Production Planning and Control: Process, Steps and Tools

Late orders, idle machines and piles of half-finished work usually point to the same root cause. The factory is not planning and tracking work in a structured way. Experienced supervisors can keep things moving for a while, but that approach struggles as volumes and product variety grow.

This guide explains the planning and control process step by step. It then shows which software tools support each stage.

Key Takeaways

• Planning decides what to make, when and with which resources, while control checks that work follows the plan.
• The core process covers forecasting, master scheduling, material planning, routing, loading, scheduling, dispatching and follow-up.
• Accurate data on demand, stock and capacity matters more than complex planning methods.
• ERP tools connect demand forecasts, material plans and shop floor progress in one system.

What Is PPC?

Every factory must balance customer demand against limited machines, labour and materials. Production planning and control (PPC) is the function that manages this balance. Planning sets targets and the sequence of work before production starts. Control monitors progress and corrects deviations as work moves through the shop floor.

Many manufacturers call this team PPIC, which adds inventory control to its scope. The goal stays the same: deliver on time at the lowest practical cost.

Objectives of PPC

A well-run planning function serves several goals at once. The main ones are:

• Meeting delivery dates promised to customers.
• Using machines and labour efficiently without overloading them.
• Keeping raw material and finished goods stock at sensible levels.
• Reducing work-in-progress, waiting time and rework.
• Giving management reliable data for capacity and investment decisions.

How Planning Differs by Production Type

Planning methods depend on how a factory makes its products. The three main production types each need a different focus:

• Job production makes one-off or low-volume custom items. Planning focuses on routing, realistic lead time quotes and sharing machines between orders.
• Batch production makes groups of identical items in runs. Planning balances batch sizes against changeover time and storage costs.
• Mass or continuous production runs standard products at high volume. Planning focuses on line balancing, steady material flow and preventive maintenance.

Many factories combine these types, such as batch processing followed by custom finishing.

The PPC Process Step by Step

The process splits into a planning phase and a control phase. Each phase contains several linked steps that feed into one another.

Planning Phase

1. Demand forecasting. Planners estimate future demand using sales history, confirmed orders and market input. Forecasts set the volume the factory must prepare for.
2. Master production scheduling. The master production schedule (MPS) states which products to make, in what quantity and in which period. It balances demand against available capacity.
3. Material planning. Planners calculate the raw materials and components each schedule needs. They compare requirements with stock and open purchase orders to decide what to buy.
4. Routing. Routing defines the sequence of operations and the work centres each product passes through. It also records standard set-up and run times.
5. Loading. Loading assigns work to each machine or work centre. It checks that the assigned hours stay within available capacity.
6. Scheduling. Scheduling sets start and finish times for every job and operation. Common methods include forward scheduling, backward scheduling and priority rules such as earliest due date.

Control Phase

1. Dispatching. Dispatching releases approved work orders, drawings and materials to the shop floor.
2. Follow-up and expediting. Supervisors track progress against the schedule and clear bottlenecks, shortages or breakdowns.
3. Inspection. Quality checks confirm that output meets specifications before it moves to the next stage.
4. Corrective action. When output falls behind, planners reschedule jobs, add shifts or move work to other machines.

Common Challenges With Manual Planning

Many small and mid-sized factories still plan in spreadsheets and on whiteboards. Manual production planning and control works when demand is stable and product variety is low. It fails when orders change daily and planners cannot see live stock or machine status. Typical symptoms include:

• Frequent rush orders that disrupt the schedule.
• Material shortages found only when a job is due to start.
• Over-optimistic delivery promises from the sales team.
• No reliable record of actual run times or scrap.

ERP Tools That Support Each Stage

Software does not replace planning judgement. It gives planners accurate data and removes manual calculation. The main ERP functions map directly to the steps above. Before buying, check that your bills of materials and routings are accurate, because every plan depends on them.

Demand Forecasting

Forecasts start with clean sales data. ERP demand forecasting analyses order history, seasonal patterns and open quotations to project future volumes. Planners can then adjust forecasts using market knowledge before they feed the master schedule.

Master Scheduling and Capacity Planning

Planners need to see whether the factory can deliver what sales has promised. ERP production planning tools build the master schedule and compare it with work centre capacity. Overloaded periods show up clearly, so planners can shift jobs or add shifts in advance.

Material Requirements Planning

Material shortages often delay production even when machines and labour are free. ERP MRP breaks each product’s bill of materials into component requirements across the planning horizon. It then nets these against stock and open orders to suggest purchase and work orders.

Shop Floor Control

Plans only work if planners know what is happening on the floor. ERP shop floor control captures job start and finish times, output quantities and scrap through terminals or mobile devices. Supervisors see live progress against the schedule and react before delays spread.

Connected Manufacturing Data

These tools work best when they share one database. An ERP manufacturing module links bills of materials, routings, work orders, inventory and costing. Finance then sees actual production costs without manual reconciliation.

Measuring PPC Performance

Metrics show whether planning decisions work in practice. Strong production planning and control should move these numbers in the right direction over time. Track them monthly:

• On-time delivery rate against customer promise dates.
• Schedule adherence, meaning jobs completed as planned.
• Overall equipment effectiveness (OEE) for key machines.
• Inventory turnover for raw materials and finished goods.
• Planned versus actual lead times.

Final Thoughts

Effective planning starts with clear demand, accurate stock data and realistic capacity figures. The control phase then keeps work on track through dispatching, monitoring and quick corrections. Factories still relying on spreadsheets for production planning and control should start by connecting forecasts, materials and shop floor data. If you are reviewing options, Awebstar can help you scope manufacturing ERP software around your current workflows.

Frequently Asked Questions

What is the difference between production planning and production control?

Planning decides what to make, when and with which resources. Control monitors actual progress and corrects deviations from the plan.

What does PPIC stand for?

PPIC stands for Production Planning and Inventory Control. It combines production scheduling with management of raw materials, work-in-progress and finished goods.

What is the difference between MRP and ERP?

MRP calculates material requirements for production. ERP includes MRP plus finance, sales, purchasing, inventory and other business functions in one system.

Which scheduling method works best?

It depends on your production type. Backward scheduling suits make-to-order work with fixed due dates, while forward scheduling suits make-to-stock environments.

Can small factories benefit from planning software?

Yes. Even small factories gain from accurate material planning and live job tracking. Cloud ERP options also reduce upfront costs for smaller operations.