Supply Chain Disruptions are an Inconvenience for Consumers, a Major Headache for Manufacturers.
Learn how Phenix Software can ease your planning and scheduling pain.
The great toilet paper shortage was our first clue. Then shortages of frozen foods, RVs and puppies. Changing demand was disrupting supply chains and our consumer dream of ‘same day shipping’ was slipping away.
Toilet paper is back in stock, as are frozen foods, RVs and puppies. But supply chain perturbations continue. Today shortages of computer chips and construction materials, tomorrow who knows?
As consumers these days we have endless choice, so many of the shortages are inconvenient, but manageable. But upstream in the supply chain, manufacturers are locked into the products they make and have contractual relationships with suppliers and customers. They sit squarely in the middle of the supply chain, exposed to volatile demand and erratic supply.
This puts tremendous pressure on manufacturing, and many of our customers in the process industries are in crisis mode with production schedules in disarray. They are finding that scheduling alone cannot cope with the disruption.
Demand volatility disrupts manufacturing
One of our customers, a frozen food manufacturer, has seen demand nearly double as people stay at home and cook. The sales organization is delighted and is booking every order but manufacturing simply can’t keep up. And as they react and reschedule to meet the demands of irate customers, manufacturing efficiency is plummeting. What can they do to stabilize the situation?
Erratic supply disrupts manufacturing
Another food manufacturing customer needs tapioca for many of their products. But maritime pileups of container ships are making tapioca scarce. No matter how they change the schedule, they can’t meet target service levels. How should they navigate this raw material shortage, and what are their options to make the best of a bad situation?
Manufacturing itself is disrupted
A third food manufacturer has a huge staffing problem, with up to 30% of the production staff not showing up for work. They can’t staff all the lines, and they are constantly rescheduling to accommodate this, further disrupting production. How do they accommodate these unpredictable staff shortages?
Planning and then scheduling is the answer
There is a common thread in the stories above. The first plant has insufficient capacity due to increased demand. The second has insufficient capacity due to a raw material (supply) constraint. The third has insufficient capacity due to staffing shortages on the plant. In all cases the schedulers are being tasked to fit too much production into too little available capacity.
They all need a realistic production plan before scheduling commences. The plan should specify the quantity of each product to be produced over the time period and should require no more than the available capacity using realistic production rates and staffing levels.
It’s management’s responsibility to decide on the plan, and determine what products and customers to prioritize, and what can’t be made. Once that plan is in place, scheduling can optimize changeovers and inventory to maximize throughput, and minimize waste.
Master Production Schedules and capacity workbenches
Larger manufacturers often have supply chain software with Master Production Schedule (MPS) capabilities to create the production plan. In these cases, our scheduling software makes use of this production plan. Many manufacturers however don’t have MPS, yet these capacity and priority decisions must still be made.
Phenix Planning and Scheduling software lets you see if demand exceeds capacity, and alerts if raw materials or staffing levels are insufficient to support the plan. Schedulers can also sort products by priority and reject low priority orders prior to scheduling.
We are currently working on a Capacity Workbench for the upfront planning and prioritization process, and would be happy to share our plans to get your feedback.
Book a call with us to find out more!
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About Phenix Software
Changeovers and incorrect inventory levels waste significant time and money and affect customer service. Phenix planning and scheduling software uses Aligned Product Wheels to minimize waste and align production with the business’s customer service, cost and working capital goals.