Post on 31-Mar-2015
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Chapter 15 - Material & Capacity Requirements Planning(MRP/CRP)
Planning Objectives
• Satisfy customer demand
• Ensure availability and efficient use of resources– Material– Capacity
• KEY - Balance demand and resources
Planning and Control System Questions
• What are we going to make, and when?
• What does it take to make it?
• What do we already have?
• What must we get, and when?
• Successful answers result in right:– goods, quantity, quality, time, cost
Types of Resource Planning Systems
• Material Requirements Planning (MRP) -– A set of techniques that uses bill of material
data, inventory data, and the master production schedule to calculate time-phased requirements for materials. Recommends release of replenishment orders and rescheduling of open orders as conditions (priorities) change.
» APICS Dictionary - 9th Ed.
MRP’s Objectives
• What to Order
• How Much to Order
• When to Order
• When to Schedule Delivery
MRP OverviewMRP Inputs MRP Processing MRP Outputs
Masterschedule
Bill ofmaterials
file
Inventoryrecords
file
MRP computerprograms
Changes
Order releases
Planned-orderschedules
Exception reports
Planning reports
Performance-controlreports
Inventorytransaction
Primaryreports
Secondaryreports
Material Requirements PlanningInputs• Master schedule: States which end items to produce,
when, and in what quantities.• Bill of materials: Raw materials, parts, subassemblies, and
assemblies needed to produce one unit of a product (Single vs. multiple level).
• Product structure tree: Visual depiction of a bill of materials, with all components listed by levels
• Inventory status/transactions: Location, quantity, ins, outs, picks, changes.
• Planning Factors: Lead time, scrap allowance, yield factors, lot sizes, safety stock/safety lead time
Material Requirements Planning
A Final Point
• MRP focuses on materials ONLY and DOES NOT guarantee that the plan can be implemented from a capacity/resource perspective. To close the loop, it’s necessary to do capacity requirements planning (CRP)
Capacity Requirements Planning• The process of determining short-
range capacity requirements from MRP outputs
• Load reports/profiles show known and expected future capacity requirements vs. expected capacity availability
Ch 13 - 28© 1998 by Prentice-Hall IncRussell/Taylor Oper Mgt 2/e
Capacity Requirements PlanningMRP planned
orderreleases
Routingfile
Capacityrequirements
planning
Openorders
file
Load profile foreach machine center
Ch 13 - 31© 1998 by Prentice-Hall IncRussell/Taylor Oper Mgt 2/e
Capacity Requirements Planning - Initial Load Profile
1 2 3 4 5 6
Time (weeks)
Normalcapacity
Hours ofcapacity
Ch 13 - 32© 1998 by Prentice-Hall IncRussell/Taylor Oper Mgt 2/e
Capacity Requirements Planning - Adjusted Profile
1 2 3 4 5 6
Time (weeks)
Work an extra shift
Push back
Push back
Pull ahead
Overtime
Hours ofcapacity
Types of Resource Planning Systems
• Manufacturing Resource Planning (MRP II)– A method for the effective planning of all
resources of a manufacturing company. Provides simulation capability to answer “what-if” capability and is made up of a variety of planning functions, each linked together. Output from these functions is linked with other business functions and financial reports. An extension of MRP.
» Modified from APICS Dictionary - 9th Ed.
Types of Resource Planning Systems
• Enterprise Resource Planning (ERP)– A method for the effective planning and control
of all resources needed to take, make, ship, and account for customer orders. Differs from typical MRP II in technical requirements such as graphical user interface, relational database, 4GL languages, client-server architecture and open-system portability (Example SAP R/3)
» Modified from APICS Dictionary - 9th Ed.
Trends in Resource Planning Systems
• More powerful/sophisticated• More encompassing• More integrated/flexible• More options• More user-friendly/robust• More data-base focused• More data-intense
Chapter 16 - Just-In-Time
JIT/Lean ProductionJust-in-time: Repetitive production system
in which processing and movement of materials and goods occur just as they are needed, usually in small batches
• JIT is characteristic of lean production systems
• JIT operates with very little “fat”
Just-In-Time Concepts
• jit - Inventory/production control system
• JIT - Philosophy of continuous improvement
• Simplification/Execution
• Elimination of Waste
• Reduced transaction processing
• Multi-pronged approach– High quality, Quick response, Flexibility
JIT vs. MRP/ERP• Similar goals
– Right products, right place, right time
• MRP II – Computer-based, manages complexity
• JIT– Manual systems, simplicity/execution
• The Super Bowl of Planning & Control• Choice? - play to strengths
– MRP – Planning; JIT - execution
JIT Characteristics• A Fixed, Steady Rate of Production
– Uniform flow– Linear production
• Low Inventories– Less space, investment– Uncover defects
• Small Lot Sizes– Less WIP– Flexibility/Velocity– Fast feedback
JIT Characteristics• Quick, Low Cost Setups
– Flexibility/Velocity
– Small lot sizes
• Layout– U-shaped
– Cellular
• Preventive Maintenance & Repair– Worker pride/ownership
JIT Characteristics• Multifunctional/Cooperative Workers
– Guerilla squad
– Flexible capacity
• High Quality Levels– On-going production
– Small/frequent deliveries
• Product simplification– Standardization
– Fewer part numbers/drawings
JIT Characteristics• Reliable Vendors
– Dock-to-stock
– Much smaller number
– Long-term relationships
• A Pull System of Moving Goods– Request-based
– Kanban signal
• Problem Solving/Continuous Improvement