Automated Planning


The Main.RollingPlan worksheet is designed to help you create Multiple Constraint Plans. This is an easy task, if you deal with a small number of SKUs manufactured on a couple of Work Centers/Production Lines. To get the job done, for each SKU in each Time Bucket, you simply have to enter some numbers that bring your Closing Stocks to the desired Target Stock Levels keeping in mind that your Remaining Capacity cells must not turn red, and your Top Line Parameter’s values must not exceed their corresponding Top Line Parameter’s Constraints.

The more SKUs and Work Centers/Production Lines you have, the more complex, and time consuming the planning becomes. Especially, if you have the opportunity to produce some of your SKUs on more than one Work Center/Production Line.

The idea behind Automated Planning is to calculate values for the Planned Quantities which satisfy Closing Stock Constraints, Capacity Constraints, and Top Line Parameter’s Constraints in a relatively short time. This kind of solution is not always feasible as it depends on too many factors. In this respect, rollingPlan’s Automated Planning Algorithm is not built to deliver a perfect end result. It merely provides the means to quickly estimate planning problems, and to give you a reasonable rough cut plan to work on.

Before you click on the Automated Planning button, you have to decide which Work Centers/Production Lines, and which Time Buckets to plan:

1.Work Centers/Production Lines to be selected.

2.Time Buckets to be selected.

3.Areas to place calculated Planned Quantities.

There is no need to select anything on the worksheet. Automated Planning Process pops up a two-tab dialog where you can pick desired combinations of Work Centers/Production Lines, and Time Buckets:

Work Centers Tab.

1. Work Centers/Production Lines selection List Box. You can choose your desired combination of Work Centers/Production Lines by making multiple selections (CTRL+Left Click) in this List Box.

2. Select/Unselect All Work Centers/Production Lines Button. This button selects/unselects all items on the list.

Parameters Tab.

3. Time Buckets selection List Box. Similar to above, you can make multiple selections here (CTRL+Left Click) to set your desired combination of Time Buckets.

4. Select/Unselect All Time Buckets. This button selects/unselects all time periods on the list.

5. Top Line Constraints Check Box. Put a mark in this box, if you would like Automated Planning to calculate Planned Quantities considering Top Line Parameter’s Constraints.

6. Top Line Constraints Precision Text Box. This box is enabled only, if you mark the Top Line Constraints Check Box. Here, you define a criterion to stop calculations. When difference between Top Line Parameter’s Constraints, and calculated Top Line Parameter’s values reaches desired precision, calculation process is considered complete.

7. Capacity Constraints Check Box. This box must be checked if you would like your Rolling Plan to be calculated taking into account Capacity Constraints. As a result, Planned Quantities will be limited by the Available Times in each of the selected Time Buckets.

8. Capacity Constraints Precision Text Box. This box is enabled only, if you put a mark in the Capacity Constraints Check Box. In this place, you enter another criterion to stop calculations. When difference between Available Times, and Total Required Times reaches the precision limit, calculation process is considered complete.

9. Stock Constraints Check Box. Mark this box, if you wish to bring your Closing Stocks to the Target Stock Levels in each of the selected Time Buckets. In this case, Automated Planning will calculate quantities sufficient to cover the demand, and to satisfy Stock Constraints.

10. No Stockouts Check box. When this box is checked, Planned Quantities will be calculated to close each of the selected Time Buckets at least at Zero Stock Levels.

11. Multiplicity Check Box. If you prefer Planned Quantities to be calculated as multiples of Minimum Lots specified in the Basic.WorkCentersAndSkus worksheet, put a mark here.

12. Round to Unit Check Box. This box is checked by default. It forces the Automated Planning Algorithm to calculate Planned Quantities as whole numbers. If this is not your preference, simply uncheck it.

13. OK Button. By clicking on this button you trigger the Automated Planning Process. It should be noted that if no selections are made in the Work Centers/Production Lines List Box, and in the Time Buckets List Box, all Work Centers/Production Lines in all Time Buckets will be planned. If no check boxes are marked, the algorithm will opt for Planned Quantities closing each of the selected Planning Periods at Zero Stock Levels. Standard Microsoft Excel® Undo function will not be able to recall the old values.


How does it work?

Before immersing ourselves into the depths of Automated Planning, we need to define the basic term of Zero Closing Stocks Plan:

  • This is a plan that covers Demanded Quantities, as well as any Open Stock Deficiencies to bring the Closing Stocks to the level of zero.

The term Open Stock Deficiencies does not seem to make much sense taking into account that in reality we either have stocks, or we do not. The catch here is hidden in the facts that:

(a) Closing Stocks represent the balance between Demand and Supply.

(b) Demand could be given either in a form of a Forecast,  or as a set of real Sales Orders (or as a mix of both).

(c) Sometimes, Supplies do not cover the Demand, and we end up with a  bunch of Backorders which could be represented as negative Closing  Stocks, and

(d) Closing Stocks serve as Open Stocks in the next Planning Period.

The Zero Closing Stocks Plan plays a pivotal role in the Automated Planning Algorithm. The following cases explain how it is employed to deliver results:

1. Desired Closing Stocks higher than zero.

The Zero Closing Stocks Plan is an artificial assumption. In reality, companies prefer to keep some stocks to cover fully, or partially the next Planning Periods. The reasons for this come from the need to insure the business against uncertainties in Demand, and Supply, and to ensure smooth operations exceeding customers’ expectations. To reach the latter objective, we have to define some Target Stock Levels (Stock Constraints), and then to calculate the Planned Quantities accordingly. When Automated Planning spots a mark in the Stock Constraints Check Box, it generates a Zero Closing Stocks Plan. After that, it makes some calculations to meet the Closing Stock Constraints. In essence, the Planning Algorithm adds differences between Stock Constraints, and Closing Stocks resulting from the Zero Closing Stocks Plan to the Planned Quantities of the Zero Closing Stock Plan.

2. Planned Quantities limited by the Available Times (Capacity Constraints).

There are quite a few companies who have the luxury to operate effectively with plenty of capacity to spare. As a common practice, businesses try to get as many SOs as possible in order not to let their machinery collect dust, and their workers to traipse. Automated Planning allows you to find out quickly whether you will be able to produce desired quantities in the time intervals you wish to operate your equipment. When the Planning Algorithm detects a mark in the Capacity Constraints Check Box, it creates a Zero Closing Stocks Plan for the selected Work Centers/Production Lines. Then, the plan is checked against Capacity Constraints. And, finally, calculated quantities are modified to meet Available Machine Times by considering all possibilities to produce. To say it differently, if Automated Planning determines that a certain quantity of a given SKU cannot be fully produced on a particular Work Center/Production Line (because of reaching a Capacity Constraint), it tries to find another Work Center/Production Line with more Available Capacity to manufacture the shortage.

3. Positive Target Stock Levels under Capacity Constraints.

In the real world of manufacturing, very often we come across contradictory objectives. One such case is defining Target Stock Levels for a mix of SKUs that cannot be reached, because there is simply not enough time to get all desired quantities produced at current Production Rates. On the one hand we need the stock coverage, on the other we are limited by the production capabilities of our equipment. There are many ways to approach a problem like this. We can decrease our Stock Constraints to more realistic levels; we can try to improve our Production Rates by modifying our equipment, or by making some organizational changes; we can outsource some of our production, or try to re-balance the shortage from other storage locations, etc. When Automated Planning notices marks in both Stock Constraints Check Box, and Capacity Constraints Check Box, it tries to find a compromise between these opposing limitations. As in the previous cases, the Zero Closing Stocks Plan is calculated in the beginning. After that, corresponding Required Times are determined in order to find out whether there are any capacities to spare. If such options exist, Remaining Capacities are distributed among SKUs produced on each Work Center/Production Line by applying an iterative Fair Share method, i.e. the bigger the difference between Target Stock Level and the Closing Stock resulting from the Zero Closing Stocks Plan, the bigger chunk of the Remaining Capacity the SKU gets. The outcome of the Planning Process is a plan that satisfies fully all Capacity Constraints, and fully, or partially the Stock Constraints.

4. Planned Quantities limited by Top Line Parameter’s Constraints.

Top Line Parameter is used to valuate Closing Stocks in each Time Bucket. For example, if we do not want our Inventory Position to exceed certain limits, we have to plan all our Work Centers/Production Lines accordingly. While Stock Constraints are applied per SKU, and Capacity Constraints limit quantities to be manufactured on a Work Center/Production Line level, Top Line Parameter’s Constraints have the meaning of Global Boundaries. Each quantity of every SKU planned on each and every Work Center/Production Line contributes to the value of the Top Line Parameter via the corresponding Closing Stock. To make Automated Planning consider Global Limits we have to place a mark in the Top Line Constraints Check Box. Like above, the process starts with a Zero Closing Stocks Plan. In case Stock Constraints Check Box, and/or Capacity Constraints Check Box are marked, the algorithm modifies the initial plan in accordance with the limits defined. Closing Stocks resulting from the adjusted plan are then valuated, and calculated Top Line Parameter’s values are checked against Top Line Parameter’s Constraints. If Global Boundaries are not met, the plan undergoes another series of changes until a solution satisfying fully or partially all the constraints is found.

Watch How to use Automated Planning