Production planning is all about attaining an optimal balance between supply and demand by factoring in several considerations, such as supplier constrains, production capacity, labor limitations and demand projections. While it’s true that the best manufacturing-planning practices would ideally factor in all these considerations, most planning processes tend to disproportionately constrain the supply side.
When Disruption Happens
The multiple disruptions to the global supply chain we’ve seen since the beginning of the pandemic underscores the importance of being able to quickly pivot quickly in a changing supply-chain environment. The inability to do so has far-reaching consequences. Production quickly comes to a halt if access to essential components or materials goes offline without a viable replacement. Additionally, if a buyer runs into problems and doesn’t receive finished orders on schedule, the supplier is then burdened with absorbing increased storage spaces and costs until the supply chain begins moving again.
In 2020, the global supply chain was shaken to the core and supplies were disrupted for most global businesses. Few manufacturers were spared from pandemic-related disruption and supply disruptions continue to this day, with ongoing lockdowns in China and uncertainty arising from the war in Ukraine.
The Limitations of Legacy Planning Systems
In 2020, supply issues were difficult for companies to manage because legacy production-planning tools often couldn’t adjust to new constraints quickly enough or see the big picture when making new plans. Traditional planning systems rely too heavily on manual processes and outdated algorithms. These systems produce shortsighted plans based on what provides an immediate benefit, rather than looking deeper to understand how known variables will influence an operation long term. When modeling occurs based on limited inputs, the model ultimately leads to inflexible planning decisions that cost more over time. Legacy systems often operate on these very limited sets of conditions, rules, and constraints, which affects model accuracy.
“Most organizations have legacy systems,” said John Buglino, director of marketing at Optessa, a leading provider of APS solutions. “Something built in-house or bought quite some time ago. The problem, it worked when it was developed but didn’t remain relevant. Organizations change, products change, customer demand changes. Those legacy systems are not scalable and cannot support growing complexity on the manufacturing line.”
Modern Disruptions Require Modern Solutions
Advanced Planning and Scheduling (APS) solutions, on the other hand, empowers users to model a highly constrained supply chain environment to produce buildable plans with a better long-term balance between supply and demand. These APS solutions predict all possible outcomes available using the provided inputs, delivering a truly optimized solution that features an optimal mix of short-and long-term benefits instead of focusing on the needs of the moment. Production planners require this ability to define a wide range of problems across industries and solve those problems rapidly with consideration to the entire solution space.
Above: A view of Optessa's APS software that helps manufacturers manage their supply chains.
Strong Digital Infrastructure Weathers the Disruption Storm
In conclusion, the modern, digitized supply chain can no longer wait for planners to develop new scenarios using traditional means. COVID-19 demonstrated that organizations with a strong digital infrastructure were better positioned to weather disruption. Businesses that can intelligently develop and implement new plans in near real time will find themselves better able to react to disruptions and expand visibility for all parties. APS solutions fill this need by creating a buildable plan that covers all aspects of supply, demand, production rules, and conditions. This ultimately builds the foundation for cost-effective, end-to-end supply chain coordination.
About Optessa
Optessa (https://www.optessa.com/) provides top global manufacturers with the only planning, sequencing, and scheduling software that mathematically guarantees results using patented algorithms that adapt to all challenges without custom code. The software works equally well in a broad range of manufacturing industries, as well as in shipping and logistics. Headquartered in Alberta, Canada, with branches in Hazlet, New Jersey, USA, and Goa, India, Optessa’s leadership team leverages its deep expertise in software, mathematics, manufacturing, and optimization technologies to deliver unmatched customer satisfaction.
See their video below to learn more about Optessa's planning and scheduling solutions for manufacturers.
