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Aerial Master Plan Schedule (AMPS)

Introduction

Businesses require schedule plans to execute their development plans to maximize profits effectively. The master production schedule is a business financial projection or plan on specific assets or commodities produced over a particular period. The period is usually daily, weekly, or hourly. Examples of processes in a schedule plan include production activities, staffing mechanisms, stock or inventory systems, and cash schedules are often linked to manufacturing management. Manufacturing is creating a utility from a resource to meet designated human necessities. MPS plans or schedules indicate the number of products demanded compared to the projected demand in the market. In manufacturing, production schedules are vital tools for development planning. For example, a manufacturing company producing clothes usually maintains a spreadsheet containing a production schedule or plan containing the list of sales orders in a given period and the quantity made over the specified duration within three to twelve months.

When producing materials for a company, the master production schedule (MPS) is the crucial driver of the raw materials requirements schedule (MRS). Together with bills of the raw materials, the master production schedule determines the necessities of a production schedule to be effective. In manufacturing, the master production schedule is a priority. When mapping a particular master production schedule on a business, there are a few steps to implement the process; map the companies demand market share and generate a demanding schedule ., and evaluate the inputs ( raw materials) needed to get the companies supply and distribution chain in line with production and planning mechanisms.

A master production schedule (MPS) is vital in all business activities. Customers’ requests for services are met by delivering products quickly and cost-effectively. Through scheduling, MPS develops specific schedules for developing sections and components consumed as inputs to raw materials required in planning. A master production schedule can be used for further planning and scheduling throughout a company’s strategic planning. MPS is the business’s core unit that structures and defines the set of assets to be manufactured, outlining the amount to be produced and the time to be delivered. The details of a master production schedule do not define specific components of the assets created but give the quantities manufactured. The MPS usually acts as a mediator between supply and demand by outlining the amount produced and the demand schedule of the market.

MPS Schedule evaluation and simulation

Production and manufacturing business schemes drive the demand market value of the assets produced in most market environments. Therefore, forecasting is essential for planning purposes in most business activities. The master production schedule is often the critical determinant of production and manufacturing activities. The MPS requires a high accuracy level for maximum profitability in such scenarios. In make-to-order business environments and combined production and manufacturing services for companies making standard products, the master production schedule determines the stock required for optimal production.

Standard master production plans are long-term schedules made for specific assets. This is done during the planning horizon ( usually three to two years) over one week’s minimum time frame (bucket). In the process of developing the businesses master production schedule, the steps below were used;

  • Opening stock. These are the units available during week twenty-four of the business. Week twenty-four is week one of our master production schedule.
  • These are the projected outputs over the operations schedule of the business. Foresting helps a company understand the market’s future demand and develop possible mechanisms to meet the demand quantity.
  • Order portfolio. These are the quantity value needed to be compared to the forecasted value. In our business manufacturing, cash account, raw materials, and inventory maintenance, week twenty-five ( week one of operations of the new business owners) is frozen. It is assumed to have a high demand exceeding the forecasted values and costs in the market.
  • Project hand inventory. This is generally the required quantity of inventory assets available to a business entity or electronic commerce website, ready for selling to prospective customers.
  • MPS quantity. These are the total units produced over the scheduled plan to balance supply and demand.

The raw materials inventory of the business outlines the number of inputs required to produce various units of output. Production scheduling is an essential process in determining the production of a company. (Magdalena and Suli 2019). The opening stock of the business in week thirteen was 13,000 units. The demand for products varies with time; week one is often frozen, and the units ordered by customers exceed the forecasted units to be produced. Aerial product materials produced per given order are given at 8000 units, and the items available in 5000 units. The simulated forecasted units between week twenty-five and week twenty-nine are 2,000. Units. The simulated order for week twenty-five exceeds the predicted value but is less than the available. The demand for week twenty-five ( week one of operations of the new business owners) is 2,600 units. The project on-hand stock is the difference between the units at hand and the units ordered by customers in week one.

The difference between the project on hand and the forecasted stock of week two is less than the customer’s orders in week two. Therefore the business can meet production volumes with the available raw materials. In week three, the orders placed by customers exceeded the units available. The simulated customer order of 1,000 units is more than 400 units available from week two. If we produce a given number of units, the raw materials will yield 8,000 units. Therefore, the project at hand inventory is the difference between the maximum number of units produced and the projected customer’s orders. From week thirty to week thirty-five, the projected value of inputs is doubled. The business does receive any orders within the given period.

The distribution of products is directly proportional to the number of goods produced. Therefore, the level of inputs determines a company’s output level (Left et al., 2020). Thus, the new business deliveries are frozen in week one, and no deliveries are made from week twenty-nine. The table below shows the simulated units of raw materials required for production within the given horizon.

Table 1.0 The master schedule plan of raw materials inventory ( week 25 to week 35)

ITEM Aerials
Quantity on hand:          5,000.00 order policy: 8000 units
week 25 26 27 28 29 30 31 32 33 34 35
forecast          2,000.00          2,000.00          2,000.00          2,000.00          2,000.00          4,000.00           4,000.00          4,000.00          4,000.00          4,000.00          4,000.00
customer orders          2,600.00          1,400.00          1,000.00              500.00              100.00                           –                            –                           –                           –                           –                           –
project hand inventory          2,400.00              400.00          6,000.00          4,000.00          2,000.00          6,000.00           2,000.00          6,000.00          2,000.00          6,000.00          2,000.00
MPS Quantity                            –                           –          8,000.00                           –                           –          8,000.00                            –          8,000.00                           –          8,000.00                           –
Available to promise          1,000.00          6,400.00          8,000.00          8,000.00          8,000.00

Businesses have financial management plans or schedules, and Proper financial management is significant to economic growth. Business entities have set goals and objectives for financial management. The new business owners have to increase capital. Everyone must retain reserve cash accounts to bail the business into financial constraints. The aerial company has an opening capital of 48,0000. The required starting cash balance is Week one is frozen, and the cash spent exceeds the amount projected. From week twenty-nine to week thirty-five, the spending habits of the new business increase with corresponding zero customer orders. The cost of customer orders remains constant from week thirteen to week fourteen. In week fifteen, the expenses are simulated to retain the same trend.

The income from sales also increases drastically over the given horizon. Increased revenue from sales is simulated to increase over the window period. Increased sales reduce production costs as the realized profits are used to offset the excess costs. The book balance retained by the new business has a profit balance compared to the financial account of the old company, which contained a negative balance. The cash balances are not frozen between week one and week eleven of the new business (week twenty-nine to week thirty-five).

The finished stock is the value of assets ready for consumption. Finished inventory constitutes the sold products. The closing stock ( produced goods that have not been sold) to construct a master plan schedule for the new business. The value of closing stock varies on the horizon. Closing inventory reduces over time, indicating that the new company has a positive return on investment as most of its products are consumed. As the volume of sales increases, a new business has to develop marketing strategies favorable to customers. Advertising increases customers’ awareness about products a particular company sells, thus increasing sales volume. Increased sales improve the profitability of the business.

Manufacturing involves transforming raw materials into more valuable products. The volume of goods manufactured correlates to market demand and manufacturing cost. Labor, overhead costs, and duration have a significant impact on manufacturing. For instance, workers worldwide often have five working days weekly, and the corresponding output level is lower over the weekend. Also, some products have high demand during various times of the week. For example, liquor companies have maximum sales over the weekend when most people are idle. Therefore, manufacturing is affected by many factors that limit a company’s productivity. The new business manufacturing capacity is expected to increase from week twenty-five to week thirty-five. Therefore, the variability of actual production also increases over time. High manufacturing volumes require more labor to meet the increased demand (Girsang & Purwanto, 2017). Therefore, the labor cost is simulated to be hired in the new business than in the old industry.

The new business needs to implement new control and planning schedules that determine the market demands and reconcile possible measures to fill the requests. Planning and monitoring are the essential tools used in the implementation.

The new business owners have many advantages on the new master plan schedule. The previous business had a higher risk of loss due to increased manufacturing overhead costs. High production costs strain the business’s financial base. Stabilized production is essential for manufacturing operations for effective deliveries and enhanced efficiency. Analyzing the market forces enables a company to locate areas where potential bottlenecks or other restrictions are contained. Doing so empowers a business to optimize resources and allows timely deliveries.

For a business to overcome challenges, various techniques are available. For example, SWOT analysis helps one create a strong business strategy by ensuring all the business strengths and weaknesses are accounted for. The weaknesses of a business can be eliminated by; advancing the weakness level. For example, if the company relies on one advertising method, it has to sensitize using other panels. The business can also maximize one weakness to optimize on other loose ends and merge with other business entities with higher financial capability. Capacity management is essential for a business to maximize its potential activities and production output at all times, under all conditions. A business’s capacity evaluates a company’s ability to achieve, produce, or sell within a given period. The new business should evaluate its potential to produce within specified limits and also the capability of meeting its customer demand with the available raw materials. The ability of a business to produce quality goods and services within predefined ranges dictates the business’s ability to meet the market demand without merging with other larger firms. In order to ensure proper capacity management techniques, the new business should observe the following guidelines; recognize the capacity challenges in the new business, if any, incorporate capacity issues into the management process of the new business, establish incentive blocking capacity mitigation measures as well as incentive adjusting capacity correction techniques and strengthening the new strategic capacity management process (McNair & Vangermeersch, 2020).

Inventory management involves ordering, storing, using, and selling new business stock. It involves the process of controlling and managing raw materials. Efficient management of raw materials leads to optimal production in the new business, while poor stock management is bound to deteriorate the production capacity of the new business. Proper raw materials management can be ensured by reducing wastage and recycling raw materials whenever necessary. Stock management is often categorized into four sections, raw materials management, works-in-process management, maintenance, repairs, and operations management. The new business is bound to observe the whole process of stock management to sustain its operation in the market beyond week 35 of the business operations. The new business should keep a weekly close look at the stock turnover, average days for sale, the return on investment, and the stock carrying costs (Wild, 2017).

Lastly, the new business should ensure strict adherence to schedules. Scheduling involves the process of determining where and when operations are necessary to manufacture products is to carry out. Concrete should be established by the new business for the proper structuring of complex projects necessary for the success of the new business. Scheduling tools are essential for daily tasks in a business, such as scheduling work shifts, ordering large projects for reorganizing functional departments or building new facilities in a business setup. Scheduling is a vital tool for business success, and it has been used in planning activities for optimal goal achievement and realization of priorities (Kerzner, 2017). When done effectively, it aids in understanding what can be realistically achieved within a specified period and provides sufficient time for essential tasks.

Conclusion

The master plan schedule (MPS) is essential before a business starts its operations. Through planning, companies set objectives to be achieved within specific periods. Forecasting is a fundamental tool in the production and manufacturing sectors of the business. Deliveries depend entirely on customer orders. New business owners will have a higher financial base than old businesses.

References

Girsang, A.S. and Purwanto, A., 2017. Controlling system for stock raw materials for production planning and inventory control in a pharmacy company. Int. Rev. Mech. Eng11(11), pp.855-861.https://www.researchgate.net/profile/Mohammed-Sulaiman-15/publication/323531147_Design_of_a_Domestic_Diffusion_Absorption_Refrigeration_System_Using_Evolutionary_Algorithm/links/5d6ff276a6fdcc9961af82a2/Design-of-a-Domestic-Diffusion-Absorption-Refrigeration-System-Using-Evolutionary-Algorithm.pdf#page=70

McNair, C. J., & Vangermeersch, R. (2020). Total capacity management: Optimizing at the operational, tactical, and strategic levels. CRC Press. https://doi.org/10.4324/9781003076049

Wild, T. (2017). Best practice in inventory management. Routledge. https://doi.org/10.4324/9781315231532

Kerzner, H. (2017). Project management: a systems approach to planning, scheduling, and controlling. John Wiley & Sons. https://books.google.co.ke/books?hl=en&lr=&id=xlASDgAAQBAJ&oi=fnd&pg=PR19&dq=scheduling+management+in+business+&ots=Xc6o-VN4CU&sig=4mxAvQHf-tl3GVzO2PDXGwsGkGc&redir_esc=y#v=onepage&q=scheduling%20management%20in%20business&f=false

Magdalena, R. and Suli, T., 2019, May. Forecasting Methods and Implementation of DRP (Distribution Requirement Planning) Methods in Determining the Master Production Schedule. IOP Conference Series: Materials Science and Engineering (Vol. 528, No. 1, p. 012049). IOP Publishing. https://iopscience.iop.org/article/10.1088/1757-899X/528/1/012049/meta

Left, F., Gozali, L. and Marie, I.A., 2020, July. Comparison Study Among Production Planning Research in Some Papers and Industries in Indonesia. IOP Conference Series: Materials Science and Engineering (Vol. 852, No. 1, p. 012096). IOP Publishing. https://www.ingentaconnect.com/contentone/asp/jctn/2017/00000014/00000011/art00006

 

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