Fixing planning in the VUCA world
Abstract
The essence of any business is flow. The flow of materials and/or services from suppliers — perhaps through multiple manufacturing plants and then through delivery channels to customers. The flow of information to all parties about what is planned and required, what is happening, what has happened and what should happen. The flow of cash returns from the market to the organisation and through to the suppliers. This paper makes a critical connection between the concept of flow and the material requirements planning (MRP) inputs, processing logic and assumptions and introduces a necessary change in processing logic to address the challenges companies experience today. The true purpose of planning — to promote and protect the flow of relevant information and materials — was the driving purpose behind the development of MRP. Throughout this planning and information system evolution, MRP’s basic requirements, assumptions and processing logic have remained unchanged. Despite newer and more powerful planning, and control applications powered by cloud-based infrastructure, the basic approaches to planning manufactured and purchased items have remained largely a constant since the 1960s. This paper proposes an innovative pragmatic proven methodology that enables a company to successfully sense and adapt to changes in the volatility, uncertainty, complexity and ambiguity (VUCA) world.
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Author's Biography
Carol Ptak is currently a Partner with the Demand Driven Institute (DDI) and was most recently at Pacific Lutheran University as Visiting Professor and Distinguished Executive in Residence. Previously, she was Vice President and Global Industry Executive for Manufacturing and Distribution Industries at PeopleSoft, where she developed the concept of demand driven manufacturing (DDM). Carol spent four years at IBM Corporation, culminating in the position of Global SMB Segment Executive. A leading authority in the use of enterprise resource planning (ERP) and supply chain tools to drive improved bottom line performance, Carol’s expertise is well grounded in four decades of practical experience as a successful practitioner, consultant and educator in manufacturing operations. Her pragmatic approach to complex issues and dynamic presentation style has her in high demand worldwide on the subject of how to leverage these tools and achieve sustainable success. She holds an MBA from Rochester Institute of Technology and completed the EMPO programme at Stanford University. Carol is a frequent educator at university level and presents at many key technical conferences around the world, including South Africa, France, Israel, Australia, Ireland, the Netherlands and 11 APICS International conferences. In addition to her collaborative works with Chad Smith, she is the author and coauthor of the books MRP and Beyond (Irwin Professional, 1996), ERP, Tools, Techniques and Applications for Integrating the Supply Chain (Ptak and Schragenheim, CRC Press, 1999), Necessary but Not Sufficient (Goldratt, Schragenheim, Ptak, North River Press, 2005) and Theory H.O.W. – How Organizations Could Work (Ptak and Cavallaro, Specialty Publishing Company, 2006). Carol is certified through APICS/ASCM at the fellow level (CFPIM) and was certified in Integrated Resource Management (CIRM) with the first group internationally. Carol was the President and CEO of APICS, The Educational Society for Resource Management for the year 2000. Prior to her election as APICS President, she served on the society in a variety of positions.
Chad Smith is Co-founder and Partner of the Demand Driven Institute (DDI). Prior to DDI, Chad co-founded Constraints Management Group (CMG) in 1997, a services and technology company specialising in manufacturing, materials and project management solutions for mid-range and large manufacturers. He served as Managing Partner of CMG from 1998 to 2015. Clients past and present include Unilever, LeTourneau Technologies, Boeing, Intel, Erickson Air-Crane, Siemens, IBM, The Charles Machine Works (Ditch Witch) and Oregon Freeze Dry. In addition to the collaborative works with Carol Ptak he also coauthored Demand Driven Performance: Using Smart Metrics (Smith and Smith, Industrial Press, 2014). Chad is also a certified expert in all disciplines of the Theory of Constraints studying directly under the tutelage of the late Dr Eli Goldratt.
Citation
Ptak, Carol and Smith, Chad (2024, December 1). Fixing planning in the VUCA world. In the Journal of Supply Chain Management, Logistics and Procurement, Volume 7, Issue 2. https://doi.org/10.69554/GWUD5741.
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