Manufacturing Planning and Control Systems

Manufacturing Planning and Control Systems

2019 | Henk Zijm and Alberto Regattieri
This chapter discusses the essentials of the best-known manufacturing planning and control systems, focusing on discrete manufacturing with limited attention to process industries. It begins with the Economic Production Quantity (EPQ), an elementary result in efficiency-driven production, and extends it to non-stationary deterministic demand. The chapter introduces Materials Requirements Planning (MRP) and Manufacturing Resources Planning (MRP II), followed by a discussion of Hierarchical Production Planning (HPP) focused on capacity. It then presents a more advanced approach based on Just-in-Time (JIT) and Lean Manufacturing (LM) philosophies, which propose a different way of organizing manufacturing and assembly processes. A case study on the Toyota production system illustrates key concepts of Lean Manufacturing. The chapter continues with Workload Control and the Theory of Constraints, which help maintain stable and predictable internal lead times. Finally, it provides an overview of state-of-the-art and future developments, with a focus on digital and cloud manufacturing. The chapter starts with production under deterministic demand, discussing mass production in capital-intensive industries, which involves significant setup costs and production to stock. These factors influence the balance between production setup and inventory costs, leading to the famous Economic Order Quantity (EOQ) or Economic Production Quantity (EPQ) formula. The formula is derived from annual production costs as a function of production lot size, considering annual demand, production rate, inventory holding costs, setup costs, and marginal production costs. The formula is presented as TC(Q) = cD + K(D/Q) + (1/2)hQ(1 - D/P), where D is annual demand, P is production rate, h is inventory holding cost, K is setup cost, and c is marginal production cost. The chapter also includes a figure showing the cyclical stock behavior under constant demand.This chapter discusses the essentials of the best-known manufacturing planning and control systems, focusing on discrete manufacturing with limited attention to process industries. It begins with the Economic Production Quantity (EPQ), an elementary result in efficiency-driven production, and extends it to non-stationary deterministic demand. The chapter introduces Materials Requirements Planning (MRP) and Manufacturing Resources Planning (MRP II), followed by a discussion of Hierarchical Production Planning (HPP) focused on capacity. It then presents a more advanced approach based on Just-in-Time (JIT) and Lean Manufacturing (LM) philosophies, which propose a different way of organizing manufacturing and assembly processes. A case study on the Toyota production system illustrates key concepts of Lean Manufacturing. The chapter continues with Workload Control and the Theory of Constraints, which help maintain stable and predictable internal lead times. Finally, it provides an overview of state-of-the-art and future developments, with a focus on digital and cloud manufacturing. The chapter starts with production under deterministic demand, discussing mass production in capital-intensive industries, which involves significant setup costs and production to stock. These factors influence the balance between production setup and inventory costs, leading to the famous Economic Order Quantity (EOQ) or Economic Production Quantity (EPQ) formula. The formula is derived from annual production costs as a function of production lot size, considering annual demand, production rate, inventory holding costs, setup costs, and marginal production costs. The formula is presented as TC(Q) = cD + K(D/Q) + (1/2)hQ(1 - D/P), where D is annual demand, P is production rate, h is inventory holding cost, K is setup cost, and c is marginal production cost. The chapter also includes a figure showing the cyclical stock behavior under constant demand.
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