In this study, a hierarchical production planning and control system (HPPCS-FMS) framework for a Flexible Manufacturing System (FMS) is developed. The HPPCS-FMS is a three-level hierarchy embedded in a closed-loop structure where the main feedback is the anticipated effective capacity. The HPPCS-FMS exploits the flexibility inherent in the manufacturing system to respond effectively to a frequently changing demand mix. All levels benefit from flexible process plans as a means to use capacity effectively. Flexible process plans offer not only alternative machines for operations but also alternative sequences of operations for producing the same work piece. To implement the framework, the problems at each level are identified and modelled; the integration among the levels is defined and a simulation-based capacity anticipation mechanism is developed. The proposed HPPCS-FMS is tested under different scenarios. The results demonstrate that capacity anticipation considerably improves the performance.