Can Differentiated Production Planning and Control enable both Responsiveness and Efficiency in Food Production?

This paper addresses the complex production planning and control (PPC) challenges in food supply chains. The study illustrates how food producers' traditional make-to-stock (MTS) approach is not well suited to meet the trends of increasing product variety, higher demand uncertainty, increasing sales of fresh food products and more demanding customers. The paper proposes a framework for differentiated PPC that combines MTS with make-to-order (MTO). The framework matches products with the most appropriate PPC approaches and buffering techniques depending on market and product characteristics. The core idea is to achieve more volume flexibility in the production system by exploiting favourable product and market characteristics (high demand predictability, long customer order lead time allowances and low product perishability). A case study is used to demonstrate how the framework can enable food producers to achieve efficiency in production, inventory and PPC processes – and simultaneously be responsive to market requirements

Supply Chain Control Principles in Local Food Production: A Norwegian Case Study

Based on an analysis of the supply chain of four producers of local specialty foods, we explore how planning and control principles can be applied to align supply chain capabilities and market requirements. It has been shown that local food struggles with market access, and that the supply chain is one of the obstacles preventing local food producers from gaining a solid market position. We identify a number of features of the local food chain, analyse the obstacles and develop generic designs and control principles for local food producers

Differentiated production planning and control in food supply chains

The PhD thesis reports on an empirical and exploratory investigation of the strategic determination of the principles used to guide production planning and control (PPC) in the food sector. Food producers have traditionally focused on offering customers high quality products at low prices, and products are generally made to stock (MTS) to meet customers' delivery lead time expectations. Efficiency in food production is critical and producers have relied on producing in large volumes to keep unit costs down. On the other hand, customers also require producers to respond quickly to changes in the market place. In an attempt to better meet customer requirements, the food sector has adopted more market-oriented principles in the way production is planned and controlled - shifting from the dominant MTS approach to applying more make-to-order (MTO) and combined MTO-MTS approaches. However, which PPC approach to choose in which situation is still unclear. This study therefore investigated how food producers can differentiate their PPC approaches to better meet the requirements for both responsiveness and efficiency. Four research questions (RQs) guided the research: RQ1: What are the characteristics of food supply chains? RQ2: How can PPC be differentiated according to food supply chain characteristics? RQ3: What are the potential benefits of differentiated PPC? RQ4: What are the tactical and operational challenges of differentiated PPC? The RQs were addressed using a design science approach combining literature studies and a case study. The case study was conducted in TINE, Norway's largest producer, distributor and exporter of dairy products. The study was mainly conducted in the period 2010-2013, and analyses were performed and solutions developed in close collaboration with company representatives in order to strengthen the trustworthiness of findings and results. RQ1 found that the market and product characteristics typically require responsiveness from food producers, while producers' production systems are mainly focused on efficiency through exploitation of scale benefits. Thus, there is a lack of strategic fit between the external requirements stemming from product and market characteristics and the capabilities of the production system to enable the required level of responsiveness and efficiency. In order to answer RQ2, a concept for differentiated PPC was developed, consisting of the following principles: Favourable product and market characteristics like low perishability, high demand predictability and long customer order lead time allowances should be exploited to provide flexibility to the production system PPC approaches should be differentiated according to food supply chain configurations, i.e. product and market combinations Slack resources in the form of inventory, capacity and time should be differentiated to buffer against demand uncertainty Based on these principles, a framework for differentiated PPC was developed. The framework identifies appropriate PPC approaches and buffering techniques for each supply chain configuration. The concept and framework were then used to design a new PPC system for the case facility, also leading to the development of a decision tree for determining a product's demand predictability. RQ3 investigated the potential benefits of the differentiation approach to PPC. The proposed PPC system was not implemented as part of the study and effects could therefore not be measured. Expected benefits were instead substantiated by combining insights from literature and the case study, with effects grouped into six categories; improved quality, higher speed, better dependability, higher flexibility, reduced costs, and improved performance of the PPC function. The concept for differentiated PPC is based on combining MTO and MTS in the same production system, and RQ4 discussed the additional challenges this imposes on the tactical and operational PPC levels. The discussion concluded that the traditional material requirements planning (MRP) method is likely to continue to be the backbone of PPC in the food sector, but that MRP combined with a workload control (WLC) planning method could be a potential solution for tactical and operational PPC in such hybrid production environments

Tactical and Operational Issues in a Hybrid MTO-MTS Production Environment: The Case of Food Production

Hybrid production environments that combine MTO and MTS strategies have emerged to enable production systems to better respond to changes in consumer and market demand. This paper discusses some of the tactical and operational production planning and control (PPC) issues involved in such hybrid production environments, using the food industry as an illustrative case. The discussion identifies MRP combined with WLC as a promising approach for incorporating MTO items into an MRP planning environment on the tactical and operational levels. Additional techniques are required to incorporate uncertainty and provide flexibility in this particular context and these should be further investigated taking different food supply chain characteristics into considerationacceptedVersio

Can Differentiated Production Planning and Control enable both Responsiveness and Efficiency in Food Production?

This paper addresses the complex production planning and control (PPC) challenges in food supply chains. The study illustrates how food producers' traditional make-to-stock (MTS) approach is not well suited to meet the trends of increasing product variety, higher demand uncertainty, increasing sales of fresh food products and more demanding customers. The paper proposes a framework for differentiated PPC that combines MTS with make-to-order (MTO). The framework matches products with the most appropriate PPC approaches and buffering techniques depending on market and product characteristics. The core idea is to achieve more volume flexibility in the production system by exploiting favourable product and market characteristics (high demand predictability, long customer order lead time allowances and low product perishability). A case study is used to demonstrate how the framework can enable food producers to achieve efficiency in production, inventory and PPC processes – and simultaneously be responsive to market requirements

Tactical and Operational Issues in a Hybrid MTO-MTS Production Environment: The Case of Food Production

Part VI: Services, Supply Chains and OperationsInternational audienceHybrid production environments that combine MTO and MTS strategies have emerged to enable production systems to better respond to changes in consumer and market demand. This paper discusses some of the tactical and operational production planning and control (PPC) issues involved in such hybrid production environments, using the food industry as an illustrative case. The discussion identifies MRP combined with WLC as a promising approach for incorporating MTO items into an MRP planning environment on the tactical and operational levels. Additional techniques are required to incorporate uncertainty and provide flexibility in this particular context and these should be further investigated taking different food supply chain characteristics into consideration

Control Model for Intelligent and Demand-Driven Supply Chains

Orchestrating supply chains is challenging. This chapter describes how to control a supply chain to make it truly demand-driven – based on the assumption that all relevant information is made available to all partners in real time. The chapter explores the elements of a framework for intelligent and demand-driven supply chain control, with regards to the overall concept and associated principles, and demonstrates these in a case example. Challenges to the realization of the proposed control model include trust and power, supply chain dynamicity and uncertainty, and required investments in competence, standardization, and information and communication technology. Some of these can be met through initial small-scale implementations of the proposed model, to demonstrate effects, and by exploiting facilities for information sharing and collaboration, like supply chain dashboards and control studios. Future research within operations management, technology and information and communications technology (ICT) will support broader realization of the proposed control model

Can Differentiated Production Planning and Control enable both Responsiveness and Efficiency in Food Production?

This paper addresses the complex production planning and control (PPC) challenges in food supply chains. The study illustrates how food producers' traditional make‐to‐stock (MTS) approach is not well suited to meet the trends of increasing product variety, higher demand uncertainty, increasing sales of fresh food products and more demanding customers. The paper proposes a framework for differentiated PPC that combines MTS with make‐to‐order (MTO). The framework matches products with the most appropriate PPC approaches and buffering techniques depending on market and product characteristics. The core idea is to achieve more volume flexibility in the production system by exploiting favourable product and market characteristics (high demand predictability, long customer order lead time allowances and low product perishability). A case study is used to demonstrate how the framework can enable food producers to achieve efficiency in production, inventory and PPC processes – and simultaneously be responsive to market requirements

Sustainable Food Supply Chains: Towards a Framework for Waste Identification

Part 1: SustainabilityInternational audienceReduction of waste in food supply chains is an important sustainability issue. More efficient utilisation and management of the resources and values created in food supply chains can contribute to improving competitiveness, and environmental and social responsibility. This study uses the seven wastes approach from lean theory to classify categories of waste in fresh food supply chains and to identify at which stage of the supply chain waste occur. A case is used to illustrate the applicability of the classification. The analysis identifies four categories of waste in the fresh food supply chain; time, distance, energy and mass. The study indicates that the majority of waste is hidden in time, energy and mass categories, related to overproduction, defects and transportation