Production Planning and

Control
Chapter 3 – Master Production
Scheduling (MPS)
 The Master Schedule is:
 The formal link between production
planning and actual production
 The basis for calculation of resources
needed
 The driving force behind the material
requirements plan
 The primary priority plan for
manufacturing

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 The Master Schedule:
 Works with end items.
 Its breaks down the production plan into
the requirements for individual end items.
In each family, by date and quantity.
 The total of the items in the MPS should
not be different from the total shown
on the production plan.

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Objectives and Steps for the
MPS
 Objectives –
 Maintain good customer service
 Make effective use of resources
 Maintain effective levels of inventory
 Accomplished by:
 Develop a preliminary MPS
 Check MPS against capacity and resources
 Reconcile any differences

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Information Needed to Develop
an MPS
 Production Plan data
 Forecasts for individual items
 Actual customer orders
 Inventory levels
 Capacity constraints

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Relationship to Production Plan

MPS 
Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
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 MPS Example

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 MPS Example - Develop a
preliminary MPS

1.

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 MPS Example
2.

3.

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Rough-cut Capacity Planning -
Check MPS against capacity
and resources
 Establishes whether critical resources
are available
 Bottleneck operations
 Critical labor resources
 Critical material
 Often uses a resource bill for a single
product

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Example Resource Bill

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Example Resource Bill

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Example Resource Bill

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Resolution of Differences
 Compare the total time required to the
available capacity of the work centre.
 If available capacity is greater than the
required capacity, the MPS is workable.
 If not, method of increasing capacity have
to be investigated by adjust the available
capacity with overtime, extra workers,
routing through other work centres or
subcontracting.
 If not, need to revise the MPS.
Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Resolution of Differences
 Finally master production schedule must be judged
by three criteria:
 Resource use

 Is the MPS within capacity restraints in each

period of the plan? Does it make the best use

of resources?
 Customer service

 Will due date be met and will delivery

performance be acceptable?
 Cost

 Is the plan economical or will excess costs be

incurred for overtime, subcontracting,

expediting or transportation?
Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Master Schedule “Focal Points”
 Make-to-Stock – Limited end products,
many components, (TV)
 Make-to-Order – Many end products,
fewer components, (Jewlery)
 Assemble-to-Order Many end products,
combination of components and
subassemblies

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Final Assembly Schedule
 Assembly according to customer
schedule
 Generally used in an Assemble-to-Order
environment
 Many options
 Too many possible final configurations to
forecast or master schedule
 MPS usually done at the option level

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Example MPS Environments

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 MPS, FAS and Other Planning
Activities

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 MPS Planning Horizon
 Minimum time horizon over which the
master schedule must extend to ensure
complete planning
 Calculated as the longest end-to-end
lead time of the product structure

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 EXAMPLE - Cumulative Planning
Horizon
 For this product – Minimum Planning Horizon 12
weeks

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Delivery Promises
 MPS is a plan for what production can
and will do
 Sales delivery promises can be made
from
 “Consumption” of forecasts – Projected
available balance
 Available to Promise calculations
 MPS values for a given time period left after
actual customer orders are subtracted.
Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Available to Promise Example

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Projected Available Balance
 Within demand time fence (forecast not
taken into account)
 PAB = Prior period PAB + MPS – customer
orders
 Outside of demand time fence
 PAB = Prior period PAB + MPS – greater of
customer order or forecast

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Example of MPS with ATP and
PAB (Demand time fence at end of week 3)

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Time Fences
 Points in the planning horizon to define the
flexibility allowed in the MPS
 Frozen Zone (closest to current date)
 Capacity and materials committed to customer orders,
forecast generally ignored
 Senior management approval for changes
 Slushy Zone
 Less commitment of materials and capacity
 Tradeoffs negotiated between marketing and
manufacturing
 Liquid Zone – All changes allowed within limits of
the Production Plan
Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.
 Time Fences

Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman, Clive All Rights Reserved.