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7, October 2005, 634–651
Stumbling blocks of PPC: Towards the holistic conﬁguration of PPC systems
H.-H. WIENDAHL*y, G. VON CIEMINSKIz and H.-P. WIENDAHLz
yInstitute of Manufacturing and Management (IFF), University of Stuttgart, Nobelstrasse 12, 70569 Stuttgart, Germany zInstitute of Production Systems and Logistics (IFA), University of Hannover, Schonebecker Allee 2, 30823 Garbsen, Germany ¨
Manufacturing companies often complain about the diﬃculties they face in meeting their customers’ logistic requirements. Many blame the perceived inadequacies of their production planning and control (PPC) software for their performance deﬁcits. The paper illustrates why this is only a partial view of the causes of the shortcomings. PPC software is just one of six conﬁguration aspects of the entire PPC system. The authors argue that the conﬁguration of the PPC aspects objectives, processes, objects, functions, responsibilities and tools has to be carried out methodically and consistently in order for the PPC system to function properly. The analysis of examples of so-called ‘stumbling blocks’ of PPC, inadequate conﬁgurations of one or several of the aspects, supports this claim. The paper closes with the proposal of a checklist that the authors suggest as a ﬁrst approach to ensure the consistent conﬁguration of PPC systems. Keywords: Production planning and control systems; Conﬁguration aspects of PPC systems; Stumbling blocks; Conﬁguration and operation of PPC systems; Actors in PPC
1. Introduction It is almost 30 years since Orlicky (1975) ﬁrst described the material requirements planning (MRP I) algorithm. To this day the algorithm remains the kernel of many production planning and control (PPC) systems. Despite 30 years of progress in PPC theory and practice, and the deﬁnition of additional key functions, a large number of manufacturing companies remain unsatisﬁed with the degree of fulﬁlment of their logistic objectives. Recent surveys prove that companies still miss their logistic targets by a wide margin (Fraunhofer IPT Institute 2003, Wiendahl 2003a). This applies to the logistic performance measures of production—work-inprogress levels, throughput times and schedule reliability—in the same way as to those of stores: inventory levels, service levels and delivery delays.
*Corresponding author. Email: Hans-Hermann.Wiendahl@ iff.uni-stuttgart.de
A historical review reveals various causes of the unsatisfactory logistic performance and, considering these, the solutions that a holistic conﬁguration of PPC systems requires. In the past, critical evaluations of PPC methods identiﬁed the limited capabilities of computer hardware as the principal cause for the insuﬃcient fulﬁlment of logistic objectives. These hardware limitations only allowed a step-by-step development of PPC algorithms. Due to this, the manufacturing resource planning (MRP II) algorithm that followed MRP I is characterised by the successive execution of its functions. As real situations in manufacturing companies seldom conform to the rigid assumptions that are underlying this algorithm, there were calls for a more realistic consideration of practical conditions. PPC research therefore concentrated on the development of new functions and algorithms (Plossl 1985, Vollmann et al. 1997) and neglected the analysis of the required preconditions such as an organisational framework for PPC (Kraemmerand et al. 2003).
Production Planning & Control ISSN 0953–7287 print/ISSN 1366–5871 online # 2005 Taylor & Francis http://www.tandf.co.uk/journals DOI: 10.1080/09537280500249280
Stumbling blocks of PPC Over time, the remarkable progress of computer technology facilitated the application of more powerful planning software such as enterprise resource planning (ERP), supply chain management (SCM), advanced planning and scheduling (APS) or manufacturing execution systems (MES) (Stadtler 2002). All of these systems carry out a considerably larger number of functions than their predecessors. They apply sophisticated mathematical algorithms to solve multi-variable optimisation problems and can thus consider numerous planning restrictions simultaneously. Due to the immense complexity of the implementation of these large systems they often fail to produce the substantial logistic performance improvements the companies are hoping for (Davenport 1998). In contrast, other businesses preferred ‘simple’ PPC approaches. The increased popularity of just-in-time principles and Japanese management methods made companies avoid the application of software and focus on organisational aspects instead. They achieved remarkable performance gains, e.g. by the introduction of Kanban control cards (Soder 2004). The contrast between highly sophisticated, computerised PPC systems whose logistic performance is insuﬃcient and simple, rules-based control mechanisms that achieve astonishing results made researchers and industrialists realise that the problems of PPC cannot be solved by more powerful software alone. There seem to be other causes of the described performance deﬁcits, which had been neglected so far. The standard textbooks on PPC oﬀer detailed descriptions of the theoretical foundations of the PPC functions, mainly mathematical models and algorithms (Plossl 1985, Fogarty et al. 1991, Hopp and Spearman 2000, Vollmann et al. 1997). However, instructions on the design and implementation of PPC systems are uncommon or not very detailed. Fogarty et al. (1991) emphasise that the choice of a logistic strategy should reﬂect the nature of the customer demands. The logistic strategy in turn determines appropriate manufacturing strategies and the corresponding feasible planning and control methods. Vollmann et al. (1997) stress the importance of mapping the planning and control processes speciﬁcally for the purpose of implementing PPC software to support the planning functions. The same authors provide a selection of the prerequisites of the system implementation. Otherwise, there are only case studies on MRP or ERP system implementations available that provide some indication on the critical success factors of PPC systems (see, for example, Akkermanns and van Helden 2002, Wiers 2002). In general management literature, important approaches are being discussed that aim to ensure the fulﬁlment of business objectives. Publications on PPC almost completely ignore these discussions, especially
as far as the role of operational employees is concerned. Kaplan and Norton (1996) propose the balanced scorecards as a method to link business strategies to speciﬁc aspects of performance. Miles and Snow (1978) determine what types of business organisations lead to above-average levels of performance. Maslow (1987) and Huczynski and Buchanan (1991) explain the important inﬂuence that human motivation and employee involvement have on the performance of a business. Storey and Sisson (1993) discuss the eﬀects of performance-related pay on the performance of a company and provide instructions on the eﬀective design of remuneration systems. In order to ensure that PPC systems contribute to high levels of logistic performance, these general methods and approaches have to be adapted for the speciﬁc ﬁeld of production management. Publications that transfer these approaches to the ﬁeld of PPC have only recently been published (Waﬂer 2003, ¨ Wiendahl and Westkamper 2004, Nyhuis 2004). ¨ According to the authors’ experience it is not only the neglect of above-mentioned important factors but also the lack of awareness of the correlations between separate factors that aﬀect the conﬁguration of PPC systems and lead to undesirable logistic performance deﬁcits. These so-called ‘stumbling blocks of PPC’ are errors in the conﬁguration of a PPC system as a whole. The symptoms of these stumbling blocks, insuﬃcient fulﬁlment of logistic objectives, a lack of transparency and excessive eﬀorts required, are easily identiﬁable. Often though those responsible for PPC on the operational level are not able to simply remove the stumbling blocks. On the one hand the interdependencies between their causes make a ﬁnal analysis more diﬃcult; on the other hand, the changes required by the situation can exceed the competencies of the operational staﬀ involved. In most cases, only the managing directors can remove the causes of the stumbling blocks. Therefore, the objective of this article is to create a framework for the identiﬁcation, analysis and removal of classic stumbling blocks of PPC: Section 2 deﬁnes the key terms of PPC. The PPC system, conﬁguration aspects of PPC and stumbling blocks of PPC. . Section 3 describes typical stumbling blocks of PPC. The descriptions ﬁrst identify their respective symptoms, analyse their causes and present possible solutions to remove the stumbling blocks. The practical examples included in the discussion of each stumbling block are based on the experiences the authors gained in industrial projects. The projects focus on the conﬁguration of PPC concepts, the selection of suitable software tools and the implementation of both in practice.
H.-H. Wiendahl et al. PPC system includes the three value added processes, Source, Make and Deliver, in accordance to the terminology of the supply chain operations reference (SCOR) model (Supply Chain Council 2004) (cf. ﬁgure 1a). The input and output stores of a company are thus subject matter of a PPC system in the same way as production. The PPC system crosses company boundaries: It allows for the requirements of customers and suppliers since, following supply chain management principles, the management of the storage processes takes the delivery performance of the suppliers as well as the demand behaviour of the customers into account. According to this deﬁnition, the term ‘PPC system’ comprises more than just the PPC software. The software is only the tool to plan and control the logistic process chain as well as the storage of production master data and feedback data.
Section 4 outlines a framework for the holistic conﬁguration of a PPC system. It lays the foundations for a coherent and customised composition of the planning and control functions of manufacturing companies. . The conclusions in section 5 draw the insights together in the form of a questionnaire. The holistic conﬁguration of a PPC system should consider the issues that the questionnaire raises in order to avoid the formation of stumbling blocks. This merges the aspects of the functions and data of PPC as well as its processes and responsibilities in an integrated model that provides a basis for the holistic conﬁguration of PPC systems.
2. Key terms of PPC The PPC system is the central logistic control mechanism that matches a company’s output and logistic performance to the customer demands. The task of the PPC system is to plan, initiate and control the product delivery of a manufacturing company as well as to monitor and, in case of unforeseen deviations, i.e. disturbances or order changes, to re-adjust the order progress or the production plans. 2.2 Conﬁguration aspects of a PPC system On the basis of this deﬁnition, six conﬁguration aspects of a PPC system can be distinguished (cf. ﬁgure 1b): The ‘logistic objectives’ of a company are situated at the heart of the PPC system. If necessary, these have to be diﬀerentiated for diﬀerent departments of the company. . The ‘PPC processes’ determine the logical and chronological order of PPC planning and control activities. Thus they deﬁne the workﬂow of order processing in terms of the information ﬂow along the logistic process chain. The activities related to the material ﬂow follow the same logic, but are not directly a subject matter of the PPC system.
2.1 PPC system In the context of this paper, the term ‘PPC system’ denotes the entirety of functions and tools used for the planning and control of the logistic processes in a manufacturing company. The scope of application of a
Value-adding processes Object Responsibility
Figure 1. Deﬁnition of a production planning and control system. (a) Scope of application and (b) conﬁguration aspects.
Stumbling blocks of PPC The ‘PPC objects’ are the planning objects of PPC. The most important objects are the articles (ﬁnished products, components or raw materials), resources (machinery and personnel) and orders (customer orders, spare parts orders, sample orders, etc.). . The ‘PPC functions’ deﬁne the activities that are required to plan and control the logistic processes in the stores and in production. The fundamental activities are the deﬁnition of local objectives and targets, forecasting and decision-making, providing feedback on order progress as well as continuous improvement. . ‘PPC responsibilities’ determine the positions—and therefore the members of staﬀ—that are in charge of certain PPC activities. Conventional PPC systems ignore this organisational view as they operate on the assumption that responsibilities are organised by a central entity (see for example Hackstein 1989, Vollmann et al. 1997). . The ﬁve conﬁguration aspects described above constitute the logical core of a PPC system. The purpose of the ‘tools for planning and control’ is to support the operational order processing by (semi-)automated PPC activities. This creates standards for the operational activities and relieves staﬀ of time-consuming routine tasks. More time therefore becomes available for the required planning and control decisions.
Ideally, the symptoms can be traced back to a single cause. In this case, only one conﬁguration aspect is aﬀected and the mistake in the conﬁguration is easily detected and removed. An example is the entry of incorrect planned capacity values into PPC software. If, for instance, the capacity of a bottleneck work system has wrongly been set at 18 hours per working day instead of the correct value of 16 hours, production overloads arise. This stumbling block can be easily removed by a simple correction of the planned capacity value. In cases where several cause-and-eﬀect relationships inﬂuence or even amplify each other, the removal of stumbling blocks becomes more complex. Here, several of the conﬁguration aspects are aﬀected. Even though their symptoms are as apparent as for the simple stumbling blocks, their removal is a lot more diﬃcult: It is necessary to, ﬁrst, identify the relationships between the diﬀerent causes. Secondly, the causes in diﬀerent conﬁguration aspects have to be changed simultaneously and in a co-ordinated way. Typically, this exceeds the competence of the operational actors so that their managers have to understand and remove the stumbling block.
3. Typical stumbling blocks of PPC The following examples describe the stumbling blocks with several causes that are most commonly found in industrial practice. Each explanation is divided into the description of the symptoms and the analysis of their causes. Measures that are used for the removal of the stumbling blocks follow. The examples are based on real situations in industrial companies.
These conﬁguration aspects serve as a theoretical basis to analyse and remove the stumbling blocks of PPC.
2.3 Stumbling blocks of PPC The presence of stumbling blocks of PPC becomes apparent through symptoms such as the insuﬃcient fulﬁlment of logistic objectives, a lack of transparency of order processing or an unnecessarily high eﬀort of the staﬀ involved in carrying out PPC activities. The term stumbling block exclusively applies to internal mistakes in the conﬁguration of the six aspects deﬁned above. Factors related to the external environment such as unreliable suppliers or literally ‘chaotic’ customers are not considered. The PPC system itself does not have any control over these factors. Nevertheless, the external factors represent requirements that have to be considered when designing the PPC system. An analysis of the relationships between causes and eﬀects is required in order to detect and remove the stumbling blocks. 3.1 Stumbling block ‘missing positioning in system of logistic objectives’ The ﬁrst example of a stumbling block of PPC highlights the importance of deﬁning consistent objectives and of communicating the responsibilities for fulﬁlling the objectives clearly to the staﬀ that plan production operations or carry them out. In PPC, one can often ﬁnd conﬂicts between the logistic objectives work-in-progress level (WIP level), utilisation, throughput time and schedule reliability because they are neither compatible nor locally or temporally constant (Wiendahl 1995). Accordingly, one should never maximise or minimise the value of just one objective, but consider the simultaneous eﬀects of measures on all logistic objectives. The nature of these conﬂicts has been recognised for some time
H.-H. Wiendahl et al. positioning their logistic processes at certain operating points on the production operating curves. The conﬂict between objectives described above only represents a stumbling block if those responsible ignore it in their day-to-day job. In a typical example, the managing directors of a medium-sized manufacturer of construction components required short throughput times to achieve short delivery times. At the same time, they demanded a high utilisation of expensive machinery in order to obtain a fast return on investment. The production operation curves clarify the conﬂict that the production department faced as a result (cf. ﬁgure 2): On the one hand, the objective of short throughput times requires a low WIP level in production (WIPTTPmin). On the other hand the objective of a high utilization necessitates a high WIP level (WIPUmax). The inconsistent directives of the directors are the cause for two stumbling blocks: In day-to-day business, concrete decisions concerning orders have to be taken. Conﬂicting management directives fail to determine the most important logistic objective. As a result a guideline for these decisions is missing. . As the management directives described above are contradicting in themselves the target values that are derived from them have to be as well. Therefore it is impossible for operational planners to take rational decisions.
(Gutenberg 1951, Plossl 1991). Nevertheless, many companies are not aware of their consequences. Frequently, production managers are trying to ‘optimise’ the utilisation of work systems concurrently to the throughput time. Detailed investigations demonstrate that such an approach is not target-oriented because ultimately no single objective of the optimisation can be deﬁned. Substituting the minimum-cost objective for the logistic objectives does not resolve the conﬂict. Instead, companies should start by setting strategic objectives derived from the market environment (Ketokivi and Heikkila ¨ 2003). Typical examples of such objectives are ‘Reduce throughput times by 50%’ or ‘Maintain a delivery reliability of 95%’. These objectives serve as the priorities, which dominate the trade-oﬀ that has to be reached with the remaining logistic objectives. The production operating curves are a proven methodology for the analysis of the interdependencies between logistic objectives and their consequences for PPC. They quantitatively describe the dependence of the objectives utilisation, throughput time and schedule reliability on the WIP levels in production and can easily be computed (Nyhuis and Wiendahl 2003). Figure 2 shows that the best possible target values for the diﬀerent logistic objectives do not coincide at the same WIP level of a work system. A classical example of this phenomenon is the conﬂict between ‘short order throughput times’ and ‘high work system utilisation’ that was already mentioned. Whereas short work system throughput times can only be achieved at low WIP levels, high WIP levels are required in order to guarantee a high utilisation. This in turn leads to excessive throughput times. The situation requires a trade-oﬀ between the logistic objectives. Companies can achieve this by
The production operating curves are helpful tools to analyse and remove both stumbling blocks: Initially, the curves explain the interdependencies between the logistic objectives and facilitate their relative prioritisation (step 1 of the logistic positioning). . The remaining target values follow from the value set for the most important objective. For example, the desired throughput time determines both the target utilisation as well as the target WIP level (step 2 of the logistic positioning).
Schedule reliability Maximum
hpu t tim e
WIP level 0 WIPTTPmin WIPTTPmin : WIP level at target throughput time WIPUmax WIPUmax : WIP level at target utilisation
Figure 2. Logistic operating curves as a model of the interdependencies between logistic performance measures.
Taking a strategic decision, the directors regarded short throughput times as the most important objective. However, in order to implement the new management directives, further boundary conditions had to be considered. The machine operators still tried to maintain high WIP levels at the work systems so that they always see a work load in front of their machines and can reduce setup times by changing the sequence of orders. Obviously, this strategy also supports a high work system utilisation. At the same time it adversely aﬀects throughput time and schedule reliability.
Stumbling blocks of PPC In order to maintain the desired prioritisation of the logistic objectives, management should take the following actions: Oﬀer ‘qualiﬁcation’ in production logistics to all relevant employees (including shop ﬂoor operators) and communicate the new priorities of the logistic objectives. . Verify the conformance of the logistic objectives with the ‘interests’ of the employees. In particular, management has to ensure that compensation schemes eﬀectively support the objective of short throughput times.
The following section describes how those involved inﬂuence production planning and control, and how their decisions impact on the fulﬁlment of logistic objectives.
3.2 Stumbling block ‘divergent stakeholder interests’ The second stumbling block conﬁrms the importance of the consistency between the logistic objectives and the PPC staﬀ who have the responsibility for meeting the targets. It also stresses the fact that staﬀ has to be qualiﬁed in order to carry out PPC functions. In an empirical study on the implementation of ERP systems, Amoako-Gyampah (2004) came to the conclusion that diﬀerent levels of the management hierarchy have diﬀerent perceptions of the system to be introduced. It is therefore essential that the managing directors not only provide all future users with adequate training in the application of the new system, but that it is equally important they make eﬀorts to convince staﬀ members of the beneﬁts of the change and of the necessity to utilise the new system to achieve enhanced business objectives. The report by Wiendahl et al. (2002, 2005) on the introduction of a Kanban control is a prominent example for the potential for conﬂicts between such business objectives and the individual objectives and interests of production employees. In this case, production management wanted to reduce throughput time and WIP levels signiﬁcantly. The central planning department was responsible for the design of the Kanban system and the setting of its parameters. On the basis of customer demands and target replenishment times the planners also calculated the number of Kanban cards required. The production department was briefed about the changes and a subsequent trial run passed without problems. The company therefore regarded the implementation of the new production control system as a success.
It came as a surprise that the production was not able to sustain the aspired improvements for more than a short time after implementation of the new control system. Rather, both the values of WIP and throughput times soon rose to old levels again. The detailed analysis of the production department that was initiated as a consequence, revealed insuﬃcient consultation with the production operators. The operators pursued the objectives ‘job security’ and ‘stable order processing’ by stockpiling orders for uncertain times in the future. This leads to unnecessary safety stocks, permanent changes to the order sequence and decreasing schedule reliability. Obviously the pull principle that is underlying the Kanban control does not conform to these interests of the production operators: Kanban enforces temporary idle times for most work systems. In order to counteract this, the operators added copied Kanban cards to the Kanban control loops to raise WIP to the previous levels. Thus, they apparently resolved the conﬂicts between the objectives of the company and their own individual objectives. Production management only realised that the unwanted modiﬁcations had been made and understood the exact causes of the modiﬁcations after the analysis of the Kanban control system. The example highlights the prerequisites for a sustained successful implementation of the new control system; thorough qualiﬁcation of all staﬀ involved and an incentive system that emphasises the objectives of due-date oriented order processing (in order to avoid order sequence modiﬁcations) and ﬂexible working hours (in order to guarantee processing on demand) rather than promoting the conventional objective of high resource utilisation.
3.3 Stumbling block ‘missing responsibility for inventories’ The third stumbling block illustrates the consequences of a lack of coordination of the responsibilities for the PPC processes and objects. They result in an insuﬃcient fulﬁlment of the logistic objectives. Often, there is no clear dividing line separating one area of responsibility from another. Typical symptoms are high inventory levels of purchased components and ﬁnished products, or recurrent discussions on the binding eﬀect of orders and their reliable fulﬁlment. The company described in this section produces make-to-order machines of medium complexity. Depending on the customer requirements, this may include engineer-to-order operations. A detailed analysis was initiated by the managing directors who were
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dissatisﬁed with the high inventory levels of purchased components and ﬁnished products, and the uncertainties caused by sudden changes of due-dates or engineering changes. Figure 3a shows parts of the order processing chain. Figure 3b indicates the problems resulting from an unclear deﬁnition of interfaces: The production is responsible for the material ﬂow from the start of the production order (i.e. printing of order documentation) to the ﬁnal operation (i.e. input to store). This includes the responsibility for throughput times and WIP levels. Subsequently, the ﬁnished products are handed over to the sales department, either to be delivered immediately or to be stored in the ﬁnished product store. The purchasing department has the responsibility for all purchased components. However, there is no responsibility deﬁned for the target inventory levels for ﬁnished products. The company neither deemed it necessary to deﬁne nor to regularly monitor them, because ﬁnal assembly should not take place before there is a customer order. This should have prevented ﬁnished products from being stored. Recurring appeals to cut inventory levels remained without eﬀect. Instead, purchased component and ﬁnished product inventory levels were steadily growing. In addition, staﬀ in the shipment area complained about too small dispatch and storage spaces. The root cause analysis showed:
The actual start date of production is delayed relative to the planned start date. The reasons are product engineering changes due to changes in customers’ requests or design modiﬁcations by the engineering department.
Two issues have to be solved to improve the interfaces: 1. Placing of orders (information ﬂow): Does the person who acquires new or altered information directly beneﬁt or have a quantiﬁable advantage from passing it on? Would it be to his/her disadvantage if he/she did not pass it on? 2. Delivery of orders (material ﬂow): Does the supplier have a direct, quantiﬁable beneﬁt from a timely delivery to his/her successor? Would a late delivery be to his/her disadvantage? In our example, a handover deadline was ﬁxed for the transfer of products to the shipment area, which is within the responsibility of the sales department. The resulting deadlines are realistic, because the calculation of the order ﬂow includes a capacity check. From a production point of view, the sales department places ﬁxed ‘orders’. The fact that products are handed over without transferring inventory responsibility to the sales department is the reason why the sales department experiences neither an advantage nor any disadvantage if it fails to pass on the postponement of customer due dates. . Likewise, from a sales point of view, the ‘promise’ made by production seems to be binding. But production has no fulﬁlment risk: delivering
Initially, customers insist on the machines being delivered as soon as possible. Near completion of the order, they tend to postpone the delivery date when they realise that the machine is not needed now, e.g. because of building delays.
Purchasing delivers on time places fixed order Production
places fixed order Sales delivers on time
Responsibility Production Parts fabrication order I Assembly order Parts fabrication order II OP 1 ... ... OP 4
Purchased components Idle time Throughput time production order Printing order documentation Input to store
Finished Shipment Start-up products Idle time Time
Figure 3. Stumbling block ‘missing responsibility for inventories’. (a) Status as planned and (b) actual status.
Stumbling blocks of PPC goods on time means production is cleared of its responsibility, without having to worry about any penalties when orders are completed behind schedule. A possible solution may be to add the ﬁnished product store to production’s responsibility. This initiates the necessary improvements out of self-interest. An analysis of the interface between production and purchasing shows similar results: The required due date for purchased components is calculated by backward scheduling, before passing it on to the suppliers with a safety lead time. Production takes no responsibility for inventory levels from the planned start but only after the order is actually started. This is why production is merely interested in passing on information regarding production orders being pulled ahead but not about orders postponed. Frequently, the problem is solved by transferring the responsibility for material dispatch and material inventory responsibility to production.
resulting conﬂicts are illustrated by the following disputes: Dispatch aims to release orders at the latest possible moment to meet the objective of short throughput times. Whenever demand is low, intense debates with production are unavoidable. Production wants orders to be released much earlier to maintain a high utilisation. . To meet the objective of high schedule reliability and ensure that customers receive their products on time, logistics strives for realistic delivery promises. It sets the planned start and ﬁnish dates as well as the sequence of orders in accordance with these promises. As soon as demand rises, however, the available capacities are not suﬃcient to keep the promised delivery dates. Hence, production is urged to raise capacity. If this is not possible, the dispatch department is asked to release orders at an earlier point in time. . Usually, the parties concerned are not able to reach an agreement. Therefore, often top management is asked to solve the conﬂict and decide upon which orders to release or which to speed up. Necessarily, the set objectives are missed.
3.4 Stumbling block ‘inconsistent responsibilities for functions’ If the responsibilities for PPC objects, functions and objectives are deﬁned inconsistently, top management is obliged to spend a high eﬀort on resolving unnecessary disputes as the following example exempliﬁes. One of the principal tasks of management is to clearly deﬁne the responsibilities and assign the functions within a company. It is generally accepted that appropriate objectives have to be deﬁned so that responsibilities within the organisation are consistent and therefore the functions be carried out reliably (Kaplan and Norton 1996). Unfortunately, reality often rather reﬂects the informal organisation, i.e. the power structure among the persons concerned. In a company with 300 employees, the ‘right way’ to fulﬁl functions and to accomplish the given objectives was the subject of heated discussions among the three departments of dispatch, production and logistics: Dispatch is responsible for order release, production takes on capacity control and sequencing at the work systems, and logistics is responsible for promising delivery dates, thus being partially in charge of order generation. Each department has its own system of objectives, the priorities diﬀer: The primary objective of dispatch are ‘short throughput times’, the principal goal of production is a ‘high utilisation’, while the top priority of logistics is a ‘high schedule reliability’. All these objectives were quantiﬁed by targets. The
A helpful framework to remove this stumbling block is Lodding’s (2004) model of manufacturing ¨ control. Its basic idea is to combine the functions of manufacturing control with the objectives of the PPC system. Thus, it becomes possible to assess whether the responsibilities for functions and objectives are consistently deﬁned. He deﬁnes the following four functions (cf. ﬁgure 4a): Order generation determines the planned input and output, as well as the planned order sequence. . Order release determines when orders are released to the shop ﬂoor (actual input). . Capacity control determines the available capacity in terms of working time and the number of staﬀ assigned to work systems, and thus aﬀects the actual output. . Sequencing determines the actual sequence of order processing for a speciﬁc work system, and thus aﬀects schedule reliability.
These functions aﬀect the three manipulated variables ‘input’, ‘output’ and ‘order sequence’. The discrepancies between two manipulated variables lead to the observed variables of manufacturing control (cf. ﬁgure 4b): The start deviation results from the diﬀerence between planned input and actual input. . The WIP level results from the diﬀerence between actual input and actual output.
Order generation Order release Capacity control Disposition
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Planned input Start deviation Throughput time WIP level Utilization Order generation Planned output Backlog Actual output Capacity control WIP level Actual Input Order release
4 1 3
Planned sequence Function Difference
Sequence deviation Manipulated variable Direction
Actual sequence Observed variable Objective
Figure 4. Model of (a) functions and (b) logistic interdependencies in manufacturing control. Adapted from Lodding (2004). ¨
The backlog results from the diﬀerence between planned output and actual output. . The sequence deviation results from the discrepancy between actual and planned sequence.
The observed variables aﬀect the objectives of PPC described above, i.e. throughput time, WIP level, utilisation and schedule reliability. Figure 4b shows the interdependencies connecting functions, manipulated variables, observed variables and objectives to each other. The functions deﬁne the manipulated variables, the observed variables result from the discrepancies between two manipulated variables, and the logistic objectives are determined by the observed variables. As a basic principle, conﬂicts arise when one department takes the responsibility for a speciﬁc objective when the accomplishment of this objective is also aﬀected by another department. These conﬂicts obviously cannot be resolved by the persons involved. Figure 5 illustrates how the responsibilities for objectives and functions are deﬁned by the described company:
The second conﬂict arises between the production and the logistics departments: Production aﬀects the objective of schedule reliability via capacity control (actual output) and sequencing, whereas logistics impacts the objective via order generation. Again the responsibility for objectives and functions is not united under ‘one authority’. This inevitably leads to a permanent conﬂict as described in the above paragraph and requires a higher authority to solve each case. For production to call for an earlier order release to ensure utilisation even complicates the matter, as a third party, i.e. dispatch, has to be considered.
To remove this stumbling block the responsibility for the complete order processing chain must be put ‘into the same pair of hands’. An order management centre could fulﬁl this role. Alternatively, it is possible to divide the order processing chain into sub chains, in which the responsibilities for objectives and functions are combined.
The ﬁrst conﬂict arises between the production and the dispatch departments: Although order release (via actual input) and capacity control (via actual output) aﬀect the objectives of throughput time and utilisation, the responsibility for objectives and functions is not united under ‘one authority’. Accordingly, situations, in which the achievement of an objective depends on the decisions of the other department, require a higher authority to make the ﬁnal decision.
3.5 Stumbling block ‘insuﬃcient quality of feedback data’ The insuﬃcient quality of feedback data reported in the following case is a symptom of the lack of integration of all PPC functions in the tools for planning and control. Data quality has recently been identiﬁed as one of the important factors in the conﬁguration of PPC system (Xu et al. 2002). All purposeful and successful planning
Stumbling blocks of PPC
Actual input Dispath Production Logistics Order generation* Planned output Throughput time WIP level Utilization Backlog Actual output Capacity control Order release
Planned sequence Function Difference Objective Direction
Actual sequence Responsibility Stumbling block
Observed variable Manipulated variable
* promised delivery date
Figure 5. Stumbling block ‘inconsistent responsibilities for functions’.
and control depends on a complete, consistent and current data basis for all planning, control, execution and performance measurement activities (Wiendahl et al. 2003a). Besides the production master data, the production feedback data are especially important for this purpose: Feedback data represent the inputs for the logistic ‘performance measurement’ carried out at the end of a production planning period. Deviations between the planned and actual values of logistic performance measures lead to new control decisions or the adjustment of target values (see section 3.6). . For day-to-day business the continuous logistic ‘performance monitoring’ is more important. The deviations between planned and actual order progress detected by this function have to be corrected by immediate control measures in order to make sure that promised or planned due-dates can be maintained despite order changes or inevitable disturbances.
There is a range of possible causes for the insuﬃcient quality of feedback data, of which the IT structure in a manufacturing company is one of the more signiﬁcant reasons. In a survey carried out by the Fraunhofer Institute for Systems and Innovation Research in 2001, 60% of the companies responded that there is no hardware connection between the production data acquisition (PDA) software and the remaining IT structure (Beckert and Hudetz 2002). A timely and fast
intervention of production control in production is thus impossible. At times there is a complex structure of mutual dependencies that is underlying the symptoms. This is exempliﬁed by the following example: In the manufacturing company considered, the feedback data were characterised by inconsistencies that resulted from a substantial delay in recording the data in the PDA software (only 75% of operations showed a positive throughput time). However, the actual processing times matched the standard processing times relatively accurately. After the introduction of new planning software the problem disappeared within a period of six weeks. A preliminary analysis showed that the feedback data were only used for the controlling of costs but not for the ongoing monitoring of the order progress. A second ‘manual feedback system’—local inspections by the foremen—provided the feedback information required to control the order progress in time. As the feedback data were not immediately incorporated in the next production plan, the operators did not recognise the beneﬁt of the plausible and immediate provision of feedback data. The regular appeals by the production managers to increase the quality of the feedback data therefore did not have any eﬀect. The PPC cycle shown in ﬁgure 6 provides a basis for a detailed analysis of the situation. It consists of a logical sequence of the activities of production planning and control. Based on insights from decision theory, the
H.-H. Wiendahl et al. In the chosen example, the fundamental causes of the stumbling block were due to the open control loop between decision and execution activities: At the start of the project the feedback between the ‘Do’ and the ‘Re-plan’ phases malfunctioned. The capacity planning function was missing from the software in use, which thus produced unrealistic production plans. The foremen had to correct the production plans produced by the software by extensive manual interventions. The low quality of the feedback directly resulted from this: As the operators did not see a direct personal beneﬁt from feeding events back plausibly and promptly, they regarded the activity as a pointless exercise leading to excessive eﬀort. . The introduction of new planning software interrupted this spiral of errors. The operators realised that the quality of the production plans (in the shape of their own dispatch list) depended on their provision of accurate feedback data.
Set targets Forecast Learn (Re-)Act Plan Evaluate Check Do Order progress Collect Do Allocate
Decide Production plan
Figure 6. The PPC cycle as a model for management and execution activities.
cycle splits the four phases of the Deming cycle (Plan, Do, Check, Act) (Deming 1992) into eight separate steps (Balve et al. 2001, Wiendahl 2002). The setting of targets during the ‘Act’ phase marks the beginning as well as the end of the PPC cycle. The ‘Plan’ phase contains three steps that prepare the actual production process: ‘Forecast’ determines the necessary information inputs of production planning, i.e. the probable demand for, as well as the supply of, ﬁnished products, materials and capacities, . ‘Allocate’ directly relates the demand for articles and resources to their supply, . ‘Decide’ deﬁnes the production plan.
This analysis explains why the problem with the insuﬃcient quality of feedback data disappeared in this short period.
3.6 Stumbling block ‘errors in PPC parameters’ As is shown by the sixth example, the omission of a key PPC function results in a stumbling block because parameters in the tool for planning and control cannot be set correctly. One of the functions of PPC software is to eﬀectively support dispatch activities. Dispatch parameters in the PPC software serve as the basis of (semi-)automated dispatch decisions. The eﬀectiveness of these decisions therefore depends on the actors’ understanding of logistic processes on the one hand and on the appropriate setting of dispatch parameters on the other. The central PPC planning parameters include the planned values for the oﬀset and replenishment times, order throughput times and operation throughput times. With the help of these time-based parameters purchase orders are placed and production orders are scheduled. Hence the parameters represent the logic foundation of the entire due-date structure in a company. Figure 7 shows that the successive scheduling runs of the MRP II approach utilise scheduling parameters at diﬀerent levels of aggregation. Between the level of an entire purchasing process (parameter: replenishment time) and the disaggregated level of separate operations (operation and inter-operation times) there are normally two levels of aggregation: one for the material
The actual manufacture of the products is subject of the ‘Do’ phase. The ‘Check’ phase has to ‘Collect’ information about the order progress in production and to ‘Evaluate’ this in comparison to the original plans. Diﬀerences between planned and actual require corrective control measures. These are also referred to as ‘Re-Plan’. If the PPC system regularly fails to achieve the set targets, systematic errors may be the cause. For this reason, the ‘Re-Act’ phase completes the cycle. The ‘Learn’ step should help to avoid the performance shortcomings in the future. PPC methods and the various planning and control parameters contained within them have to be set consistently and in accordance to the logistic objectives. The required accuracy of planning predetermines the tolerable delay between production events and their feedback. An eﬀective performance monitoring is therefore a prerequisite for realistic production plans (Wiendahl 2002).
Stumbling blocks of PPC
Dispatch level 2 A B Time Offset dispatch level 2 B Throughput time production order B Time Production order • (mean) throughput time of production order • equal to replenishment time if dispatch level includes only one production order Operation • (mean) throughput time of operation of production order • estimated or calculated (inter-operation time + operation time)
Material requirements planning: BOM explosion and offsetting
Replenishment time/ offset dispatch level
3 1 2 3
Product • (mean) purchasing time of entire purchasing process (external/internal) • Dispatch level (BOM level) may include one or more production orders
Planned order throughput time Capacity requirements planning: throughput scheduling Planned operation throughput time
OP 3 Time
Throughput time operation 2
Figure 7. Classical scheduling parameters of PPC.
requirements planning and one for the capacity requirements planning and scheduling. Therefore there are two relevant types of stumbling blocks: 1. Inconsistent parameters: The scheduling parameters at diﬀerent levels of aggregation are inconsistent (e.g. the oﬀset of a manufactured component is equal to 3 weeks, the sum of the throughput times of all operations included in the manufacturing order is equal to 4 weeks). 2. Unrealistic parameters: The values of the scheduling parameters are normally not maintained at the planned values in reality (e.g. the mean planned throughout time of manufacturing orders is equal to 5 days whereas the actual mean throughput time is equal to 7 days). Manufacturing companies often underestimate the signiﬁcance of correct parameter setting. The scheduling parameters are merely estimated or derived from historic data. In this way, a tool manufacturer used a mean planned throughput time value of 27 working days for scheduling manufacturing orders. This value was based on the experience of the production foreman. The actual mean value of the throughput time for the manufacturing orders was equal to 32.5 working days. The diﬀerences between plan and actual mean values occurred due to the production bottleneck: a long operation throughput time of a coating process. The prerequisite for realistic planned values is the knowledge of the actual values. The lack of a performance monitoring function constitutes an obvious
stumbling block in this context. The company considered did lack this function: The feedback data—order master data and due dates—have to be recorded at all work systems on the shop ﬂoor (step ‘Collect’ in the PPC cycle in ﬁgure 6). Subsequently, order throughput times and other logistic performance measures can be calculated from these. . Subsequently, logistic performance measurement has to determine the accuracy of the planning parameters. This is achieved by comparing the throughput time parameters set for the scheduling function of the PPC software with the actual values measured in production. If necessary, the parameters have to be adjusted bearing in mind the logistic objectives (step ‘Learn’ in the PPC cycle in ﬁgure 6). . Only the introduction and regular execution of the PPC cycle guarantees the accuracy of the throughput time parameters. The procedure described equally applies to all other PPC planning parameters.
Adjusting parameters may lead to another stumbling block: For the purpose of replenishing the ﬁnished products store, the order dispatch function assumed a throughput time of 27 working days. Backward scheduling runs generated the required production orders based on this assumption. Thus, the diﬀerence of 5.5 days between the planned and the actual throughput time aﬀected the schedule reliability. The
H.-H. Wiendahl et al. times are too short. This is shown in the throughput diagram in ﬁgure 9a. When increasing the values of the parameters in the backward scheduling run, the orders will be released to the shop ﬂoor much earlier. As orders cannot be started ‘in the past’, the input curve takes a leap (one-oﬀ load surge), making the WIP levels at the work systems and hence the length of the order queues grow (cf. ﬁgure 9b). This implies, on average, longer waiting times and longer throughput times of orders, along with an increased variation of throughput times (Wiendahl 2002). As a result, the schedule reliability is decreasing and completing important orders on time is only possible by means of rush orders and costly expediting exercises. The vicious circle is spiralling upward to stabilise at a level where the amount of work pieces stored as work-in-progress exceeds the storage capacity (Wiendahl 1995). The correct logistic analysis would be as follows: The backlog is the actual cause of the due-date deviation of orders (cf. ﬁgure 10a). This backlog cannot be reduced by increasing the planned throughput times, but by temporarily increasing capacities or outsourcing work. Figure 10b shows the eﬀects of this intervention: From the ‘present day’ the backlog will gradually decrease. As a result, adherence to the planned due dates is improving, and from a certain point in time planned and actual output are matched. However, such reactions call for ﬂexible capacities (Wiendahl 2002). Outsourcing work for some time basically has the same eﬀect. However, compared to an increase of capacity the impact will be delayed (cf. ﬁgure 10c).
Actual throughput time Planned throughput time Actual output
production was running into backlog. For this reason, companies have to be aware not to enter the vicious circle of production control when modifying planning parameters. The next section explains how to act correctly when these modiﬁcations become necessary.
3.7 Stumbling block ‘lack of logistic understanding’ Due to a lack of logistic understanding, many manufacturing companies fail to make the correct connections between decisions taken in the PPC functions and their eﬀect on the degree of fulﬁlment of the logistic objectives. How a production system deals with logistic issues and how this aﬀects planning and control has been the subject of discussion for some time, especially in view of the familiar shortcomings of the MRP approach and the lack of logistic understanding on the part of the users of PPC. The vicious circle of production control is a particularly illustrative example of how little is known about the actual interdependencies between manipulated and observed variables (cf. ﬁgure 8). In the USA this circle was ﬁrst described by Mather and Plossl (1978), while Kettner (1981) and Wiendahl (1995) explained its consequences to the German audience. The vicious circle sets out from the mistaken conclusion that schedule reliability is poor because the planned throughput
Throughout times and their variation increase Insufficient delivery reliability
Planned input = Actual input
Due-date deviation (too late)
Length of queues increases
Time Input (planned/actual) Planned output
Planned throughput times are increased
New actual throughput time Load surge
Load on work systems increases
Orders are released earlier
Planned throughput time
Due-date deviation (too late) New planned throughput time Present day Actual output Time
Figure 8. Stumbling block ‘lack of logistic understanding’ causes vicious circle of PPC. Adapted from Plossl and Kettner.
Figure 9. Inadequate logistic reaction to interrupt vicious circle of PPC. Throughput diagrams for (a) initial situation and (b) for an increase in planned throughput times.
Stumbling blocks of PPC
Planned Input = Actual input Planned output
do not conform. This inconsistency shows analogies to ﬂuid mechanics (Wiendahl 2003b): Throughput time planning based on mean values assumes that the order stream resembles a steadily ﬂowing river (a so-called laminar ﬂow of orders). Only when throughput time variation is very low, schedule reliability is suﬃcient. . If the order stream resembles a mountain torrent (comparable to a turbulent ﬂow of orders), the focus has to be on the individual order. The individual planning of throughput time ensures schedule reliability despite strongly varying throughput times.
Actual output Backlog
Planned input = Actual input Planned output = Actual output
Such a situation allows for two alternatives:
Outsourcing Planned input = Actual input Planned output = Actual output Backlog
On the one hand, logistic turbulences might be inevitable. Individual throughput times are necessary and the software must be adapted accordingly. . On the other hand, the steady-river scenario is feasible. Orders are processed according to the FIFO rule (or maximum slack). A low variation of throughput times ensures the planned schedule reliability.
Figure 10. Adequate logistic reactions to interrupt vicious circle of PPC. (a) Initial situation, (b) temporary increase in capacity and (c) temporary outsourcing.
A similar eﬀect may be achieved by deferring make-tostock orders (orders not related to a customer request) or rejecting customer orders, though the latter might have a negative eﬀect on the market.
The relationship between logistic requirements and logistic capabilities determines the choice of a logistic guideline. The requirements depend on the allowed due-date deviation (tolerance requirements), the demand ﬂuctuation (ﬂexibility requirements) and the delivery time (speed requirements), cf. ﬁgure 11 (Wiendahl et al. 2002, 2003b): Tolerance requirements: Is the planning tolerance set for a value such as throughput time, smaller than the actual variation? . Flexibility requirements: Do the ﬂuctuations in demand exceed capacity ﬂexibility? . Speed requirements: Do heterogeneous delivery times require heterogeneous throughput times?
3.8 Stumbling block ‘inadequate logistic guidelines’ The stumbling block described below shows the consequences of a lack of consistency between the PPC functions and the process, which the functions are meant to control. An important instance of wrong PPC parameter setting is the formulation of inadequate logistic guidelines. In this case, the planned throughput times entered in the PPC software are realistic and match the mean value of the production throughput times. However, the variation of the actual throughput times is higher than the planned tolerance. Hence, the available planning functionality (throughput time planning based on mean values) and the actual throughput time performance (high variation of throughput times)
If the requirements exceed the capabilities, it is necessary to apply individual throughput times for each order. Practical experience shows that missing one of the three requirements is suﬃcient to increase the variation of throughput times. In most cases, this is due to varying order priorities or sequence changes meant to avoid setup times. Accordingly, suﬃcient planning tolerances, little demand ﬂuctuations and homogeneous delivery times allow for order throughput times to be based on mean values. The same applies vice versa: Heterogeneous delivery times, considerable ﬂuctuations in demand and tight planning tolerances call for the individual planning and control of orders.
H.-H. Wiendahl et al.
Required delivery time Distribution of lead times
Minimum delivery time Mean throughput time
Demand fluctuation Capacity flexibility
Demand fluctuation Capacity flexibility
Units / day
Planning tolerance Variation of throughput times
Variation of throughput times
Figure 11. Criteria for choice of logistic guideline.
Following a ﬂow-oriented guideline makes it easier to forecast the throughput time and thus to determine the delivery date. Traditional PPC methods support this approach, too. However, strong ﬂuctuations in demand and unforeseen events make it diﬃcult to provide capacity according to need. This is why it places high demands on ﬂexible capacities and predictive performance monitoring to achieve the ideal of a steady order stream.
logistic objectives. A holistic (re-)conﬁguration of the PPC system has to consist of the following three stages: Initially management has to determine the logistic strategy, i.e. the logistic performance that it wants to oﬀer to the customers. This includes the prioritisation of external logistic objectives and the trade-oﬀ between internal logistic target values. Manufacturing companies have to ensure that the logistic strategy matches their manufacturing vision which predetermines the design of its production systems (Riise and Johansen 2003). In fact, companies should ideally formulate manufacturing and logistic strategies simultaneously and also design production systems and the related PPC system in parallel. . The technical concept of the PPC system has to be built on the basis of the logistic strategy. The basic logistic conﬁguration has to ensure that the conﬁguration aspects of PPC—processes, objects, functions and responsibilities—are consistent with each other as well as the achieved prioritisation of logistic objectives. The selection of suitable production planning and control methods and algorithms facilitates a partially or fully automated materials and capacity dispatch. The analyses of the stumbling blocks of PPC oﬀer instructions on how to
4. Conﬁguration of the production planning and control system Many industrial companies are dissatisﬁed with the degree to which they fulﬁl their logistic objectives: throughput times and inventory levels seem to vary uncontrollably; promised due-dates can only be adhered to by use of costly expediting exercises. For this reason, there are controversial views about the potential of PPC software in academia and practice. The examples of stumbling blocks of PPC presented above show that the ever-present demand for improved software with more powerful algorithms is not always justiﬁable. Rather, it is the inconsistent conﬁguration of the aspects of PPC that aﬀects the fulﬁlment of
Stumbling blocks of PPC avoid inconsistencies of the conﬁguration aspects of the PPC system. . The third stage is the implementation concept of the PPC system. This includes the selection of PPC software that is capable of supporting the technical concept, the setting of all relevant parameters in the PPC software and the development of a suitable implementation strategy that includes the qualiﬁcation of all staﬀ. Case studies conﬁrm the necessity of a role-speciﬁc training-on-the-job implementation (Wiendahl and Westkamper 2004). ¨ It is not suﬃcient to conﬁgure a PPC system once on implementation. As a rule, changes to the internal and external situation of the company require a periodic veriﬁcation in accordance with the PPC cycle shown in ﬁgure 6. This ensures that the current conﬁguration, the methods used and the parameters set are still suitable. Two types of changes can be distinguished: Abrupt changes, such as the introduction or withdrawal of competitive products, the development of new technologies or other changes to the market environment are relatively easy to detect. In such cases, the need for action is obvious. From a logistic perspective there is no need for new methods or tools for detecting such changes. Timely indicators of market or technological changes are desirable. These, however, are research issues for general management disciplines. . Creeping changes are much more diﬃcult to detect. Step-by-step adjustments of market volumes, delivery or replenishment times hardly attract the attention of those responsible. However, for the conﬁguration of PPC systems this type of change is much more critical because it necessitates the continuous veriﬁcation and adjustment of the chosen conﬁguration in parallel to day-to-day business. It can be compared to the sharpening of tools that a good craftsman regularly carries out.
suitability of a chosen conﬁguration. The questions are separated into ﬁve sections: Objectives and stakeholder interests: Have the logistic objectives been deﬁned and are the objectives consistent? Is their degree of fulﬁlment being monitored? . Is someone responsible for the fulﬁlment of the objectives? . Have the logistic objectives been matched to customer demands and are they consistent with the performance targets for the employees on all hierarchical levels (the stakeholders)?
Logistic guideline and PPC methods: Does a logistic guideline exist? Do the planning and control methods used match the logistic guideline? . Is there a mechanism that ensures the consistency of logistic guideline, logistic positioning and the planning and control methods used? Is someone responsible for this mechanism?
Order processing chain and responsibilities: Have the separate process steps of the order processing chain been deﬁned? . Has the responsibility for each step been assigned? . Have the interfaces between the responsibilities been deﬁned unambiguously? . Do those who have to fulﬁl the logistic objectives have an adequate level of authority for making decisions?
Data quality and parameter setting: Is there a mechanism that ensures the accuracy of master data and feedback data? Is someone responsible for this mechanism? . Are the values of the planned throughput times consistent across all three scheduling levels of the PPC system (long-range and intermediate-range planning, and short-term control)? . Is there a mechanism for continuously checking, and adapting if necessary, the accuracy of PPC parameters? Is someone responsible for this mechanism?
5. Conclusions The discussion of the stumbling blocks presented above highlights the importance of a holistic conﬁguration of PPC systems. Although section 4 outlines the main phases of a methodical PPC conﬁguration process, a fail-safe procedure has not been developed in detail yet. However, as focussed questionnaires are a way of assessing the appropriateness of management and production system designs (Barnes and Rowbotham 2003), the following questions can be recommended as part of a ‘quick-check’ to assess the
Qualiﬁcation of employees and logistics audit: Do all staﬀ involved in the logistics function understand the fundamental interdependencies between the logistic objectives, the manipulated variables and the observed variables? Is there a regular refresh activity? . Does a logistics audit form part of the quality management system?
H.-H. Wiendahl et al.
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From a practical point of view, the answers a company provides to the questions above directly indicate areas that the company has to improve in order to achieve a holistic PPC conﬁguration and to avoid the stumbling blocks described. From a scientiﬁc point of view, further research has to be carried out in order to adapt the organisational and human aspects of existing performance management theories to the ﬁeld of production management and integrate them into the framework for conﬁguring PPC systems.
Acknowledgements This article reports on research activities of the project ‘Modellbasierte Auftragsmanagement-Gestaltung’ (Model-based Conﬁguration of the Order Management Process) that is funded by the German Research Foundation (DFG) under registration WI 2670/1.
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Hans-Hermann Wiendahl studied Industrial Engineering at the Technical University in Berlin. He has worked at the Fraunhofer Institute for Manufacturing Engineering and Automation (IPA) and at the Institute for Industrial Manufacturing and Management (IFF), University of Stuttgart, since 1996 where he held positions as researcher, department manager and now technical manager ‘Order Management’. He completed his PhD under the supervision of Professor Westkampfer and is now working on his habilitation thesis. His main research interests are in ¨ production management, especially PPC, as well as in the selection and implementation of ERP and MES systems. He was responsible for numerous research and industrial projects and has published on these subjects extensively. Gregor von Cieminski holds a degree in Manufacturing Sciences and Engineering from the University of Strathclyde in Glasgow. He is a research assistant at the Institute of Production Systems and Logistics (IFA) at the University of Hannover. As a member of the production management research group his interests are in the ﬁelds of logistic modelling of production processes and supply chain management. He has published several articles on these subjects in scientiﬁc journals and conference proceedings.
Hans-Peter Wiendahl studied Mechanical Engineering at the Engineering School in Dortmund, at the RWTH in Aachen and MIT (USA). Under the supervision of Professor Opitz, he completed his PhD in 1970 and his habilitation thesis in 1972. Until 1979 he was manager of planning and quality at Sulzer Escher Wyss GmbH in Ravensburg before becoming the head of paper machinery design for the same company. He became professor and head of the Institute of Production Systems and Logistics (IFA) at the University of Hannover in 1979 and held this position until 2003. His main research interests are in production management, factory planning and production systems. He is the author and publisher of numerous books and articles on these subjects.
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