Production Planning & Control,

Vol. 16, No. 7, October 2005, 634–651

Stumbling blocks of PPC: Towards the holistic

configuration of PPC systems
H.-H. WIENDAHL*y, G. VON CIEMINSKIz and H.-P. WIENDAHLz
yInstitute of Manufacturing and Management (IFF),
University of Stuttgart, Nobelstrasse 12, 70569 Stuttgart, Germany
zInstitute of Production Systems and Logistics (IFA),
University of Hannover, Schönebecker Allee 2, 30823 Garbsen, Germany

Manufacturing companies often complain about the difficulties they face in meeting their
customers’ logistic requirements. Many blame the perceived inadequacies of their production
planning and control (PPC) software for their performance deficits. The paper illustrates
why this is only a partial view of the causes of the shortcomings. PPC software is just one
of six configuration aspects of the entire PPC system. The authors argue that the configuration
of the PPC aspects objectives, processes, objects, functions, responsibilities and tools has to be
carried out methodically and consistently in order for the PPC system to function properly.
The analysis of examples of so-called ‘stumbling blocks’ of PPC, inadequate configurations
of one or several of the aspects, supports this claim. The paper closes with the proposal of a
checklist that the authors suggest as a first approach to ensure the consistent configuration of
PPC systems.

Keywords: Production planning and control systems; Configuration aspects of PPC systems;
Stumbling blocks; Configuration and operation of PPC systems; Actors in PPC

1. Introduction A historical review reveals various causes of the

unsatisfactory logistic performance and, considering
It is almost 30 years since Orlicky (1975) first described these, the solutions that a holistic configuration of
the material requirements planning (MRP I) algorithm. PPC systems requires. In the past, critical evaluations
To this day the algorithm remains the kernel of many of PPC methods identified the limited capabilities of
production planning and control (PPC) systems. Despite computer hardware as the principal cause for the insuffi-
30 years of progress in PPC theory and practice, and cient fulfilment of logistic objectives. These hardware
the definition of additional key functions, a large limitations only allowed a step-by-step development
number of manufacturing companies remain unsatisfied of PPC algorithms. Due to this, the manufacturing
with the degree of fulfilment of their logistic objectives. resource planning (MRP II) algorithm that followed
Recent surveys prove that companies still miss their MRP I is characterised by the successive execution of
logistic targets by a wide margin (Fraunhofer IPT its functions. As real situations in manufacturing
Institute 2003, Wiendahl 2003a). This applies to the log- companies seldom conform to the rigid assumptions
istic performance measures of production—work-in- that are underlying this algorithm, there were calls for
progress levels, throughput times and schedule a more realistic consideration of practical conditions.
reliability—in the same way as to those of stores: PPC research therefore concentrated on the develop-
inventory levels, service levels and delivery delays. ment of new functions and algorithms (Plossl 1985,
Vollmann et al. 1997) and neglected the analysis of
*Corresponding author. Email: Hans-Hermann.Wiendahl@ the required preconditions such as an organisational
iff.uni-stuttgart.de framework for PPC (Kraemmerand et al. 2003).
Production Planning & Control
ISSN 0953–7287 print/ISSN 1366–5871 online # 2005 Taylor & Francis
http://www.tandf.co.uk/journals
DOI: 10.1080/09537280500249280
 Stumbling blocks of PPC
Over time, the remarkable progress of computer tech-
nology facilitated the application of more powerful
planning software such as enterprise resource planning
(ERP), supply chain management (SCM), advanced
planning and scheduling (APS) or manufacturing execu-
tion systems (MES) (Stadtler 2002). All of these systems
carry out a considerably larger number of functions
than their predecessors. They apply sophisticated
mathematical algorithms to solve multi-variable
optimisation problems and can thus consider numerous
planning restrictions simultaneously. Due to the
immense complexity of the implementation of these
large systems they often fail to produce the substantial
logistic performance improvements the companies
are hoping for (Davenport 1998). In contrast, other
businesses preferred ‘simple’ PPC approaches. The
increased popularity of just-in-time principles and
Japanese management methods made companies avoid
the application of software and focus on organisational
aspects instead. They achieved remarkable performance
gains, e.g. by the introduction of Kanban control cards
(Soder 2004). The contrast between highly sophisticated,
computerised PPC systems whose logistic performance
is insufficient and simple, rules-based control mechan-
isms that achieve astonishing results made researchers
and industrialists realise that the problems of PPC
cannot be solved by more powerful software alone.
There seem to be other causes of the described perfor-
mance deficits, which had been neglected so far.
The standard textbooks on PPC offer detailed
descriptions of the theoretical foundations of the PPC
functions, mainly mathematical models and algorithms
(Plossl 1985, Fogarty et al. 1991, Hopp and Spearman
2000, Vollmann et al. 1997). However, instructions on
the design and implementation of PPC systems are
uncommon or not very detailed. Fogarty et al. (1991)
emphasise that the choice of a logistic strategy should
reflect the nature of the customer demands. The logistic
strategy in turn determines appropriate manufacturing
strategies and the corresponding feasible planning and
control methods. Vollmann et al. (1997) stress the
importance of mapping the planning and control
processes specifically for the purpose of implementing
PPC software to support the planning functions. The
same authors provide a selection of the prerequisites
of the system implementation. Otherwise, there are
only case studies on MRP or ERP system implementa-
tions available that provide some indication on the
critical success factors of PPC systems (see, for example,
Akkermanns and van Helden 2002, Wiers 2002).
In general management literature, important
approaches are being discussed that aim to ensure the
fulfilment of business objectives. Publications on PPC
almost completely ignore these discussions, especially
635
as far as the role of operational employees is concerned.
Kaplan and Norton (1996) propose the balanced score-
cards as a method to link business strategies to specific
aspects of performance. Miles and Snow (1978) deter-
mine what types of business organisations lead to
above-average levels of performance. Maslow (1987)
and Huczynski and Buchanan (1991) explain the impor-
tant influence that human motivation and employee
involvement have on the performance of a business.
Storey and Sisson (1993) discuss the effects of
performance-related pay on the performance of a com-
pany and provide instructions on the effective design of
remuneration systems. In order to ensure that PPC
systems contribute to high levels of logistic performance,
these general methods and approaches have to be
adapted for the specific field of production management.
Publications that transfer these approaches to the field
of PPC have only recently been published (Wäfler 2003,
Wiendahl and Westkämper 2004, Nyhuis 2004).
According to the authors’ experience it is not only the
neglect of above-mentioned important factors but also
the lack of awareness of the correlations between sepa-
rate factors that affect the configuration of PPC systems
and lead to undesirable logistic performance deficits.
These so-called ‘stumbling blocks of PPC’ are errors in
the configuration of a PPC system as a whole. The
symptoms of these stumbling blocks, insufficient fulfil-
ment of logistic objectives, a lack of transparency and
excessive efforts required, are easily identifiable. Often
though those responsible for PPC on the operational
level are not able to simply remove the stumbling
blocks. On the one hand the interdependencies between
their causes make a final analysis more difficult; on the
other hand, the changes required by the situation can
exceed the competencies of the operational staff
involved. In most cases, only the managing directors
can remove the causes of the stumbling blocks.
Therefore, the objective of this article is to create a
framework for the identification, analysis and removal
of classic stumbling blocks of PPC:
. Section 2 defines the key terms of PPC. The PPC
system, configuration aspects of PPC and
stumbling blocks of PPC.
. Section 3 describes typical stumbling blocks of
PPC. The descriptions first identify their respective
symptoms, analyse their causes and present
possible solutions to remove the stumbling blocks.
The practical examples included in the discussion
of each stumbling block are based on the experi-
ences the authors gained in industrial projects.
The projects focus on the configuration of PPC
concepts, the selection of suitable software tools
and the implementation of both in practice.
636 H.-H. Wiendahl et al.
. Section 4 outlines a framework for the holistic
configuration of a PPC system. It lays the founda-
tions for a coherent and customised composition of
the planning and control functions of manufactur-
ing companies.
. The conclusions in section 5 draw the insights
together in the form of a questionnaire. The holistic
configuration of a PPC system should consider the
issues that the questionnaire raises in order to
avoid the formation of stumbling blocks.
This merges the aspects of the functions and data of
PPC as well as its processes and responsibilities in an
integrated model that provides a basis for the holistic
configuration of PPC systems.
2. Key terms of PPC
The PPC system is the central logistic control mechan-
ism that matches a company’s output and logistic
performance to the customer demands. The task of the
PPC system is to plan, initiate and control the product
delivery of a manufacturing company as well as to
monitor and, in case of unforeseen deviations, i.e.
disturbances or order changes, to re-adjust the order
progress or the production plans.
2.1 PPC system
In the context of this paper, the term ‘PPC system’
denotes the entirety of functions and tools used for the
planning and control of the logistic processes in a
manufacturing company. The scope of application of a
(a)
Source Make Deliver
Value-adding processes
Figure 1. Definition of a production planning and control system. (a) Scope of application and (b) configuration aspects.
PPC system includes the three value added processes,
Source, Make and Deliver, in accordance to the termi-
nology of the supply chain operations reference (SCOR)
model (Supply Chain Council 2004) (cf. figure 1a). The
input and output stores of a company are thus subject
matter of a PPC system in the same way as production.
The PPC system crosses company boundaries: It allows
for the requirements of customers and suppliers since,
following supply chain management principles, the
management of the storage processes takes the delivery
performance of the suppliers as well as the demand
behaviour of the customers into account. According
to this definition, the term ‘PPC system’ comprises
more than just the PPC software. The software is only
the tool to plan and control the logistic process chain
as well as the storage of production master data and
feedback data.
2.2 Configuration aspects of a PPC system
On the basis of this definition, six configuration aspects
of a PPC system can be distinguished (cf. figure 1b):
. The ‘logistic objectives’ of a company are situated
at the heart of the PPC system. If necessary, these
have to be differentiated for different departments
of the company.
. The ‘PPC processes’ determine the logical and
chronological order of PPC planning and control
activities. Thus they define the workflow of order
processing in terms of the information flow along
the logistic process chain. The activities related to
the material flow follow the same logic, but are not
directly a subject matter of the PPC system.
(b)
Function Process
Objective
Object Responsibility
 Stumbling blocks of PPC
. The ‘PPC objects’ are the planning objects of
PPC. The most important objects are the articles
(finished products, components or raw materials),
resources (machinery and personnel) and orders
(customer orders, spare parts orders, sample
orders, etc.).
. The ‘PPC functions’ define the activities that are
required to plan and control the logistic processes
in the stores and in production. The fundamental
activities are the definition of local objectives and
targets, forecasting and decision-making, providing
feedback on order progress as well as continuous
improvement.
. ‘PPC responsibilities’ determine the positions—and
therefore the members of staff—that are in charge
of certain PPC activities. Conventional PPC
systems ignore this organisational view as they
operate on the assumption that responsibilities
are organised by a central entity (see for example
Hackstein 1989, Vollmann et al. 1997).
. The five configuration aspects described above
constitute the logical core of a PPC system. The
purpose of the ‘tools for planning and control’ is
to support the operational order processing by
(semi-)automated PPC activities. This creates stan-
dards for the operational activities and relieves staff
of time-consuming routine tasks. More time there-
fore becomes available for the required planning
and control decisions.
These configuration aspects serve as a theoretical
basis to analyse and remove the stumbling blocks
of PPC.
2.3 Stumbling blocks of PPC
The presence of stumbling blocks of PPC becomes
apparent through symptoms such as the insufficient
fulfilment of logistic objectives, a lack of transparency
of order processing or an unnecessarily high effort of the
staff involved in carrying out PPC activities. The term
stumbling block exclusively applies to internal mistakes
in the configuration of the six aspects defined above.
Factors related to the external environment such as
unreliable suppliers or literally ‘chaotic’ customers are
not considered. The PPC system itself does not have
any control over these factors. Nevertheless, the external
factors represent requirements that have to be consid-
ered when designing the PPC system.
An analysis of the relationships between causes and
effects is required in order to detect and remove the
stumbling blocks.
637
Ideally, the symptoms can be traced back to a single
cause. In this case, only one configuration aspect is
affected and the mistake in the configuration is easily
detected and removed. An example is the entry of
incorrect planned capacity values into PPC software.
If, for instance, the capacity of a bottleneck work
system has wrongly been set at 18 hours per working
day instead of the correct value of 16 hours, production
overloads arise. This stumbling block can be
easily removed by a simple correction of the planned
capacity value.
In cases where several cause-and-effect relationships
influence or even amplify each other, the removal of
stumbling blocks becomes more complex. Here, several
of the configuration aspects are affected. Even though
their symptoms are as apparent as for the simple
stumbling blocks, their removal is a lot more difficult:
It is necessary to, first, identify the relationships between
the different causes. Secondly, the causes in different
configuration aspects have to be changed simultaneously
and in a co-ordinated way. Typically, this exceeds the
competence of the operational actors so that their
managers have to understand and remove the stumbling
block.
3. Typical stumbling blocks of PPC
The following examples describe the stumbling blocks
with several causes that are most commonly found in
industrial practice. Each explanation is divided into the
description of the symptoms and the analysis of their
causes. Measures that are used for the removal of the
stumbling blocks follow. The examples are based on real
situations in industrial companies.
3.1 Stumbling block ‘missing positioning in system of
logistic objectives’
The first example of a stumbling block of PPC highlights
the importance of defining consistent objectives and of
communicating the responsibilities for fulfilling the
objectives clearly to the staff that plan production
operations or carry them out.
In PPC, one can often find conflicts between the
logistic objectives work-in-progress level (WIP level),
utilisation, throughput time and schedule reliability
because they are neither compatible nor locally or
temporally constant (Wiendahl 1995). Accordingly,
one should never maximise or minimise the value of
just one objective, but consider the simultaneous
effects of measures on all logistic objectives. The nature
of these conflicts has been recognised for some time
638
(Gutenberg 1951, Plossl 1991). Nevertheless, many com-
panies are not aware of their consequences. Frequently,
production managers are trying to ‘optimise’ the utilisa-
tion of work systems concurrently to the throughput
time. Detailed investigations demonstrate that such an
approach is not target-oriented because ultimately no
single objective of the optimisation can be defined.
Substituting the minimum-cost objective for the logistic
objectives does not resolve the conflict. Instead, compa-
nies should start by setting strategic objectives derived
from the market environment (Ketokivi and Heikkilä
2003). Typical examples of such objectives are ‘Reduce
throughput times by 50%’ or ‘Maintain a delivery relia-
bility of 95%’. These objectives serve as the priorities,
which dominate the trade-off that has to be reached with
the remaining logistic objectives. The production oper-
ating curves are a proven methodology for the analysis
of the interdependencies between logistic objectives and
their consequences for PPC. They quantitatively
describe the dependence of the objectives utilisation,
throughput time and schedule reliability on the WIP
levels in production and can easily be computed
(Nyhuis and Wiendahl 2003). Figure 2 shows that the
best possible target values for the different logistic objec-
tives do not coincide at the same WIP level of a work
system. A classical example of this phenomenon is the
conflict between ‘short order throughput times’ and
‘high work system utilisation’ that was already
mentioned. Whereas short work system throughput
times can only be achieved at low WIP levels, high
WIP levels are required in order to guarantee a high
utilisation. This in turn leads to excessive throughput
times. The situation requires a trade-off between
the logistic objectives. Companies can achieve this by
Schedule
reliability
Maximum
ug hpu
T hro
Minimum
0 WIPTTPmin
WIPTTPmin : WIP level at target WIPUmax : WIP level at
throughput time
Figure 2. Logistic operating curves as a model of the
interdependencies between logistic performance measures.
H.-H. Wiendahl et al.
positioning their logistic processes at certain operating
points on the production operating curves.
The conflict between objectives described above
only represents a stumbling block if those responsible
ignore it in their day-to-day job. In a typical example,
the managing directors of a medium-sized manu-
facturer of construction components required short
throughput times to achieve short delivery times.
At the same time, they demanded a high utilisation
of expensive machinery in order to obtain a fast
return on investment. The production operation curves
clarify the conflict that the production department
faced as a result (cf. figure 2): On the one hand,
the objective of short throughput times requires a
low WIP level in production (WIPTTPmin). On the
other hand the objective of a high utilization
necessitates a high WIP level (WIPUmax). The inconsis-
tent directives of the directors are the cause for two
stumbling blocks:
. In day-to-day business, concrete decisions concern-
ing orders have to be taken. Conflicting manage-
ment directives fail to determine the most
important logistic objective. As a result a guideline
for these decisions is missing.
. As the management directives described above are
contradicting in themselves the target values that
are derived from them have to be as well.
Therefore it is impossible for operational planners
to take rational decisions.
The production operating curves are helpful tools to
analyse and remove both stumbling blocks:
. Initially, the curves explain the interdependencies
between the logistic objectives and facilitate their
relative prioritisation (step 1 of the logistic posi-
tioning).
Utilisation
. The remaining target values follow from the value
Maximum set for the most important objective. For example,
the desired throughput time determines both the
target utilisation as well as the target WIP level
(step 2 of the logistic positioning).
e
t tim Taking a strategic decision, the directors regarded
short throughput times as the most important objec-
tive. However, in order to implement the new manage-
ment directives, further boundary conditions had to be
considered. The machine operators still tried to
maintain high WIP levels at the work systems so
that they always see a work load in front of their
WIP level
WIPUmax machines and can reduce setup times by changing the
sequence of orders. Obviously, this strategy also
target utilisation
supports a high work system utilisation. At the same
time it adversely affects throughput time and schedule
reliability.
 Stumbling blocks of PPC
In order to maintain the desired prioritisation of the
logistic objectives, management should take the follow-
ing actions:
. Offer ‘qualification’ in production logistics to all
relevant employees (including shop floor operators)
and communicate the new priorities of the logistic
objectives.
. Verify the conformance of the logistic objectives
with the ‘interests’ of the employees. In particular,
management has to ensure that compensation
schemes effectively support the objective of short
throughput times.
The following section describes how those involved
influence production planning and control, and
how their decisions impact on the fulfilment of logistic
objectives.
3.2 Stumbling block ‘divergent stakeholder interests’
The second stumbling block confirms the importance of
the consistency between the logistic objectives and the
PPC staff who have the responsibility for meeting the
targets. It also stresses the fact that staff has to be
qualified in order to carry out PPC functions.
In an empirical study on the implementation of ERP
systems, Amoako-Gyampah (2004) came to the conclu-
sion that different levels of the management hierarchy
have different perceptions of the system to be intro-
duced. It is therefore essential that the managing
directors not only provide all future users with adequate
training in the application of the new system, but that
it is equally important they make efforts to convince
staff members of the benefits of the change and of the
necessity to utilise the new system to achieve enhanced
business objectives.
The report by Wiendahl et al. (2002, 2005) on the
introduction of a Kanban control is a prominent exam-
ple for the potential for conflicts between such business
objectives and the individual objectives and interests of
production employees. In this case, production manage-
ment wanted to reduce throughput time and WIP levels
significantly. The central planning department was
responsible for the design of the Kanban system and
the setting of its parameters. On the basis of customer
demands and target replenishment times the planners
also calculated the number of Kanban cards required.
The production department was briefed about the
changes and a subsequent trial run passed without
problems. The company therefore regarded the
implementation of the new production control system
as a success.
639
It came as a surprise that the production was not able
to sustain the aspired improvements for more than a
short time after implementation of the new control
system. Rather, both the values of WIP and throughput
times soon rose to old levels again. The detailed analysis
of the production department that was initiated as a
consequence, revealed insufficient consultation with the
production operators.
The operators pursued the objectives ‘job security’
and ‘stable order processing’ by stockpiling orders for
uncertain times in the future. This leads to unnecessary
safety stocks, permanent changes to the order sequence
and decreasing schedule reliability.
Obviously the pull principle that is underlying the
Kanban control does not conform to these interests of
the production operators: Kanban enforces temporary
idle times for most work systems. In order to counteract
this, the operators added copied Kanban cards to the
Kanban control loops to raise WIP to the previous
levels. Thus, they apparently resolved the conflicts
between the objectives of the company and their own
individual objectives. Production management only
realised that the unwanted modifications had been
made and understood the exact causes of the modifica-
tions after the analysis of the Kanban control system.
The example highlights the prerequisites for a
sustained successful implementation of the new control
system; thorough qualification of all staff involved and
an incentive system that emphasises the objectives of
due-date oriented order processing (in order to avoid
order sequence modifications) and flexible working
hours (in order to guarantee processing on demand)
rather than promoting the conventional objective of
high resource utilisation.
3.3 Stumbling block ‘missing responsibility
for inventories’
The third stumbling block illustrates the consequences
of a lack of coordination of the responsibilities for the
PPC processes and objects. They result in an insufficient
fulfilment of the logistic objectives.
Often, there is no clear dividing line separating one
area of responsibility from another. Typical symptoms
are high inventory levels of purchased components and
finished products, or recurrent discussions on the
binding effect of orders and their reliable fulfilment.
The company described in this section produces
make-to-order machines of medium complexity. Depen-
ding on the customer requirements, this may include
engineer-to-order operations. A detailed analysis
was initiated by the managing directors who were
640
dissatisfied with the high inventory levels of purchased
components and finished products, and the uncertainties
caused by sudden changes of due-dates or engineering
changes.
Figure 3a shows parts of the order processing chain.
Figure 3b indicates the problems resulting from an
unclear definition of interfaces: The production is
responsible for the material flow from the start of the
production order (i.e. printing of order documentation)
to the final operation (i.e. input to store). This includes
the responsibility for throughput times and WIP
levels. Subsequently, the finished products are handed
over to the sales department, either to be delivered
immediately or to be stored in the finished product
store. The purchasing department has the responsibility
for all purchased components. However, there is no
responsibility defined for the target inventory levels for
finished products. The company neither deemed it neces-
sary to define nor to regularly monitor them, because
final assembly should not take place before there is a
customer order. This should have prevented finished
products from being stored.
Recurring appeals to cut inventory levels remained
without effect. Instead, purchased component and
finished product inventory levels were steadily growing.
In addition, staff in the shipment area complained about
too small dispatch and storage spaces. The root cause
analysis showed:
. Initially, customers insist on the machines being
delivered as soon as possible. Near completion of
the order, they tend to postpone the delivery date
when they realise that the machine is not needed
now, e.g. because of building delays.
(a) places
fixed order
Purchasing
delivers
on time
(b) Responsibility
Purchasing
Parts fabrication order II
OP 1
Purchasing Purchased
components
Idle time
Printing order documentation
Figure 3. Stumbling block ‘missing responsibility for inventories’. (a) Status as planned and (b) actual status.
H.-H. Wiendahl et al.
. The actual start date of production is delayed
relative to the planned start date. The reasons are
product engineering changes due to changes in
customers’ requests or design modifications by the
engineering department.
Two issues have to be solved to improve the
interfaces:
1. Placing of orders (information flow): Does the
person who acquires new or altered information
directly benefit or have a quantifiable advantage
from passing it on? Would it be to his/her
disadvantage if he/she did not pass it on?
2. Delivery of orders (material flow): Does the
supplier have a direct, quantifiable benefit from a
timely delivery to his/her successor? Would a late
delivery be to his/her disadvantage?
In our example, a handover deadline was fixed for the
transfer of products to the shipment area, which is
within the responsibility of the sales department. The
resulting deadlines are realistic, because the calculation
of the order flow includes a capacity check.
. From a production point of view, the sales depart-
ment places fixed ‘orders’. The fact that products
are handed over without transferring inventory
responsibility to the sales department is the reason
why the sales department experiences neither an
advantage nor any disadvantage if it fails to pass
on the postponement of customer due dates.
. Likewise, from a sales point of view, the ‘promise’
made by production seems to be binding. But
production has no fulfilment risk: delivering
places
fixed order
Production Sales
delivers
on time
Responsibility
Responsibility Production
Sales
Parts fabrication order I
Assembly order
... ... OP 4
Finished Shipment Start-up
products
Throughput time production order Idle time Time
Input to store
 Stumbling blocks of PPC
goods on time means production is cleared of its
responsibility, without having to worry about
any penalties when orders are completed behind
schedule.
A possible solution may be to add the finished
product store to production’s responsibility. This initi-
ates the necessary improvements out of self-interest.
An analysis of the interface between production
and purchasing shows similar results: The required due
date for purchased components is calculated by back-
ward scheduling, before passing it on to the suppliers
with a safety lead time. Production takes no responsi-
bility for inventory levels from the planned start but
only after the order is actually started. This is why
production is merely interested in passing on informa-
tion regarding production orders being pulled ahead
but not about orders postponed. Frequently, the pro-
blem is solved by transferring the responsibility for
material dispatch and material inventory responsibility
to production.
3.4 Stumbling block ‘inconsistent responsibilities
for functions’
If the responsibilities for PPC objects, functions and
objectives are defined inconsistently, top management
is obliged to spend a high effort on resolving unneces-
sary disputes as the following example exemplifies.
One of the principal tasks of management is to clearly
define the responsibilities and assign the functions
within a company. It is generally accepted that appro-
priate objectives have to be defined so that responsibil-
ities within the organisation are consistent and therefore
the functions be carried out reliably (Kaplan and
Norton 1996). Unfortunately, reality often rather
reflects the informal organisation, i.e. the power struc-
ture among the persons concerned.
In a company with 300 employees, the ‘right way’ to
fulfil functions and to accomplish the given objectives
was the subject of heated discussions among the three
departments of dispatch, production and logistics:
Dispatch is responsible for order release, production
takes on capacity control and sequencing at the
work systems, and logistics is responsible for promising
delivery dates, thus being partially in charge of order
generation. Each department has its own system of
objectives, the priorities differ: The primary objective
of dispatch are ‘short throughput times’, the principal
goal of production is a ‘high utilisation’, while the top
priority of logistics is a ‘high schedule reliability’.
All these objectives were quantified by targets. The
641
resulting conflicts are illustrated by the following
disputes:
. Dispatch aims to release orders at the latest
possible moment to meet the objective of short
throughput times. Whenever demand is low,
intense debates with production are unavoidable.
Production wants orders to be released much
earlier to maintain a high utilisation.
. To meet the objective of high schedule reliability
and ensure that customers receive their products
on time, logistics strives for realistic delivery
promises. It sets the planned start and finish dates
as well as the sequence of orders in accordance with
these promises. As soon as demand rises, however,
the available capacities are not sufficient to keep the
promised delivery dates. Hence, production is
urged to raise capacity. If this is not possible, the
dispatch department is asked to release orders at
an earlier point in time.
. Usually, the parties concerned are not able to reach
an agreement. Therefore, often top management is
asked to solve the conflict and decide upon which
orders to release or which to speed up. Necessarily,
the set objectives are missed.
A helpful framework to remove this stumbling
block is Lödding’s (2004) model of manufacturing
control. Its basic idea is to combine the functions of
manufacturing control with the objectives of the
PPC system. Thus, it becomes possible to assess whether
the responsibilities for functions and objectives are
consistently defined. He defines the following four
functions (cf. figure 4a):
. Order generation determines the planned input and
output, as well as the planned order sequence.
. Order release determines when orders are released
to the shop floor (actual input).
. Capacity control determines the available capacity
in terms of working time and the number of staff
assigned to work systems, and thus affects the
actual output.
. Sequencing determines the actual sequence of order
processing for a specific work system, and thus
affects schedule reliability.
These functions affect the three manipulated variables
‘input’, ‘output’ and ‘order sequence’. The discrepancies
between two manipulated variables lead to the observed
variables of manufacturing control (cf. figure 4b):
. The start deviation results from the difference
between planned input and actual input.
. The WIP level results from the difference between
actual input and actual output.
642 H.-H. Wiendahl et al.

(a) (b) Planned Start Actual Order

input deviation Input release
Order
generation Disposition Throughput time
WIP
WIP level level
Order Utilization
release
Order Planned Actual Capacity
generation output Backlog control
output
Capacity
control

Schedule reliability

2 4 Planned Sequence Actual

sequence deviation sequence Sequencing
Sequencing 3
1

Production Function Manipulated variable Observed variable

Difference Direction Objective

Figure 4. Model of (a) functions and (b) logistic interdependencies in manufacturing control. Adapted from Lödding (2004).

. The backlog results from the difference between
planned output and actual output.
. The sequence deviation results from the discre-
pancy between actual and planned sequence.
The observed variables affect the objectives of PPC
described above, i.e. throughput time, WIP level,
utilisation and schedule reliability.
Figure 4b shows the interdependencies connecting
functions, manipulated variables, observed variables
and objectives to each other. The functions define the
manipulated variables, the observed variables result
from the discrepancies between two manipulated
variables, and the logistic objectives are determined by
the observed variables.
As a basic principle, conflicts arise when one de-
partment takes the responsibility for a specific ob-
jective when the accomplishment of this objective is
also affected by another department. These conflicts
obviously cannot be resolved by the persons involved.
Figure 5 illustrates how the responsibilities for
objectives and functions are defined by the described
company:
. The first conflict arises between the production and
the dispatch departments: Although order release
(via actual input) and capacity control (via actual
output) affect the objectives of throughput time
and utilisation, the responsibility for objectives
and functions is not united under ‘one authority’.
Accordingly, situations, in which the achievement
of an objective depends on the decisions of the
other department, require a higher authority to
make the final decision.
. The second conflict arises between the production
and the logistics departments: Production affects
the objective of schedule reliability via capacity
control (actual output) and sequencing, whereas
logistics impacts the objective via order generation.
Again the responsibility for objectives and func-
tions is not united under ‘one authority’. This inevi-
tably leads to a permanent conflict as described
in the above paragraph and requires a higher
authority to solve each case. For production to
call for an earlier order release to ensure utilisation
even complicates the matter, as a third party, i.e.
dispatch, has to be considered.
To remove this stumbling block the responsibility for
the complete order processing chain must be put ‘into
the same pair of hands’. An order management centre
could fulfil this role. Alternatively, it is possible to
divide the order processing chain into sub chains, in
which the responsibilities for objectives and functions
are combined.
3.5 Stumbling block ‘insufficient quality of
feedback data’
The insufficient quality of feedback data reported in
the following case is a symptom of the lack of
integration of all PPC functions in the tools for planning
and control.
Data quality has recently been identified as one of the
important factors in the configuration of PPC system
(Xu et al. 2002). All purposeful and successful planning
 Stumbling blocks of PPC
Dispath
Production
Order Planned
Logistics
generation* output
Logistics
Planned
sequence
Function Objective Observed variable
Difference Direction Manipulated variable
Figure 5. Stumbling block ‘inconsistent responsibilities for functions’.
and control depends on a complete, consistent and
current data basis for all planning, control, execution
and performance measurement activities (Wiendahl
et al. 2003a). Besides the production master data, the
production feedback data are especially important for
this purpose:
. Feedback data represent the inputs for the logistic
‘performance measurement’ carried out at the end of
a production planning period. Deviations between
the planned and actual values of logistic perfor-
mance measures lead to new control decisions or
the adjustment of target values (see section 3.6).
. For day-to-day business the continuous logistic
‘performance monitoring’ is more important.
The deviations between planned and actual order
progress detected by this function have to be
corrected by immediate control measures in order
to make sure that promised or planned due-dates
can be maintained despite order changes or
inevitable disturbances.
There is a range of possible causes for the insufficient
quality of feedback data, of which the IT structure in a
manufacturing company is one of the more significant
reasons. In a survey carried out by the Fraunhofer
Institute for Systems and Innovation Research in 2001,
60% of the companies responded that there is no
hardware connection between the production data
acquisition (PDA) software and the remaining IT
structure (Beckert and Hudetz 2002). A timely and fast
643
Actual Order
input Dispatch
release
Throughput time
WIP level
Utilization
Backlog Actual Capacity
output control
Schedule reliability Production
Sequence Actual Sequencing
deviation sequence
Responsibility * promised delivery date
Stumbling block
intervention of production control in production is thus
impossible.
At times there is a complex structure of mutual
dependencies that is underlying the symptoms. This is
exemplified by the following example: In the manufac-
turing company considered, the feedback data were
characterised by inconsistencies that resulted from a
substantial delay in recording the data in the PDA
software (only 75% of operations showed a positive
throughput time). However, the actual processing
times matched the standard processing times relatively
accurately. After the introduction of new planning
software the problem disappeared within a period of
six weeks.
A preliminary analysis showed that the feedback data
were only used for the controlling of costs but not for
the ongoing monitoring of the order progress. A second
‘manual feedback system’—local inspections by the
foremen—provided the feedback information required
to control the order progress in time. As the feedback
data were not immediately incorporated in the next
production plan, the operators did not recognise the
benefit of the plausible and immediate provision of
feedback data. The regular appeals by the production
managers to increase the quality of the feedback data
therefore did not have any effect.
The PPC cycle shown in figure 6 provides a basis for a
detailed analysis of the situation. It consists of a logical
sequence of the activities of production planning and
control. Based on insights from decision theory, the
644 H.-H. Wiendahl et al.
Set targets
Forecast
Learn
(Re-)Act
Plan Allocate
Evaluate Check Decide
Do Production
plan
Order Collect
Do
progress
Figure 6. The PPC cycle as a model for management and
execution activities.
cycle splits the four phases of the Deming cycle (Plan,
Do, Check, Act) (Deming 1992) into eight separate steps
(Balve et al. 2001, Wiendahl 2002).
The setting of targets during the ‘Act’ phase marks the
beginning as well as the end of the PPC cycle. The ‘Plan’
phase contains three steps that prepare the actual
production process:
. ‘Forecast’ determines the necessary information
inputs of production planning, i.e. the probable
demand for, as well as the supply of, finished
products, materials and capacities,
. ‘Allocate’ directly relates the demand for articles
and resources to their supply,
. ‘Decide’ defines the production plan.
The actual manufacture of the products is subject of
the ‘Do’ phase. The ‘Check’ phase has to ‘Collect’
information about the order progress in production
and to ‘Evaluate’ this in comparison to the original
plans. Differences between planned and actual require
corrective control measures. These are also referred to as
‘Re-Plan’.
If the PPC system regularly fails to achieve the
set targets, systematic errors may be the cause. For
this reason, the ‘Re-Act’ phase completes the cycle.
The ‘Learn’ step should help to avoid the performance
shortcomings in the future. PPC methods and the
various planning and control parameters contained
within them have to be set consistently and in accor-
dance to the logistic objectives. The required accuracy
of planning predetermines the tolerable delay between
production events and their feedback. An effective
performance monitoring is therefore a prerequisite for
realistic production plans (Wiendahl 2002).
In the chosen example, the fundamental causes of the
stumbling block were due to the open control loop
between decision and execution activities:
. At the start of the project the feedback between
the ‘Do’ and the ‘Re-plan’ phases malfunctioned.
The capacity planning function was missing from
the software in use, which thus produced unrealistic
production plans. The foremen had to correct
the production plans produced by the software by
extensive manual interventions. The low quality of
the feedback directly resulted from this: As the
operators did not see a direct personal benefit
from feeding events back plausibly and promptly,
they regarded the activity as a pointless exercise
leading to excessive effort.
. The introduction of new planning software
interrupted this spiral of errors. The operators
realised that the quality of the production plans
(in the shape of their own dispatch list) depended
on their provision of accurate feedback data.
This analysis explains why the problem with the
insufficient quality of feedback data disappeared in
this short period.
3.6 Stumbling block ‘errors in PPC parameters’
As is shown by the sixth example, the omission of a
key PPC function results in a stumbling block because
parameters in the tool for planning and control cannot
be set correctly.
One of the functions of PPC software is to effectively
support dispatch activities. Dispatch parameters in the
PPC software serve as the basis of (semi-)automated
dispatch decisions. The effectiveness of these decisions
therefore depends on the actors’ understanding of logis-
tic processes on the one hand and on the appropriate
setting of dispatch parameters on the other.
The central PPC planning parameters include the
planned values for the offset and replenishment times,
order throughput times and operation throughput times.
With the help of these time-based parameters purchase
orders are placed and production orders are scheduled.
Hence the parameters represent the logic foundation of
the entire due-date structure in a company. Figure 7
shows that the successive scheduling runs of the MRP
II approach utilise scheduling parameters at different
levels of aggregation. Between the level of an entire
purchasing process (parameter: replenishment time)
and the disaggregated level of separate operations
(operation and inter-operation times) there are
normally two levels of aggregation: one for the material
 Stumbling blocks of PPC
Function Parameter
Material requirements
planning: Replenishment time/
BOM explosion and offset dispatch level
offsetting
Planned order
throughput time
Capacity requirements
planning:
throughput scheduling
Planned operation
throughput time
Figure 7. Classical scheduling parameters of PPC.
requirements planning and one for the capacity require-
ments planning and scheduling. Therefore there are two
relevant types of stumbling blocks:
1. Inconsistent parameters: The scheduling parameters
at different levels of aggregation are inconsistent
(e.g. the offset of a manufactured component is
equal to 3 weeks, the sum of the throughput times
of all operations included in the manufacturing
order is equal to 4 weeks).
2. Unrealistic parameters: The values of the schedul-
ing parameters are normally not maintained at the
planned values in reality (e.g. the mean planned
throughout time of manufacturing orders is equal
to 5 days whereas the actual mean throughput time
is equal to 7 days).
Manufacturing companies often underestimate the
significance of correct parameter setting. The scheduling
parameters are merely estimated or derived from
historic data. In this way, a tool manufacturer used a
mean planned throughput time value of 27 working days
for scheduling manufacturing orders. This value was
based on the experience of the production foreman.
The actual mean value of the throughput time for the
manufacturing orders was equal to 32.5 working days.
The differences between plan and actual mean values
occurred due to the production bottleneck: a long
operation throughput time of a coating process.
The prerequisite for realistic planned values is
the knowledge of the actual values. The lack of a
performance monitoring function constitutes an obvious
645
Aggregation level
Dispatch level
3 2 1 Product
1 • (mean) purchasing time of entire
A purchasing process (external/internal)
2 I
3 • Dispatch level (BOM level)
B
may include one or more
Time production orders
Offset dispatch level 2
Production order
B • (mean) throughput time of
production order
• equal to replenishment time if
Time dispatch level includes only one
Throughput time production order B
production order
Operation
OP 1 OP 2 OP 3 • (mean) throughput time of operation
of production order
• estimated or calculated
Time
Throughput time operation 2 (inter-operation time + operation time)
stumbling block in this context. The company consid-
ered did lack this function:
. The feedback data—order master data and due
dates—have to be recorded at all work systems
on the shop floor (step ‘Collect’ in the PPC cycle
in figure 6). Subsequently, order throughput times
and other logistic performance measures can be
calculated from these.
. Subsequently, logistic performance measurement
has to determine the accuracy of the planning
parameters. This is achieved by comparing the
throughput time parameters set for the scheduling
function of the PPC software with the actual values
measured in production. If necessary, the param-
eters have to be adjusted bearing in mind the
logistic objectives (step ‘Learn’ in the PPC cycle
in figure 6).
. Only the introduction and regular execution of
the PPC cycle guarantees the accuracy of the
throughput time parameters. The procedure
described equally applies to all other PPC planning
parameters.
Adjusting parameters may lead to another stumbling
block: For the purpose of replenishing the finished
products store, the order dispatch function assumed a
throughput time of 27 working days. Backward sched-
uling runs generated the required production orders
based on this assumption. Thus, the difference of
5.5 days between the planned and the actual
throughput time affected the schedule reliability. The
646 H.-H. Wiendahl et al.

production was running into backlog. For this reason,
companies have to be aware not to enter the
vicious circle of production control when modifying
planning parameters. The next section explains
how to act correctly when these modifications become
necessary.
3.7 Stumbling block ‘lack of logistic understanding’
Due to a lack of logistic understanding, many manufac-
turing companies fail to make the correct connections
between decisions taken in the PPC functions and
their effect on the degree of fulfilment of the logistic
objectives.
How a production system deals with logistic issues
and how this affects planning and control has been the
subject of discussion for some time, especially in view
of the familiar shortcomings of the MRP approach and
the lack of logistic understanding on the part of the
users of PPC.
The vicious circle of production control is a particu-
larly illustrative example of how little is known about
the actual interdependencies between manipulated and
observed variables (cf. figure 8). In the USA this circle
was first described by Mather and Plossl (1978), while
Kettner (1981) and Wiendahl (1995) explained its
consequences to the German audience. The vicious circle
sets out from the mistaken conclusion that schedule
reliability is poor because the planned throughput
times are too short. This is shown in the throughput
diagram in figure 9a. When increasing the values of
the parameters in the backward scheduling run, the
orders will be released to the shop floor much earlier.
As orders cannot be started ‘in the past’, the input curve
takes a leap (one-off load surge), making the WIP levels
at the work systems and hence the length of the order
queues grow (cf. figure 9b). This implies, on average,
longer waiting times and longer throughput times of
orders, along with an increased variation of throughput
times (Wiendahl 2002).
As a result, the schedule reliability is decreasing
and completing important orders on time is only
possible by means of rush orders and costly expediting
exercises. The vicious circle is spiralling upward to
stabilise at a level where the amount of work pieces
stored as work-in-progress exceeds the storage capacity
(Wiendahl 1995).
The correct logistic analysis would be as follows: The
backlog is the actual cause of the due-date deviation of
orders (cf. figure 10a). This backlog cannot be reduced
by increasing the planned throughput times, but by
temporarily increasing capacities or outsourcing work.
Figure 10b shows the effects of this intervention: From
the ‘present day’ the backlog will gradually decrease.
As a result, adherence to the planned due dates is
improving, and from a certain point in time planned
and actual output are matched. However, such reactions
call for flexible capacities (Wiendahl 2002).
Outsourcing work for some time basically has the
same effect. However, compared to an increase of
capacity the impact will be delayed (cf. figure 10c).

Throughout
times and their
(a) Planned
Planned input
variation Actual = Actual input output
Work content

increase throughput time

Insufficient
Planned
delivery
throughput time Due-date deviation
reliability
(too late)
Actual output

Present day Time

Length of
queues
Planned
increases Input
throughput
New actual (planned/actual)
times are
(b) Planned
Work content

increased throughput time

output
Load
surge
Due-date deviation
Load on Planned
Orders (too late)
throughput time New planned Actual
work systems are released
increases earlier throughput time output

Present day Time

Figure 9. Inadequate logistic reaction to interrupt vicious

Figure 8. Stumbling block ‘lack of logistic understanding’ circle of PPC. Throughput diagrams for (a) initial situation
causes vicious circle of PPC. Adapted from Plossl and Kettner. and (b) for an increase in planned throughput times.
 Stumbling blocks of PPC 647
(a)
do not conform. This inconsistency shows analogies to
Planned Input
= Actual input
Planned output fluid mechanics (Wiendahl 2003b):
Work content

. Throughput time planning based on mean values

Actual output
assumes that the order stream resembles a steadily
flowing river (a so-called laminar flow of orders).
Backlog Only when throughput time variation is very low,
Present day Time schedule reliability is sufficient.
. If the order stream resembles a mountain torrent
(comparable to a turbulent flow of orders),
(b)
the focus has to be on the individual order. The
Planned input
= Actual input individual planning of throughput time ensures
Work content

schedule reliability despite strongly varying

Planned output
= Actual output
throughput times.
Such a situation allows for two alternatives:
Backlog

Present day Time . On the one hand, logistic turbulences might

be inevitable. Individual throughput times are
necessary and the software must be adapted
(c)
accordingly.
Planned input . On the other hand, the steady-river scenario is
Work content

Outsourcing = Actual input

Planned output
= Actual output
Backlog
Present day Time
Figure 10. Adequate logistic reactions to interrupt vicious
circle of PPC. (a) Initial situation, (b) temporary increase in
capacity and (c) temporary outsourcing.
A similar effect may be achieved by deferring make-to-
stock orders (orders not related to a customer request)
or rejecting customer orders, though the latter might
have a negative effect on the market.
3.8 Stumbling block ‘inadequate logistic guidelines’
The stumbling block described below shows the
consequences of a lack of consistency between the
PPC functions and the process, which the functions
are meant to control.
An important instance of wrong PPC parameter
setting is the formulation of inadequate logistic guide-
lines. In this case, the planned throughput times entered
in the PPC software are realistic and match the mean
value of the production throughput times. However,
the variation of the actual throughput times is higher
than the planned tolerance. Hence, the available
planning functionality (throughput time planning
based on mean values) and the actual throughput
time performance (high variation of throughput times)
feasible. Orders are processed according to the
FIFO rule (or maximum slack). A low variation
of throughput times ensures the planned schedule
reliability.
The relationship between logistic requirements
and logistic capabilities determines the choice of a
logistic guideline. The requirements depend on the
allowed due-date deviation (tolerance requirements),
the demand fluctuation (flexibility requirements) and
the delivery time (speed requirements), cf. figure 11
(Wiendahl et al. 2002, 2003b):
. Tolerance requirements: Is the planning tolerance
set for a value such as throughput time, smaller
than the actual variation?
. Flexibility requirements: Do the fluctuations in
demand exceed capacity flexibility?
. Speed requirements: Do heterogeneous delivery
times require heterogeneous throughput times?
If the requirements exceed the capabilities, it is
necessary to apply individual throughput times for
each order. Practical experience shows that missing one
of the three requirements is sufficient to increase the var-
iation of throughput times. In most cases, this is due
to varying order priorities or sequence changes meant
to avoid setup times. Accordingly, sufficient planning
tolerances, little demand fluctuations and homogeneous
delivery times allow for order throughput times to be
based on mean values. The same applies vice versa:
Heterogeneous delivery times, considerable fluctuations
in demand and tight planning tolerances call for the
individual planning and control of orders.
648 H.-H. Wiendahl et al.
Criterion: Time
Quantity
Minimum delivery time
Mean throughput time
Criterion: Quantity
Units / day
Demand fluctuation
Capacity flexibility
Criterion: Tolerance
Quantity
Planning tolerance
Variation of throughput times
Figure 11. Criteria for choice of logistic guideline.
Following a flow-oriented guideline makes it easier to
forecast the throughput time and thus to determine the
delivery date. Traditional PPC methods support this
approach, too. However, strong fluctuations in demand
and unforeseen events make it difficult to provide
capacity according to need. This is why it places high
demands on flexible capacities and predictive perfor-
mance monitoring to achieve the ideal of a steady
order stream.
4. Configuration of the production planning
and control system
Many industrial companies are dissatisfied with the
degree to which they fulfil their logistic objectives:
throughput times and inventory levels seem to vary
uncontrollably; promised due-dates can only be adhered
to by use of costly expediting exercises. For this reason,
there are controversial views about the potential of PPC
software in academia and practice.
The examples of stumbling blocks of PPC presented
above show that the ever-present demand for improved
software with more powerful algorithms is not always
justifiable. Rather, it is the inconsistent configuration
of the aspects of PPC that affects the fulfilment of
Required
Distribution
delivery
of lead times
time
Delivery/lead time
Demand
fluctuation
Capacity
flexibility
Time
Planning
tolerance Variation of
throughput times
Lead time
logistic objectives. A holistic (re-)configuration of the
PPC system has to consist of the following three stages:
. Initially management has to determine the logistic
strategy, i.e. the logistic performance that it wants
to offer to the customers. This includes the prior-
itisation of external logistic objectives and the
trade-off between internal logistic target values.
Manufacturing companies have to ensure that the
logistic strategy matches their manufacturing vision
which predetermines the design of its production
systems (Riise and Johansen 2003). In fact, compa-
nies should ideally formulate manufacturing and
logistic strategies simultaneously and also design
production systems and the related PPC system in
parallel.
. The technical concept of the PPC system has to be
built on the basis of the logistic strategy. The basic
logistic configuration has to ensure that the
configuration aspects of PPC—processes, objects,
functions and responsibilities—are consistent with
each other as well as the achieved prioritisation of
logistic objectives. The selection of suitable produc-
tion planning and control methods and algorithms
facilitates a partially or fully automated materials
and capacity dispatch. The analyses of the stum-
bling blocks of PPC offer instructions on how to
 Stumbling blocks of PPC
avoid inconsistencies of the configuration aspects
of the PPC system.
. The third stage is the implementation concept of
the PPC system. This includes the selection of
PPC software that is capable of supporting the
technical concept, the setting of all relevant para-
meters in the PPC software and the development of
a suitable implementation strategy that includes
the qualification of all staff. Case studies confirm
the necessity of a role-specific training-on-the-job
implementation (Wiendahl and Westkämper 2004).
It is not sufficient to configure a PPC system once on
implementation. As a rule, changes to the internal and
external situation of the company require a periodic
verification in accordance with the PPC cycle shown in
figure 6. This ensures that the current configuration, the
methods used and the parameters set are still suitable.
Two types of changes can be distinguished:
. Abrupt changes, such as the introduction or with-
drawal of competitive products, the development of
new technologies or other changes to the market
environment are relatively easy to detect. In such
cases, the need for action is obvious. From a logis-
tic perspective there is no need for new methods or
tools for detecting such changes. Timely indicators
of market or technological changes are desirable.
These, however, are research issues for general
management disciplines.
. Creeping changes are much more difficult to detect.
Step-by-step adjustments of market volumes,
delivery or replenishment times hardly attract the
attention of those responsible. However, for the
configuration of PPC systems this type of change
is much more critical because it necessitates
the continuous verification and adjustment of the
chosen configuration in parallel to day-to-day
business. It can be compared to the sharpening of
tools that a good craftsman regularly carries out.
5. Conclusions
The discussion of the stumbling blocks presented above
highlights the importance of a holistic configuration of
PPC systems. Although section 4 outlines the main
phases of a methodical PPC configuration process,
a fail-safe procedure has not been developed in
detail yet. However, as focussed questionnaires are a
way of assessing the appropriateness of management
and production system designs (Barnes and
Rowbotham 2003), the following questions can be
recommended as part of a ‘quick-check’ to assess the
649
suitability of a chosen configuration. The questions are
separated into five sections:
Objectives and stakeholder interests:
. Have the logistic objectives been defined and are the
objectives consistent? Is their degree of fulfilment
being monitored?
. Is someone responsible for the fulfilment of the
objectives?
. Have the logistic objectives been matched to
customer demands and are they consistent with
the performance targets for the employees on all
hierarchical levels (the stakeholders)?
Logistic guideline and PPC methods:
. Does a logistic guideline exist?
. Do the planning and control methods used match
the logistic guideline?
. Is there a mechanism that ensures the consistency
of logistic guideline, logistic positioning and the
planning and control methods used? Is someone
responsible for this mechanism?
Order processing chain and responsibilities:
. Have the separate process steps of the order
processing chain been defined?
. Has the responsibility for each step been assigned?
. Have the interfaces between the responsibilities
been defined unambiguously?
. Do those who have to fulfil the logistic objectives
have an adequate level of authority for making
decisions?
Data quality and parameter setting:
. Is there a mechanism that ensures the accuracy of
master data and feedback data? Is someone
responsible for this mechanism?
. Are the values of the planned throughput times
consistent across all three scheduling levels of the
PPC system (long-range and intermediate-range
planning, and short-term control)?
. Is there a mechanism for continuously checking,
and adapting if necessary, the accuracy of PPC
parameters? Is someone responsible for this
mechanism?
Qualification of employees and logistics audit:
. Do all staff involved in the logistics function under-
stand the fundamental interdependencies between
the logistic objectives, the manipulated variables
and the observed variables? Is there a regular
refresh activity?
. Does a logistics audit form part of the quality
management system?
650 H.-H. Wiendahl et al.
From a practical point of view, the answers a com-
pany provides to the questions above directly indicate
areas that the company has to improve in order to
achieve a holistic PPC configuration and to avoid the
stumbling blocks described.
From a scientific point of view, further research has to
be carried out in order to adapt the organisational and
human aspects of existing performance management
theories to the field of production management and
integrate them into the framework for configuring
PPC systems.
Acknowledgements
This article reports on research activities of the pro-
ject ‘Modellbasierte Auftragsmanagement-Gestaltung’
(Model-based Configuration of the Order Management
Process) that is funded by the German Research
Foundation (DFG) under registration WI 2670/1.
References
Akkermanns, H. and van Helden, K., Vicious and virtuous
cycles in ERP implementation: a case study of interrelations
between critical success factors. Euro. J. Inform. Syst., 2002,
11, 35–46.
Amoako-Gyampah, K., ERP implementation factors: A
comparison of managerial and end-user perspectives.
Business Proc. Manage. J., 2004, 2(10), 171–183.
Balve, P., Wiendahl, H.-H. and Westkämper, E., Order
management in transformable business structures—basics
and concepts. Robot. Comp.-Integ. Manuf., 2001, 6(17),
461–468.
Barnes, D. and Rowbotham, F., Developing a questionnaire
for the four-stage model of operations strategy. Prod.
Planning & Control, 2003, 7(14), 613–622.
Beckert, B. and Hudetz, W., Stand und Potenzial
produktionsnaher Datenverarbeitung. PPS Manage., 2002,
2(7), 35–39.
Davenport, T., Putting the enterprise into the enterprise
system. 1998, Harv. Business Rev., 4(78), 121–131.
Deming, W.E., Out of Crisis, 18th edition, 1992 (MIT Press:
Cambridge).
Fraunhofer IPT Institute, Droege & Co., Stellhebel für
den Markterfolg—Branchenanalyse Maschinenbau, 2003
(Droege: Düsseldorf).
Fogarty, D.W., Blackstone, J.H. and Hoffmann, T.R.,
Production and Inventory Management, 2nd edition, 1991
(South-Western: Cincinnati).
Gutenberg, E., Grundlagen der Betriebswirtschaftslehre: Band
1: Die Produktion, 1st edition, 1951 (Springer: Berlin).
Hackstein, R., Produktionsplanung und -steuerung (PPS): Ein
Handbuch für die Betriebspraxis. 2nd revised edition, 1989
(Springer: Berlin).
Hopp, W.J. and Spearman, M.L., Factory Physics:
Foundations of Manufacturing Management, 2000 (Irwin:
Chicago).
Huczynski, A. and Buchanan, D., Organizational Behaviour:
An Introductory Text, 1991 (Prentice Hall: Hemel
Hempstead).
Kaplan, R. and Norton, D.P., The Balanced Scorecard:
Translating Strategy into Action, 1996 (McGraw-Hill:
New York).
Ketokivi, M. and Heikkilä, J., A strategic management system
for manufacturing: Linking action to performance.
Prod. Planning & Control, 2003, 6(14), 487–496.
Kettner, H. and Bechte, W., Neue Wege der Fertigungssteuer-
ung durch belastungsorientierte Auftragsfreigabe. VDI-Z,
1981, 11(123), 459–465.
Kraemmerand, P., Møller, C. and Boer, H., ERP implementa-
tion: an integrated process of radical change and continuous
learning. Prod. Planning & Control, 2003, 4(14), 338–348.
Lödding, H., Verfahren der Fertigungssteuerung, 2004
(Springer: Berlin).
Luczak, H., Eversheim, W. and Schotten, M. (eds.),
Produktionsplanung und -steuerung. Grundlagen, Gestaltung
und Konzepte, 2nd edition, 1999 (Springer: Berlin).
Maslow, A.H., Motivation and Personality, 3rd edition, 1987
(Addison-Wesley: Boston).
Mather, H. and Plossl, G.W., Priority fixation versus through-
put planning, in Proceedings of the APICS International
Conference, 1977, pp. 27–51.
Miles, R. and Snow, C.C., Organizational Strategy, Structure
and Process, 1978 (McGraw-Hill: New York).
Nyhuis, P. and Wiendahl, H.-P., Logistische Kennlinien:
Grundlagen, Werkzeuge und Anwendungen, 2nd edition,
2003 (Springer: Berlin).
Nyhuis, P., 3-Sigma PPC—A holistic approach for managing
the logistic performance of production systems. Ann. CIRP,
2004, 1(53), 371–376.
Orlicky, J., Material Requirements Planning, 1975 (McGraw-
Hill: New York).
Plossl, G.W., Production and Inventory Control: Principles and
Techniques, 2nd edition, 1985 (Prentice Hall: Englewood
Cliffs).
Plossl, G.W., Managing in the New World of Manufacturing,
1991 (Englewood Cliffs: Prentice Hall).
Riise, J.O. and Johansen, J., Developing a manufacturing
vision. Prod. Planning & Control, 2003, 4(14), 327–337.
Stadtler, H., Supply chain management—an overview.
In Supply Chain Management and Advanced Planning, edited
by H. Stadtler and C. Kilger, pp. 7–27, 2002 (Springer:
Berlin).
Storey, J. and Sisson, K., Managing Human Resources and
Industrial Relations, 1993 (Open University Press:
Buckingham, UK).
Supply Chain Council, Supply Chain Operations Reference
Model Version 6.01. Available online at: http://www.
supply-chain.org (accessed 1 November 2004).
Soder, J., 2004, Produktion im Kundentakt. In Management
Circle Seminar, Munich, 24–25 April 2004.
Vollmann, T.E., Berry, W.L. and Whybark, D.C.,
Manufacturing Planning and Control Systems, 4th edition,
1997 (Dow Jones-Irwin: Homewood).
Wäfler, T., 2003, Shop-floor planning and control from
a socio-technical perspective. In Current Trends in
Production Management: Proceedings of IFIP WG5.7
International Working Conference, 5–9 October 2003,
Karlsruhe, Germany, edited by G. Zülch, S. Stowasser
and H. Jagdev, pp. 94–100, 2003 (Shaker: Aachen).
 Stumbling blocks of PPC 651

Wiendahl, H.-H., Rempp, B., Westkämper, E. and Wiendahl, H.-H. and Westkämper, E., PPC Design and
Pritschow, G., PPC in a turbulent environment—fundamen- human aspects: Training-on-the-job enhances role-specific
tals and approaches. In Proceedings of the 33rd CIRP skills. Prod. Eng., 2004, 1(11), 129–132.
International Seminar of Manufacturing Systems, 5–7 Wiendahl, H.-P., Load-oriented Manufacturing Control, 1995
June 2000, Stockholm, Sweden, edited by G. Sohlenius, (Springer: Berlin).
pp. 320–325, 2000. Wiendahl, H.-P., Begemann, C. and Nickel, R., Die klassischen
Wiendahl, H.-H., Situative Konfiguration des Auftragsmanage- Stolpersteine der PPS und der Lösungsansatz 3-Sigma-PPS.
ments im turbulenten Umfeld. Heimsheim, 2002 (Jost-Jetter: In Expertensystem Logistik, edited by H.-P. Wiendahl and
Stuttgart). H. Luczak, 2003 (Springer: Berlin).
Wiendahl, H.-H., Roth, N. and Westkämpfer, E., Logistical Wiendahl, H.-P., von Cieminski, G., Begemann, C. and
positioning in a turbulent environment. CIRP Ann. Manuf. Nickel, R., Human factors in production planning and
Tech., 2002, 1(51), 383–386. control. In Integrating Human Aspects in Production
Wiendahl, H.-H., Marktanforderungen verstehen, Management, edited by G. Zülch, H. Jagdev and P. Stock,
Stolpersteine erkennen. Flexible atmende Produktion: 2005 (Springer: Berlin) pp. 113–126.
Auftragsschwankungen in den Griff bekommen. In Wiers, V.C.S., A case study on the integration of APS and
Management Circle Seminar, Munich, 17–18 ERP in a steel processing plant. Prod. Planning & Control,
September, 2003a. 2002, 6(13), 552–560.
Wiendahl, H.-H., Das logistische Leitbild: Neues Gestaltungs- Xu, H., Horn Nord, J., Brown, N. and Nord, G.D., Data
merkmal der Produktion. Wt Werkstattstechnik, 2003b, quality issues in implementing an ERP. Indust. Manage. &
4(93), 315–322. Data Syst., 2002, 102(1), 47–58.

Hans-Hermann Wiendahl studied Industrial Engineering at the Technical University in Berlin.

He has worked at the Fraunhofer Institute for Manufacturing Engineering and Automation
(IPA) and at the Institute for Industrial Manufacturing and Management (IFF), University of
Stuttgart, since 1996 where he held positions as researcher, department manager and now tech-
nical manager ‘Order Management’. He completed his PhD under the supervision of Professor
Westkämpfer and is now working on his habilitation thesis. His main research interests are in
production management, especially PPC, as well as in the selection and implementation of ERP
and MES systems. He was responsible for numerous research and industrial projects and has
published on these subjects extensively.

Gregor von Cieminski holds a degree in Manufacturing Sciences and Engineering from the
University of Strathclyde in Glasgow. He is a research assistant at the Institute of Production
Systems and Logistics (IFA) at the University of Hannover. As a member of the
production management research group his interests are in the fields of logistic modelling of
production processes and supply chain management. He has published several articles on these
subjects in scientific journals and conference proceedings.

Hans-Peter Wiendahl studied Mechanical Engineering at the Engineering School in Dortmund, at

the RWTH in Aachen and MIT (USA). Under the supervision of Professor Opitz, he completed
his PhD in 1970 and his habilitation thesis in 1972. Until 1979 he was manager of planning and
quality at Sulzer Escher Wyss GmbH in Ravensburg before becoming the head of paper machin-
ery design for the same company. He became professor and head of the Institute of Production
Systems and Logistics (IFA) at the University of Hannover in 1979 and held this position until
2003. His main research interests are in production management, factory planning and produc-
tion systems. He is the author and publisher of numerous books and articles on these subjects.