Introduction

In our previous blog we discussed the added value IT in the wire & cable industry for Product Engineering and Quoting as well as for Sales and Invoicing. We will now explore how to improve business performance by investing in IT for Planning.

Planning in the wire & cable industry is a balancing act to maximize production efficiency while keeping inventory at an acceptable level. At the same time, the cables have to be shipped to the customer at the confirmed date.

The planner is dealing with two issues:

1. At the one hand, the planner will try to create efficient production runs at the extruders and armoring machines by grouping production jobs and minimizing change-over losses in time and material.
2. On the other hand, the planner will avoid to move jobs forward too much as this will increase the capital consumption in inventory of (semi-)finished products.

It is this domain where IT can show off its core competency of mass data processing and complex computing. Planning software is able to calculate a longer-term preliminary plan based on an ever-increasing number of parameters.

For the wire & cable industry it is important that length-based inventory netting, grouping and ‘parallel consumption of materials’ is supported in these calculations. E.g. the system should take the maximum drum size for production into account when creating planned orders. The planner can review and adjust the results before releasing the planned orders in time-buckets (typically one week) to the procurement and production departments. The production manager will typically apply a second round of optimization to the orders in these time buckets to achieve optimal production efficiency while taking the complex context of the production operations into account. We will discuss this in more detail in the next paragraph.

Information Technology can be instrumental in the planning process to reduce costs of products by optimizing production runs, resulting in higher margins for the company. The effort to optimize production processes should not bring the level of inventory turnover below acceptable levels. We have seen that IT can help in this balancing act.

In our next blog we will discuss how IT can contribute to Production.