Tuesday 18 December 2018

Function of the PPIC (Production Planning and Inventory Control)

Production Planning and Inventory Control

PPIC stands for Production Planning & Inventory Control. PPIC is a part of the corporate organization that bridges the 2 department ie: marketing & production.

Inventory or supplies for a company is an asset in the form of supplies of raw materials/raw material. The goods are in the process of production, and goods that are own for sale. Because the inventory is stored in the warehouse, warehouse and inventory management so very concern. Warehousing itself is unity of components in the Supply Chain product.

The warehouse serves as a storage area for goods Yes, to be used in the production process. This storage function is often called space inventory, warehouse of raw materials, etc. Companies large or small, for the procurement and storage of the goods it needed large expenses. Storage costs each year generally reaches about 20 – 40% of the price of the goods. For it takes a strategy or a good inventory management so that optimum inventory costs.


In the organizational structure there are several variations to expresses the function of Planning and warehouse (material ware house and Final Product ware house), to such a condition, the PPIC charge on Monitoring Inventory (Safety Stock, issue a Bill of materials, inventory data accuracy, the effectiveness of the system).

Whereas the activities of the warehousing, such as; 1) Reception, storage and delivery of raw materials to the processing, 2) acceptance, storage, and delivery of the final product to the Customer, 3) Operating System information, Generally under the control of the Head Ware House-level Supervisor or Manager , tailored to the scope of his responsibilities.

Production Planning Control

The General duties of the PPIC is received an order from the Sales (Sales/marketing) then make sure the order was completed and sent to the customer at the time of the already agreed upon. Simple isn't it?

Not have expected PPIC function definition, closely related to the functions of Marketing, Purchasing, and production. In addition, information on the levels of raw materials, Work in Process (WIP), the Final Product, and the data stock name to part Finance especially in the manufacture of the company's financial reports are also included in the responsibilities of the PPIC.

Some companies have production planning management style that looks technically different, but in general this function is not much different. The situation of the Market demand of manufacturers able to apply the most appropriate operating strategies. One example, to suppress the storage costs, customer demands manufacturers implement production models make to order, with a variation of the high product items and reservations in small quantity. These factors will greatly affect the system planning model inside.

PPIC specifications

I invite you to explore the role of PPIC specifically. There are stories that can explain this pattern, we have a production model of the MTO, with market Japan as one of the "potential market", the pattern of the order goods from the Customer/Distributor Japan very interesting. When items come in the port, container directly distributed to their Customer. So our products need not be removed from the container. These distributors are already entering the schedule of arrival and unloading. When arriving at the harbor there, so they don't need the intermediary Warehouses to store. Not only this, it is usually a pattern of MTO was follow by variations of the product. It is very high in a Lot of small-lot orders. Which in practice will make production activity becomes more difficult and potentially raise the cost.

Case as above to show so difficult to Manufacture to take control of the customer. Play in the "niche", we should not just talk function, but other aspects which own product will be a value added, in winning the competition.

If you are a practitioner who is familiar with the process of PPIC Make to order (MTO). It has a very high variation of product items, and accept. The order in lots of small-lot, the model order like this usually very troublesome, especially in the stages of the realization of the product. Whether it's coincidence or not, the condition is becoming a sort of Boomerang for process manufacturing as a whole.

Internal management & issues

One of the biggest internal problem we manufacture low flexibility, i.e. The ability of production parts in following marketing strategy sometimes is still very less. For that PPIC is responsible in determining and evaluating the production system. It would have to be complete manually or using software in this system. Absolute manage it there under the responsibility of the PPIC. Sometimes. Weak understanding and awareness of leader-leader of the production of this cause. It is often the presence of internal conflict among the PPIC and production.

I relationship with the PPIC production like "Tom and Jerry". Although it does not cover possible, with certain considerations. Such as flexibility changes the direction of the production, supply and distribution of material, data, among. The PPIC and production are under one roof or Division operations. Each led by Top-level managers.


From the example of case I have ever encountered in field, a model such as this requires Operational Manager with figure of leadership & knowledge that is very strong, if not will occur over lapping Job, the limit of liability that is not clear, and the most danger that is a concession-concession or agreement negative effect on pullback schedule delivery and material consumption is relatively high.

PPIC is not a robot, which only run activities in accordance to applicable procedures. But in the team, a group of people with the PPIC contains. Basic qualification which have the nature of learner/learning people. It have some analytical skills, and systematic. So not only are running systems that already exist. But rather on ensuring effective run system or my term "Rule Maker".

Design Planning and Inventory Control

The role of information systems in the production planning activity is enormous. So the magnitude of it until I dare assure you. Without the help of software, activity planning will not be optimal. Planning is not only working on the issues of planning. But is related to the management of the inventory.

Automatic Planning should have a Link with the system of Purchasing and Ware house in real time and up date. This is still in scope inventory, excluding the supervisory activities of the production process.

Any change in the processes associated with rescheduling, reset (Remake), request for additional material, etc. It is certainly going to affect the allocation of capacities all the scheduling. The question is, could it be Ms. Excel do?

If I go in sync, I know, the answer is "probably not". Excel can only do it separately and depends on the operator to perform a series of updates.

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