08/24/2023 | Press release | Archived content
The benefits of production planning software vs scheduling are about the granularity of the plan: capacity plans (or master production schedules) are not granular and factor in less granular things, like high level capacity, forecasts, inventory, and transfer times. They are often done weekly, and that's where production planning software will shine. Once you start scheduling operations down to the hour, that's a job for production scheduling software. Here are a few of the commonly asked questions when searching for products.
Production planning software helps you determine how to run production based on your client orders, forecasts, and safety stock requirements. It enables you to figure out the "what," the "when," the "where," and the "how many" behind all your manufacturing activities:
Once your production planning software has produced all of this information, you can send it to your production scheduling system and determine the best sequence for making the products and the ideal use of your machines to ensure your plants run as efficiently as possible.
The leading benefit of production planning software is that it enables you to create a master production schedule. This schedule gives you a detailed, time-phased representation of the quantities, timing, and sequencing in your manufacturing operations.
Your master production schedule also enables you to understand the constraints across your entire manufacturing network. Your network probably includes production plants, suppliers, and distribution centers. With production planning, you can not only create a capacity plan for your production facilities, but also make a warehouse plan that dictates how you should be transferring and storing products to meet demand signals at each distribution center. You can then create a supply plan that stipulates which materials you should be purchasing and how you should be moving them between facilities to keep your supply chain balanced.
All of the information in your master production schedule will be based on constraints. This is where production planning software excels over enterprise resource planning (ERP) systems. Although ERP systems often offer production planning capabilities, the plans they produce don't always reflect your company's constraints. An ERP may tell you that you need to make 1,000 units of a product this week, but it won't take into account that you can only make 500 units in a day and that the materials you need are in a warehouse three states away-details that can have a dramatic impact on your production plan. By contrast, production planning software will help you use your production plants and your entire supply chain network to meet your demand on time at the lowest possible cost.
Another major benefit of production planning software is the ability to reduce planning cycle time. Even today, too many companies still plan production manually using spreadsheets. This approach forces teams to review every item and event throughout the production cycle. A production planning solution that lets you manage by exception can dramatically increase the efficiency of your planning team by allowing them to focus only on the areas that urgently need attention.
With production planning software, you can also optimize your inventory of raw materials and finished goods. With better signals about what your inventory should be, you can make smarter purchase decisions throughout your supply chain and plan production in ways that improve inventory turnover.
Better production planning will also help you improve customer service levels. Rather than constantly navigating the challenges of unexpected shortages and downtimes, you'll be able to produce wherever and whenever you need to so that you can ensure you have the right products in the right places at the right time.
You can also use production planning software to increase production throughput. Suppose your factory produces pens in three colors: red, black, and blue. Every time you switch to producing a different color, you must clean out and reset your machines. This means you should strive to batch your orders for each color as much as possible so you can minimize changeovers and reduce nonproductive time. Production planning will enable you to look across your manufacturing facilities, understand demand patterns, and then sequence production of each color to hit your production targets with as few changeovers as possible. As you increase throughput and reduce nonproductive times, you'll naturally increase your utilization of capital equipment too.
Consider how production planning software can help you reduce waste and obsolescence. The software lets you monitor shelf life closely to make the best use of your inventory. If some products are set to expire in three days, you can avoid shipping them to a customer. If you have a backlog of items with several months of shelf life remaining, you can focus on using up that inventory and slow down your purchasing of the raw materials these products contain. As you reduce waste, you'll reduce labor costs because you'll stop building products you don't really need.
Your production planning software can also help you capture tribal knowledge. Detail schedulers typically have many years' worth of information in their heads. What will happen to your business when they retire or get promoted? By capturing this information in software, you can systematize it and make it available to your next generation of employees.
And finally, good production planning can help you assess the impact of major supply chain disruptions. Over the past few years, we've all seen how turmoil in the global supply chain has made business more challenging for manufacturers. Rather than panicking and making sweeping changes to your operations, you can use your production planning software to evaluate the exact impact of each disruption in terms of demand spikes, materials shortages, or changes in the labor force. You can then take precise steps to protect your business.
Consider using production planning software if your revenues are at least $150 million and you're running a manufacturing business with multiple plants. The software will be ideal for you if you have alternate sources for each of your raw materials-in other words, a choice of at least two vendors from which you can buy each item in your supply chain. It will also be a good fit if you have more than one location in which you can make each of your products. When there's a great degree of variability around your "what," "where," "when," and "how many," your company will realize the benefits of using powerful software, rather than spreadsheets, for production planning.
The benefits we're discussing here aren't limited to a particular industry. But we've found that most companies that benefit from production planning software are in the consumer-packaged goods, food and beverage, durables, life sciences, and chemicals industries.
Now that we've explored the high-level goals and benefits of production planning software, let's run down the features your software should provide. Make sure your solution enables you to:
As you research production planning software, be prepared to ask potential providers highly specific questions about the capabilities of their platforms and the results customers have achieved with them. Here are the questions we recommend:
Make sure you find a provider that's committed to helping you go through the process the right way. Your provider should have a methodology for helping you formulate your project objectives, map out your ideal outcomes, identify your biggest obstacles and plan to how overcome them, and project the overall benefits you hope to achieve from the project.
Even after you've chosen the right production planning software for your business, your job isn't done. To ensure you have a successful implementation, make sure you:
There are many reasons to choose Logility's production planning software. Here are just a few:
Find out more about Logility's production planning softwarehere
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