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Day 3 Agenda
Review of Day 2 Supply Chain Cockpit Heuristics Optimiser
Day 3 Agenda
Review of Day 2 Supply Chain Cockpit Heuristics Optimiser
Day 2 Agenda
Review of Day 2 Supply Chain Cockpit Heuristics Optimiser
Functionality
Navigate Through Supply Chain
Maps / Zoom Launch Applications Filters (work areas) Details for a selected object Drill-Down & Back Queries Alerts
Control Panel
Focus on Relevant Information
SCC Benefits
Benefits
Highly configurable to the conditions within a wide variety of industries and business situations Intuitive graphical user interface gives user maximum channel visibility to the entire Supply Chain Network Integration with all APO modules through a consistent data model to ensure reliability and planning accuracy Fast and direct access to specific information without jumping through multiple screens An integrated, intelligent Alert Monitor provides specific decision support for problem resolution on all planning levels
SCC Components
Navigation Component Supply Chain Engineer
Modeling Navigation and Information retrieval
Alert Monitor
Alert Handling
Supply Chain Engineer enables creating, changing and maintaining the supply chain model.
Supply Chain Cockpit allows planners to view and navigate the model in subsets and track performance
Alert Monitor allows to monitor and manage exceptions and problems with the supply chain model.
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SCC Users
SCC is the central point of access for all applications of APO and end users who perform various roles use this tool. User profiles allow for the filtering of information which is relevant for the users specific role.
Demand Planner
View overall supply chain, access information on forecast Vs actual sales, update demand plan
Distribution Planner
View supply chain distribution network, access distribution plan
Production Planner
Access information on orders, deliveries at production location, suppliers and access production plan
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Alert Monitor
Alert Monitor allows the user to monitor the plan, manage exceptions and problems in the supply chain. SNP planning alerts are exclusively generated through macros.
Dynamic Alerts reflect current planning situation and is not suitable for large alert quantities (reduces the performance) Database Alerts reflects planning situation at the time of macros execution and the database alerts are generated in the background and the snapshot can be viewed.
Alert handling:
Alert Monitor in SNP allows to display and also remove alerts for resources and location products Also the alerts can be configured to be sent over mail to the user.
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Alert Profile
Assignment of alert profile to SCC user profile Selection of alert types Object selection variants via object type Priority variants (error, warning, information, etc..) with selection variants having thresholds.
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The network model represents a specific supply chain and consists of individual nodes and links. A model can have different planning versions. It is possible to create several models, each with different versions for simulation purposes.
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Pre-requisite is to have master data for locations, products, resources and other elements. Supply chain network is created by placing the locations on the map and creating a connective network with transportation lanes. The lane direction shows the direction of the product transportation flow. Next, we assign products, resources and PPMs to locations using drag and drop functionality. Quota arrangements are defined to determine the percentage of product that will be transported to other locations in the chain.
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Questions
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Day 3 Agenda
Review of Day 2 Supply Chain Cockpit Heuristics Optimiser
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Heuristics Content
SNP Heuristics Capacity Check Capacity Leveling
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Heuristics Contents
SNP Heuristics Capacity Check Capacity Leveling
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SNP Heuristic
The SNP heuristic performs requirements planning through the entire supply chain network to determine how to satisfy the customer and/or consumer demand. It is part of a repair-based planning process consisting of heuristic, capacity leveling, and deployment.
SNP Heuristics
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Requirements Planning
Sequential planning for each location to determine sourcing requirements. It lumps all requirements for a given material/location combination into one demand for the period (or time bucket). Then, it determines the valid sources and quantity based on predefined percentages for each source. Heuristic plan may not be feasible as system assumes infinite capacity and does not consider component availability. Planner must adjust the plan by leveling resource capacity, one location at a time. After the heristics run, the planner checks transportation, handling, storage, and production resource capacity consumption, then levels capacity.
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Heuristic considers demand at product/location level, checks inventory, stock in transit and firm production. The process generates demands for intermediate products and raw materials, and for finished products
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60%
40%
30%
70%
Distribution centre
Incoming Quotas
Production Location Distribution centre (DC)
Product
70% 30%
60%
40%
Quota
60%
Supplier
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40%
2. Network
Performs SNP run for selected products in all locations Planning is carried out for the entire network.
3.
Location
Planning is carried out for the locations specified
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Heuristic Processing
1. 2. Data from live Cache is read Netting calculation completed a. Target Stock calculated b. Target stock - projected stock = planned quantity Lot sizing considered Procurement type checked a. Search for PPM b. Explode PPM Receipts created Resource load calculated
3. 4.
5. 6.
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Heuristics Contents
SNP Heuristics
Capacity Check
Capacity Leveling
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Capacity Check
The Capacity Check enables the planner to view the impact of planned orders on resources and to quickly determine whether the plan is feasible or not. If there is a capacity overload situation, the planner has to do simulative planning by manipulating resource utilisation to balance resource usage. Once the changes are saved, the production plan or transportation plan becomes the basis for the daily production schedule.
SNP
Unit
6/6/2005
6/7/2005
Available Capacity
Hrs
20
20.0
Capacity Consumption
Hrs
18
22
Capacity Load
90
110
Capacity is defined as 16 Hrs Time Consumption for unit quantity is determined by PPM For Quantity demand, Capacity Deficiency is Highlighted as overload as ratio of capacity consumed and capacity available in % terms
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Heuristics Contents
SNP Heuristics
Capacity Check
Capacity Leveling
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Capacity Levelling
Time-Based Capacity Leveling
Capacity load
BACKWARD
for demand with high priority
FORWARD
for demand with low priority
100 %
Day 1
Day 2
Day 3
Day 4
Day 5
Plan can be adjusted using the following methods Forward shift, Backward shift, Combination of both If time based capacity leveling option is chosen, various priority rules have to be chosen
whether it is based on decreasing order quantity or increasing order quantity whether it is based on decreasing or increasing stock range of coverage whether it is based on decreasing product priority or increasing product priority
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Alternative Methods
Modify resource master data Shift order quantities to an alternative resource Change production and transportation orders
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Master data and transaction data for version 8 Master data and transaction data for version 9
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Disadvantages
No Optimal solution; sometimes not a feasible solution User participation is required to get a feasible solution Planning is step by step across the production process No planning costs are considered Since infinite capacity is considered, capacity constraints will involve user intervention to a large extent
Recommendations for Use Most suitable method for situation where interactive solutions is required Suitable method for combining manual and automatic planning procedures
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Questions
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Day 3 Agenda
Review of Day 2 Supply Chain Cockpit Heuristics Optimiser
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generate a supply plan Identify where the costs are maintained Describe how the costs influence the optimisation result Explain the what-if process in SNP Optimiser
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F(x,y2)=
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F(x,y2)= A
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Lateness Production Lot Sizes Transportation Lot Sizes Purchase of Additional Capacities
DS
Resource Allocation (Alternative Machines/Storage) Start Dates NOT Lot Sizes or Alternative Recipes
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Build loads for unassigned transport orders Run TLB Run Deployment
SNP Optimiser
The optimiser uses linear programming methods for planning, such that it simultaneously considers all relevant factors making the entire chain as a single problem The objective of the optimiser is to find the optimal solution to an equation (target function) in which all the penalty factors defined simultaneously are considered. The objective may be to minimize costs or maximize profits. Since the optimiser assesses alternatives this way, it can determine the best feasible plan on the lowest cost.
One time period (bucket)
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$
Goal: Minimize costs
The Optimisation result run does not include pegging of final orders back to the original individual demand because the demands are bucketed. The optimiserconsiders capacity across all locations. The optimiseralso considers all alternative capacity resources globally. The optimiserignores standard storage and transportation costs if product-specific costs have been maintained. The optimiserconsiders all types of capacity constraints, including transportation, production, handling, and storage constraints.
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Process Components
Total cost of production process:
Key drivers
-Components -Process
Total cost of sourcing process:
-Available capacity
Data
Demand priority
-Customer
orders
Demand priority -Delay cost -Max delay -Non-delivery cost -Storage cost
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Optimisation Engine
APO uses the standard ILOG solvers for Optimisation
APO Live cache creates input log (Costs, Profile, etc) for ILOG Optimiser ILOG Optimiser uses Solvers and creates an output log Livecache publishes results in APO based on the ILOG output log
Linear Programming techniques: Basic Solution: Generates a solution based on all available data. Simplex method with continuous variables. Discrete: Generates a solution based on all available data. Simplex method in which certain variables are discrete. Acceleration techniques: Time Aggregation: Data is added according to times buckets. The nearest time bucket is solved first. Product Decomposition: Product groups are created and the problem is solved group by group. Priority Decomposition: Data are grouped and resolved by prioritizing the high priority problems Incremental: A subset of products is selected before executing the optimiser.
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Optimisation Methods
Linear Programming
Basic Solve
Meta heuristics
Time Aggregation Product Decomposition Priority Decomposition
Incremental
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Optimiser Profile
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Costs
Due date violation
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Transport Capacity
Storage Capacity
A B C D
Production Capacity
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Meet Late:
Maximum Delay Allowed Delay Cost Storage Cost
Source of Cost
PPM Resource Master Resource Master Product Master Transportation Lane Resource Master Resource Master Resource Master Product Master Product Master
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Disadvantages
Results are difficult to interpret Data maintenance is heavy and complicated Important to have accurate cost maintenance May propose changes to highly dynamic capacity variants Difficult to modify proposed plan since interpretation and understanding the reasoning is tough Black box effect
Suitable for complex planning scenarios which uses cost as a basis for planning
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Questions
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4.
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2.
3.
The different methods of capacity leveling are ____, ____ and ____
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3.
4.
For ensuring safety stock, production storage cost should be _____ than Safety Stock penalty Optimiser suffers from _____ effect
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SCC Recap
What are the functionalities of SCC? How is Alert handling done in SNP? What are the pre-requisites for modeling a supply chain network? What are the pre-requisites for using a fully operational SCC?
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