Chapter 1. Manufacturing
Planning and Control
0. The Context for MPC
A. Globalization/Internationalization
Even small firms have customers around the world,
and many have foreign sources of supply as well,
not to mention large firms such as Dell, Solectron,
Wal-Mart, etc.
B. The Role of the Customer— from mass
production to mass customization
 The need for product and process flexibility (and
MPC flexibility) to meet the relentless push for
product differentiation, faster response, lower
inventory and transaction costs.
0. The Context for MPC
C. The Impact of Information Technology
ERP systems provide the means for linking
functionally disparate, geographically dispersed,
and culturally different organizational units into a
coherent system.
Lean production →
Lean organization →
Lean enterprise →
Lean supply chains
1. MPC System Defined
MPC system concerns planning and controlling the
manufacturing process (including materials,
machines, people, and suppliers). Tasks to
Plan capacity requirements and availability
Plan for materials to arrive on time, right quantity
Ensure utilization of capital equipment
Maintain appropriate inventory
Schedule production activities…
Cost and benefits: like all investments, costs could be
high and payoffs could be quite handsome as well.
2. An MPC System Framework
A 3-phase model: Fig. 1.1
The need to match MPC with firm’s layout/
Job shop
Cellular manufacturing
Flexible manufacturing systems
Assembly line
Just in time …
Sales and operations
Master production
Detailed capacity
Front End
Detailed material
Material and
capacity plans
Back End
Enterprise Resource Planning (ERP) System
Manufacturing Planning and Control System
An MPC System Framework
Front End
• Activities and systems for
overall direction setting
• Systems for detailed material
and capacity planning
• MPC execution systems
Back End
Choosing a layout type
Layout selection = f (positioning strategy)
 Process (functional) layout
 Product (line/flow) layout
 Hybrid (combination) layout (e.g., one work
multiple machines (OWMM), group
technology/cellular manufacturing (GT/CM),
flexible manufacturing systems (FMS)
 Fixed-position layout
Number of subparts
MPC Classification Schema (Fig.1.2)
Time between successive units
MPC Classification Schema
• Flow (continuous production–chemical plants,
food, etc.)
• Repetitive (longer production cycles–
• Just-in-Time (shorter production cycles–TVs,
personal computers)
• MRP (management of complicated parts
• Project (unique, long duration–ships).
MPC Classification Schema
What are the two factors in the classification?
• Product complexity: number of subparts
• Process complexity: nature of repetitiveness
(time between successive units)
All MPC systems are not the same. What affects
the complexity/design of an MPC?
Product and process complexity. e.g., in flow type of
production, materials management is simple.
3. Evolution of MPC Systems
• Evolution of competitive priority/strategy:
cost, quality, time, flexibility
• The MPC system must adapt to meet
changing company needs
• Periodic MPC system audits compare
system responses to the requirements of
the marketplace
Concluding Principles
• The framework for the MPC is general, and all 3 phases
must be performed, but specific applications must reflect
particular firm conditions and objectives.
• In supply chain environments, the MPC must coordinate the
planning and control efforts.
• MPC systems should support the strategy and tactics
pursued by the company.
• Different manufacturing processes dictate the need for
different MPC designs.
Concluding Principles
• The MPC should evolve to meet changing requirements in
the market, technology, products, and processes.
• The MPC should be comprehensive in supporting the
management of all manufacturing resources.
• An effective MPC can contribute to competitive performance
by lowering costs and providing greater responsiveness to
the market.
• In firms that have an integrated ERP system and database,
the MPC system should integrate with and support crossfunctional planning through the ERP system.
Quiz – Chapter 1
• In the MPC process, capacity decisions (equipment,
facilities, suppliers, etc.) are most likely to occur in what
time horizon?
• In the MPC process, detailed scheduling decisions are
most likely to occur in what time horizon?
• Master Production Scheduling (MPS) and Resource
Planning are a part of which MPC phase?
• Measurement and Control are a part of which MPC
• Products that are part of a one-time production process
(e.g. bridges or aircraft carriers) would most likely use
which form of MPC?

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