unconstrained & Constrained planning

In the unconstrained planning, we take into consideration that we have enough material (on-hand) and enough resources to manufacture,so that the demand is satisfied on the specified date. This is where the compression days come into affect.

In the constrained planning, the planning engine will tell us that with the available resources and the available on-hand these are the dates that the demands can be satisfied, here we see the Days late. The demand will be satisfied on a later date than the SSD that we give in the sales order because there might be some delay either by the Supplier or there might be some delay in manufacturing certain items in-house (resources).

But in real scenarios there are some companies where we see that though they go for constraint planning and the planning engine says that the demand can be met on a later date, still they were able to satisfy the demand on the SSD in the sales order. This happens of inaccurate datas in the item attributes, routings etc etc... Had they got the correct data's in place i am sure that the planning engine will be perfect.

Overview of Constraint-Based Planning

Constraint-based planning and scheduling is an approach for balancing material and plant resources while meeting customer demand. It takes into account constraints at the enterprise and plant levels. Material and capacity constraints are considered simultaneously. Capacity constraints include factory, distribution, and transportation resources. This complete picture of the problem provides instant and global visibility to the effects of planning and scheduling decisions throughout the supply chain.

There are two types of constraint-based planning--with and without optimization. This section first describes constraint types that are applicable to both types, and then describes constraint-based planning without optimization. Constraint-based planning with optimization is described in Optimization.

Constraint Types

You can define constraints for materials and resources in your plan. You will also be able to specify the level of importance of these constraints depending on your business needs and the planning horizon. You can generate plans using the following scenarios for each planning bucket type (days, weeks, periods):

·         Plan considering material constraints only

·         Plan considering resource constraints only

·         Plan with respect to both material and resource constraints

Overview of Optimization

In optimized supply chain plans, Oracle ASCP uses a combination of traditional linear programming and constraint programming techniques.

You can choose to optimize your plans to meet one or more of the following objectives:

·         Maximize inventory turns

·         Maximize plan profit

·         Maximize on-time delivery

The plan objective is derived by combining and weighting chosen objectives. Optimization determines the best possible sources of supply, considering all your material, resource, and transportation constraints.

Optimized plans automatically choose (on the basis of minimizing plan objective cost) the following:

·         Alternate bills of material

·         Alternate routings

·         Alternate resources

·         Substitute components

Constrained plans with decision rules also select alternate bills of material, routings, and resources; however, they do not do so on the basis of maximizing plan objectives.

Optimized plans do not select an alternate bill of material unless it has an alternate routing specified and do not select an alternate routing unless it has an alternate bill of material specified.

Optimized plans will override the rankings and sourcing percentages provided in sourcing rules and bills of distribution as necessary in order to minimize the plan objective cost.

You cannot plan repetitive items in optimized plans.

Optimization Objectives

Multiple optimization objectives can be met by assigning weights to each. This is done using the Optimization tab.

For more information on the Optimization tab, see Defining Plans.

Following are descriptions of the various optimization objectives:

Maximize Inventory Turns

This objective is achieved by minimizing the total inventory for the plan duration.

Maximize Plan Profit

·         The following are considered:

o    Item cost

o    Resource cost

o    Inventory carrying cost

o    Transportation cost

Other penalty costs are considered, such as demand lateness, resource over utilization, etc.

Maximize On-time Delivery

This maximizes on-time delivery by trying to ensure that all demand is met on time. Penalty factors specify the relative importance of demands when maximizing on-time delivery.

Setting Penalty Factors

Oracle ASCP depends a great deal on data related to costs, penalties, and priorities above and beyond what is available from the ERP system. You can set penalty factors at different levels using flexfields, plan options, or profile options. Flexfields let you set penalty factors at the most discrete level. For example, you can set the Penalty Factor for Late Demand at the Demand, Item, or Org level using flexfields. Plan options and profile options let you set the same penalty factor at the Plan level and Site level, respectively.

Warning: Penalty costs are different from penalty factors. Penalty costs are the product of the penalty factor and some other parameter such as list price, item cost, resource cost, or transportation cost.

For all of the steps related to setting penalty factors, please log in as Manufacturing and Distribution Manager, unless otherwise noted. You must run the Create Planning Flexfields program beforehand for the flexfields used for setting penalty factors to be operational. Please see Oracle ASCP Flexfields for additional details. Finally, please refer to Choosing an Objective Function for help with setting actual penalty costs.

 

 

 

 

Time fences in ASCP

Time Fences You can specify a Planning Time Fence, which prevents new

order creation or reschedule in suggestions; a Demand Time Fence, which

you can use to ignore forecast demand either in planning or in loading an

MDS; and a Release Time Fence, to define the window within which planning

can automatically release orders from plans designated as Production. You

define the length of each time fence either as a fixed number of work days

or as the item’s Total lead time, Cumulative total lead time, or Cumulative

manufacturing lead time. Note that the use of the Planning and Demand

Time Fences is further controlled by attributes of each individual plan.

 

 

 

Demand Time Fence Control

The demand time fence is bordered by the current date and a date within which the planning process does not consider forecast demand when calculating actual demand. Within the demand time fence, Oracle Master Scheduling/MRP and Supply Chain Planning only considers actual demand. Outside the demand time fence, the planning process considers forecast demand. You can specify whether to use demand time fence control when loading a master schedule and launching the planning process.

Planning Time Fence Control

The planning time fence is bordered by the current date and a date within which the planning process does not alter the current material plan or master schedule. You can specify whether to use planning time fence control when launching the planning process.

For discrete items within the planning fence, the planning process does not reschedule in (create earlier) order due dates or create new planned orders for the item to satisfy net demand requirements. However, the planning process can reschedule out or cancel an order when it determines that such orders create excess supply. For discrete items outside the planning time fence, the planning process can generate suggestions to create, change, and reduce entries on the master schedule or the material requirements plan.

For repetitive items, Oracle Master Scheduling/MRP and Supply Chain Planning restricts the planning process to suggest rates of production within the planning time fence that differ from the current aggregate repetitive schedule by no more than the acceptable rate increase and acceptable rate decrease you defined for the item. If either the acceptable rate increase or decrease value is undefined, the planning process is not restricted from increasing or decreasing the repetitive schedule respectively.

You can choose whether to display a warning when you define or update MPS entries that violate the planning time fence, or when you define or update MDS entries that violate the demand time fence. Set the MRP:Time Fence Warning profile option to Yes. See: Setting Your Personal User Profile.

Planning Time Fences for Requisitions Purchase requisitions and internal requisitions are not subject to planning time fence processes.

Release Time Fence Control

The release time fence is bordered by the current date and a date within which the planning process automatically releases planned orders to Oracle Work in Process as discrete jobs or to Oracle Purchasing as purchase requisitions. You can specify whether to use release time fence control when defining your plan name.

The planned orders must meet the following auto-release criteria:

• the new due date lies within the auto-release time fence

• the lead time is not compressed

• the orders are for standard items (will not release models, option classes, and planning items)

• the orders are not for Kanban items

• the orders are for DRP planned items in a DRP plan, MPS planned items in an MPS plan, or MRP planned items in an MRP plan See: Auto-release Planned Orders.

• the release time fence option is defined as anything other than Do not auto-release, Do not release (Kanban), or Null

• DRP, MPS, and MRP plans must be run with the Memory-based Planning Engine See: Enabling the Memory-based Planning Engine.

Auto-release of suggested repetitive schedules is not applicable to repetitively planned items. No material availability check is performed before WIP jobs are released.

Time Fences and Firm Orders

A firm order is an order that is frozen in quantity and time (unavailable for rescheduling). Oracle Master Scheduling/MRP and Supply Chain Planning automatically creates a planning time fence for the firm order if the firm order exists after the planning time fence date. There are two methods you can use to firm an order that creates a time fence: you can firm a planned order or firm a discrete job in the Planner Workbench, or you can firm a discrete job or purchase order within Oracle Work in Process and Oracle Purchasing directly.

Oracle Master Scheduling/MRP and Supply Chain Planning creates a time fence for a firm order because it implies that resources committed to meeting the firm order would be unavailable for orders scheduled earlier.

Lead times

Lead Times

Lead times in Oracle are divided into several elements. The relationship between

these elements and the various types.

 

 Preprocessing The time it takes to prepare an order for release; this might

be the time it takes to prepare a shop packet for manufacturing or to prepare

a purchase order. This is sometimes referred to as paperwork lead time.

 

Fixed The portion of an item’s lead time that does not vary with the order

quantity. Setup time is a typical example; this is often a fixed amount of

time, regardless of the size of the order. Planning uses fixed lead time to

plan both manufacturing and purchase orders.

 

 Variable The portion of lead time that varies with the order quantity.

Planning uses variable lead time to plan manufacturing orders only.

 

 Processing The time it takes for a supplier to fulfill your purchase order

once released or the typical time it takes to complete a discrete job for the

item. For manufactured items, this can be calculated from the fixed and

variable lead times and represents the time it takes to manufacture the Lead

time lot size quantity of the item; as such, it is an average. It is used to

calculate the cumulative lead times. Planning does not use processing lead

time at all for manufactured items; it uses the combined fixed and variable

lead time. For purchased items, planning will use the processing lead time

only if you do not specify a fixed lead time for the item.

 

 Postprocessing The time it takes to put away purchased material after it is

received. Planning uses this for purchased material only; for manufactured

items, you should include this in your routings if it is significant.

You can calculate fixed, variable, and processing lead times from your routing

time, as described in Chapter 4. This process uses the lead time lot size, which you

also specify on this tab.

The Lead Times tab also includes two types of cumulative lead time:

 

 Cumulative Total The “critical path” lead time, or the time it takes to

buy the first piece of raw material, manufactures all the subassemblies

and makes the item.

 

 Cumulative Manufacturing The cumulative lead time for manufacturing

activities only; this is the cumulative total lead time, minus the purchasing

lead time.

 

Cumulative lead times can be used to set the different planning time fences or

the Infinite Supply Horizon in Oracle Inventory ATP rules. Using a cumulative lead

time instead of a user-defined number of days means that these fences and horizons

can shrink as you reduce lead times, without additional maintenance. Cumulative

lead times are also helpful in reviewing proposed engineering changes; if you schedule

a change inside an item’s cumulative lead time, you may require expediting of

material to satisfy the new demand. You can calculate cumulative lead times with

the Rollup Cumulative Lead Times concurrent program after you have calculated or

entered your item lead times.