Theory of constraints based information systems in production management

Abstract

Management, in general, consists of several activities such as planning, organizing, leading and controlling an organization, improving processes, decision making etc. Production management covers the same activities, but it is focused especially on production system. This paper deals with production planning that is one of the most important activities of production management. Some planning problems are too complex to be solved without using an adequate software tool. Several planning methods used in business information systems are presented in this paper. All of the mentioned methods are based on TOC (Theory of Constraints) principles and all of them should help to simplify decision processes on production management level. The goal of this paper was to explore the influence of TOC based planning information systems on company performance and outcomes. Our research was focused especially on make-to-order companies where capacity problems are very frequent. Therefore this paper deals only with information systems that include TOC principles in their planning algorithms as the very important tool for optimal utilization of constrained resources and increasing production throughput. Our research was divided into two phases. In the first phase we addressed manufacturing companies in order to identify the major problems in production planning processes. We found out that a lot of mentioned problems relate with the absence of a special software application for production planning and scheduling. Almost 70% or respondents still use MS Excel or any similar software application for this purpose. It is not an adequate tool for solving capacity or the next complex planning problems. We also found out that companies which use any advanced planning solution are not able to measure its benefits in the most cases. In the second phase of our research we focused on Czech information systems providers and tried to identify all TOC based planning systems that are offered on the Czech market. We found out that the most often used advanced method for production planning is APS (Advanced Planning and Scheduling), but not all offered systems include all four of its planning algorithms.