Tag: CTPD

ATP vs. CTP: What’s the Difference and Why Does it Matter?
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With global competition intensifying, the number of manufacturers competing for your customers’ business is growing. So how does one create a sustainable advantage in a rapidly shifting competitive landscape? The answer lies in going back to one basic that was as true when the first manufacturer made the first widget as it is today: Deliver on your promises.

In this post, I’ll drill down into the one promise that still causes headaches for many manufacturers – on-time deliveries – and how the problem may not lie in your people or processes, but in the systems you use. In fact, one single feature can make a huge difference – whether you’re using ATP or CTP when making delivery commitments.

The Difference Between ATP and CTP

Most manufacturers have heard of the terms available to promise (ATP) and capable to promise (CTP). ERP solution vendors use them all the time. While they are sometimes used interchangeably, the difference between them is significant. To lay the groundwork, let’s start with some definitions. According to the Association for Supply Chain Management (ASCM):
- ATP is the uncommitted portion of a company’s inventory and planned production, maintained in the master schedule to support customer order promising.
- CTP is the process of determining if the required components and resources (e.g., materials, labor, machine capacity) are available to support a specific order or production request.
For me, the key difference stands out immediately. ATP refers to a thing (inventory), whereas CTP is a process. Put another way, ATP is exclusively inventory focused. It looks at what is currently available, either in inventory or in production, but not committed to another order. The difference is “available” for new orders. The available date for production or for orders in excess of inventory plus production is based on static lead times. It doesn’t matter if the plant has capacity or not, the answer is the same for ATP.

On the other hand, CTP looks at what could be, i.e., what could be promised to the customer based on the materials and resource capacity available. Instead of just promising whatever the customer asks for, CTP allows sales to provide a realistic availability based not just on inventory but also on factory capacity.

That’s a big difference!

Why ATP Falls Short of CTP

Leveraging CTP can help almost every manufacturer meet their customer commitments, but it’s particularly critical for complex manufacturers. Consider these shortfalls of ATP:

Static data – Because ATP looks only at inventory and static lead times, it doesn’t account for changes in demand, production delays, capacity changes, or resource constraints. The more overloaded and volatile the manufacturing environment, the less accurate the ATP answer will be. Static lead times are blind to capacity overloads and the actual volatility of the manufacturing environment.

No constraints management – ATP completely ignores production constraints. As much as we’d all like to believe constraints aren’t an issue, they are often the main issue in complex manufacturing environments.

Lack of real-time scheduling – As should be apparent, ATP is not tied to scheduling the way CTP is. As production schedules change, CTP information is automatically updated while ATP allows sales to continue to promise based on inventory alone. Often in ATP environments, customers aren’t notified an order is going to be late until the shipment has already been missed.

Overpromising – The bottom line is that trying to get by with ATP in a complex manufacturing environment can lead to missed customer commitments and poor customer service.

CTP Gives Manufacturers an Order Reservation System

In a CTP environment, every new order gets a capable date that is fully vetted for both capacity and material availability to ensure the quoted date is in perfect alignment with the manufacturer’s capabilities. Every time a new order is entered, it reserves its spot in the schedule and the materials it requires. This ensures that capacity is not oversold. It ensures that the manufacturer can provide a reliable delivery date with confidence to their customer.

Since this is an automated process, environments with CTP drastically reduce the churn between sales and production. Sales isn’t constantly contacting production to know what can be delivered and production isn’t constantly going through manual calculations to try and determine what can be delivered. The only time production needs to get involved is when a customer’s request date cannot be made.

Provided the CTP system communicated the capacity and material constraints for the order, production knows the dials that must be turned to improve the date. Can they run overtime, can they expedite a purchased part, can they slide another order to make room, etc. CTP allows the manufacturer to be proactive. CTP provides all the necessary information up-front to make the best decisions for the manufacturer and their customers.

CTP Continually Monitors the Order Throughout Its Lifecycle

Unlike ATP, CTP accounts for the real-time conditions of the production environment. By continuously establishing a schedule based on the current state of the manufacturing plant along with capacity and materials availability, the CTP is always reflecting the projected delivery date of every order in the system. CTP keeps the manufacturer in proactive mode, eliminating the guesswork and the manual intervention.

In cases where a drastic event like a multi-day machine breakdown, a material showing up from the supplier week(s) late, or major components of the build needing to be scrapped, CTP allows the manufacturer to proactively communicate with their customer. The manufacturer can let their customer know as soon as they know that an order is at risk and will be armed with a new CTP date to provide the customer again fully vetted against the state of manufacturing along with its capacity and material availability.

Support Best Practices

CTP even aligns to lean manufacturing and waste reduction initiatives by allowing manufacturers to align production to actual demand, reducing overproduction, scrap, excess inventory, and operational waste.

Is Guesswork Good Enough for Your Manufacturing Operation?

Probably not. Unfortunately, many commercial ERP software applications only offer ATP functionality, requiring sales and production managers to make their “best guess” at what can be delivered by when. These systems simply aren’t designed for complex manufacturing environments where capacity constraints are the limiting factor, production priorities can change at a moment’s notice, and meeting customer commitments is critical to long-term business success.

That’s why SyncManufacturing from Synchrono provides CTP functionality that can be used with your existing ERP system to help you:
- Commit to orders with confidence
- Adjust to supply chain disruptions
- Reprioritize production easily and as needed
- Manage constraints to increase throughput
- Improve on-time deliveries
- Control the chaos
If guesswork isn’t good enough for you, reach out to learn more or schedule a demo and see SyncManufacturing in action.

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July 15, 2025
Are Your Manufacturing Metrics Meaningless?

It seems not a week goes by when I don’t hear from someone in manufacturing: “You can’t manage what you can’t measure”. Of course, there is a lot of truth to that statement, but as someone who spends all day, every day, helping manufacturers gather real-time data for better operational performance, I believe the statement is incomplete. The axiom should be: “You can’t manage what you can’t measure consistently and accurately.”

Take the example of On Time Delivery (OTD). In any manufacturing environment, delivering what you promised when you promised is good business, so measuring this metric makes sense. However, as simple as this metric should be to measure, it can get complicated. Consider this scenario:

The Challenge with Measuring On-Time Delivery

Bob in sales promises a customer that their order will be shipped by the 15^th of the month. The factory comes back and says, given the current production load, there is no way we can get the order out the door until the 25^th. The order isn’t big enough, nor has the customer done enough business with the company, to warrant upending the production schedule to meet the promised delivery date. As a result, the factory’s understanding of the promise date is the 25^th, while Bob’s (and the customer’s) is the 15^th. Who’s right?

Let’s say the customer’s order history does warrant upending the production schedule, but that throws off the delivery date for several other orders. These customers are accommodating, so despite the chaos in the factory, the change doesn’t result in any lasting harm. If the factory then delivers these orders by the new promised delivery date, are they still “on time?” What if the customers whose orders were affected hadn’t been so accommodating?

Later that month, the factory manager is called on the carpet by the CEO because according to his monthly reports, the factory’s OTD rate is less than 50%! (The report IT creates for the CEO compares the original promised date against the actual delivery date.) The factory manager pulls out a spreadsheet showing the production schedule against actual delivery. According to his figures, the factory’s OTD rate is 95%. Not perfect, but darn good. Is the factory manager’s position defensible?

Making Manufacturing Metrics Meaningful Again

Let’s take a look at a few of the challenges presented in the above scenario and how Synchrono can help resolve them.

#1 One version of the truth – The factory manager’s spreadsheet is the type of “red flag” we look for when clients call us in to ask how they can improve operations. Spreadsheets in manufacturing almost always mean that people are working from different versions of reality. Not only is there a question of where the data comes from, but studies also show that a good portion of the spreadsheets used in business contain errors. Creating a common definition for key metrics and then letting a system, such as SyncView from Synchrono, serve that KPI up in a dashboard helps ensure everyone is working from the same version of the truth.

Related Post – It’s Time: Manufacturers Need to Cut Ties With MRP and Spreadsheets

#2 Bridging the Divide Between Production and Sales – In many facilities, the last thing the production scheduler wants to do is take time out of their day to negotiate with sales. Every call could mean a change to their carefully crafted schedule. For their part, sales is more interested in closing business. If they’re promising unrealistic dates, well, they can always ask for forgiveness later.

SyncManufacturing considers all resources when calculating capacity: materials, people, processes and equipment – and delivers a “capable to promise” date (CTPD) that the factory can meet given current supply and workload. Many Synchrono customers give sales access to this information during the sales process, eliminating unrealistic promised delivery dates or the need for sales to call the factory. In the example above, Bob would have been given a CTPD that he could reliably provide to his customer, making the issue of conflicting OTD metrics moot. Just as important, providing Bob with a CTPD prevents Bob – and the organization – from making a local decision that could have enterprise-wide impact. Along with CTPD verification, many SyncManufacturing software customers put a process in place where they talk through the options available when a customer request date cannot be met. This way, the organization can have a systematic discussion of what can be done, rather than making a decision in isolation that could have wide-spread ramifications.

#3 Synchronizing Resources to Demand – Finally, many of our customers have dramatically increased their on-time delivery rate through the synchronization of resources to demand. At Rex Materials Group, on-time shipments went from 50% to 98% in one facility. I should also mention that Synchrono helped RMG lower lead times as well. Many orders that used to take three to four weeks can now be delivered in less than five days. Some products even have a 24-hour turnaround. Orders can be shipped the next day with no extra effort.

If your manufacturing metrics need an overhaul, here are a few additional resources you might appreciate:

White paper: Metrics That Drive Action

Video: Visualizing Metrics in the Factory of the Future

May 7, 2018
Peace on Earth and Goodwill Between Sales and Production
The decorations. The music. The food. The holiday season is a time of cheer and goodwill for many people. Nevertheless, there are two groups who may find each other especially trying this time of year: sales and production. That’s because this isn’t just the holiday season; it’s also the end of the fiscal year for many organizations. While everyone else has visions of sugarplums dancing in their heads, sales has a vision of only one thing: making quota.

‘Tis the Season

It’s common knowledge that not every salesperson reaches their quota, but what you may not know is that that’s by design. Sales management theory suggests that 60 to 70% of people making quota is about right. Higher than that and you’ve set quotas too low.

Unfortunately, sales managers don’t always care about sales management theory. Their compensation is based off making their collective quota. If only 60% of their people make quota, they probably won’t be taking that extended family vacation this year. The actual number of reps hitting quota in most organizations is closer to 50%, which puts even more pressure on sales managers and their direct reports. In the heat of the moment, salespeople often make promises, such as faster delivery dates, without having all the information.

Demand-Driven Manufacturing Puts the “Happy” Back in the New Year

When I talk with salespeople, many of them tell me they don’t like the end of year situation any more than their counterparts in production. The problem is that everything happens so quickly, the customer is playing hardball (buyers know they have the upper hand this time of year), and the rep needs to close the business.

It’s time to break out of the vicious cycle that happens every December and often enough throughout the year as well. To do so, we need to look at the underlying causes – not counting the tremendous pressure on sales to make quota, which we’ve already covered and isn’t going to change. Instead, we’ll focus on what’s in our control:
- Many ERP manufacturing systems only consider material availability, not available capacity.
- Sales doesn’t have visibility into what’s possible.
- Adjusting production schedules to accommodate orders is time-consuming and often creates more problems than it solves.
SyncManufacturing^TM can solve these challenges. The software’s Capable-to-Promise Date (CTPD) functionality looks not only at material availability, but also at capacity. What-if analyses can be performed to determine realistic delivery dates, given the current production load. This helps sales avoid the mistake of over-promising, and it gives them an advantage. They don’t have to turn away business that they could accept if only they had visibility into what was possible.

It’s worth noting that this frees up production planners as well. They’re no longer responding to urgent requests from sales asking for shorter delivery times or readjusting schedules to accommodate sales already made. When an order is accepted, the scheduling engine in SyncManufacturing automatically adjusts the production schedule, improving asset utilization and minimizing lead times for all orders.

Sales and Production are just two groups that benefit from applying Demand-Driven Manufacturing principles. If you’d like to learn more about the enterprise-wide benefits, download: The Enterprise-wide Impact of Synchronized Planning, Scheduling, and Production Execution.
December 27, 2017

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