Planning ahead

From a shaky start, advanced planning and scheduling (APS) software has seen an almost meteoric rise to stardom in recent years. The ascendancy of APS specialists such as Preactor – which has grown at a compound average of 17% year-on year over the last two decades – proves the point. As does the company's expansion in recent years around the world, with latest developments including new offices in Dallas, Texas, to support US manufacturers wanting to get on board, as well as France, Spain and, as we go to press, Brazil and China as well. It's also the case that APS software is being implemented not only at SME sites, as an adjunct to existing ERP systems, but increasingly also in much larger companies, for the usual reasons – including to improve production sequencing and optimise operations for best OTIF metrics. That's, in part, a direct result of the massively extended breadth and depth of the available software and consulting expertise, covering everything from scheduling small shopfloors to APS spanning whole companies and out into their supply chains. And, according to Mike Novels, chairman and managing director of Preactor, this, in turn, has led to Preactor and its subsidiaries designing and implementing more APS systems direct, in line with the diktats of larger organisations. "Our global partners are still very important, in terms of scoping and implementing APS systems. However, as a percentage of overall sales, they have reduced from around 80% to 65%, as more manufacturers insist on sourcing their consulting from our regional companies direct." That's not true everywhere, though. Novels explains that some parts of the globe are more mature than others, in terms of understanding the value and efficacy of bolting on APS. "In the UK, management teams understand very well what APS is and what it does," he asserts. "We're way past the hype and scepticism years here. France and Brazil are also very mature, but Germany is not – in that case, probably because of the prominence of SAP solutions. Meanwhile, China, for example, is only just becoming aware that APS is something they ought to be considering." Quite apart from purchasing preferences, the maturity factor perhaps explains any residual reluctance to move beyond the realms of spreadsheets and workarounds in some organisations and regions. Company ownership, and the resulting culture and IT strategy, still has a significant bearing on how production scheduling and management problems are viewed and solved. Nevertheless, for operations directors, finance directors, IT directors, etc, who already have APS and may now be considering their systems' functionality – wondering where to prioritise further investment – Novels has two messages. On the one hand, he says, APS packages from Preactor have been significantly upgraded and extended (upwards and downwards), in terms of scope, scale and functionality. And, on the other, he explains that the company has now also moved on from its APS roots and released its first demand and capacity planning suite. That may pleasantly surprise many in the industry – particularly when they learn that Preactor is using a similar pricing model to its existing APS sales and offering the software for less than £15,000. Scheduling speed Looking at new APS software, Novels says: "Preactor 12, for example, will be launched before the end of this year, with a lot of new capabilities, as well as a new look and feel. Most important for larger companies with more complex APS requirements, it's also orders of magnitude faster than its predecessor, in terms of dealing with larger production data sets. So scheduling speed is really impressive." And the firm has also improved its integration software. "Preactor Link is another powerful introduction," continues Novels. "Preactor has always worked by linking into manufacturers' existing ERP systems, but with this package, the connection is straight out of the box. And that's not only for ERP, but also MES [manufacturing execution systems] and the like." What about Preactor's brand new demand and capacity planning software, dubbed Preactor 400 GMPS? Novels explains that existing Preactor users, particularly those in FMCG (fast moving consumer goods), have for some time been pressing for this – especially given the sky-high prices typically bandied about for equivalent functionality. "This is a new market for us, outside our heritage of detailed scheduling, and instead addressing the related issue of longer-term capacity planning," says Novels. "The main problem we needed to tackle for these manufacturers was essentially forecasting automatically against variable demand, and in very dynamic environments. These are not trivial problems, so to make the development process as fruitful as possible, we encouraged enthusiastic users to be part of the programme. We were able to see where their existing solutions weren't quite working, aspects they would like to be able to handle, etc. Then they were involved in using our prototype software, providing feedback, bouncing around ideas and so on." We're not talking small beer, either. Among leading lights in Preactor's beta testing initiative were Mars and Premier Foods. As a result of this level of participation, Novels says that the new software has very rounded functionality. Indeed, he believes that it will quickly appeal far beyond the FMCG sector for which it was developed. "A lot of manufacturers will want to buy the software to transform their longer term planning, and then use the output of likely demand to feed into their existing Preactor APS systems so they can run 'what ifs' ahead of time. "Bear in mind that, unlike APS – which is necessarily tightly integrated with ERP, and works at the order level – demand and capacity planning works in parallel with ERP at the product level. Essentially, it extracts aggregated demand [confirmed orders versus stock SKUs and future demand] and then forecasts what will need to be made and when, in line with stock control rules – and the implications for each SKU. Then it receives actual data over a defined period before making another plan, and so on. And it works in make-to-order, as well as make-to-stock, mode." Most important, though, Novels says the software has been designed to be very interactive. "So, for example, if it shows that you can't make enough of a particular SKU with the current capacity, you can switch between infinite and finite capacity modes to understand potential impacts several months ahead. It enables management to explore the implications of a range of longer horizon production and supply chain options to help them optimise decisions against forecast requirements." The bottom line: Novels is not suggesting that manufacturers need now to switch their attention from APS to capacity planning. Far from it: if they haven't already investigated APS, they ought to be doing so, he says – perhaps by learning from the likes of UK playground equipment manufacturer Playdale, engineering giant Siemens in Austria, South American long steel maker Gerdau and Asian computer packaging specialist Advantek, all of which have turned around their production scheduling with Preactor APS in the last 12 months. However, he is saying that for those many manufacturers also wrestling with demand forecasting and capacity planning, there is now an affordable and very proven solution.