Manufacturing managers and executives need to understand that the CRP and scheduling tools provided by ERP systems have only a very limited ability to predict downstream consequences of a change of any kind. For example they have no tools to help them intelligently prioritize their workload, they have no ability to accurately estimate the promise date of a new order and they have no way to synchronize material and capacity constraints.
The CRP module is unable to accurately calculate the projected demand and utilization of capacities because it uses a number of techniques that have severe limitations such as:
Back in the mid 1980’s it was recognized that ERP systems were not providing manufacturers with the tools they needed to send information to the shop floor and to track what was going on in the shop floor. This opened the door for software vendors to provide what they called Manufacturing Execution Systems (MES).
It is my experience in working with hundreds of manufacturers over the years that very few of them accurately measure their on-time delivery performance. This is somewhat surprising given the critical relationship between delivering on-time and keeping customers happy.
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