Production Planning Essay

Production Planning Essay

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One of the challenges for the operations manager in any business is the scheduling of key production activities. There are numerous variables that need to be considered in this planning process. These factors include production capacity, customer demand, supplier performance, design completion, cash flow, and staffing (Heizer, 2011). All these factors come together to create a production plan that can fluctuate based on many external forces. The idea of the master production schedule and the sales and operations plan is to help forecast and meet the required production levels. The goal is to maximize efficiency and profitability through anticipating demand and adjusting production schedules accordingly. The Sales and Operations Plan (S&OP) and the Master Production Schedule (MPS) are two tools used in operations management to assist in the scheduling process.
Master Production Schedule (MPS)
The MPS is the overall timetable that outlines exactly what is to be made and when. The schedule follows the production plan which sets the overall level of output in broad terms. The MPS breaks down the more generic production plan and provides the specifics regarding exactly what is getting produced (Heizer, 2011). The production plan is derived from all the elements of the planning process and MPS must satisfy this production plan. One company that markets MPS solutions identifies inputs to MPS as forecast demand, production costs, inventory costs, customer orders, inventory levels, supply, lot size, production lead time and capacity. This translates to MPS outputs of amounts to be produced, staffing levels, quantity available to promise and projected available balance (Inventory Solution Logistics ...

... middle of paper ...

...roducts that are expensive to hold in inventory and it is not expensive to change production levels. The final approach to production planning is a mix of the level and chasing methods. Many businesses will use elements from both to create the optimal balance of production and inventory on hand (Heizer, 2011).

Works Cited

Heizer, J. &. (2011). Operations Management Tenth Edition. Upper Saddle River, NJ, U.S.:
Prentice Hall.
Inventory Solution Logistics Corp. (2007). What is MPS? Retrieved April 26, 2011, from
Inventory Solutions Logistics Corp.:
Lapide, L. (2004, Fall). Sales and Operations Planning Part I: The Process. The Journal of
Business Forecasting .
Wallace, T. (2010, Fall). Executive Sales and Operations Planning: Cost and Benefit Analysis.
Journal of Business Forecasting .

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