Materials Planning is a set of systematic scheduling procedure to ensure availability of raw materials, equipments, consumables, and instruments at work place on time refers to schedule of shop fabrication or delivery, and/ or site installation; with consideration that the quantities of material are not over stock or low material efficiency or material less than required need it, and found best balance between optimizing the service level & minimizing costs and keep in budget.
The material is not limited of raw material, consumables, fittings, bolts & nuts, coating materials, equipments, instrumentation, recommended spare parts, report of material status, storage space, and planning method.
This Material planning will be applied of a job order on Engineering, Procurement and Construction (EPC) project that basic design and roughly quantity & weights of equipment have been determined.
Consideration aspects of material planning:
i) Changes of Bill of Materials.
ii) Restrictiveness of storage space.
iii) Bottleneck of fabrication or construction capacity
iv) Highway issues, such as: traffic generation, vehicular access, highway safety.
The technical aspects shall be coordinated and developed by material management team using manual method or ERP software, it depend on scope of work and complexity of project.
Generally the below items as some input to develop material planning that it may be combined and flexible in application, depend on project characteristics:
Ø Supporting documents
Material planning shall be developed base on approve documents, such as: Bill of Materials, construction drawings, scenario of materials delivery, etc.
Ø Required Schedule
The priority and schedule of materials on work place normally should be arranged as short as possible with application of material, but in fact many factors influences of it cause of site conditions or others.
Ø Scope of works
In general CONTRACTOR shall responsible to fulfill scope of works in accordance with specifications of project contract agreement. CONTRACTOR may sub contract some portion of their job to sub contractors, include material supply cause of some reason: special requirements of product, production capacity, and keep cost in budget.
Ø Inventory space
The indoor & outdoor space area shall be estimated for material storage and possibility of material circulation.
Ø Grouping of material
Material shall be organized by identifications of group that it may base on material specifications, WBS, location, etc. It will make easier for traceability.
Ø Delivery package
It shall be considered regarding limitation of access to site, such as: bearing capacity of roads, bridges, jetty, lifting equipments, etc.
Related the above input, processes of material planning during project execution will be developed of three sections, which it shall be supported by different responsible function involve of each section below:
Ø Section-1 Engineering phase
- Materials will be planned for purchase requisition, where the initial processes refer to BOM and data sheets; the numbers of consumables shall be considered of losses; the components shall have tagging.
- Material management team shall develop some scenario for material grouping, package that will be subcontracted, and location of fabrication related with schedule of incoming materials, inventory space, and scope of works.
- Material management team shall develop and describe material requirements for vendors or subcontractors in order meet specifications and schedule.
- The required priority and schedule of incoming materials on work place shall be planned backward refer to fabrication or delivery or installation schedule of each Work breakdown structure (WBS).
Ø Section-2 Fabrication phase
Materials will be planned for fabricate component of equipments or products where the raw material shall be cut and considered to get optimum material efficiency in use by develop cutting lay out.
Ø Section-3 Delivery material to site.
Materials or equipments or fabricated part shall be planned for delivery, it related with limitation of access to site. Materials shall be collected first of a lay down area prior deliver to site at the same time. The one of important information is delivery time of goods from vendors to work place or project site.
There are some item shall be considered of this section, as follow:
- Government/ local regulations,
- Traffic conditions (bridge, port, road, quantity, etc),
- Delivery material shall use sea freight.
Material Planning system shall be designed have capability to give quick valid information data, as follow:
i) Report of required materials, Plan schedule of material, Report of purchase order, Report of changes to planning materials, and Performance report.
ii) Report of material status per detail equipment or work breakdown structure at any time.
iii) Comparison of quantity and price between initial requirements, realization of purchase order, and actual used.
Material planning shall be periodically evaluated for some items as follow:
- Estimation cost & volume of project cost structure to control material expenses keep in budget.
- Bill of material released by engineering department to avoid excess or shortage material of purchase request,
- Comparisons between specifications and required materials related with scope of supply,
- Fabrication and/or Installation progress to achieve works keep on schedule.
