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Manufacturing planning

Manufacturing planning is a method to predict future manpower requirements, facility requirements, and equipment needs. Manufacturing planning helps companies plan for all the future needs of the company including financial planning. Market forecasting is used as the basis of determining the future requirements. Your manufacturing strategy, product structure, and production methods all impact your company's ability to use manufacturing planning. Manufacturing planning is a total company commitment to using all of its resources more effectively.

All companies must answer the basic "when, why, where, and how" questions as they pertain to their manpower needs, facility needs, and equipment needs. Once the changes are met, the company will begin to reduce excess waste and increase profitability. It is focused on having the right resources available at the right time.

Manufacturing planning is not only focused on the long-term costs of the company, but improving the short-term costs as well. A company needs to create 3 different planning structures:

  • Short-term planning

  • Medium-term planning

  • Long-term planning

Manufacturing planning will help your company determine the costs of the projected inventory needed for future orders and the cost of the current inventory. This will allow your company to financially prepare for these costs so you are not overwhelmed by bills when the supply for your product is decreased. Manufacturing planning is completely focused on minimizing costs. Looking over past mistakes and costs, you can predict the costs for the future and eliminate certain wastes. Acquiring un-needed assets can significantly hurt your company, especially if the demand for your product lowers due to market fluctuations.

For example, if you own a printing company and you purchase a new warehouse because you think your company will continue growing and you will need the extra space, you are losing money on that warehouse until you move into it. If the market declines and you do not need the warehouse, your investment will be lost. You will be unable to re-coup the money you invested into the building, causing financial ruin for some companies. Many companies do this by purchasing equipment they do not yet need. They predict that the company will outgrow its current state and they over-exaggerate how much the company will actually grow.

Successful manufacturing planning will help you predict when you need to purchase the new equipment. This is usually done at a time when you have almost outgrown the equipment and you need it now, not in the future. Any investment you make in equipment needs to produce a speedy return. Waiting until your company is ready can reduce your investment loss and save your company thousands of dollars. Another common mistake companies make is waiting too long before they make the investment in new equipment. If your workers are overwhelmed with the production, you need to invest in more machines or more workers as soon as possible. When you wait too long, you are wasting time, which is a loss in money.

To have manufacturing planning work for your company, you must be able to make realistic predictions for your company. The investments you make need to be focused on the current state and future state of the company. Any company can become profitable by increasing productivity through a proper balance of manpower, machinery, and facility requirements.

A simple way to start manufacturing planning within your company is to look at the assembly line and the organization of the machines. Is there a way you can reduce the amount of wasted space at your company? Do your employees have enough room to properly perform their job duties? Start with simple things like the organization of the floor and then start moving your way up through management.

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