Master scheduling is the process of coordinating manufacturing output with customer orders. After the operations planning (S&OP), the master schedule is the next stage in planning.
Figures from operations and sales planning exercise (i.e. Master scheduling, which is located at a lower level and the product group level, will be flowed through to master planning.
Master scheduling will decide when certain product groups will be manufactured when customer orders will have been filled, and what manufacturing capacities are still available to meet new customer demand.
The Materials Requirement Planning system (MRP), which calculates the quantities and times of the purchase and production orders required to fulfill the master schedule, will further plan the master schedule.
Master Schedule Record
Your company’s planning system and products will affect the master schedule record. However, it will still contain many required pieces of information. This record should include the forecasted demand, the number, and projected inventory levels of the company, as well as the production quantities and promised quantity.
The planning horizon is the time period in which the master schedule record is displayed. It can take a few days or a couple of months depending on what the finished item is.
Complex products, such as aircraft or customized conveyor systems, will take months to produce while products that are manufactured and delivered within a few days have a shorter planning time.
Available to Promise
The master schedule provides information about the production dates and the time they will be available. It also gives marketing information that can be used to communicate with customers regarding final delivery dates.
The sales department can provide final delivery dates based on the availability of the stock-to-promise inventory.
The ATP is the difference between the sales orders booked and the production quantity that the manufacturing unit has planned to produce. The amount of the sales order reduces the number of available promised quantities when the sales team places a new order. The customer may be required to give a different delivery date depending on what is available to promise quantity for the next order.
The ATP quantity is an estimate based on customer sales orders and estimated production. It is not a true figure. If a customer calls to cancel an order or the manufacturing department plans to make a new run of the product, the quantity that is available will be changed, which may allow delivery dates to be shortened.
The opposite happens if the customer requests a change to the sales order for a greater amount or if the manufacturing department does not produce the required quantity of parts. Each master scheduling quantity is associated with an inventory that is available to promise. This is because the master scheduling quantity specifies when and how many new goods can be made to fulfill future sales orders.
Any changes to the master schedule can lead to delays in shipping to customers. Or, reducing sales orders could mean that raw materials aren’t being used and incurring storage costs at the warehouse.
A company can set a demand time fence to prevent changes from being made to the master schedule. This is the number period that can be frozen from the current time and where there are no or very few changes to the master plan.
Based on the cost of making changes to the master calendar, the number of periods that can be used can be determined. The demand time fence may be extended for changes that are very costly. However, if adjustments to the master plan cost only a few days, the fence can be extended for a couple of weeks.
Changes made after the demand time limit are less expensive for the company but still incur some costs.
This is the Planning Time Fence. The master scheduler can use this period to:
- Changes to the schedule
- Take into account customer requirements
- Taking into account manufacturing changes