Materials requirement planning

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  • CURRENT
  • Materials requirement planning

    1. 1. What MRP does? • MASTER SCHEDULE FOR END ITEMS • DETAILED SCHEDULE FOR RAW MATERIALS AND COMPONENTS USED IN THE END PRODUCT  Dependent demand  Lumpy demand MRP
    2. 2. Independent Vs dependent demand  Independentdemand Demand unrelated to demand of other products.(end products and spare parts) Usually forecast Conventional inventory control system (EOQ, WAGNOR WHITIN) applicable.
    3. 3. Independent Vs dependent demand  Dependent demand  Demand directly related to demand of some other product.(components, raw materials or sub assemblies) Requirements derived from delivery schedule of other items. MRP is the appropriate tool for planning and control for manufacturing inventories Raw materials WIP Components Sub assemblies
    4. 4. Lead times  Ordering lead times (for purchased parts)  Initiation of receipt of item purchase requisition from vendor(off shelf/ fabricate)
    5. 5. Lead times  Manufacturing lead time  Process part through sequence of machines as given on route sheet (operation + non productive times)  Place order item delivered  In MRP lead times are used to determine starting dates for assembling final products and sub assemblies, for producing component parts and for ordering raw materials.
    6. 6. Inputs to MRP  The master production schedule and other data.  The bill of materials file( the product structure)  The inventory record file.
    7. 7. Master Production Schedule Week no: 6 7 8 9 10 Product P1 50 100 Product p2 70 80 25 Etc TYPICAL INFORMATION IN MPS (a) What end products are to be produced? (b) How many of each product to be produced? (c) When the products are to be ready for shipment? Firms customer orders DEMAND forecasted demand demand for individual components or parts (for repair and service- often excluded form MPS since it does not include end product demand)
    8. 8. Inventory record file  Accurate current data on inventory status  Generally computerized (item master file)  Lead times must be established in inventory record file.  Ordering lead time purchasing records  Manufacturing lead time process route sheets  INVENTORY TRANSACTIONS:- (issue, arrivals, order placement/realization) MUST BE KEPT CURRENT
    9. 9. Master Production Schedule Week no: 6 7 8 9 10 Product P1 50 100 Product p2 70 80 25 Etc
    10. 10. INPUTS FOR MRP EXAMPLE  p1 p2  S1(1) S2(2) S3(1) S4(1) C1(1) C2(4) C3(1) C4(2) C5(1) C6(1) C4(1) M4
    11. 11. PRODUCT STRUCTURE FOR P1 AND P2 WEEK 6 7 8 9 10 P1 50 100 P2 70 80 25
    12. 12. INITIAL INVENTORY STATUS FOR M4 PERIOD 1 2 3 4 5 6 ITEM MATERIAL, M4 GROSS REQUIREMENTS SCHEDULED RECEIPTS 40 ON HAND 50 90 NET REQUIREMENTS PLANNED ORDER RELEASES
    13. 13. LEAD TIMES (IN WEEKS) ASSEMBLY MANUFACTURING ORDERING P1= 1 C4= 2 M4-3 P2= 1 S2= 1 S3= 1
    14. 14. BASIC MRP LOGIC  Input MPS, BOM, inventory status, lead times  Do parts explosion  Offset requirements by lead times  Netting of requirements from gross by considering availabilities.  Lot sizing of net requirements for procurement or production
    15. 15. PERIOD 1 2 3 4 5 6 7 8 9 10 ITEM MATERIAL, P1 50 100 GROSS REQUIREMENTS SCHEDULED RECEIPTS ON HAND 0 NET REQUIREMENTS 50 100 PLANNED ORDER RELEASES 50 100
    16. 16. PERIOD 1 2 3 4 5 6 7 8 9 10 ITEM MATERIAL, P2 70 80 25 GROSS REQUIREMENTS SCHEDULED RECEIPTS ON HAND 0 NET REQUIREMENTS 70 80 25 PLANNED ORDER RELEASES 70 80 25
    17. 17. PERIOD 1 2 3 4 5 6 7 8 9 10 ITEM SUB MATERIAL, S2 100 200 GROSS REQUIREMENTS SCHEDULED RECEIPTS ON HAND 0 NET REQUIREMENTS 100 200 PLANNED ORDER RELEASES 100 200
    18. 18. PERIOD 1 2 3 4 5 6 7 8 9 10 ITEM SUB MATERIAL, S3 70 80 25 GROSS REQUIREMENTS SCHEDULED RECEIPTS ON HAND 0 NET REQUIREMENTS 70 80 25 PLANNED ORDER RELEASES 70 80 25
    19. 19. PERIOD 1 2 3 4 5 6 7 8 9 10 ITEM COMPONENT, C4 70 280 25 400 GROSS REQUIREMENTS SCHEDULED RECEIPTS ON HAND 0 NET REQUIREMENTS 70 280 25 400 PLANNED ORDER RELEASES 70 280 25 400
    20. 20. PERIOD 1 2 3 4 5 6 7 8 9 10 ITEM COMPONENT, M4 GROSS REQUIREMENTS 70 280 25 400 SCHEDULED RECEIPTS 40 ON HAND 50 90 20 NET REQUIREMENTS -20 260 25 400 PLANNED ORDER RELEASES 260 25 400

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