60% of Supply Chain Professionals Answered this Question Incorrectly - Customers Beware!
I recently created this quiz on Linkedin about when to utilize Available to Promise (ATP) functionality. Out of 52 votes, only 38% selected the correct response, which suggests that there is a definite knowledge gap on this important topic.
ATP functionality can be highly effective when used correctly. In a previous article, I do a deeper dive into how ATP works. In this article, I'll focus on explaining the quiz results.
In which environment would the use of Available to Promise (ATP) functionality work effectively?
In which environment would the use of Available to Promise (ATP) functionality work effectively?
Make to Order 15%
Engineer to Order 2%
Make to Stock 38%
All of the Above 44%
Total 52 votes
Here was my explanation
Correct Answer: Make to Stock
From 52 votes, 38% selected the right option, that is Make to Stock. Why? In an MTS environment there should be available inventory to promise against, either in stock or scheduled to be available. T
Most Popular Response: All of the Above
In a Make to Order or Engineer to Order environment, by definition, there is no inventory available to promise against, so ATP will not work.
There is another practice called Capable to Promise which can work in an environment where finished goods are not stocked. In this case, instead of available inventory, customer orders are committed against available capacity and/or materials.
What do you believe should be the key takeaways from these results?
Business Growth Specialist | Published Author | Strategic Planning | Process Improvement | Lean Manufacturing
5moI'm amazed at how many supply chain professionals don't understand basic Supply Chain and MRP parameters. These were things I learned on my first job over 25 yrs ago. I've seen it cause major Supply Chain disruptions. People complained about COVID (which it had an affect), but I've seen with many companies that it was self-induced due to poor supply chain strategy and planning.