Intended learning outcomes: Present long-term planning, also called master planning. Differentiate between master planning and master scheduling. Produce an overview on bid processing, customer blanket order, sales and operations planning (SOP), (detailed) resource requirements planning, requests for quotations, and blanket order processing.
Figure 5.1.2.1 shows the sequence and tasks in long-term planning in MEDILS form (for an explanation of MEDILS symbols, see Section 4.1.2).
Fig. 5.1.2.1 Long-term planning: master planning.
Definitions of the tasks in Figure 5.1.2.1 follow here. For the methods and techniques used for long-term or master planning, see Section 5.2.
Bid processing handles a customer request for quotations and determines delivery (labor or product or product family, quantity, and due date). For details, see Section 5.2.1.
A customer blanket order determines the scope of delivery. It can then be described by rough-cut business objects, or through product families or rough-cut work centers. In that case, the order due date is defined only as a time period. For details, see Section 5.2.1.
Demand forecasting, defined in Section 1.1.6, estimates future demand. Demand planning combines forecasting techniques and judgement to estimate demand for products and services along the supply chain (compare [ASCM22]). For details, see Section 5.2.1 and Chapter 10.
Sales and operations planning brings together all the plans for the business (marketing, development, sales, manufacturing / production, sourcing, and financial) in one integrated set of plans. It is performed at least once per month and is reviewed by management at an aggregate (product family) level ([ASCM22]). For details, see Section 5.2.2.
Resource requirements planning (RRP), or resource planning, calculates the requirements for components and capacity (persons and infrastructure), based on the production plan, generally divided up along the time axis, and through analytical explosion of product structures (also called explosion of bill of materials) and routing sheets. RRP is gross requirements planning; inventory and open orders are not taken into consideration. For details, see Section 5.2.2.
The output of RRP includes in particular a procurement plan for components and materials.
Resource budgeting calculates the procurement (or materials) and capacity budget (direct costs and overheads), and the budget for other overheads. For details, see Section 5.2.2.
Thus, master planning yields the quantities of the resources to be used in the long-term planning horizon and calculates financial implications.
The planning horizon is the future time period included in planning.
The planning horizon for master scheduling must be at least as long as the cumulative lead time to manufacture all units in the master schedule (MS). This lead time encompasses production, procurement of all components, and customer-specific design.
Master scheduling is establishing a plan to produce specific products or provide specific services within a specific time period.
See Section 5.2.3. The most important output of master scheduling is the master production schedule (MPS), a disaggregated version of a production plan, expressed in specific products, configurations, quantities, and dates. The MPS serves as input for rough-cut capacity planning (RCCP).
Requests for quotations and blanket order processing turn over the procurement plan for salable products, components, and materials as well as the requirements for external capacities to suppliers in the supply chain. This task includes supplier selection, call for bids, and the processing of the supplier blanket orders.
For details, see Section 5.2.4. In data management, each blanket order is a business object, an order (see Section 1.2.1). If the minimum blanket order quantity on the blanket order is zero, the blanket order is a prediction only.
Continuation in next subsection (5.1.2b).
Course section 5.1: Subsections and their intended learning outcomes
5.1 Business Processes and Tasks in Planning & Control
Intended learning outcomes: Describe the MRP II concept and its planning hierarchy. Explain the part processes and tasks in long-term, medium-term planning as well as in short-term planning & control. Present the reference model of processes and tasks in planning & control. Produce an overview beyond MRP II: DRP II, integrated resource management, and the “theory of constraints”.
5.1.1 The MRP II Concept and Its Planning Hierarchy
Intended learning outcomes: Explain the business processes in logistics and operations management of an enterprise, structured according to temporal range. Describe the different degrees of detail in planning. Disclose the aim of data management.
5.1.2 Part Processes and Tasks in Long-Term Planning
Intended learning outcomes: Present long-term planning, also called master planning. Differentiate between master planning and master scheduling. Produce an overview on bid processing, customer blanket order, sales and operations planning (SOP), (detailed) resource requirements planning, requests for quotations, and blanket order processing.
5.1.2b Part Processes and Tasks in Medium-Term Planning
Intended learning outcomes: Disclose medium-term planning & control, also called detailed planning and scheduling. Produce an overview on detailed resource requirements planning, and order proposal.
5.1.3 Part Processes and Tasks in Short-Term Planning & Control
Intended learning outcomes: Present in detail short-term planning & control, also called execution and control of operations. Produce an overview on order release, order coordination, order monitoring and order checking, delivery, job-order costing, and billing.
5.1.4 Priority Planning: Manufacturing Planning & Control Processes Within the Temporal Ranges in the MRP II Concept.
Intended learning outcomes: Explain the manufacturing planning & control processes and priority planning within the temporal ranges in the MRP II concept.
5.1.4b Processes and Tasks in Planning & Control: A Reference Model for the MRP II Concept
Intended learning outcomes: Describe the reference model for MRP II of business processes and tasks in planning & control. Differentiate between materials management, time management and scheduling, and capacity management. Produce an overview on inventory management and control, and master data.
5.1.5 Beyond MRP II: Distribution Resource Planning (DRP II) and Integrated Resource Management
Intended learning outcomes: Produce an overview on distribution planning, distribution inventory, and distribution resource planning (DRP II). Disclose the concept of (integrated) resource management.
5.1.5b Beyond MRP II: The “Theory of Constraints”
Intended learning outcomes: Explain bottleneck capacity as well as the five focusing steps in the theory of constraints (TOC) approach.
