APICS CPIM-8.0 - Certified in Planning and Inventory Management (CPIM 8.0)

Finite loading is a capacity planning approach that takes into account the available capacity of the resources and does not allow overloading. It considers adjustments to plans based on planned capacity utilization, which means that it can change the start or end dates of the operations to avoid exceeding the capacity limits. This way, finite loading ensures that the production schedule is realistic and feasible. Other capacity planning approaches, such as infinite loading, do not consider adjustments to plans based on planned capacity utilization. Infinite loading ignores the capacity constraints and schedules the operations based on the due dates and the lead times, regardless of the resource availability. This may result in overloading the resources and causing delays or disruptions in the production process. Therefore, the fundamental difference between finite loading and other capacity planning approaches is that finite loading considers adjustments to plans based on planned capacity utilization, while other approaches do not. References:

CPIM Part 2 Exam Content Manual, p. 48

The Difference Between Finite Capacity Scheduling and Infinite Capacity Loading

FINITE LOADING

Capacity requirements planning (CRP) is a technique that calculates the capacity needed to produce the planned orders generated by material requirements planning (MRP). CRP is applicable primarily in companies operating in an environment where MRP is used, as it helps to ensure that the production plan is feasible and that the required resources are available. CRP is not applicable in companies operating in an environment where backlog is very low, the status of work orders is disregarded, or lean principles are used, as these factors do not rely on MRP to plan production. References: Capacity Requirements Planning | APICS Dictionary Term of the Day, APICS CPIM 8 Planning and Inventory Management | ASCM

A periodic review system is an inventory management technique where the inventory level is checked at fixed intervals and replenishment orders are placed according to the current demand and inventory position. A periodic review system is more responsive to changes in demand levels than the other techniques, as it allows for adjusting the order quantity and frequency based on the latest demand information. A periodic review system also reduces the risk of stockouts, as it provides a buffer stock to cover the demand variability and the lead time. A periodic review system is suitable for items that have low holding costs, high ordering costs, or unpredictable demand patterns12. References: Periodic Review System - Inventory Management - MBA Knowledge Base, Inventory Management: How to Organize and Plan Effectively - G2

Plan-do-check-action (PDCA) is a technique that would best be used to return a process under control when it is outside its upper control limit (UCL). PDCA is a four-step cycle of continuous improvement that involves planning a change, implementing the change, checking the results, and acting on the findings. PDCA can help identify and eliminate the root causes of variation, improve the process performance, and prevent the recurrence of problems. PDCA is also known as the Deming cycle or the Shewhart cycle. References:

Managing Supply Chain Operations, Chapter 9: Quality Management, Section 9.3: Quality Improvement, Subsection 9.3.1: Plan-Do-Check-Act Cycle

CPIM Exam Content Manual, Module 8: Quality, Technology and Continuous Improvement, Section 8.2: Continuous Improvement, Subsection 8.2.1: Continuous Improvement Concepts, Subsubsection 8.2.1.1: Plan-Do-Check-Act Cycle

Sales and Operations Planning (S & OP) is the proper forum for evaluating cross-functional impacts of a change in demand, including capacity, supply, and financial implications. Executive-level S & OP meetings align demand and supply decisions and ensure that changes in strategic direction are reviewed and approved.

“The S & OP executive meeting is where demand and supply plans are balanced and decisions are made on resource changes or market actions.”

— CPIM SMR Module, S & OP Function and Governance