How long until this resolution is shattered by reality? Probably many of you know situations like these: You had the perfect plan with optimal ressource utilization, best use of components and order-promise-rate. Everything seemed perfect, you started with production execution, issued components, posted confirmations for the first operations.
- part of the intermediate product deviates in quality and is out-of-spec, even with rework
- a machine ressource breaks down that is needed to execute your plan
- your customer requests a change in quantity, spec, or timing.
And of course, your original plan does not fit to this changed situation any longer.
Such situations sometimes require to split production orders, and take part of the order onto a different route through production, or postpone part of the order to manufacture in the future (e.g. when the machine is up again), or manufacture part of the order into a completely different quality or product.
In the metals industry the production plan is even more dynamic, even without deviations. The actual attributes of intermediate product from previous production steps determine the production sequence for the next step. Thus, the optimal production sequence may result in the situation that part of orders do no longer fit into the current shift or sequence, and need to be shifted into the future. Again, this often results in a production order split.
With Business Suite 7, SAP has re-introduced the production order split to solve problems as described above. Some of you may know that such a feature was available already in previous releases – with limitations, such as the mandatory usage of product cost collectors.
The new solution removes many of these limitations and at the same time offers a wide range of additional flexibility in creating a child order. Although the parent and child order remember through a split hierarchy that they once were the same, they are after the split two fully independent production orders.
This provides the planner with much flexiblity to split off part of the intermediate quantity, and manufacture the child order at another date, with a different material, and adopt routing and bill of material independently from the parent order.
Most importantly, the new split enables a fair cost split between parent and child, based on planned cost to manufacture the split quantity until the split operation.
So, we still struggle with the deviations and manufacturing constraints. But now in a much more transparent and flexible manner, resulting in happy controllers that can trust their numbers, and happy shopfloor planners that can communicate their execution reality through ERP to their colleagues in sales, shipping or enterprise-wide supply chain planning.
Not after the fact, when it is too late to react, but when the decision is taken.