Why is APS more critical today than a decade ago?
APS solutions have become more in demand by industries in recent years compared to the early 2000s. This is not just about the natural commercial growth a product experiences as it consolidates in the market. We could even say that this type of growth is hampered by the reduced prominence of Brazilian industry in recent decades and the consequent decrease in this consumer market. It's more than that. Perhaps the most significant factor in this equation is the increased volatility of the supply chain caused both by extraordinary events, such as the pandemic, and by the more globalized market profile, with greater interdependence between economic actors. This means that a small fluctuation on one side generates a large wave at other levels of the supply chain . Despite collaborative efforts such as CPFR or technologies that provide visibility in the chain, the bullwhip effect is a harsh reality. In other words, it's not an isolated case due to the pandemic. We are talking about a basic law of physics applied to the market. A system that grows and heats up in the long term brings with it this entropic characteristic of greater disorder and randomness. And this increase in entropy is a headache for those who need to plan their production and inventory. Oh, it really is! As if that weren't enough, we also see a substantial increase in the volume of SKUs that industries have in stock, mass customization strategies, as well as a reduction in product life cycles (see fast fashion in the fashion industry and the increasingly frequent launches in technology, just to give easy examples). This makes one characteristic of the industry increasingly evident as a competitive differentiator: agility . And here we have a term that is difficult to measure financially. A business owner cannot compare, on an equal footing, the attractiveness of an investment in machinery with an investment in agility. However, at the mes time, we know that it generates a better level of service, a reduction in lead time that improves the company (the difference between cash outflow for the purchase of raw materials and revenue inflow from customers) because we will get to our customers faster and probably receive payment sooner. Being more punctual and delivering faster than the competition may not be on the company , but it is a competitive advantage in most industries. APS ( Advanced Planning & Scheduling ) were designed not only to create efficient plans (with reduced setups and waiting times), but also to update them mes make rescheduling changes very quickly in the face of changes, seeing the impacts throughout the production processes, in a future horizon that can be mes . These changes can be in supply , production or demand . In terms of supply, our suppliers may not meet their delivery deadlines or deliver insufficient volumes mes material . Production can also experience problems such as variations in pace, labor shortages, maintenance, and various other factors. Finally, demand can also vary greatly. It is very common for a PPC to receive an urgent request from the sales department and make changes to the production plan in the short term, but without identifying the real medium-term impacts of these modifications on other products and processes. Therefore, at the end of the month, the targets are not met, and the reason is unknown because PPC failed to establish the causal relationship between the events when there was still time, and now it is too late. A robust APS solution will allow you to see this causality and quickly decide what to do, simulating scenarios and comparing them. While good demand planning can reduce surprises and bring more stability, on the other hand, we have a stark truth: unpredictable events and products (items with low forecastability ) will exist and, in many cases, will increase. As Mike Tyson said: "Everyone has a plan until they get punched in the face." A good fighter is one who reacts quickly with a new plan before getting knocked out.
And how can neo help your industry?
NEO Engenharia de Produção is a Siemens Smart Expert Partner and offers solutions that include business analysis and APS software . We've created a new concept that values cutting-edge technology and technical excellence, while mes believing in human sensitivity, creative work, and personalized, committed relationships. Contact us using the form below or via WhatsApp to learn more about our solutions and schedule a personalized analysis tailored to your business needs. Schedule your production with experts in technological solutions.