ISCOM471 - Planning and Controlling the Supply Chain
ISCOM471 - Planning and Controlling the Supply Chain
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Date Created: 11/07/15
Running head PLANNING AND CONTROLLING THE SUPPLY CHAIN Planning and Controlling the Supply Chain Angie Killion ISCOM 471 September 16 2013 Paul Yakob PLANNING AND CONTROLLING THE SUPPLY CHAIN 2 Planning and Controlling the Supply Chain Planning and controlling the supply chain is very important part of operations management Riordan Manufacturing is a company on the cutting edge of the plastics business In reviewing its processes Riordan will explore each of the four primary forecasting techniques and elements of each that may apply to Riordan Next the impact production plans master production schedules roughcut capacity planning workforce size and carrying inventory are explored and analyzed in relation to the budgets set by Riordan Because Riordan is a manufacturing company a comparison between Riordan Manufacturing and a service organization in regards to material requirements planning Finally material requirements planning system concepts will be examined Forecasting Techniques There are four forecasting techniques qualitative time series analysis casual relationships and simulation Qualitative forecasting is subjective and is based on opinions Some methods associated with qualitative techniques are grass roots which forecasts using input from those who actually deal with what is being forecasted and market research which uses data collected by surveys or interviews to test hypotheses about the market Time series analysis is based on past demand to forecast future demand A common model under time analysis is simple moving average which is taking data points from a time period and dividing the sum of the data points by the number of actual data points Another method is Box Jenkins technique This method is said to be the most accurate statistical technique This method relates class of statistical models to data and fits the model to the time series by using Bayesian posterior distributions Chase Jacobs Aquilano 2006 Casual relationship is when one element or action PLANNING AND CONTROLLING THE SUPPLY CHAIN 3 causes another to happen Econometric models which is used to describe some sector of the economy by a series of interdependent equations Leading indicators is another method associated with casual relationships These indicators are things such as pricing that will affect the sales of products Finally simulation models which are computer based and help the ones forecasting to make decisions using internal variables and external environment Production Plans Master Production Schedules RoughCut Capacity Planning Workforce Size Carrying Inventory in Relations to Budgets Master Production Schedule MPS is a system where the production group enters existing or forecasted orders MPS then creates the amounts and dates of the specific items required for each order entered The next step is roughcut capacity where verification that production and warehousing equipment and labor are available This is also where it is verified that vendors have enough material to supply when needed Workforce size is the number of workers needed to produce the product Carrying inventory is the inventory carried over from the last period Material Requirements Planning Material Requirements Planning MRP is the logic for determining the number of parts components and materials needed to produce a product as well as when each should be ordered or produced MRP started out as a very simple system but has developed to a very successful operating system used in global operations Initially set up to plan materials MRP has it evolved to take on resources as well and was then called manufacturing resource planning or MRP II MRP is used for different purposes but the main purpose for its development is control inventory levels assign operating priorities for items and plan capacity to the production system Chase PLANNING AND CONTROLLING THE SUPPLY CHAIN Jacobs Aquilano 2006 MRP has the same objectives as any other inventory management system which is improve customer service minimize inventory investment and maximize operating efficiencies MRP does not work alone Master schedules bill of materials files inventory records files and output reports are needed to in conjunction With MRP to be successful PLANNING AND CONTROLLING THE SUPPLY CHAIN 5 Reference Chase R B Jacobs F R amp Aquilano N J 2006 Operations management for competitive advantage 11th ed New York NY McGrawHill Companies
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