Traditional planning and scheduling tools such as manufacturing resource planning (MRP) use cumbersome procedures based upon predefined heuristics. As a result MRP systems aren’t really capable of change in response to demand, or to shifts in material availability or capacities (be them plant or labour).
Predominantly these systems plan materials and capacity separately; one system ignoring the limitations of the other. The end result is a plan that can’t be executed in the real world and this leads to inaccurate production schedules, false delivery dates and some very unhappy customers.
Unlike MRP, APS plans and schedules all facets of an organisation by simultaneously taking in to account available materials AND capacity. The end result is a more realistic supply chain plan which means deadlines met and customer orders fulfilled on time.
APS provides value in specific environments where simpler planning methods can not adequately address the complex trade offs between competing priorities.
For example, APS can pay dividends to enterprises working with one (or more) of these characteristics:
•Requirement to trade off key costs across the supply chain (e.g. Procurement vs. Production vs. Logistics vs. Storage vs. Labour)
•Production intensive environment with multiple facilities, variable routings and recipes
•Asset intensive operations requiring maximum utilisation
•Seasonal behaviour of key drivers (demand, supply, and capacity)
•150 million turnover plus, with a large degree of operational variability
•Highly dynamic sourcing (where to make, make or buy, where to buy, where to ship-from decisions)
If your business features characteristics of this kind read on. If not, APS might be the equivalent of using a sledgehammer to crack nuts.
APS technologies can help a company at three planning levels within the business — strategic, tactical and operational. At a strategic level the system must look at long term success requirements such as infrastructure investment (i.e. demand network design) and market positioning (i.e. domestic / export, services / retail). At a tactical level that same business’ APS must focus upon mid term success requirements, how best to maximise returns within 12 – 18 month time frame (i.e. where to make, what shift patterns to employ, what downtime to schedule). And at a purely operational level the focus is much more immediate, maximising efficiencies in 1 — 6 weeks. (i.e. detailed production schedule, transportation schedule).
APS is not a ‘plug and play’ solution to all your planning and scheduling problems. Whilst the benefits are there to reap there is also a large potential barrier to consider:
The APS model serves as an interpretation layer, sitting between the mathematical solver engines which do the analysis and configuring, and the business. As a result,
APS is heavily reliant on the ability of practitioners to accurately model individual supply chains. Practitioners need to ensure that all material flows and corresponding costs and constraints are available to the system to accurately reflect business behaviour.
If for example, your team is in the habit of overstating capacity to secure a safety margin; your APS plans for scheduling to maximise efficiency will be inhibited. To that extent the system is as good as the information it is fed.
Further, the potentially large amount of data which the APS system may require to function effectively could be more than your existing ERP system can handle. This factor alone may prevent some businesses from ever realising the total benefits of APS.
APS solutions have no boundaries so it’s crucial to clearly define the scope of the challenge – otherwise modelling will be endless and the output useless.
It’s important to recognise that supply chain projects cross functional boundaries so a successful optimisation must ensure that all department parties are equally optimised. The most optimal solution for a business therefore, is one in alignment with supply chain and business goals.
When running a pilot, take a cross section of the business or product portfolio. Aim for a sample that is concise enough to evolve with the pilot but also exercises the most challenging constraints and costs within a supply chain. Analyse the results carefully before proceeding. If the pilot does not make sense then the confusion will only be magnified on a full APS rollout.
This article was written by Shaun Phillips, solutions architect, Infor. Shaun has delivered business benefits, using APS technologies, to companies across Australia, Asia, and Europe for more than 10 years.