Transcript Chapter 11

Chapter 13
Material Requirements Planning
© 2000 by Prentice-Hall Inc
Russell/Taylor Oper Mgt 3/e
MRP
 Computerized
inventory control &
production planning system
 Schedules
component items when they
are needed - no earlier and no later
© 2000 by Prentice-Hall Inc
Russell/Taylor Oper Mgt 3/e
2000 by Prentice-Hall, Inc
Ch 13 - 2
2
When to Use MRP
 Dependent
and discrete items
 Complex products
 Job shop production
 Assemble-to-order environments
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Russell/Taylor Oper Mgt 3/e
2000 by Prentice-Hall, Inc
Ch 13 - 3
3
MRP Inputs & Outputs
Master Production Schedule
Product
Structure
File
Material
Requirements
Planning
Inventory
Master
File
Planned Order Releases
Work Orders
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Russell/Taylor Oper Mgt 3/e
Purchase Orders
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Rescheduling Notices
Ch 13 - 4
4
MRP Inputs
 Master
production schedule
 Product
structure file
 Inventory
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Russell/Taylor Oper Mgt 3/e
master file
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Ch 13 - 5
5
Master Production Schedule
 Drives
MRP process with a schedule of
finished products
 Quantities represent production not
demand
 Quantities may consist of a combination
of customer orders & demand forecasts
 Quantities represent what needs to be
produced, not what can be produced
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Ch 13 - 6
6
Master Production Schedule
MPS
Period
Item
1
2
3
4
5
6
7
8
Clipboard
86 93 119 100 100 100 100 100
Lapboard
0 50
0 50
0 50
0 50
Lapdesk
75 120 47 20 17 10
0
0
Pencil Case 125 125 125 125 125 125 125 125
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2000 by Prentice-Hall, Inc
Ch 13 - 7
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Product Structure Tree
Clipboard
Clip Assembly
(10)
Board
(1)
Rivet
(2)
Top Clip
(1)
Bottom Clip
(1)
Pivot
(1)
Spring
(1)
Sheet
Metal
(8 in2)
Sheet
Metal
(8 in2)
Spring
Steel
(10 in.)
Iron
Rod
(3 in.)
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Level 0
Pressboard
(1)
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Level 1
Finish
(2oz.)
Level 2
Level 3
Ch 13 - 8
8
Indented Bill of Material
LEVEL
0----1----2----3--2----3--2----3--2----3-1---1----2---2-© 2000 by Prentice-Hall Inc
Russell/Taylor Oper Mgt 3/e
ITEM
Unit of Measure
Clipboard
Ea
Clip Assembly
Ea
Top Clip
Ea
Sheet Metal
In2
Bottom Clip
Ea
Sheet Metal
In2
Pivot
Ea
Iron Rod
In
Spring
Ea
Spring Steel
In
Rivet
Ea
Board
Ea
Press Board
Ea
Finish
Oz
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Quantity
1
1
1
8
1
8
1
3
1
10
2
1
1
2
Ch 13 - 9
9
Inventory Master File
Description
Item
Item no.
Item type
Product/sales class
Value class
Buyer/planner
Vendor/drawing
Phantom code
Unit price/cost
Pegging
LLC
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Board
7341
Manuf.
Ass’y
B
RSR
07142
N
1.25
Y
3
Inventory Policy
Lead time
Annual demand
Holding cost
Ordering/setup cost
Safety stock
Reorder point
EOQ
Minimum order qty
Maximum order qty
Multiple order qty
Policy code
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2
5,000
1
50
25
39
316
100
500
100
3
Ch 13 - 13
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Inventory Master File, Con’t.
Physical Inventory
On hand
Location
On order
Allocated
Cycle
Difference
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100
W142
50
75
3
-2
Usage/Sales
YTD usage/sales
MTD usage/sales
YTD receipts
MTD receipts
Last receipt
Last issue
Codes
Cost acct.
Routing
Engr
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1,100
75
1,200
0
8/25
10/5
00754
00326
07142
Ch 13 - 14
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Inventory Accuracy
1. Maintain orderly stockrooms
2. Control access to stockrooms
3. Establish & enforce procedures for
inventory withdrawal
4. Ensure prompt and accurate entry of inventory
transactions
5. Take physical inventory count on a regular
basis
6. Reconcile inventory discrepancies in a timely
manner (use cycle counting)
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2000 by Prentice-Hall, Inc
Ch 13 - 15
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The MRP Matrix
Lot size:
LT:
Gross requirements
Scheduled receipts
Projected on hand
Net requirements
Planned order receipts
Planned order releases
PD
1
2
3
4
5
6
7
8
9

Item
 name or number identifying scheduled item
 LLC
 low-level-code; lowest level at which item
appears in a product structure
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2000 by Prentice-Hall, Inc
Ch 13 - 16
13
10
Parts Of MRP Matrix

Lot size
 order multiples of this qty; can be min/max qty
 LT (lead time)
 time from order placement to receipt
 PD (past-due)
 orders behind schedule
 Gross requirements
 demand for item by time period
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Ch 13 - 17
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
Scheduled receipts
 quantity already on order & receipt date
 released orders become scheduled receipts
 Projected on hand
 expected on-hand inventory at end of period
 Net requirements
 net amount needed after on-hand
adjustments
 Planned order receipts
 net requirements adjusted for lot-sizing
 Planned order releases
 planned order receipts offset by lead time
© 2000 by Prentice-Hall Inc
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2000 by Prentice-Hall, Inc
Ch 13 - 18
15
Capacity Requirements
Planning (CRP)
 Computerized
system that projects load
from material plan
 Creates
load profile
 Identifies
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underloads and overloads
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Ch 13 - 25
16
Capacity Terms
 Load
profile
 Capacity
 Utilization
 Efficiency
 Load
 Load percent
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Ch 13 - 26
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Capacity Requirements
Planning
MRP planned
order
releases
Routing
file
Capacity
requirements
planning
Open
orders
file
Load profile for
each machine center
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Ch 13 - 28
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Initial Load Profile
Hours of
capacity
Normal
capacity
1
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2
3
4
5
6
Time (weeks)
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Ch 13 - 31
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Adjusted Load Profile
Hours of
capacity
Work an
extra shift
Overtime
Push back
Pull ahead
Push back
1
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2
3
4
Time (weeks)
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5
6
Ch 13 - 32
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Remedies for Underloads
1. Acquire more work
2. Pull work ahead that is scheduled for
later time periods
3. Reduce normal capacity
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Russell/Taylor Oper Mgt 3/e
2000 by Prentice-Hall, Inc
Ch 13 - 33
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Remedies for Overloads
1. Eliminate unnecessary requirements
2. Reroute jobs to alternative machines or work
centers
3. Split lots between two or more machines
4. Increase normal capacity
5. Subcontract
6. Increase the efficiency of the operation
7. Push work back to later time periods
8. Revise master schedule
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2000 by Prentice-Hall, Inc
Ch 13 - 34
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Problems with MRP
 Material
requirements plan is first;
capacity is an afterthought
 MRP
assumes fixed lead times
 Excessive
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reporting requirements
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Ch 13 - 43
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Manufacturing Resource
Planning (MRP II)
 Extension
of MRP
 Plans all resources needed for running
a business
 Variations include
 Service
Requirements Planning (SRP)
 Business Requirements Planning (BRP)
 Distribution Requirements Planning
(DRP)
© 2000 by Prentice-Hall Inc
Russell/Taylor Oper Mgt 3/e
2000 by Prentice-Hall, Inc
Ch 13 - 38
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MRP II Modules

Forecasting
 Customer order entry
 Production planning /
master production
scheduling
 Product structure / billof-material processor
 Inventory control
© 2000 by Prentice-Hall Inc
Russell/Taylor Oper Mgt 3/e

Material
requirements
planning
 Capacity planning
 Shop floor control
 Purchasing
 Accounting
 Financial analysis
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Ch 13 - 39
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Prospects for MRP/MRP II

Coordinates company strategy among
different functional areas
 Responds quickly to what-if? questions at
various levels of detail
 BOM processors, purchase modules, &
customer order entry are standard
requirements for Manufacturing Information
Systems
 Monitors design & vendor quality, & customer
service
 Builds trust, teamwork, & better decisions
 Cash-flow planning & profit/cost projections
© 2000 by Prentice-Hall Inc
Russell/Taylor Oper Mgt 3/e
2000 by Prentice-Hall, Inc
Ch 13 - 44
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