Marketing

PCP: What is a Production Control Plan and what is its importance in the logistics of your company

By May 18, 2020No Comments

PCP is the acronym for Production Planning and Control. In other words, it is a system that manages the operational resources of a company.

The production and logistics sectors are fundamental in a company.

It is through these departments that the company achieves more quality, agility and economy in its processes, thus obtaining a competitive advantage.

But how can we do that? The best tool is the PCP.

What is the PCP – Production Control Plan?

PCP is the acronym for Production Planning and Control. In other words, it is a system that manages the operational resources of the company, involving all operations and the consolidation of information.

In other words, good results will be achieved by planning, controlling and scheduling the production processes.

In this way, the company is able to further guarantee quality and productivity.

In addition, it is possible to reduce operational costs.

What are the objectives of the PCP?

This tool, due to its main characteristics, impacts the whole company.

The functions of this type of planning are based on three pillars:

  • Planning -determines which products will be produced and when.
  • Scheduling – defines the resources that will be used from the beginning to the end of the production flow.
  • Control – carrying out monitoring to correct possible deviations and/or errors identified.

However, in addition to these pillars, other issues need to be verified, such as

  • The amount of products that will be produced.
  • The layout of the factory plant to make better use of the flow of inputs.
  • The stages that make up the manufacturing process.
  • The definition of labour, both mechanical and human.

With these limitations, the company can better plan, schedule and control the production process, always reviewing the established objectives and preventing deviations from happening.

If changes are necessary due to errors or failures, having these factors in mind allows for better decisions to be made.

That is why this planning tool also offers technical support to management, showing the main problems of the production sector.

What are the advantages of Production Planning and Control?

Technical support for decision making.

As we said before, this tool allows to control the whole flow of the productive process of the company.

That means that the data will always be at hand and can be consulted whenever necessary.

On top of that, it makes it easier to identify problems and faults.

From this observation, management and direction can make decisions based on real data, defining what must be done to solve the problem.

More attractive final results.

The company that adopts the production planning and control tool shows more attractive end results.

Why? Basically, because it is able to better identify the strengths and weaknesses of production and logistics, attacking the problems according to their order of priority.

More compatibility between the production and sales sectors

The production department needs to be interconnected with the whole company, especially with the sales sector.

At the end of the day, its no use if a seller makes a sale of a product that is not available.

By adopting the planning and control process, we know exactly how many products are stocked, which we will have to produce and which are missing (possibly requiring urgent attention and production).

Systematize the production process.

If the idea, when using the planning tool, is to have control over the production process, it is clear that this will result in a systematized production.

That brings more agility, ease, safety, quality, correctness, speed and less cost.

Cost reduction

This account is quite simple: more control equals less loss, less work, less waste and, consequently, more cost reduction.

What are the stages?

Demand forecasting

Making a demand forecast is an important action for the company to know when it needs each product, whether for the sales sector or for the collection, production and logistics departments.

This technique is subjective, but it is based on historical and statistical data to identify the most sold products, the most used raw materials, the minimum collection of each product and the seasonal sales.

With this data, managers are able to size the production and verify the material and human resources needed for the process.

Production planning and capacity.

This stage uses the demand forecasting data defined for the medium and long term.

Based on this, the companys production capacity must be analysed to verify whether any adaptation is needed in the sector.

In this way, production capacity can be increased or reduced in line with demand.

Aggregate Production Planning (APP).

At this point, the objective is to define the best production strategy for the company.

Thus, decisions regarding production volume, stockpiling, dismissal and hiring of people, sub-contracting, overtime requirements and contracts for logistics and supply services are considered.

O PAP is generally considered annually, but there is a monthly review, which takes into consideration consumer demand and production capacity.

The objective is to make decisions that are appropriate to the needs of the company.

Master Production Schedule (MPS).

This stage considers the short-term execution of production plans.

The PMP allows, then, to analyze and direct resources so that the production of a certain period is executed and exceeds the required demand.

This scheduling is therefore more detailed, covering not only demand forecasting, but also open purchase and production orders and completed orders.

Detailed Production Programming (PDP).

The PDPs main objective is to show how the company will carry out its daily operations.

In other words, it addresses the operational side itself. The activities involved in this process are:

  • Sequence of production orders – defines the operational sequence of the machines with the aim of reducing idleness, backlogs and stockpiles.
  • Materials management – aims at controlling the stockpiling, delimiting the size of the lots, defining the safety stockpiling and the way of replenishing the raw material.
  • Issuance of production orders – is the implementation of the production program by issuing the necessary documents for operations to be initiated. It is also done the release of the production leaving available the necessary resources.

In companies that work with repetitive production (i.e. they have a large volume of production and little variety of products), the ODP must be guided by production systems.

Some examples are Kanban, Six Sigma, Poka – yoke and Kaizen.

On the other hand, companies with intermittent production (i.e. low volume of production and large variety of products) have more difficulty in carrying out the PDP.

Thats why the use of specific software is the most appropriate.

Production control

The productive process must be accompanied to guarantee that it is walking as expected.

This stage also provides for annotations on the time and performance of the process, storing the updated data for use in subsequent decisions.

What are the tools that can be used?

Kanban

The kanban system is based on the use of cards ( post-its ) to identify and visualize the production flow.

In general, two axes are used, placed in a frame.

One axis shows the tasks that need to be performed and the other brings stages of process execution.

These stages must be appropriate to the need of the company, but in general, they are used “to execute”, “in progress” and “completed”.

As the tasks evolve, the card is placed in the corresponding column.

That way, it is easier to visualize if any process is behind schedule and to identify possible problems.

It also guarantees that the deadlines will be met.

Six Sigma.

This tool is internationally recognized because it provides more efficiency, economy and quality to the companys production processes.

This is achieved by identifying problems and implementing improvements.

This results in lower operating costs, which increases profits as a consequence.

Six Sigma is also about how often a given operation uses more than the minimum resources needed to satisfy customers.

This represents a waste rate per operation, which allows a diagnosis on the performance level of the processes.

Kaizen.

This theory has collective work as its main point.

Therefore, human resources are highly valued and must be motivated to align their personal interests with the goals of the organization.

The Kaizen method has some assumptions. They are these:

  • Waste disposal.
  • Involvement of all employees, regardless of hierarchy.
  • Increased productivity with low investment
  • Visual management principle, which provides for transparency in procedures, values and processes.
  • Attention to the work environment or the factory floor, that is, the premises of the company that creates value.
  • Process oriented.
  • Learning by doing.

Poka-yoke.

This tool is applicable in any situation involving risks of defects or failures.

In other words, it is a quality management method that aims to reduce costs by eliminating failures or problems (nonconformity) with products.

Conclusion.

Thus, we can perceive that planning and production control is an ideal tool to have more productivity, eliminate errors, failures and reduce costs increasing, as a consequence, the profit.

The use of various tools and the execution of the stages of the PCP will guarantee that the process is carried out in the best possible way and that the company obtains maximum benefits.

Leave a Reply