Manufacturing companies are now looking to planning & scheduling as the next big opportunity to improve operations performance. The number of effective manufacturing planning & scheduling applications on the market today is proof that manufacturers are investing in this critical area of the business. So why are some companies still struggling to make their investment in production planning software and processes pay off? There are many reasons why a planning & scheduling initiative might not deliver expected ROI, but as I recall an incident from early in my career, I’m reminded that effective two-way communication is a critical element for planning & scheduling program success.
One late Friday afternoon, I received a call from one of our production planning associates about the status of a replacement production process I was working on. The conversation didn't go well.
“Hey John, the implementation schedule you provided says that the new process is up and running. I’m calling to make sure it is because we’re counting on those parts for the assembly lines in two plants, starting next Monday.”
I paused, swallowed hard, stammered, and replied, “Lowell, we’re still two weeks out from cutting over to the new process.”
There was silence on the line for what seemed like an eternity. "John, that means there are no parts for Monday's assembly, so we’ll have to stop both lines until we get replacement materials out to those factories.” I felt crushed, mortified, and scared, and wanted to crawl into a hole — “I am the cause of the line shutting down,” was all that kept running through my mind.
It couldn’t be happening … The new process was supposed to save the company time and money, and I was so excited to get it up and running. I had known for four weeks that we were off-plan, so why hadn’t I communicated the delay to the production planner? Why did the planner wait until late Friday afternoon to tell me that the plants would shut the lines down on Monday without those parts? The good news is that we avoided the line shutdown by having a different plant work the weekend then airship product to the two plants that needed it.
The experience left an indelible mark in my mind and taught me three valuable lessons: First, I owned the communication to the production planner. Yes, he could have checked in with me, but my failure to communicate was the root cause of the late Friday afternoon fire drill. Second, shutting down a production line has enormous ramifications; there was no way I was going to let poor planning and lack of communication cause this again. Finally, it’s one thing to communicate, but even more important to maintain closed-loop communication — especially where the production schedule is concerned. It’s what allows everyone involved to have the same information so they can execute their jobs and responsibilities effectively.
Any manufacturing company can take advantage of these lessons for greater effectiveness in its planning & scheduling function.
First, CREATE A ROBUST S&OP PROCESS that includes two-way communication. A robust sales and operations planning (S&OP) process always has monthly sessions so that sales, marketing, engineering, and operations can discuss current sales and the sales forecast for one to four quarters out. Then, sales and operations should get together every week to quickly review activity up to a two-week horizon. These sessions are the formal structure to foster communication among departments and roles.
Second, BUILD ROBUST PLANNING & SCHEDULING PROCESSES that include two-way communication. I’ve rarely, if ever, encountered a plant with predictable demand and no unexpected variability, have you? Effective production planning and scheduling is a careful balance of (1) materials and finished goods inventory, (2) equipment utilization, and (3) people. A breakdown in any of these causes excess or missing inventory, unavailable or untrained labor, and idle or bottleneck equipment.
Where the first element is concerned -- materials and finished goods inventory planning -- automation can reduce and manage potential human error and establish a method for effective communication and feedback loops. These elements improve inventory picking and location, bills of material, safety stock settings, unit of measure conversions, and many other details. It can also provide a mechanism for quick and accurate response to the all-too-common unexpected circumstances.
We should also consider equipment utilization in context of planning and scheduling. Today’s manufacturing plant typically requires a lot of equipment and materials or WIP routing; as the number of machines or routing increases, the number of flow combinations also grows. Increased complexity of product flow also means more chances of equipment or tool breakdown and capacity constraints. Manufacturers must carefully balance equipment and tools to maximize equipment utilization, including availability, capacity, and uptime. This is one more area where software and automation can simplify and balance flows, simulate scenarios, and identify risk and potential failure points in advance. Planning and scheduling solutions can also make two-way communication among roles more effective so teams can avoid the blame game and focus instead on setting priorities and finding solutions to problems.
The final element, people — labor, manpower, or simply you and me! In the strictest sense, planning and scheduling people is similar to planning and scheduling equipment. You examine and control the inputs and outputs to increase capacity. That might mean having people work longer shifts, adding a second shift, or helping them work faster and more efficiently. However, communication is a secret ingredient that can make the difference between “ok” people utilization and a “great team.”
The greatest benefit of effective two-way communication among the team is flexibility. For example, would you ever try to convert a lathe into a part washing machine? Not a chance! But can you move a drill press operator to an assembly position? Absolutely, if you provide the proper training, coaching, tools, and incentive for the team member to succeed. Companies that foster good two-way communication among team members and across teams position themselves to respond to the unexpected and even handle crisis well. People are the company’s best assets to collectively and creatively pull together to get your business through any storm.
There is no one-size-fits-all approach to create effective two-way communication for production planning & scheduling. Each company should balance its available communication tools — daily standups, weekly or monthly cross-functional planning, visual dashboards, town hall meetings, email, one-on-one conversations — just as it balances resources for effective S&OP and production planning and scheduling. The good news is that no matter where your company is on the continuum of effective communication, there’s always room for improvement.