Hopefully, you are in a position to safely assume the latter. But for many complex businesses, rapidly adjusting to demand is a perilously involved tasked, requiring the ability to assess and respond to new circumstances virtually instantaneously. One of the keys to building this level of agility into production processes is the integration of real-time and production planning.
As a refresher, production planning refers to the strategic allocation of resources (i.e. person hours, machine usage, container usage, etc.) during critical production processes. In this way it is related to Postmodern ERP, but limited in scope to the production floor itself. As is the case with Postmodern ERP, these planning solutions should ideally leverage interconnecting pieces of IT infrastructure and software in order to optimize the movement of resources through various production processes to meet demand in the most efficient way possible.
Also like Postmodern ERP, this type of planning is about more than just creating a pen and ink sketch of the production facility’s activities. While this kind of inherently static production schematic has helped to optimize throughput since the 19th century, the increasingly digitized world of Industry 4.0 demands more reactive, integrated solutions. Production planning can and should be a driver of increased visibility and agility within an organization, adding business value by bringing a measure of illumination to the complex relationships between demand, capacity planning, throughput, and supply streams both within and without a given company.
If planning represents one facet of increased intra-operational connectivity, the integration of real-time data represents a significant value added proposition in that direction. Thanks to the rise of Industry 4.0, an influx of sensors, digitized inventories, and live shipment tracking have given planners a host of new and connected tools for building more responsive and flexible workflows. To wit, the increase in supply chain digitization has made it possible for data to be transmitted instantaneously throughout an organization. The ready availability of real-time data can be a boon to planners for a number of reasons:
Powerful forces on their own, real-time and production planning represent the potential for significant added business value when integrated. By linking planning software with up-to-the-minute data about demand and various touch points on the value stream, manufacturers can respond to real-time changes in demand in order to create improved production plans. Not only will planners gain a more holistic view of the relevant production streams, but they’ll put themselves in a position to bolster their overall production control by better understanding potential future hurdles. The end result is a more agile, cost effective supply chain.
By responding to real-time changes in demand planners can help to optimize machine and person hour usage, so that no production time is wasted responding to the obsolete demands of the past. Instead, production facilities can be used in such a way as to ensure that the exact right proportion of products is being manufactured with no delay based on the present needs of the customers and the changing conditions of the market. The same principles can be applied to other processes across the supply chain:
In this way, the further digitization of the supply chain can be leveraged towards a more flexible, more adaptable, and more cost effective production scheme—one that boasts enough agility to respond to ever-changing global conditions.