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Copyright 2011 by The McGraw-Hill Companies, Inc. ll rights reser!e".McGraw-Hill#Irwin

Manufacturing

Planning and Control

MPC 6thEdition

Chapter 6

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Material Requirements

Planning (MRP)

Material Requirements Planning(MRP) has the managerial objective

of providing the right part at theright time to meet the schedulesfor completed products!

MRP provides a formal plan for eachpart number"ra# materials$components$ and finished products!

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%genda

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6-4

Resource

planning

&ales and operations

planning

'emand

management

Master productionscheduling

'etailed capacit

planning

'etailed material

planning

Material and

capacit plans

&hopfloor

sstems

&upplier

sstems

EnterpriseResourc

ePlanning(ERP

)&stem

Front End

Engine

Back End

Manufacturing Planning and Control System

*imephased

requirement (MRP)

records

Routing

file

+ills of

material

,nventor

status

data

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+asic MRP Record

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+asic MRP Record

-n hand

Period

. / 0 1 2

3ross requirements .4 14 .4

&cheduled receipts 24

Projected available balance 1 21 11 11 1 11

Planned order releases 24

5ead time . period5ot si7e 24

% previousl

released order

due in period .

% unreleased

order due in

period 2

Requirements

from all

sources

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+ill of Materials

*he +-M sho#s thecomponents and

subassemblies

required to produce

a product

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Product &tructure 'iagram

&ubassemblies

are represented

b separate

levels

8inished product is

located at the top$

components belo#

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E9plosion

E9plosion"the process of translating product

requirements into component part requirements

Considers e9isting inventories and scheduled

receipts

Calculating the quantities of all components

needed to satisf requirements for an given part!

Continued until all parts have been considered$leading to e9act requirements for all purchased

and:or ra# material parts

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3ross and ;et

Requirements 3ross requirements represent the total planned usage for the part

;et requirements account for e9isting inventor and:or scheduled

receipts

.44 req

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'emand *pes in MRP

'ependent"component or subassembl

demand driven b net requirements from the

ne9t higher level (e!g! scoop demand causedb net requirements for scoop assemblies)

,ndependent"demand driven b requirements

from outside the firm (e!g! customer orders)

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5ead *ime -ffsetting

3ross to net e9plosion sho#s ho# much of each

part is required$ but not #hen

*iming requires consideration of t#o factors5ead times"ho# long does it ta?e to obtain the

component or subassembl

Precedent relationships"the order in #hich parts

must be assembled MRP considers both factors #hen developing the

plan

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&cheduling 5ogic

*#o common approaches to scheduling e9ist

8ront schedule"schedule each step as earl as

possible

+ac? schedule"schedule each step as late as

possible

MRP combines bac? scheduling and gross to net

e9plosionReduced inventories

Minimi7ed storage time

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+ac? &cheduling

*op handle

assembl has the

longest duration of

an subassembl

&coop assemblmust be complete

before final

assembl can begin

-nl #hen all sub

assemblies and

components are

available can final

assembl begin

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MRP RecordsPlanned order release

for top handle assembl

becomes gross

requirement for top

handle component andnail (note / nails required

per assembl)

5otforlot order polic

e9actl matches suppl

to net requirements

8i9ed lot si7e order

polic requires orders in

multiples of lot si7e

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MRP *echnical ,ssues

Processing frequenc"recalculating all records and

requirements is called regeneration *his is a computationall intensive process so it is often run

in the bac?ground and during periods of lo# sstem demand ;et change approach onl recalculates those records

that have e9perienced changes

5ess frequent processing results in an outofdate

picture More frequent processing increases computer costs

and ma lead to sstem nervousness

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&afet &toc? and &afet

5ead *ime

&afet stoc? is buffer stoc? over and above the

quantit needed to satisf gross requirements

@sed #hen quantit uncertaint is the issue &afet lead time changes both the release and

due date of shop and:or purchase orders to

provide a margin for error

@sed #hen timing of orders is the issue

&afet lead time is not just an inflated lead time

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Pegging

Pegging provides a lin? bet#een demand

(order releases$ customer orders$ etc!) and

the gross requirements for partsPegging records include the specific part

numbers associated #ith a gross requirement

Pegging information can trac? the impact of a

problem (e!g! material shortage) bac? to theorder(s) it #ill affect

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Planning Aori7on

*otal amount of time included in MRP

calculations

5onger planning hori7on increasescomputational requirements

&horter planning hori7on ma result in less

effective plans if significant future demand is not

visible%t a minimum$ should cover the cumulative lead

time for all finished goods items

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&cheduled Receipts vs!

Planned -rder Releases &cheduled receipts represent an actual commitment

(purchase order$ production order$ etc!)

Planned orders are onl the current plan and can be

changed more easil &cheduled receipts for production orders alread have

component materials assigned&cheduled receipts do not impact gross requirements

Planned order releases do not have component materialsassignedPlanned order releases do impact gross requirements

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@sing the MRP &stem

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MRP Planner *as?s

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E9ception Codes

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+ottom@p Replanning

@sing pegging data to guide efforts to solve

material shortages

Pegging data allo#s the planner to ta?eaction onl #hen actual customer orders are

impacted

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MRP &stem -utputPart number and description MRP sstem data

MRP planning data

E9ception messages

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MRP &stem 'namics

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Principles

Effective use of an MRP sstem allo#s development of a

for#ardloo?ing approach to managing material flo#s!

*he MRP sstem provides a coordinated set of lin?ed

product relationships$ #hich permits decentrali7ed decisionma?ing for individual part numbers!

%ll decisions made to solve problems must be implemented

#ithin the sstem$ and transactions must be processed to

reflect the resultant changes! Effective use of e9ception messages allo#s attention to be

focused on the vital fe# rather than the trivial man!

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Bui7 " Chapter 6

Material Requirements Planning (MRP) ta?es place in the front

end sstems of the manufacturing planning and control sstem

(*rue:8alse)

,n a Material Requirements Planning (MRP) sstem$ #hat does

timephasing of gross requirements mean

8ront scheduling logic starts each step of the process as late as

possible (*rue:8alse)

% lotforlot order polic generates orders for a fi9ed quantit$

independent of actual requirements (*rue:8alse) Processing all Material Requirements Planning (MRP) records in

a single computer run is called DDDDDDDDDDD

&afet lead time involves inflating lead times to ensure stoc?

availabilit (*rue:8alse)