WHY IS PAM IMPORTANT?|
ADVANCED EVALUATION AND ANALYSIS OF INFORMATION pertinent to the organization's business and
manufacturing environment is key in enabling the organization to:
- identify and analyze
- make (the right)
business decision at the right time;
- formalize and
optimize practical plans and execution schedules;
opportunities to improve operating efficiencies and reduce
- measure performance
against plan and modify behaviour if required; and
- effectively respond
For each of the above items, a certain "opportunity window" exists. This window is closed once the organization reaches a certain point in time, so the item must be acted upon while the window is still open. The PAM methodology helps the company crystallize the significant potential benefits and profits hidden within its business and manufacturing environment.
INCORPORATING PAM METHODOLOGY
ADVANCES IN COMPUTER AND SOFTWARE TECHNOLOGY have enabled systems to be much "smarter" than they used to be. Rather than simply documenting transactions and maintaining data bases, they now have the capacity to use this information not only for report writing, but also for decision making, which is the essence of PAM - making the right decision at the right time, both at the operations and business levels.
For example, instead of only asking, "How much inventory do I have?" (an inventory reporting question), we should ask, "What should the inventory be in the first place?" (a decision-making question). The answer may be very complex and, in fact, depends on many different parameters. It also impacts many areas of the operation, such as: customer service,
production costs, profitability, ability to find new customers, equipment and plant utilization, production cycle time and throughput. And this is only one example out of many others.
The PAM concept improves the planning, scheduling and decision-making process in the organization and ensures more efficient and cost-effective execution of production.
PAM has a significant effect on profitability since it leverages the investment that the company has in plant, equipment, technology, and manpower and allows the company, to do more with what it already has. And this is directly reflected in the bottom line.
HOW PAM WORKS
DOING THE JOB RIGHT depends on the tools that are being used. The use of computers to enhance decision making is very new, but can provide significant benefits and almost unlimited capabilities.
To make the PAM concept possible and practical, one must use a system that will:
This is a completely new class of product in its category, and application - one in which computers get involved in
decision making, rather than information processing and reporting.
- Reflect the organization's true business philosophy and manufacturing environment in its logic and behaviour.
- "know" the
organization and its capabilities.
- Use this knowledge
and human-like reasoning to make business decisions, generate
operating plans, schedule production and optimize other
manufacturing activities and logistics.
PAM SYSTEM STRUCTURE
THE PAM SYSTEM STRUCTURE should
consist of three distinctive elements:
- A set of parameters
and data elements used as a "key" to define the
strategic business philosophy and manufacturing environment of
- A set of parameters
and data elements used to define police? and operational
constraints and their interdependencies.
- A decision-making
engine that uses the above parameters to improve the quality of
the operational and business decisions, and deliver realistic
operational plans and schedules.
The parameters should be user controlled to give the system the flexibility it needs to reflect various business
conditions which the company may encounter.
The key to the system is its ability to reason - based on the parameters, setting - coupled with the computer's fast
processing capabilities and access to vast amounts of information required to make an intelligent decision.
PAM technology enables the company to perform a more accurate and intelligent planning, scheduling and optimization not
available using conventional technology and, therefore, significantly improve operating efficiencies and profits.
Ed Coben is president of ComMIT Systems Inc.,
which specializes in the development and implementation of advanced
manufacturing, scheduling, optimization and decision-support
systems. This article is based on the implementation of PAM
technology at companies like Ford Motor, ITT and