Integrated planning system, Subject, object and subject of supply...

Integrated Planning System

In order to organize effective supply chain planning, there must be a planning system, i.e. an ordered set of organizational forms, methods and tools for determining goals and methods aimed at achieving the set goals.

Thus, the planning system is a whole complex of elements (subject, object, object, means, process and planning mechanism) (Figure 2.5).

Elements of the planning system

Fig. 2.5. Elements of the planning system

All of the above items should be directed to the planning system performing the following tasks:

• increasing the controlled market share;

• foreseeing customer requirements;

• achieving a higher level of logistics service;

• ensuring coordinated actions of participants in the supply chain.

Subject, object and subject of supply chain planning

The subjects of planning are the enterprises entering the supply chain and ensuring the achievement of the set goals.

Planning by the enterprises the activity within the supply chain allows to find answers to the following fundamental questions of the market economy:

1. What products, goods and services should be produced in the supply chain?

2. How much production or goods is advantageous in the supply chain and what economic resources should be used?

3. How should these products be produced, distributed and how to organize production and distribution?

4. Which enterprises will produce and distribute these products?

5. Who will consume these products, goods and services?

6. What infrastructure supply chain is needed to ensure the effectiveness of its activities?

7. How can the supply chain adapt to the market and how will it adapt to internal and external changes in the market?

From these main questions posed to the supply chain, it follows that the basic planning object is the interrelated system of planning and economic indicators characterizing the logistics processes in the supply chain.

Planned activities are draft plans.

Supply Chain Planning Principles

In order for integrated planning to ensure the effectiveness of the supply chain, appropriate planning principles must be followed. As the main distinguish the following principles:

planning needs - means ubiquitous and mandatory application of plans when performing any kind of logistics activities;

unity of plans - is that all plans developed by the enterprises of the supply chain (production, distribution, supply, transportation, etc.) should be are closely linked to a single logistics plan;

continuity of plans - implies a gradual transition from strategic to tactical plans, and from them to operational ones, as well as the necessary interaction between short- and long-term plans;

flexibility plans - suggests the possibility of adjusting the established indicators and coordinating the activities of participants in the supply chain;

accuracy of plans - means drawing up plans based on reliable information using the methods that will ensure the accuracy of planning that the supply chain wants to achieve;

optimality of plans - provides the need to choose the best option at all planning stages from several possible or alternative;

effectiveness of plans - requires the development of such an option for all participants in the supply chain, which, with existing resources and capacities, ensures the greatest economic benefit;

the balance of plans - the principle of valuation, according to which for any supply chain, there is an optimal combination of various resources to ensure the maximum (effective) satisfaction of customer needs;

holism - is to coordinate and integrate plans. Integration is the coordination of plans between different levels of planning, coordination covers the alignment of plans within a single level.

Based on these principles, a planning mechanism is formed.

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