Why Ascp Not Mrp

7/31/2019 Why Ascp Not Mrp

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Keefe Ho

Principal Consultant


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Move from MRP to Advanced Planning Case Sharing

The Coverage of Advanced Planning in Industry

Operation Dilemma - Industry Drivers

Why Advanced Planning, Not MRP

Case Background - The Problem & Business Requirement

How we approach it

Share Lessen Learnt with You


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The Coverage of Advanced Planning in Industry

3rd PL

Component Mfg

Sitex

Hubx

Contract Mfg

2nd Suppliers

Retail

Sub AssyMfg

Supply Base You

Distribution Customers


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Industry Transformation

Today

Customer forecast errorsresult in missed deliveries

Excessive inventories Outsource to fill product line

gaps and reduce cost

Independently developedproducts for broad use

Manual and point-to-pointcollaboration

Demand variability does notadversely impact service levels

Planning for strategic inventorymanagement

Outsource anything that is non-core and not proprietary

Customer-specific designs andproducts

Pervasive network collaboration

Tomorrow


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Reduce Time-to-MarketInvest in R&D for Next Gen Technologies

Convert Design Ins into Design Wins

Sustain Profitability & Improve MarginsFocus on Core Competencies

Streamline Operations, Manage Costs

Improve Customer ResponsivenessAccept Your Customers Bad Forecasts

Gain Real-Time Global Supply & Demand Visibility

Industry Goals


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Forecast Accuracy 25-80%

Productivity 30%

Profit Margin 5-15%

Inventory Carrying Cost 25-60%

Order Fulfillment Time 30-50%

Total Supply Chain Costs 25-50%

Source: Pittiglio Rabin Todd & McGrath (PRTM)

Industry Opportunities


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Why ASCP, Not MRPMRP ASCP

Core Objectives Material-related

Material-related

Capacity-related

Production/Operationscheduling

Planning Procedure Sequential processes Holistic processes

Planning Scope Facility Single-site model Multi-sites model

Planning Scope Material All planned item in one Both,Two-level planning

Constrained/Optimized Planning Not supported Supported

Decision-making Support Not enabled Enabled

Performance Indicators None KPIs provided

ATP Statement Generation Not supported Supported

Planning by Priority Stuck to due-date Priority prior to due-date

Biz Solution Extension Limited Diversified

Oracle ToolsFeatures


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RT-SMT

Comp

Factory

RT-Outside

Comp

Outsourcing

Supp1

Hub1

Cust2

Cust3

Cust4

TR

Hub1TR

Cust1TR

RT-DIP RT-ASY

TRRT-SMT

Comp

Factory

RT-DIP RT-ASY

Supp2

Supp2

TR

TR

Move from MRP to Advanced Planning


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Case BackgroundThe Problem & Business Requirement

Multiple Legal Entity & Multiple Inventory Organizationspread in TW & CN

Frequent product updates

High consumer demand

Limited manufacturing capacity

Long lead times (Long Planning Cycle) Powerful retailers

M f MRP t Ad d Pl i


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RT-SMT

Comp

Factory

RT-Outside

Comp

Outsourcing

Supp1

Hub1

Cust2

Cust3

Cust4

TR

Hub1TR

Cust1TR

RT-DIP RT-ASY

TR

RT-SMT

Comp

Factory

RT-DIP RT-ASY

Supp2

Supp2

TR

TR

Move from MRP to Advanced PlanningThe Problems or Pains

Problem Size :Num of Org : 9 Num of Item :50000 Num of Suppliers:500Level of BOM : 8 Level of Routing: 3~5 Num of Operation/per Routing: 1~2


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Business Requirement Multi-Org Planning: Single global supply chain plan to execute from

Intelligent Substitution of Items: To be able to optimize the inventoryby minimizing the creation of new supplies when the demand can besatisfied by substitution, thus reducing inventory carrying cost,reducing obsolescence and increasing the service levels.

Alternate Routing: Optimal use of resources to build the products byselecting the best available alternate routings.

Capacity fulfillment for Internal production & outside supplier

Accurate Order Promising

Building a well defined forecasting process and ability to consumethe sales orders from the forecast.



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TR

Hub2

RT-SMT

Comp

Factory- TW

RT-Outside

Comp

Outsourcing

Supp1

Hub3

Cust2

Cust3

Cust4

TR

Hub1TR

Cust1TR

RT-DIP RT-ASY

TR

RT-SMT

Comp

Factory- CN

RT-DIP RT-ASY

Supp2

Supp3

TR

TR

Move from MRP to Advanced PlanningBusiness Requirements

2. Semi-FG supplied by Factory-CN

3. Alternate Sourcing from Factory-CN

6.

Bonde

dvs

non-Bond

ed

M f MRP Ad d Pl i


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Business Gains

Did in Legacy Apps Doing in OracleMulti-ORG Planning 2 ORG w/ Guts feeling 9 ORGs w/ Scientific Data within 2 hrs

Alternate Item & Routing Just Guess the numbers

1.Regularly maintain Alternate Routing &

Alternate Item

2.If Master routing is full,

alternate routing will be initiated

3.Keep watchingthis progressive improvement

Capacity fulfillment for

Internal production & outside

supplier

1.Capacity did not consider in MRP

2.Buyer always push Supplier

like firefighting

1.Reflect the real capacity status

2.quick judgement on OSP or not

Order Promise 1.Sales call PMC2.PMC feedback Promise Date

1.Sales directly get Promise Datewhile SO is created

Forecast consumed by Sales Order

1.PMC consume FCST

w/ SO in Excel manually

2.Input the Net Value into MRP

1.No manual involvement on consumption

2.Help Sales focus on FCST and

SO accuracy

PAIN Point

Business Gains


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Move from MRPto Advanced Planning

How we approach it


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Wed: FCST & SO Enter

Run Consume plan( Data Collection , ODP generate FCST)Sales review consumption report and modify FCST

Run ASCP-I (capacity & critical item )

Host Interlock Meeting between GPMC+LPMC+Sales

------------------------------------------------------------------------------------------------

Thu: Interlock meeting (Check ASCP-I +Modify SO, FO Shipping Date)GPMC run Net Change (modify capacity, make item schedule)

PO release for Critical Item + Commit Critical Item Schedule

Data Collection (SO/INV/WIP/PO only)

Run ASCP-II (capacity & All item )

-------------------------------------------------------------------------------------------------------- Fri : Release PO,IR,WO

A Planners Daily Life in a Week


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Share Lessen Learnt with You Phase Approach for Advanced Planning

F MRP Ad d Pl i


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From MRP to Advanced PlanningA Rapid ROI Approach

Oracle Applications(10.7, 11.0, 11i)

Readiness

Assessment

Unconstrained ASCP

(Multi-Site MRP)

Constrained ASCP(Single Holistic Plan)

Constrained ASCP(Multiple Sequential Plan)

Optimized ASCP(Plan Optimization)

Time

AddedValue

Phase 0

1 Wk

Phase 1

2.5 Month

Phase 2

2.5 Month

Phase 3

1 Month

Constrained

Unconstrained

Optimized

Option 1

Option 2

A single plan across all sites Reduce planning cycle time Improved exception resolution Online planning Integrated performance

management

Constrained global masterplan for key components andresources

Plus constrained site leveldetailed plan

Improve plan quality by

recommend alternates Generate feasible plans

Constrained single holisticplan for the entire supply chain

Improve plan quality byrecommend alternates

Generate feasible plans

Priority based decisions Cost based optimization

You Are Here

ORACLEASCP Service RapidTime To Value


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Documents

Why Ascp Not Mrp