Supply Chain Planning Basics: Implications

For every complex problem … there’s a simple solution … and it’s wrong.

(H.L. Menken)

In our fourth blog we considered execution in the context of the planning and scheduling processes; now let’s summarize our findings and consider why and how we uniquely consider these supply chain planning domains.

To accomplish an objective we plan: we break our objective down into a series of steps we can follow to achieve it efficiently. We include sufficient detail to reasonably ensure feasibility, more detail in earlier steps. We measure how well our plan meets our objective, how well we’re following our plan, and re-plan remaining steps as circumstances change. The better we plan, the more likely we’ll succeed.

We schedule when efficient task sequences aren’t obvious. Finding an optimal schedule is likely impractical, so we often use specialized logic and optimization technology to help us find good answers fast. We plan/schedule to help us execute: to do the right things at the right times in the right ways to efficiently achieve our objective. We freeze the portion of our plan/schedule required to preserve prep time and leave it out of our re-planning/scheduling workflow, and we manage reality real-time as we execute our plan.

For several key reasons, it is important to consider these three domains separately and uniquely. Firstly, the objective in each domain is unique, so the technology tools and logic employed in each should suit the relevant objective. Planning looks at the final objective and how we’re going to get there; scheduling looks for efficient ways to order independent tasks, and plan execution achieves the objective by following the plan/schedule.

Secondly, the horizon in each domain is unique: planning considers the entire unfrozen horizon, whereas scheduling considers an initial, smaller unfrozen horizon within the plan, and plan execution considers only the frozen period.

Thirdly, the measure of success in each domain is unique: planning considers the final objective; scheduling considers localized efficiencies within the plan context, and plan execution considers work quality and conformance to the plan/schedule.

Finally, the detail required in each domain is unique: planning has just enough to reasonably ensure high level, overall plan feasibility; scheduling requires significantly more to ensure efficiency and executability; plan execution must manage to all of reality in real time.

These simple, intuitive concepts apply in most any context, but they are particularly helpful in complex supply chain planning scenarios. When evaluating your planning, scheduling and execution processes, considering planning theory and recognizing similarities, differences, and interdependencies will help you position the proper skill sets, logic, tools, workflows and data within each domain, and to integrate them effectively to ensure success.

For additional information, read the previous blog posts in this series:

  1 Comment   Comment

  1. The first thing needs to be considered for business execution is to set up goals and objectives of your business. After that planning and implementation is required to bring effectiveness and efficiency in your business to achieve those goals. Thanks for sharing the above information.

    Reply

Leave a Comment