MRP Planner Tasks

• Purchase orders
Release • Shop floor (production) orders

Reschedule • Change due dates of existing orders (when desirable)

• Set lot sizes and lead times

Analyze and Update • Adjust scrap allowances and safety stocks

Reconcile • Identify errors and inconsistencies and eliminate their root causes

Identify Problems • Take action now to prevent future crises

Solve Shortages • Adjust records and system parameters to prevent recurrence

Enhance • Identify system enhancements to improve performance

 Exception Codes

Separating the vital few from the

trivial many
Requirements
Part numbers that cannot be
Orders with
with planned satisfied
unsatisfactory
orders in the within system
timing or
immediate parameters
quantity
period (management
input needed)
 Bottom-Up Replanning
• Using pegging data to guide efforts to solve
material shortages
– Pegging data allows the planner to take action
only when actual customer orders are impacted
MRP System Output
Part number and description MRP system data

MRP planning data

Exception messages
 MRP System Dynamics

MRP System Issues

Procedural
Rescheduling– Complex
Transactions inadequacies–
moving the transactions–
during a situations the
due date of inventory
period– system
an order to adjustments,
unexpected wasn’t
an earlier or service parts,
changes designed to
later date etc.
handle
 System Dynamics
An MRP is not a static document
As time goes by
Some orders get completed
Other orders are near completion
New orders will have been entered
Existing orders will have been altered
Quantity changes
Delays
Missed deliveries
– See Figure 6.11,6.12,6.13
 Principles

• Effective use of an MRP system allows development of a

forward-looking approach to managing material flows.
• The MRP system provides a coordinated set of linked product
relationships, which permits decentralized decision making for
individual part numbers.
• All decisions made to solve problems must be implemented
within the system, and transactions must be processed to reflect
the resultant changes.
• Effective use of exception messages allows attention to be
focused on the “vital few” rather than the “trivial many.”
 10. XYZ Company
Item A; Lot Size = 150; LT = 1, SS = 0. Average Inventory = ?

Period 1 2 3 4 5 6 7 8 9 10

Gross Requirements 71 46 49 55 52 47 51 48 56 51

Scheduled Receipts

Proj. Available Bal. 150

Planned Order Rel.

Item B; Lot Size = 150; LT = 1, SS = 0. Average Inventory = ?

Period 1 2 3 4 5 6 7 8 9 10

Gross Requirements 77 83 90 22 10 10 16 19 27 79

Scheduled Receipts

Proj. Available Bal. 150

Planned Order Rel.

 10. XYZ Company
Item A; Lot Size = 3 weeks supply (P=3); LT = 1, SS = 0. Average Inventory = ?
Period 1 2 3 4 5 6 7 8 9 10

Gross Requirements 71 46 49 55 52 47 51 48 56 51

Scheduled Receipts

Proj. Available Bal. 150

Planned Order Rel.

Item B; Lot Size = 3 weeks supply (P=3); LT = 1, SS = 0. Average Inventory = ?

Period 1 2 3 4 5 6 7 8 9 10

Gross Requirements 77 83 90 22 10 10 16 19 27 79

Scheduled Receipts

Proj. Available Bal. 150

Planned Order Rel.

 14. ABC Manufacturing Company
a. Component C (Q=40, LT=2, SS=0)

1 2 3 4 5 6

Gross Requirements

Scheduled Receipts

Projected Available Balance

Planned Order Release

b. Component C (Q=40, LT=2, SS=0)

1 2 3 4 5 6

Gross Requirements

Scheduled Receipts

Projected Available Balance

Planned Order Release