs to be done to for it to meet its objectives. By planning effectively, each department can work together towards the same goal.
Production planning is a complex process that involves many steps. The number of steps will depend on the complexity of your operations and supply chain and the risks associated with your production schedule. You’ll need to consider market demand expectations before you begin.
Understanding market demand forecasting is essential to making a production plan. If you know how much of a product will be sold, you can plan when to make it and how much to make. This will help you get the right materials from your suppliers on time so that you can run out of stock.
Knowing what your customers want is essential to running a business. It would help if you forecast market demand to understand how much of each product you should make, when, how much raw material you’ll need, and which vendors you’ll need to source materials from.
1. Product Routing
Product routing is a tool that helps you visualize the flow of raw materials through your production operations. It tracks how they move from one step to the next until they become the end product and are shipped to another processor.
Product routing is a great way to ensure you have everything you need to fulfil a sales order. The bill of materials (BOM) you create will tell you what materials are required to develop the product and where they should be placed in the facility. And if all your labour and equipment are in the right places, your manufacturing line will be more efficient.
2. Scheduling of Processes
The second step in the production planning process is to understand how long each operation takes to complete its function in the production process. It would help if you also focused on possible downtimes or deviations and understood how much time you will give your vendors to receive raw materials and when you can tell customers about their deliveries.
You’ll create several different schedules: a master schedule, an operation schedule, and a daily schedule–to name a few. These schedules will help you locate inefficiencies and determine why they’ve appeared so you can take the appropriate remediation steps.
3. Dispatching of Orders
One of the most common issues, when you’re producing large volumes of goods is running out of materials before completing your entire order. Yet this doesn’t have to happen because if you run low on materials early in production, you can halt the line and avoid shutting down equipment later in the process.
When you have many orders to fulfil, you might run out of supplies before the work is done. To prevent this from happening, make sure you order enough of all materials or find another way to get them.
4. Monitoring & Control
Monitoring & Control of Production Planning: It ensures that all progress is being made with your production line and that product quality meets expectations. This is done by evaluating risks and implementing controls to minimize them.
The plan should also identify the jobs individual employees will do when problems occur so everyone will know how to get the production schedule back on track.
Modify production plans as needed
Production plans are flexible. Operations can change based on downsizing operations or when expanding processes. Goals should constantly be revisited and adjusted to reflect current procedures and company objectives.
Vijay comes with a vast experience in ERP and enterprise solutions space with about 20 years of experience in various packaged application like Acumatica, SAP, Orion, Salesforce.com, SugarCRM and, SalesLogix.