Being confined to Excel; is it a reward or a punishment?

In this article, I will discuss why many factories plan their productions using Excel and why this situation is unsustainable.

I liken planners to jugglers who have to juggle numerous balls labeled with inventory, capacity, OEE, demand, customer satisfaction, labor, and more, all while walking on a tightrope without dropping a single one. Planners with this skillset must have a reason for choosing Excel as their planning tool, implying that Excel is capable of fulfilling this task. Is that true? No, this statement is half true and half false. Let me explain what is true and what is false.

Production planners are at the forefront of battling the challenges of production. Therefore, they have realized before the officers sitting in the headquarters, sorry, the managers in the offices, that ERP systems are not sufficient to generate and maintain a feasible production schedule. This is a significant problem. Managers in the office, having invested millions in ERP weaponry to advance themselves in the competitive war, struggle to believe and heed the complaints from planners on the front lines saying, “We can’t schedule production with ERP.” The communication gap and silence between planners and factory management, who must plan and execute production under any conditions, deepen.

For planners who haven’t been given a handy tool, Excel seems like a saving grace in the midst of battling the challenges of the production field; it’s almost free, easy to use, and seems capable of doing everything with a little push. However, the relationship between planners and Excel, which starts in this way, turns into a nightmare over time, and even if the management doesn’t want to see it, this nightmare eventually affects not only the planners but also the factory’s balance sheet.

Fighting in a Dark Battlefield!

In many companies, it is unknown how directly decisions made by production planners relate to the factory’s balance sheet. Many managers not understanding the scheduling problem and its impacts sufficiently cause planners to fight in the dark. The countless heroic stories being written on the battlefield are unseen by managers in the dark. Planners know their role in heroic stories such as increasing on-time delivery rates, controlling interim stock levels, and achieving less overtime and higher capacity usage, but they can’t explain it to anyone.

Of course, with enough time and effort, a consistent and valid schedule can be created using Excel. But the same could be done by shifting colored labels representing orders on an empty wall. However, the problem is not to produce any schedule; the problem is to produce a schedule that production can implement without objections quickly and to keep it continuously updated according to field conditions. Due to sudden changes in the production field, the initially derived schedule becomes obsolete, but it continues to be followed until it is renewed due to the effort required.

To understand the time and effort required to update the production schedule when a critical change occurs in the production field, it is necessary to first accept that each change affects all subsequent production processes like dominoes falling. Therefore, it is not enough to calculate only the effect of a change within a process; it is necessary to consider the impact of the fallen dominoes on the entire system. Without using a tool capable of making such end-to-end calculations, this process can take hours, and by the time it is completed, it has already become invalid due to another change. If you are revising your production schedule weekly in your factory, you should know that alarm bells about your factory’s production and cost performance are ringing.

Advanced Planning Systems are the Correct Solution to this Problem!

The good news is there is a way to silence the alarm bells I mentioned above. APS (Advanced Planning and Scheduling) systems enable the generation of a new schedule in seconds, even in a factory with a very complex operation. If I say that manufacturers who respond quickly and accurately to changes will gain a strategic competitive advantage over others, no one will object.

If the production schedule directly affects a factory’s balance sheet to this extent, how can we justify carrying out such a vital task through Excel? Factory managers must realize that there are limits to ERP systems and start thinking about what to do about it. They can start by asking the following questions:

If it was claimed that ERP would solve everything, why are planners still using Excel?

Is Excel the right tool for this job?

If you think you can manage with Excel, why are the world’s largest manufacturers using an advanced planning system (APS) integrated into their ERPs?

If it takes planners hours or even days to update the production schedule, how does using a system that reduces this to seconds bring agility to your factory?

Is the task of planners to pour water to extinguish the fire after a problem arises, or is it to foresee and prevent the possibility of fire?

Let me return to the question I asked in the first paragraph. Planners know very well what they are doing. Because of their duties, they know both the realities of the production field and what customers and managers expect. When supported by the right tools without being confined to Excel, they will find solutions that satisfy everyone, even before the problem arises.