What is APS? To some it is an Advanced Planning System, to others it's Advanced Planning and Scheduling. Good start in the understanding stakes eh? Fortunately, however, there is a pretty common understanding of its capabilities and that is the ability to synchronize all resources, whether they be material, mechanical or human, with customer demand.
Not synchronization again!
I'm absolutely certain that I've written and you've read the phrase "synchronizing resources" many times before when discussing other application areas, which I guess is good in terms of uniting today's demand-focussed application goals, but kinda confusing when deciding just what fits with what and what you do or don't need as a system purchaser. So let's investigate the promise of APS a bit further.
The growth of multi-site operations, outsourced manufacturing and sub-contracting across the external supply chain, has greatly increased the complexity of the total manufacturing and thus the planning and scheduling challenge.
Lead times are not fixed as conventional MRP (Material Requirements Planning) would have you believe, they are dynamic. Just as when you travel home from work the journey time will probably be different to that in the morning. Capacity is not infinite it is finite and there is a need to plan in hours and sometimes minutes rather than daily time buckets, responding to schedule changes and taking into account all constraints and bottlenecks simultaneously. Conventional MRP also stands accused of pulling in stock too soon in contradiction of the just-in-time manufacturing concept leading to excessive and expensive stock holdings.
APS over MRP
It is the different way in which APS calculates due dates and allocates resources that has been heralded as delivering huge gains for manufacturers. Of course individual systems may vary operationally, but in principal APS deals with total resource planning. It defines all the resources and when in the manufacturing process they are required. It doesn't expect all the materials to be available at the start of the cycle and calculates in real time the knock-on effects of late component deliveries, resource interruptions, staff absence or planned down times. This approach gives a manufacturer back days of previously lost lead time and much reduced stock-holding time through accurately predicted just-in-time (JIT) deliveries.
APS schedules backwards from the due date to produce the earliest start date using standard times and checking the available materials. It then schedules forward checking actual available capacity and taking account of bottlenecks, to produce the earliest possible delivery date. From the result, actual material required-by days for each stage are generated, and order dates are adjusted accordingly. Customer promise dates reflecting the current shop floor loading situation can be quickly up-dated if changed priorities, machine breakdowns or delivery shortages enter the manufacturing equation. This higher accuracy in delivery date projection results in improved customer service and higher percentage of on-time delivery.
Most APS systems have a graphical planning board of some sort that shows the total shop-floor loading at any given time and indicates any bottlenecks. Drilling down within a bottleneck display shows details of which orders are involved and can be further broken down to individual operations which can be re-scheduled by dragging along the time line. Guide lines indicate adjustments which can be made without affecting other customer promise dates and jobs can even be reallocated to alternative machines or work centres, with the effects checked on a "what if" basis. Reductions in expediting and overtime and decreased disruption to and non-productive time on the shop floor.
Huge gains?
So just how huge are the gains reported by manufacturers from successfully implementing APS? Well, reports of a 15 to 25% increase in productivity, up to 50% reduction in inventory, 50% reduction in work in progress and 80% improvement in on-time delivery performance are apparently common. This does seem a absolutely huge gain and perhaps not a truly representative figure, but you certainly get the picture.
APS and ERP
What is the difference between APS and ERP systems and if a manufacturer already has ERP to plan with why do they want APS?
In order for an organization to benefit, a typical APS is usually tied into an organization's ERP system since that is generally where all data resides. A manufacturer will want to receive and pay for materials, bill for goods sold, and these functions will still need to be handled by the ERP system. But because ERP tends to focus on the here and now and maintain a historic record, including the financial condition of the company, its backward looking nature provides historical planning data to help predict the future. But the future it plans is based on fixed lead times and infinite capacity which is fundamentally incorrect as lead times are not fixed and capacity is finite. APS routinely deals with the future and organizes based on finite capacity and dynamic lead times.
Greater accuracy
Whilst some planning data does reside in an ERP system, invariably it is only a portion of the data that a good planning system needs, say 80% as a rough guide. Elements such as Item numbers, Bills of Materials, Routes etc will all be used but with modification and enhancement to enable more accurate planning and scheduling.
For example, if you have a crew of operators who man three machines, ERP will load the machines where as ASP will want to treat the crew as the constraint and load the hours they can work. Alternative machines can be considered by ASP whereas ERP will default to a preferred route. By its nature an ERP system operates using a single set of prescriptive rules and it is actually normal for alternative strategies and business rules to be first tested in a planning system before being incorporated into an ERP system. Therefore APS provides a test bed for alternative business rules and are often indispensable for assessing inconsistent or missing data.
Vendor shift
ERP systems concentrate on recording what has happened to plan for what will happen. APS predicts what will happen and provides transparency to manage what you want to happen.
However, the connection between the two systems is one reason why most major ERP vendors have joined the market by introducing APS-based modules. APS systems are part of a family of software systems that make up the Supply Chain Execution (SCE) market and more and more traditional planning vendors are moving towards providing execution solutions, that is solutions that deliver real time actionable data, to drive fast and flexible supply chains and which help to build a more demand-driven organization rather than a push-driven organization.
