Hi all,
in the 1st stage of production we produce SFG that will be used in a later date on an offshore site.
Demand is driven by forecast. Currently forecast figures are very irregular due to Sales Organisation inputting numbers.
Coverage is set-up correctly, but the production proposals still show irregular demands.
Production unit is Period 30 days. So we would like to see a steady monthly flow of same sized order quantity. However since it is forecast driven. We see still Monthly differences of orders:
quantity can go from 19 mio units, to 4 mio units the next month to 2 months 0 units to 10 mio units the next. While production cap. for this item is 5 mio units/month max.
Now if we set-up site specific order settings: Standard Order quantity to 5 mio units. It does not smoooth out over the course like for instance a moving average. But gives mutiple order for 5 mio in one month. The months with 0 units requested remain 0. We would like it to show a more or less smoothed out curve for all months without having to change the demand forecast.
How would we best get tp this?
The standard order quantity is an order modifier, it is not an instruction to smooth the demand. If you want a smooth demand I suggest you create a forecast to reflect this and plan to the smoothed forecast whilst retaining the irregular sales forecast for comparison.
When demand is driven by an irregular forecast the supply will match the irregularities
Hi Adam,
thank you for taking the time out to respond on my post. It’s very true that it’s better to solve the cause, then to bandaid a problem. Unfortunately, all the sales departments who are responsible for setting forecasted are momentarily bound by other factors. So there is no choice for production to proceed with the way laid before us.
Imagine i have demand increase in month 1, 2 and 3 no demand in month 4, 5 and a huge demand in month 6. Hence also proposals in these months. (for the time being we will assume it’s same month delivery.
Is there a way to install site specifics so that month 4 and 5 will be used also. So we can adapt our production planning accordingly.
Building up some safety stock to handle demand increases without just increasing demands in months 1-3 and 6 which happens now. Since capacity is already overloaded, i see no other way to achieve this.
Maybe you can share some insights.
Thank you in advance
You would need to manually smooth the supply - the system will not do this because of the forecast - pushing rubbish in plans rubbish.
Then once smoothed the next run will replan through forecast - so you would need to configure action and future messages to basically ignore all suggestions to replan against the forecast.