Session 10
Material Requirements Planning
http://www.pom.edu/mpc/lectures_in_manufacturing_planning.htm
lecture session 10
• Material Requirements Planning: Role in
the MPC System
• Evolution in Material Planning
• Basic MRP of Record Processing
• Information Timing
• Technical Issues
1
Manufacturing Planning and Control
System
2
Evolution in Material Planning
•
•
•
•
•
Independent vs. Dependent Demand Items
MRP
Closed loop MRP systems
MRP II (Manufacturing Resource Planning)
ERP
3
Basic MRP Records and Record
Processing: Example
Develop an MRP spreadsheet record for six periods using the following
parameters for the item:
Period
Gross requirements
Lead time
Lot size
Safety stock
Inventory
Scheduled receipt
1
20
2
20
3
4
20
30
1 period
40 units
0 units
2 units
40 units in period 1
5
30
6
30
4
Basic MRP Records and Record
Processing: Example (Continued)
a. In what periods are there planned order releases?
b. What happens to the timing, number of planned
order releases, and average inventory (for periods
l through 6) if 10 units of safety stock are
required?
c. What happens to the timing, number of planned
order releases, and average inventory (for periods
1 through 6) if a one-period safety lead time is
used instead of the safety stock?
5
Basic MRP Records and Record
Processing
a.
No safety stock
Period
Gross Requirements
Scheduled Receipts
Projected Available Balance
Planned Order Release
Q = 40, LT = 1, SS = 0
2
1
20
40
22
2
20
3
20
4
30
5
30
6
30
2
40
22
40
32
2
40
12
Three planned orders in periods 2, 3, and 5. Average
projected inventory is 15.33 units.
6
Information Timing
Gross Requirements
Scheduled Receipts
Projected Available Balance
Planned Order Release
-
Beginning of Period
Beginning of Period
End of Period
Beginning of Period
7
Basic MRP Records and Record
Processing (Continued)
b.
Safety stock of 10 units
Period
Gross Requirements
Scheduled Receipts
Projected Available Balance
Planned Order Release
2
1
20
40
22
40
2
20
3
20
4
30
5
30
6
30
42
22
40
32
40
42
12
Q = 40, LT = 1, SS = 10
Three planned orders in periods 1, 3, and 4. Two planned
orders were moved up because of the safety stock
requirement. Average projected inventory is 28.67 units.
8
Basic MRP Records and Record
Processing
a.
No safety stock
Period
Gross Requirements
Scheduled Receipts
Projected Available Balance
Planned Order Release
Q = 40, LT = 1, SS = 0
2
1
20
40
22
2
20
3
20
4
30
5
30
6
30
2
40
22
40
32
2
40
12
Three planned orders in periods 2, 3, and 5. Average
projected inventory is 15.33 units.
9
Basic MRP Records and Record
Processing (Continued)
c.
Safety Lead Time of 1 period
Period
1
2
Gross Requirements
20 20
Scheduled Receipts
40
Projected Available Balance 2
22 42
Planned Order Release
40 40
Q = 40, LT = 1, SS = 0, SLT = 1 period
3
20
4
30
5
30
6
30
62
32
40
42
12
Three planned orders in periods 1, 2, and 4. All of the planned
orders were moved up by 1 period to account for the
safety lead time. Average projected inventory is 35.33
units.
Using safety stocks or safety lead time causes the system to
hold more inventory and order earlier. The safety lead
time causes all orders to be held an extra period in
inventory
10
Technical Issues
• Net Requirements
• Lot Sizing
– Lot-For-Lot (L4L)
– Fixed Order Quantities (Q)
• Safety Stock and Safety Lead Time
• Incorporating Service Part Demand
• Scheduled Receipts versus Planned Order
Releases
• Firm Planned Orders
11