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MASTER PLANNING
IT’S ALL PART OF THE MASTER PLAN
Master planning is critical to the success of any manufacturing organisation. Tim Rowe, Microsoft Practice Lead at Delaware UK, explains how technology is allowing the development of precise production schedules
T
he manufacturing sector is beset with a raft of challenges today from inflationary pressures on margins to issues around hiring, retention and wages, rising energy costs and supply chain delays. At the same time, manufacturers have also had to manage a wide array of disruptive macro- economic events from the War in Ukraine to Brexit and the global chip shortage. According to recent insights from market research company, Euromonitor International, “the global manufacturing sector is forecast to experience turbulences in 2023, as the worsened economic outlook, rising geopolitical risks and volatility in the energy and commodities markets will put pressure on manufacturers’ performances. Growth across industries is forecast to be uneven in 2023, with industries with high energy intensity or highly reliant on investment demand taking the heaviest hit.”
Visibility and data usage persist as key challenges for manufacturers globally according to a new report, “Building a More Resilient Future for Manufacturers through Digital Transformation” from Forrester Consulting. According to the report, over 30% of manufacturing leaders face visibility challenges with inventory, raw materials, work-in-progress, and finished goods inventory in the distributor network. Another one-third of respondents surveyed note their organisations struggle with analysing and
54 APRIL 2023 | PROCESS & CONTROL
applying the data to drive business and process improvements.
All these challenges impact the ability of manufacturers to achieve greater efficiency, agility and flexibility. As the Forrester report points out though, manufacturers have fought back in recent years by working hard to improve their operations — and become more resilient to future challenges — by engaging in digital transformation efforts.
Planning is key to this pursuit of operational excellence and to optimising the outcome of digital transformation as those companies that get it right have the opportunity to increase throughput, deliver productivity and efficiency improvements, reduce costs and ensure on-time, accurate delivery to customers. Indeed, when asked, “what tactical
steps is your company taking to address current challenges, nearly a third of manufacturing decision-makers polled for the Forrester survey (29%) cited ‘improving production planning and forecasting’. Master planning is critical to the success of any manufacturing organisation. Typically, a master planning ‘run’ would assess actual current sales orders to control inventory replenishment needed to fulfil those orders and further supported by a Forecast plan to take into account future projections to enable longer-term material and capacity planning. The intention is to enable manufacturers to develop a precise production schedule that minimises costs and maximises the use of the resources available at their disposal. Historically, however, Master planning was an overnight process that would take hours to run. It was cumbersome to execute – and that still is the case in many manufacturers today. This scenario is now rapidly changing, thanks to the work of leading solutions providers in this space. Microsoft, for instance now provides a hyper-scalable multi-tenant service called Planning Optimisation. It is specifically designed for very fast calculations resulting in shorter runtime, improving planning performance and allowing organisations to execute quick planning runs during office hours to immediately react to rapidly changing demand. This in turn enables manufacturers to gain better visibility over their stock to take more informed decisions more quickly that deliver better business outcomes and lowering costs.
Today, manufacturers have an opportunity to get master planning right, thereby transforming operational processes and boosting business advantage and competitive edge
A growing number of manufacturers are already implementing data collection through their planning processes. The ability to build on this and use predictive insights from AI and IoT across planning can be instrumental in enabling manufacturers to move from reactive to proactive operations. It is the role then of partner organisations like Delaware to support the manufacturers in their transition to intelligent planning processes. Either through the initial implementation or subsequent managed support, Delaware can support manufacturers adopt modern intelligent processes at a cost and cadence the organisation can adsorb. With providers like Microsoft continuing to invest in the solution on an ongoing basis, engaging with partners such as Delaware will ensure manufacturers are able to take advantage of those waves of innovation. Master planning is a traditional process long overdue for an overhaul. How it is executed will determine how efficient the whole order management process is. If it is done poorly, it will hurt cash flow and the bottom line. If it is done well, the business will benefit from enhanced productivity and accelerated growth.
Delaware
www.delaware.co.uk/en-gb
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