Computer System Flowchart of Production Planning

  1. Engineering design department creates Specifications for special sales orders and sends it to the production planning department. A production planning clerk enters the data into the computer system. The computer system updates the new information in two master files.
  2. Production Specification file:
  3. Operations file:
  1. Sales forecasts (expected future sales) and the back-order report (out-of-stock item report)are used to determine production needs. The process is done manually, and the results of this process are the production requirements by products. It shows how many units of each product the production department needs to produce. The data in the documents is entered into the computer system at the end of each day in batch process.
  1. Two master files from step one and data from step two are used in the process of preparing production and materials needs. This online process requires the access to the following files.
  1. Raw materials inventory file (master file): Specifies how much of each raw material is available in stock.
  2. Machine loading file (master file): Specifies capacity and availability of all machines in the factory.
  3. Open production orders file (open file):Adds a new record for the new production run or order. Contains those production orders that are still in process. Specifies authorized production of a specified quantity of a product.
  4. Production schedule file (master file): Specifies how much of each product is to be produced during the period, by whom, by department, and by date.

The open file is the open production order file.This online process adds new data into these files. The process creates eight documents and reports that are distributed to different departments.

  1. The following documents are sent to customers as acknowledgements.
  1. Bills of materials: Lists the components that are required to build each product, including part numbers, descriptions, and quantity.
  2. Operations List: Lists the sequence of steps required to produce each product, including the equipment needed and the amount of time required.
  3. Sales Order: Used to gather information regarding orders from customers.
  1. The following documents are sent to production operations.
  2. Production order: Authorizes production of a specified quantity of a product. It lists operations to be performed, quantity to be produced, and location for delivery.
  3. Move tickets: Document the transfer of parts, materials, and work in process inventory throughout the factory.
  4. Materials Issue cards: Authorize the release of raw materials.
  1. Revised Production Schedule is sent to production work center. It includes scheduled starting dates and work centers.
  1. Material Requirements Report: Authorizes movement of the needed materials from the storeroom to the factory floor. This report is a daily list of all materials needed to support jobs in process and fill production orders.

5 Technologies to Improve the Production Planning System

1)Bar coding of materials to improve speed and accuracy.

2)RFID tags can eliminate human intervention in the scanning process.

3)Robots and computer-controlled machinery is called computer-integrated manufacturing (CIM).

4)Separation of duties for production employees in order to have checks and balances to deliver products more accurately.

5)Activity Based Costing (ABC)

-refine and improve cost allocations under either job-order or process costing systems.