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Frozen production schedules result in stockouts and late servicing.
Companies working with assumption of deterministic demand often work out detailed production schedule and freeze a portion of it for the near term. The practice of frozen production schedule is quite common in CPG, Pharma and other manufacturing companies.
When the rubber meets the road and actual demand is quite different from the assumption, there are frantic calls amongst team members to prevent stockouts of items whose demand is much higher.
There is another problem with frozen schedules. These are worked out to utilize the full line capacity to get better efficiencies, which leaves no room for accommodating any change.
The deadly combination of stochastic demand assumption and efficiency focus creates chaos in the supply chain and results in stockouts and late deliveries.
We must build flexibility in the production schedule to respond to actual demand in a timely manner.