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My New ERP System has Production Planning and Production Scheduling Capability. Why Should I Need Anything Else? (Part 1)

My New ERP System has Production Planning and Production Scheduling Capability. Why Should I Need Anything Else? (Part 1)

You have just bought, or are planning to soon buy a new, state of the art ERP system. Congratulations! It should be able to do everything that you might need, right? Particularly in the area of production planning and production scheduling, right? Depending upon what you are hoping to achieve, maybe.

The classical MRP / ERP planning paradigm consists of backward scheduling work orders through the various levels of the bill of material. Each work order operation has an associated load and lead time. Capacity planning modules spread the load over the lead time, helping you spot imbalances between hours of available capacity and hours of load. While such modules don’t schedule and do have trouble accurately predicting when load will occur, they do give you some limited visibility into potential capacity shortages. If this is all you want out of your ERP / MRP system, you should be all set.

However, many practitioners want more, much more. They hope to model their capacity finitely. When operations are scheduled, they want work to be constrained by the finite capacity of machines, tooling, labor and other resources, and materials. If capacity is unavailable, they want work to be shifted out in time, and along with it the predicted order completion date. They want to see completion dates compared to requirement dates to predict how well customer needs will be met. They want to use the software to perform what-if analysis so that the best business decisions are made under various scenarios. They want to apply this finite capacity scheduling, or advanced planning and scheduling capability, over any duration production planning and production scheduling horizon.

Not all ERP vendors make finite capacity scheduling / advanced planning and scheduling a standard product offering. If you want such capability, you may have to ask for it. Even if your vendor does have it and can make it available to you, there are some “gotchas” to look out for.

Why should there even be an issue, you ask? Advanced planning and scheduling software is a specialized application. It takes specialized knowledge to effectively develop or acquire, integrate, deploy, and implement the technology. The most successful advanced planning and scheduling vendors and applications have developed this expertise over years in the marketplace.

When buying advanced planning and scheduling software from your ERP vendor, a major “gotcha” can occur when the technology isn’t owned by your vendor, but is made available to you via some kind of “partner” relationship. Whether or not you get “burned” will be determined by whether the partnership is a marriage or a speed date.

To find out, you might need to ask: Is production planning and production scheduling software truly integrated with the ERP / MRP system? If so, show me how? How many projects have the vendors worked on together? Can I talk to references that can vouch for the success? How will the partners divide up the responsibility of helping me be successful? How strong is the partnership, and if it dissolves, what happens to me? Unsatisfactory answers to any questions should be cause for serious concern.