This chapter gives two examples: a family plan example illustrating consolidation, explosion, and rollup calculations; and an operations plan example illustrating supply site and production line calculations.

Family Plan Example
Gives an example that illustrates consolidation, explosion, and rollup calculations for a family plan.

Operations Plan Example
Gives an example that illustrates operations plan calculations for supply sites and production lines.

This example illustrates consolidation, explosion, and rollup calculations for a family plan. Calculations are shown by planning week.

For each week with sales forecasts, Global Consolidation (33.7.1) calculates global forecasts by totaling family forecasts from marketing sites. Family forecasts can either be recorded directly or rolled up from end-item forecasts.

The consolidation uses the item’s average weeks-of-coverage factor (2.0) to calculate global target inventory levels. Therefore, each week’s global target inventory equals the sum of the next two weeks of sales forecasts.

The consolidation calculates global production due as:

For family-level planning, the initial opening quantity on hand is always zero. For subsequent weeks, the previous week’s quantity on hand equals the target inventory level.

If production due for the first week increases from 750 to 900. The system recalculates quantities as follows.

The consolidation initially calculates projected weeks of coverage as the family item’s average weeks-of-coverage factor. But the system recalculates it when you change production due.

For each week, the system subtracts the forecast for each upcoming week, until it encounters a week for which the on-hand quantity is insufficient to cover the forecast. It then divides the remaining inventory by the sales forecast for that week. Finally, it calculates the weeks of coverage by totaling the number of complete weeks and the decimal for the partial week.

Family Plan Explosion (33.7.14) calculates dependent end-item demands for family item gross production due quantities. To do this, it uses either the planned or calculated forecast percentage for the subfamily, which you specify when you run the explosion. Once you select this percentage, however, the calculations are the same.

Whenever units of measure vary between family and subfamily levels, the explosion converts quantities to the unit for the lower level. In this example, the family unit is metric tons, and the end-item unit is cases. A case weighs 36 kilos, so the unit-of-measure conversion factors are 1 CS = 0.036 TN and 1 TN = 27.78 CS.

The system stores dependent end-item demands as sales forecasts. Source Matrix Explosion (33.13.8) uses these forecasts to calculate the end-item operations plan.

Family Plan Rollup (33.7.13) updates the family plan when you change end-item information—for example, when you change production due quantities. In this example, production due for the first week increases from 6,250 to 6,500 cases.

The rollup works much like Family Plan Explosion (33.7.14), only in reverse. It starts by converting the end-item quantity back to the family item unit of measure.

The rollup also recalculates the actual end-item forecast percentages and stores these in the family hierarchy record.

In Global Production Maintenance (33.7.3), you would also see that the rollup correspondingly updated the family item’s gross production, projected weeks of coverage, and projected quantity on hand.