User Interface: Change Calendar – Resource Gantt Chart

From the previous article, if manual adjustment does not address the delay in the order, maybe there is not enough time for the operation to assign. We can try to increase the working time and see if this eliminates the delay.

In this sample, we will change Nov 5, a Saturday as a working day. Left-click on Nov 5 while holding down the shift key.

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Right-click the cell which is highlighted and then choose Day shift.

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You will see that the shift of Nov 5 has changed to a Day Shift.

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Run the reschedule button and you will see that operations will be assigned on Nov 5.

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You can look at the message window and confirm that there is no more message about the delay. This means that the delay was eliminated.

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To learn more about Asprova specific to this sample demonstration, you may visit Asprova’s e-Learning videos at http://lib.asprova.com/ (see 23. User Interface). You may also refer to the online help for more details on Calendar settings.

 

Continuous Improvement Tool: Quality Circle

Kaoru Ishikawa, a professor at Tokyo University, is attributed with much of the development of the idea of quality circles. It created great excitement in the West in the 1980s, at a time when every Japanese management technique was treated with great respect. A quality circle is a small group of between three and 12 people who do the same or similar work, voluntarily meeting together regularly for about one hour per week in paid time, usually under the leadership of their own supervisor, and trained to identify, analyze and solve some of the problems in their work, presenting solutions to management and, where possible, implementing solutions themselves.

Most people have the ability to tackle a wide range of problems at work in an imaginative and creative way. However, the ability of an average person at work is used partly. The QC concept assumes that once members are trained, they will be able to organize themselves to use their time effectively and there will be no need of outsiders to tell them what to do. If everyone is given a chance to use his/her talents to solve work related problems collectively, the results will be extremely positive. Problems at work place are best solved by the people most affected.

Ira B. Gregerman outlined a number of requirements for a business contemplating the use of quality circles. First, the business owner should be comfortable with a participative management approach. It is also important that the business have good, cooperative labor-management relations, as well as the support of middle managers for the quality circle program. The owner must be willing and able to commit the time and resources needed to train the employees who will participate in the program, particularly the quality circle leaders and facilitators. It may even be necessary to hire outside facilitators if the time and expertise does not exist in-house.

Some businesses may find it helpful to establish a steering committee to provide direction and guidance for quality circle activities. Even if all these requirements are met, the business will only benefit from quality circles if employee participation is voluntary, and if employees are allowed some input into the selection of problems to be addressed. Finally, the owner must allow time for the quality circles to begin achieving desired results; in some cases, it can take more than a year for expectations to be met.

Successful quality circles offer a wide variety of benefits for businesses. For example, they serve to increase management’s awareness of employee ideas, as well as employee awareness of the need for innovation within the company. Quality circles also serve to facilitate communication and increase commitment among both labor and management. In enhancing employee satisfaction through participation in decision-making, such initiatives may also improve business’s ability to recruit and retain qualified employees. In addition, many companies find that quality circles further teamwork and reduce employee resistance to change.

Reliable resources gathered from Asprova allows QC members to validate that the “problems” are indeed problems, select the priority problem, and again use the information to define the extent of that problem. Besides, our advanced planning and scheduling functions also facilitate QC members to devise solutions to such problems that will ultimately improve business’s overall competitiveness by reducing costs, improving quality, and promoting innovation.

 

Photo credits: flickr © 드림포유

Purchase Scheduling

In this article, we are going to show purchase of item “X” to be used for the production of item “AX”. In the Item table, set up the purchase of item “X”. Switch the Auto-replenish flag to Yes and set Obtain method to Purchase. Set Purchase lot size Min/Max to 1000. Update the Purchase lead time to 2 days. Since Purchase lead time is usually not displayed in the basic mode, right click the column setting and choose the Purchase lead time to be displayed.

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Run the Reschedule button. In the order table, you will notice that a purchase order of item “X” has been auto-replenished.

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Go to the Resource Gantt chart to view the purchase of item “X”. The purchase starts two days prior start of production based on the 2 day purchase lead time. This will be used as an input in the assembly of item “AX”.

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To learn more about Asprova specific to this sample demonstration, you may visit Asprova’s e-Learning videos (see 22. How to make a prototype).

 

Sales Order Scheduling – BTO

In this sample, scheduling a BTO production will be explained. Using the same sample in the previous article Sales Order Scheduling – MTO, switch the Auto-replenish flag of item “A” to “Yes” and set its production lot size Min/Max to 1000. By doing this, the production of item “A” is changed to “Make to Stock” production and will produce based on the set production lot size.

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Run the Reschedule button and switch view to Order table. You will see that three production orders were created automatically. The order quantities 300 and 500 of item “AX” are replenished for each sales order of “AX”. You will also notice that the production order quantity of item “A” is 1000, this is because we have set the lot size as 1000.

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Looking at the result in the Resource Gantt chart. The sales order quantity is set to 300 and accordingly the manufacturing order quantity of item “AX” is 300 (see Assembly1 bar). The blue bar shows that item “A” is being produced in 1000s as specified in the lot size.

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In this chart, we can also input inventory of item “A” and see how it is scheduled based on sales orders.Input “Inventory “A”” as Order code and select Inventory (absolute) as Order type. Set the due date and order quantity accordingly. Run the reschedule button to see the result in the Resource Gantt chart.

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You will see that the manufacturing order of item “AX” is replenished from Inventory where 300 items from inventory “A” are supplied to the manufacturing order of “AX”. Looking at its inventory level, the beginning on-hand is 400, then drops to 100 after replenishment to order “AX”.

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To learn more about Asprova specific to this sample demonstration, you may visit Asprova’s e-Learning videos at http://lib.asprova.com/ (see 22. How to make a prototype).

 

ABC Analysis

© MIKI Yoshihito

Vilfredo Pareto (1848-1923), an Italian economist and sociologist, made the observation that a large proportion of national wealth tended to be under the control of a relatively small number of individuals. Pareto concluded that in any series of elements to be controlled a selected small factor in terms of number of elements (20%) almost always accounts for a larger factor in terms of effort (80%). Pareto subsequently developed this observation into a more defined 80:20 rule.

The Pareto principle serves as the basis for materials management value segmentation and in this context is more commonly referred to as ABC analysis. It is based on the concept that approximately 80 percent of the total value of stock items will be accounted for by approximately 20 percent of the items. In other words, just a few stock items account for a very large proportion of total stock value; these are the key items over which management control should be exercised.

Now the question that arises is how you will identify what stock value is attached to the stored materials. Well the answer is simple – Asprova. It has features that will display the usage value of each item, which will elevate the ABC analysis concept one stage further into three stock categories used extensively in stock control.

  • Category A items: The ‘vital few’. Small in number but high in usage value.
  • Category B items: ‘Normal items’. Medium in number, medium usage value.
  • Category C items: The ‘trivial many’. High in number, low usage value.

In the purchasing context the Pareto principle can be interpreted as 80% of spends being directed towards just 20% of the suppliers. This elementary form of segmentation can then be used to separate the critical few suppliers from the trivial many. In other words, more purchasing effort and energy needs to be focused on the category ‘A’ suppliers and the materials that are purchased from them.

Whilst the remaining items in other classifications cannot be neglected, appropriate ‘low maintenance’ replenishment controls should be considered. An example of low maintenance controls would be the use of Vendor Managed Inventory (VMI), a system by which responsibility for managing the stock is placed in the hands of the supplier, thereby minimizing the purchasing effort.

The powerful tools in Asprova will allow you to keep the entire stock at your fingertips. More precisely, our detailed production scheduling and visualization functions enable superior control of the critical category ‘A’ items. It ensures that the stock level of this particular class of items remain optimized the whole time through elimination of excessive buildup and/or abundant consumption, thereby reducing overall cost and improving customer service by avoiding stockouts.

 

 

Photo credit © MIKI Yoshihito

A University in Vietnam Focusing on SCM Cooperated with Asprova

Working with VIetnam Supply Chain

Eastern International University (EIU) is a newly created university located in Binh Duong New City,Binh Duong Province, Vietnam, built by the State-owned Becamex IDC Corporation – the country’s largest infrastructure, industrial park developer and operator and a large conglomerate with over 30 related subsidiaries, has the mission of producing high-quality human resources to meet the country’s pressing needs.

EIU is the first University in Vietnam which offers Supply Chain Management Program for undergraduate level. We identify the problems Vietnam is facing with quality of workforce and provide the best solutions.

Our major supply chain management challenge in Vietnam is logistics cost. The logistics cost in Vietnam is around 25% of GDP. This creates an undue burden on businesses in Vietnam as we compete globally for FDI resources. In China and India, the logistics cost is around 15% and 13% respectively. In the USA, it is only 7.7% of GDP. This large gap is because of waste in the Vietnamese logistics processes and procedures. Another major issue is our supply base limitation. This limitation acts as a roadblock for companies in their efforts to meet the growing demand. The lack of skilled employees is a hindrance for business because it prevents companies from being established, or growing to meet marketplace demand. Information technology application is also a critical issue but there’s lack of Vietnamese businesses using IT to create competitive advantages and improve productivity. Vietnam must address these roadblocks to meet their long-term growth strategy. How can our community get to where we need to be to reach our strategic goals?

Creating a different way of educating our students is required if we will meet the challenge. We must have students who know the academic material, but are flexible in their thinking so they can meet as yet unknown problems. Collaboration between the business communities, governmental organizations, professional associations and institutions of higher learning ensure strategic challenges are completed on time, within budget and at the standards that delight the customers.

Eastern International University (EIU) is at the forefront of addressing our skill gap in employees that can meet the current and future challenges of business. EIU is addressing this skill gap by teaming with Portland State University, the Vietnam Supply Chain Association and ASPROVA Corporation. Through this collaboration we ensure we have the best understanding of what the business and governmental organizations must have for success.

We hope this cooperation will create a community and let’s be the community that creates the movement leading to success – success for our future generations.

Can Asprova Tell the Material Inventory Availability?

Answer summary:

Yes, through inventory graph. You can also use Auto replenishment so that you will be notified as to when you need to purchase materials (raw). See Videos 22.04 to 22.08

royalty-free-warehouse-clipart-illustration-439310Presidents, CEOs, directors, and other high-level executives recognise the importance of inventory management. Even the most attentive and detailed-oriented manager is no match in getting the exact level of it. Most of the time decision makers rely only on the external benchmarks that seldom deliver the expected insights. This might lead them to the wrong path when they are making the operating assumptions. Getting the right levels of the inventory is important since it not only controls costs but also measures the company’s overall health.[1].

Accounting for inventory in manufacturing environment is often more complex compare with inventory accounting in other business setups. Manufacturers account for production inventory when making plans, schedules and valuating raw materials needed for production. One of the most essential steps in managing your inventory while making production plan is knowing the availability and quantity of every resources and materials[2].

Inventory Graph

Asprova can easily monitor the availability of materials through the inventory graph.  It can check whether there is a shortage of materials or none. The graph will tell you the exact date and time on when the materials will be depleted and can give you a visualization of which operation will have a shortage in materials. In addition, Asprova has an auto-replenishment function where it can automatically replenish insufficient and depleted items for production orders and purchase orders. Auto-replenishment will also notify you if you already needed to purchase raw materials.

Monitoring the quantity and availability of every material is only one of many ways on how Asprova can help you manage your inventory. It is still best to have a hands-on experience on monitoring your inventory using Asprova. See it for yourself. Download the free trial version of Asprova and watch the tutorial videos for more information.

[1]www.bain.com/publications/articles/ten-ways-to-improve-your-inventory-management-wsj.aspx (Date Accessed: June 15, 2014)
[2]http://smallbusiness.chron.com/production-inventory-17468.html (Date Accessed: June 15, 2014)