Material requirements planning (MRP): Computer-basedinformation system for ordering and scheduling ofdependent demand inventoriesIt is a production planning process that starts from the demand forfinished products (independent demand) and plans theproduction step by step of subassemblies and parts (dependentdemand).MRP
Capacity PlanningCapacity requirements planning: The process ofdetermining short-range capacity requirements.Load reports: Department or work center reports thatcompare known and expected future capacityrequirements with projected capacity availability.Time fences: Series of time intervals during which orderchanges are allowed or restricted.
MRP PlanningDevelop a tentativemaster productionscheduleUse MRP tosimulate materialrequirementsConvert materialrequirements toresource requirementsFirm up a portionof the MPSIs shopcapacityadequate?Cancapacity bechanged to meetrequirementsRevise tentativemaster productionscheduleChangecapacityYesNoYesNo
Food catering service End items are the catered food Dependent demands are ingredients foreach recipe, i.e. bill of materialsTaco Bell menu itemsHotel renovation Activities and materials “exploded” intocomponent partsMRP in Services
Benefits of MRPLow levels of in-process inventoriesAbility to track material requirementsAbility to evaluate capacity requirementsMeans of allocating production timeEventually it is a database with limited decisionmaking capability
Requirements of MRPComputer and necessary softwareAccurate and up-to-date inputs: Master schedules Bills of materials Inventory recordsIntegrity of data
Manufacturing resource planning (MRP II) is defined byAPICS as a method for the effective planning of allresources of a manufacturing company. Ideally, it addressesoperational planning in units, financial planning, and has asimulation capability to answer "what-if" questions andextension of closed-loop MRP.This is not exclusively a software function, but a marriageof people skills, dedication to data base accuracy, andcomputer resources. It is a total company managementconcept for using human resources more productively.
Expanded MRP with and emphasisplaced on integration Financial planning Marketing Engineering Purchasing ManufacturingMRP II
MarketDemandProductionplanProblems?Rough-cutcapacity planningYes No YesNoFinanceMarketingManufacturingAdjustproduction planMasterproduction scheduleMRPCapacityplanningProblems?RequirementsschedulesAdjustmasterscheduleMRP II
Key functions and features•Master production schedule (MPS)•Item master data (technical data)•Bill of materials (BOM) (technical data)•Production resources data (manufacturing technicaldata)•Inventories and orders (inventory control)•Purchasing management•Material requirements planning (MRP)•Shop floor control (SFC)•Capacity planning or capacity requirements planning(CRP)•Standard costing (cost control)•Cost reporting / management (cost control)
What is ERP?facilitates company-wide integratedinformation systems, covering allfunctional areasperforms core Corporate activities andincreases customer service augmentingCorporate ImageERP is a solution, which
For Management – to know what is happeningin the companyOne solution for better ManagementFor cycle time reductionTo achieve cost control & low working capitalTo carry latest technologiesTo shun the geographical gapsTo satisfy the customers with high expectationsTo be Competitive & for survival
• Enterprise Resource Planning - a software system thatintegrates core business areas such as manufacturing,distribution, financials and human resources.• “Software solution that addresses the Enterprise needs, takinga process view of the overall organization to meet the goals,by tightly integrating all functions and under a commonsoftware platform”Enterprise Resource Planning
An ERP solution can deliver dramatic benefitsto businesses of all types and sizes – increasedproductivity, reduced operating expenses,improved information flow, and enhancedperformance management. Why does yourcompany need an ERP solution? Read on tolearn more.
One common system - less duplication, moreefficientCustomer focus - better customer serviceOpen communications among business partnersAdherence to standard business practicesBenefits of ERP
High costForced change of processesVery complex softwareLack of trained peopleNot Internet-readyDisadvantages of ERP
Critical Success Factors The firm & optimistic approach of the Management- on adapting the ERP product driven methodologies- on customization- on monetary commitments The dedicated Team Good Training Strict adherence to the Project schedules Right technical infra-structure Change Management
MRPIn the 1970s material requirement planning (MRP) was developed as a mechanism formanufacturing companies to calculate more precisely what materials they required, at what timeand in optimum quantities.MRPIIManufacturing Resource Planning (MRPII) evolved from MRP, because many companiesrealised that as well as the need to calculate their material requirements precisely, they alsorequired detailed capacity planning, scheduling, shop floor control and other calculations.MRPII introduced the closed-loop model, which uses a centrally held data file to record, monitorand report on various company activities. By comparing forecasts with actual data, companiescan analyse performance and improve processes to achieve better efficiency.CaliachMRP is Caliachs established MRPII system for managing core manufacturing activitiesERPEnterprise resource planning (ERP) developed MRPII even further to embrace all businessfunctions, not just those concerned with actual manufacturing. ERP encompasses materialsplanning, efficient production, profitability, customer satisfaction - almost every aspect ofbusiness.ERP also incorporates the principles of global supply chain management, in which the value ofevery activity in the supply chain is analysed, along with the growing development of Internet orweb-enabled procurement.conclusion