Within manufacturing operations the demand plan used by the organisation indicated there were issues with the demand plan entered into the company’s ERP system by the planning department.
There were complaints from manufacturing that all the components were not available to build the assemblies, purchasing and supply chain complained components were being ordered within the purchasing lead time and materials were having to be expedited which put additional pressure on the supply chain.
A review of the demand planing process was carried out with all functional stake holders.
Customer demand while advised and forecast by the customer, lead to rescheduling of the customer demand due to customer furnished equipment availability.
There were delays in the customer quotation process for new and additional customer requests, due to customer and internal processes information delays, which lead to a reduction in the build lead time.
Customer orders for the same commodity had the same lead time however some customer orders were more complex to build than others. As a result of the complexity of the build process the build horizon should have had a longer production lead time for some of these customer orders.
Some Bill of Materials and routing instructions had not been maintained and there was some uncertainty as to ownership of routing maintenance.
Production operations had not always followed the demand plan and had built out of sequence. Production operations had additional stock on the shop floor that was not recorded on the company’s ERP system. As a result of sporadic consumption, reports monitoring consumption were not accurate.
Purchase lead times had not been maintained and there was no review of safety stock and some components did not have any safety stock. Minimum order quantities were not correct, supplier lead times were found to be inaccurate, there were issues with receiving quotations suppliers and there were some issues with supplier quality.
As a result of the issues referred to above the planning team released production orders to built when approximately 70% of the materials were deemed by the ERP system to be available.
As a result of the planning review, unnecessary stock was returned to the warehouse and located, Bill of Materials were updated, routing ownership and maintenance was defined, master data was updated on the ERP system, production operations were directed to build to the production plan, metrics were established to monitor organisational performance and a coordinated supplier performance review took place to improve performance.
