3 Planning & Control

Session Synopsis

“Planning” is the developing of plans for how resources/processes will be used in the future to ensure that resources are available and “control” is implementing the plan. In manufactuing, prior to the use of computers, control would use reorder points, where when stock of items fell below a certain level a new order was placed, coupled with work being moved from process to process in the hope that it would be completed on time. These rudimentary control systems did not take account of known orders. From the 60s compters were applied to planning and control, taking known and forecast orders and calculating the requirements for all the componets and materials required: these were basic Materials Requirement Planning Systems. Early MRP systems did not consider whether the resources (people and machines) were available to follow the plan, so could produce plans which were not feasible. They were therfore follwoed by Manufacturing Resources Planning Systems(MRPII) which considered capacity, but therefore required much more data about routings, process timings and resource availability. The same approach is now widely applied beyond manufactuing in Enterprise Resources Planning (ERP) systems. In implementing ERP systems organisations can choose between adapting their processes to fit standard softeware or adapting standard software to fit their own idiosyncratic procedures.

Session Objectives

• Be able to identify planning activities in organisations;
• be able to describe the principles of Materials Requirement Planning (MRP);
• be able to describe Enterprise Resources Planning and relate it to Manufacturing Resources Planning (MRPII);
• be able to contrast the underlying rationales of ERP and Lean and relate the distinction to planning in general.

Papers

Umble, E., Haft R., & Umble H.M. Enterprise resource planning: Implementation procedures and critical success factors, European Journal of Operational Research, Volume 146, Issue 2, 16 April 2003, Pages 241-257, ISSN 0377-2217, 10.1016/S0377-2217(02)00547-7.

Key Terms

• Materials Requirement Planning;
• Manufacturing Resources Planning;
• Enterprise Resources Planning;

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