Artificial Intelligence in your planning process

Every week there are significant news from the world of AI and one can ask when an LLM (i.e. an engine like the one behind ChatGPT) will be able to replace the planner in the company. As long as the planning process is conditioned by information outside the system, known only to the planner (content of phone calls, post-its, etc.) it will be difficult for this to happen completely but we can still clarify in which ways today generative artificial intelligence (GenAI) can intervene in the planning and scheduling process and with what benefits.

 

Forecasting

So far, forecasting methods based on LLMs have not obtained better performances than more traditional methods according to scientific literature (https://arxiv.org/abs/2406.16964 and https://arxiv.org/pdf/2412.19286).

 

Tool they use in the LLM

Whatever the tool, i.e. the software, that you are using to plan production and purchasing (ERP, spreadsheet, APS), you can get help from an LLM in some of your activities, both to reduce operating times and errors. The type of integration that can be achieved between the tools makes the difference and conditions the user experience. Even more important in this integration is deciding whether you want to use a local LLM (ideal for keeping data in the company) or an external one like those of OpenAI or Anthropic.
In Cowry, the APS of Paneido, you can ask an LLM to help you prepare a script to integrate data with other systems or to automate some operations. You can also ask the LLM from Cowry to help you clarify the plan without changing the environment, i.e. without copying and pasting the context data of the question into the LLM chat, because these are passed to him automatically through selections in Cowry, unlike what can be done using an ERP, a spreadsheet or other APS. In Cowry, the connection with an LLM can be implemented as a plugin written in Python and adaptable to the specific reality. The LLM to be used can also be chosen within the plugin.

 

LLMs that use tools

This approach is certainly the most stimulating for the future scenarios that it can open up and has two levels of implementation with different ambitions

LLM as a user interface of the tool

It is possible to use the LLMs as an alternative user interface to the tools, which thus become usable even by those who have not been trained on how to use the tools and how to read their screens. For example, we can ask an LLM for a delivery date for a possible new customer order. The LLM does not have bills of materials, cycles and our current production plan inside it to respond autonomously, but it can send the request to our APS, have the response processed and then present it to us verbally without us needing to know how to find our way through the APS screens. With different systems this can be easily achieved, as long as they allow their functions to be invoked from outside the application and as long as they provide realistic answers and in times compatible with the user’s patience in waiting for an answer. The LLM can also be used for non-preconfigured requests such as dating requests (any question regarding the plan) if the planning software is able to execute code (for example SQL or Python) dynamically generated by the LLM. If the planning tool is not able to execute dynamically generated code then the only possible approach is to define a set of questions that the tool can answer, implement the functions that provide the answers to those questions and accept that the tool, via LLM, cannot answer different questions

LLM becomes an agent

When we talk about agents it means enabling an LLM to act, that is to use external tools (other software in general) both to retrieve information, that is as a user interface, but also to perform activities. For example, in your planning process the LLM could have the purchasing and production plan updated by the external tool (APS for example) when certain events occur (or with a defined periodicity) and transmit the new orders to the ERP, suppliers and the production department if in a position to interoperate with ERP, e-mail and MES respectively. Or directly request the delivery of an order that is now overdue from the supplier. In this context the advantage of having the Cowry APS instead of other software is decisive because it can execute Python code dynamically generated by the LLM and practically every LLM already knows how to create Python code. With APS that only use SQL or proprietary languages ​​to perform operations in the application, the configuration activity is much more onerous both for the APS manufacturer and for the companies that use them

 

Sooner or later, every company will undertake a project to adopt an LLM internally to support different processes. For example, using an LLM to support its customers means providing it with the knowledge to answer questions about products, return procedures or payments. Enabling this LLM to also answer questions about delivery dates of products and spare parts is an added value if you have tools, such as the advanced planning system Cowry, that can be easily integrated with LLMs and existing systems in the company.

Lean integration – part 2

The problem of integration is related not only to in house applications and processes but also to the ones of the company and its supply chain. In the previous post
we have described a lean and flexible solution for the internal integration and in this post we suggest one for integrating with suppliers. On the suppliers side
is increasing the number of relationships where, also without a formal blanket order, suppliers produce more than requested for a confirmed order, being aware
that the surplus quantity will be consumed by future orders. For the customer, the purchase lead time for surplus quantities of previous orders can be very different
from the lead time for new productions and conditions production plans and delivery dates to customers very much. An agile solution in this situations is modeling in
the APS the stock in the warehouse of the supplier and using the multi-warehouse MRP to manage distinct lead times for stock transfer and new production runs. The data
source to be used by the APS for the stock at the supplier site can be a spreadsheet, periodically updated by the supplier with the quantities for every item supplied.
This spreadsheet can be sent by e-mail by the supplier to the customer and put by the planner at the customer site in a folder of the internal network, where is
read directly by the APS. Or we can use a folder, shared between customer and supplier, containing the spreadsheet and automatically synced with Dropbox.

Lean integration technologies

In IT projects where a business application must be integrated with the ERP system, the cost of creating the data interchange routines can be very high, sometimes
as expensive as the business applications that must be added. Reasons for this are related to the fact that the company that wants to connect the applications can
work only with the manufacturer of two systems, especially if the integration technologies used by these are not accessible to the IT department of the company
(because the source code of the applications is needed or because legacy technologies must be used). These types of problems are faced also when we want to introduce
a planning system in a company and limit the diffusion of these systems only to big companies. All this is much true for older APS systems, which usually
feature less recent integration technologies. One of the most flexible and innovative approach to this problem is that used by Sikuli, a tool developed by MIT
(and used by leading company, as the website states) which has reached production grade status. It is an application that can be programmed not writing
code but describing the operations to be accomplished by the images of the button to be clicked, the text control to be filled and so on.
By the point of view of the processes where APS systems are involved, this tool enables the transfer of data towards the ERP database emulating a user who interacts
with his ERP user interface. It is a tool that can be used both for data entry (we used it to upload item master records on the ERP) and for routinely transfer
production orders or purchase requests. This means that the company that wants to export data from APS to ERP is able to create the interchange procedures on her own
and quickly, reducing the project’s costs. Further, from some systems (also from Cowry) it is possible to launch Sikuli directly, giving to it the order list or other data
as input. Systems’ integration accomplished this way it’s easier to do and to be tested and can reduce costs and lead time of the project’s integration phase.

APS and MRP

Probably this post should have been one of the first of this blog, but it’s not too late. Derek Singleton pointed me
his article about the differences between APS and
MRP systems and after reading it I can say that I largely agree with him about the differences between the two types of systems by the point
of view of the business environments where they can be used more profitably. His article has been an occasion for me to look for a good definition
of APS, to better communicate the usefulness and role of these kind of systems. The definition in the APICS dictionary doesn’t help too much in narrowing the concept:

“Techniques that deal with analysis and planning of logistics and manufacturing
during short, intermediate, and long-term time periods. APS describes any computer
program that uses advanced mathematical algorithms or logic to perform
optimization or simulation on finite capacity scheduling, sourcing, capital planning,
resource planning, forecasting, demand management, and others. These techniques
simultaneously consider a range of constraints and business rules to provide real-time
planning and scheduling, decision support, available-to-promise, and capable-to-promise
capabilities. APS often generates and evaluates multiple scenarios.
Management then selects one scenario to use as the ‘official plan’. The five main
components of APS systems are (1) demand planning, (2) production planning, (3)
production scheduling, (4) distribution planning, and (5) transportation planning.”

This definition is mostly based on what aps do (listing of modules) and less on how they do it. The most of commercial packages usually
considered APS don’t cover the complete range of
modules provided by APICS definition but only some of them and they are the same considered APS. So there should be also something else that make an application an APS.
I think that a definition should
stress also on ‘how’ the system operates to help planning. And the main features are:

  • great speed of computation (achieved by advanced mathematical algorithms but also, often, by means of in-memory dbms)
  • powerful visualisation features to let the planner analyze data more easily
  • good tools for system integration to fasten the collection of data that can be meaningful for production planning and scheduling.

The main reason the originated APS was that MRP procedure on transactional systems where too slow to let frequent replanning. After
this constraint has been reduced, the visualisation and data navigation features prevent the planner from being the new bottleneck
of the planning process. Data integration is another important aspect that let the planner not to waste time to retrieve data
which are useful for the planning sessions.

Paneido
Paneido has twenty years of experience with planning and scheduling systems. Our philosophy is making easy and fast the activities of every day and feasible the solutions to less recurring problems: phase in/out of products, rearrangements of production capacity, optimizations, etc.

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