Post on 12-Jan-2016
Resource PlanningResource Planning
OPIM 310-Lecture #7Instructor: Jose Cruz
Enterprise Resource Enterprise Resource Planning (ERP)Planning (ERP)
Organizes and manages a Organizes and manages a company’s business processes by company’s business processes by sharing information across sharing information across functional areasfunctional areas
Connects with supply-chain and Connects with supply-chain and customer management customer management applicationsapplications
ERP’s Central DatabaseERP’s Central Database
Finance & Accounting
Sales &
Marketing
Human Resources
Production & Materials
ManagementERP Data
Repository
ERP and MRPERP and MRP
MRP (material requirements planning) MRP (material requirements planning) was the precursor to ERPwas the precursor to ERP
Primarily a production planning and Primarily a production planning and control systemcontrol system
MRP evolved to MRP II (manufacturing MRP evolved to MRP II (manufacturing resource planning)resource planning)
ERP and ERP II continue to extend the ERP and ERP II continue to extend the links through all business processeslinks through all business processes
Bills ofmaterials
Engineeringand process
designs
Material Requirements Plan Material Requirements Plan OutputOutput
Inventorytransactions
Inventoryrecords
Othersources
of demand
Authorizedmaster production
schedule
Materialrequirements
plan
MRPMRPexplosionexplosion
Bill of MaterialsBill of Materials
Figure 16.3
Seat cushion
Seat-frame boards
Front legs A
Ladder-back chair
Back legs
Leg supports
Back slats
Bill of MaterialsBill of Materials
J (4)Seat-frame
boards
I (1)Seat
cushion
H (1)Seat
frame
G (4)Backslats
F (2)Backlegs
C (1)Seat
subassembly
D (2)Frontlegs
B (1)Ladder-backsubassembly
E (4)Leg
supports
AALadder-backLadder-back
chairchair
Figure 16.3
Material Requirements Material Requirements PlanningPlanning
Computerized inventory control & Computerized inventory control & production planning systemproduction planning system
Schedules component items when Schedules component items when they are needed - no earlier and no they are needed - no earlier and no laterlater
When to Use MRPWhen to Use MRP
Dependent and discrete itemsDependent and discrete itemsComplex productsComplex productsJob shop productionJob shop productionAssemble-to-order environmentsAssemble-to-order environments
Demand CharacteristicsDemand Characteristics
11 22 33 44 55WeekWeek
400 400 –
300 300 –
200 200 –
100 100 –No
. o
f ta
ble
sN
o.
of
tab
les
Continuous demandContinuous demand
M T W Th F M T W Th FM T W Th F M T W Th F
400 400 –
300 300 –
200 200 –
100 100 –No
. o
f ta
ble
sN
o.
of
tab
les
Discrete demandDiscrete demand
Independent demandIndependent demand
100 tables100 tables
Dependent demandDependent demand
100 x 1 = 100 x 1 = 100 tabletops100 tabletops
100 x 4 = 400 table legs100 x 4 = 400 table legs
MRP OutputsMRP Outputs
Planned ordersPlanned ordersWork ordersWork ordersPurchase ordersPurchase orders
Changes to previous plans or Changes to previous plans or existing schedulesexisting schedules
Action noticesAction noticesRescheduling noticesRescheduling notices
Master Production ScheduleMaster Production Schedule
Ladder-back chair
Kitchen chair
Desk chair
1 2
April May
3 4 5 6 7 8
Aggregate production plan for chair family
200
670670
200
150
120
200
150
200
120
670670
Master Production ScheduleMaster Production Schedule
Drives MRP process with a schedule of Drives MRP process with a schedule of finished productsfinished products
Quantities represent production not Quantities represent production not demanddemand
Quantities may consist of a combination of Quantities may consist of a combination of customer orders & demand forecastscustomer orders & demand forecasts
Quantities represent what needs to be Quantities represent what needs to be produced, not what can be producedproduced, not what can be produced
Inventory RecordInventory RecordItem: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements
1 2 3 4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
Week
150150
230230
00
00
00
00
120120
00 00
150150
00
120120
00 00
37
0000
Inventory RecordInventory RecordItem: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
Explanation:Gross requirements are the total demand for the two chairs. Projected on-hand inventory in week 1 is 37 + 230 – 150
Inventory RecordInventory RecordItem: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
Explanation:Gross requirements are the total demand for the two chairs. Projected on-hand inventory in week 1 is 37 + 230 – 150 = 117 units.
Inventory RecordInventory RecordItem: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
Inventory RecordInventory RecordItem: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
Projected on-hand inventory balance at end of week t
Inventory on hand at end of week t - 1
Gross requirements
in week t
Scheduled or planned receipts in
week t
= + –
Inventory RecordInventory RecordItem: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 – – 33 – – 33 ––153153 ––273273 ––273273
Projected on-hand inventory balance at end of week t
Inventory on hand at end of week t - 1
Gross requirements
in week t
Scheduled or planned receipts in
week t
= + –
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 ––33 – – 33 ––153153 – – 273273 – – 273273
Planned OrdersPlanned OrdersExplanation:Without a new order in week 4, there will be a shortage of three units: 117 + 0 + 0 – 120 = – 3 units.
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117
Planned OrdersPlanned Orders
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
Planned OrdersPlanned OrdersExplanation:Adding the planned receipt brings the balance to 117 + 0 + 230230 – 120 = 227 units.
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
Planned OrdersPlanned OrdersExplanation:Adding the planned receipt brings the balance to 117 + 0 + 230230 – 120 = 227 units.
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
230230
Planned OrdersPlanned OrdersExplanation:Offsetting for a two-week lead time puts the corresponding planned order release back to week 2.
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
230230
Planned OrdersPlanned OrdersExplanation:Offsetting for a two-week lead time puts the corresponding planned order release back to week 2.
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
230230
227227 7777 ––4343
Planned OrdersPlanned OrdersExplanation:The first planned order lasts until week 7, when projected inventory would drop to – 43.
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
230230
227227 7777
230230
Planned OrdersPlanned OrdersExplanation:Adding the second planned receipt brings the balance to 77 + 0 + 230230 – 120 = 187.
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
230230
227227 7777
230230
Planned OrdersPlanned OrdersExplanation:Adding the second planned receipt brings the balance to 77 + 0 + 230230 – 120 = 187.
187187
Item: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
230230
227227 7777
230230
187187
230230
Planned OrdersPlanned OrdersExplanation:The corresponding planned order release is for week 5.
Planned OrdersPlanned OrdersItem: CDescription: Seat subassembly
Lot Size: 230 unitsLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
00
2
00
00
3
00
120120
4
00
5
00
150150
6
00
120120
7
00
8
00Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
0000
117117 117117 227227
230230
230230
227227 7777
230230
187187
230230
187187
Lot-Sizing RulesLot-Sizing Rules
• Fixed order Quantity (FOQ)- A rule that maintains Fixed order Quantity (FOQ)- A rule that maintains the same order quantity each time an order is the same order quantity each time an order is issued.issued.
• Periodic Order Quantity (POQ)- A rule that allows Periodic Order Quantity (POQ)- A rule that allows a different order quantity for each order issued a different order quantity for each order issued but tends to issue the order at predetermined but tends to issue the order at predetermined time intervals.time intervals.
• Lot For Lot (L4L)- A rule under which the lot size Lot For Lot (L4L)- A rule under which the lot size ordered covers the gross requirements of a ordered covers the gross requirements of a single weeksingle week
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements
1 2 3 4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
Week
150150
230230
117117
120120 150150 120120
37 117117 117117
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
POQ lot
size
Gross requirements for weeks 4, 5, and 6
Inventory at end of week 3= –
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
(120 + 0 + 150)
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
(120 + 0 + 150) – 117
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
(120 + 0 + 150) – 117 = 153 units
153153
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
(120 + 0 + 150) – 117 = 153 units
153153
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
(120 + 0 + 150) – 117 = 153 units
153153
150150
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
(120 + 0 + 150) – 117 = 153 units
153153
150150
153153
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
(120 + 0) – 0 = 120 units
153153
150150
153153
150150 00 00 00
120120
120120
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQItem: CDescription: Seat subassembly
Lot Size: P = 3Lead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
153153
150150
153153
150150 00 00 00
120120
120120
Lot-Sizing Rules Lot-Sizing Rules –– POQ POQ
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements
1 2 3 4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
Week
150150
230230
117117
120120 150150 120120
37 117117 117117
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
L4L lot
size
Gross requirements in week 4
Inventory balance at end of week 3= –
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
= 120 – 117 = 3L4L lot
size
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
3
= 120 – 117 = 3L4L lot
size
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
3
3
0
= 120 – 117 = 3L4L lot
size
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
3
3
0 00
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
3
3
0
150
00
150
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
3
3
0
150
00
150
0
120
120
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4LItem: CDescription: Seat subassembly
Lot Size: L4LLead Time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
3
3
0
150
00
150
0
120
120
0
Lot-Sizing Rules Lot-Sizing Rules –– L4L L4L
Lot-Sizing Rule ComparisonLot-Sizing Rule Comparison The FOQ rule generates high average The FOQ rule generates high average
inventory because it creates remnants.inventory because it creates remnants.
The POQ rule reduces The POQ rule reduces average on-hand inventory average on-hand inventory because it does a better because it does a better job of matching order job of matching order quantity to requirements.quantity to requirements.
The L4L rule minimizes The L4L rule minimizes inventory investment inventory investment but maximizes the number of orders placed.but maximizes the number of orders placed.
Safety StockSafety Stock
MRP OutputsMRP Outputs
Material requirements plan
Action notices Releasing new orders Adjusting due dates
Priority reports Dispatch lists Supplier schedules
Capacity reports Capacity requirements planning Finite capacity scheduling Input-output control
Manufacturing resources plan
Performance reportsCost and price data
Routings and time
standards
MRP MRP explosionexplosion
Bill of MaterialsBill of Materials
J (4)Seat-frame
boards
H (1)Seat
frame
I (1)Seat
cushion
C (1)Seat
subassembly
MRP ExplosionMRP ExplosionItem: Seat subassemblyLot size: 230 units
Lead time: 2 weeks
Gross requirements 150150
1
230230
117117
2 3
120120
4 5
150150
6
120120
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
37
Week
117117 117117
0 00 0
00 00 000 00 0
227 227 77 187 187
230230
230230
Item: Seat subassemblyLot size: 230 units
Lead time: 2 weeks
Gross requirements 150150
1 2 3
120120
4 5
150150
6
120120
7 8
Planned receipts
Planned order releases
Week
0 00 0
230
230
230
230
MRP ExplosionMRP Explosion
Item: Seat subassemblyLot size: 230 units
Lead time: 2 weeks
Gross requirements 150150
1 2 3
120120
4 5
150150
6
120120
7 8
Planned receipts
Planned order releases
Week
0 00 0
230
230
230
230
MRP ExplosionMRP Explosion
Item: Seat framesLot size: 300 units
Lead time: 1 week
Gross requirements
1
00
2 3 4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
40
Week
00 00 00300 00 0
Item: Seat cushionLot size: L4L
Lead time: 1 week
Gross requirements
1
00
2 3 4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
0
Week
00 00 000 00 0
Item: Seat subassemblyLot size: 230 units
Lead time: 2 weeks
Gross requirements 150150
1 2 3
120120
4 5
150150
6
120120
7 8
Planned receipts
Planned order releases
Week
0 00 0
230
230
230
230
Item: Seat framesLot size: 300 units
Lead time: 1 week
Gross requirements 0
1
0
2 3 4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
40
Week
230
0 0 0300 00 0
Item: Seat cushionLot size: L4L
Lead time: 1 week
Gross requirements 0
1
0
2 3 4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
0
Week
230
0 0 00 00 0
Usage quantity: 1Usage quantity: 1 Usage quantity: 1Usage quantity: 1
MRP ExplosionMRP Explosion
Item: Seat subassemblyLot size: 230 units
Lead time: 2 weeks
Gross requirements 150150
1 2 3
120120
4 5
150150
6
120120
7 8
Planned receipts
Planned order releases
Week
0 00 0
230
230
230
230
Item: Seat framesLot size: 300 units
Lead time: 1 week
Gross requirements 00
1
00
2 3
00
4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
40
Week
230 2300
00 00 00300 00 0
Item: Seat cushionLot size: L4L
Lead time: 1 week
Gross requirements 00
1
00
2 3
00
4 5 6 7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
0
Week
230 2300
00 00 000 00 0
Usage quantity: 1Usage quantity: 1 Usage quantity: 1Usage quantity: 1
MRP ExplosionMRP Explosion
Item: Seat subassemblyLot size: 230 units
Lead time: 2 weeks
Gross requirements 150150
1 2 3
120120
4 5
150150
6
120120
7 8
Planned receipts
Planned order releases
Week
0 00 0
230
230
230
230
Item: Seat framesLot size: 300 units
Lead time: 1 week
Gross requirements 00
1
00
4040
2 3
00
4 5
00
6
00
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
40
Week
110110 110110
230 2300 0
00 00 00300 00 0
110 180 180 180 180
300
300
Item: Seat cushionLot size: L4L
Lead time: 1 week
Gross requirements 00
1
00
00
2 3
00
4 5
00
6
00
7 8
Scheduled receipts
Projected on-hand inventory
Planned receipts
Planned order releases
0
Week
00 00
230 2300 0
00 00 000 00 0
0 0 0 0 0
230
230
230
230
MRP ExplosionMRP Explosion
Item: Seat framesLot size: 300 units
Lead time: 1 week
Gross requirements
1 2 3 4 5 6 7 8
Planned receipts
Planned order releases
Week
300
300
Item: Seat cushionLot size: L4L
Lead time: 1 week
Gross requirements
1 2 3 4 5 6 7 8
Planned receipts
Planned order releases
Week
230
230
230
230
00 00 00 00230 2300 000 00 00 00230 2300 0
MRP ExplosionMRP Explosion
Item: Seat framesLot size: 300 units
Lead time: 1 week
Gross requirements
1 2 3 4 5 6 7 8
Planned receipts
Planned order releases
Week
300
300
Item: Seat cushionLot size: L4L
Lead time: 1 week
Gross requirements
1 2 3 4 5 6 7 8
Planned receipts
Planned order releases
Week
230
230
230
230
00 00 00 00230 2300 000 00 00 00230 2300 0
Gross requirements
1
00
2 3 4 5 6 7 8
Scheduled receipts
Planned receipts
Planned order releases
200
Week
00 00 000 00 0
Projected on-hand inventory
Item: Seat-frame boardsLot size: 1500 units
Lead time: 1 week
MRP ExplosionMRP Explosion
Item: Seat framesLot size: 300 units
Lead time: 1 week
Gross requirements
1 2 3 4 5 6 7 8
Planned receipts
Planned order releases
Week
300
300
Item: Seat cushionLot size: L4L
Lead time: 1 week
Gross requirements
1 2 3 4 5 6 7 8
Planned receipts
Planned order releases
Week
230
230
230
230
00 00 00 00230 2300 000 00 00 00230 2300 0
Gross requirements 00
1
00
2 3
12001200
4 5
00
6
00
7 8
Scheduled receipts
Planned receipts
Planned order releases
200
Week
0 00 0
00 00 000 00 0
Projected on-hand inventory
Item: Seat-frame boardsLot size: 1500 units
Lead time: 1 week
Usage quantity: 4Usage quantity: 4
MRP ExplosionMRP Explosion
Item: Seat framesLot size: 300 units
Lead time: 1 week
Gross requirements
1 2 3 4 5 6 7 8
Planned receipts
Planned order releases
Week
300
300
Item: Seat cushionLot size: L4L
Lead time: 1 week
Gross requirements
1 2 3 4 5 6 7 8
Planned receipts
Planned order releases
Week
230
230
230
230
00 00 00 00230 2300 000 00 00 00230 2300 0
Gross requirements 00
1
00
200200
2 3
12001200
4 5
00
6
00
7 8
Scheduled receipts
Planned receipts
Planned order releases
200
Week
200200 200200
0 00 0
00 00 000 00 0
500 500 500 500 500
1500
1500
Projected on-hand inventory
Item: Seat-frame boardsLot size: 1500 units
Lead time: 1 week
Figure 16.12Figure 16.12
MRP ExplosionMRP Explosion
Capacity Requirements Capacity Requirements Planning (CRP)Planning (CRP)
Computerized system that projects Computerized system that projects load from material planload from material plan
Creates load profileCreates load profile
Identifies underloads and overloadsIdentifies underloads and overloads
CapacityCapacity
Usually expressed as standard Usually expressed as standard machine hours or labor hoursmachine hours or labor hours
CapacityCapacity = (no. machines or workers)= (no. machines or workers)x (no. shifts) x (utilization)x (no. shifts) x (utilization)x (efficiency)x (efficiency)
Capacity TermsCapacity Terms
Load profileLoad profileCompares released and planned Compares released and planned
orders with work center capacity orders with work center capacity CapacityCapacity
Productive capability; includes Productive capability; includes utilization and efficiencyutilization and efficiency
UtilizationUtilization% of available working time spent % of available working time spent
workingworking
More Capacity TermsMore Capacity Terms
EfficiencyEfficiencyLoadLoad
The standard hours of work The standard hours of work assigned to a facilityassigned to a facility
Load percentLoad percentThe ratio of load to capacityThe ratio of load to capacity
Load % = Load % = ((load/capacityload/capacity)x100%)x100%
Capacity Requirements PlanningCapacity Requirements Planning
MRP plannedorder
releases
Routingfile
Capacityrequirements
planning
Openorders
file
Load profile foreach machine center
Initial Load ProfileInitial Load Profile
Figure 12.9Figure 12.9
Ho
urs
of
cap
acit
yH
ou
rs o
f ca
pac
ity
11 22 33 44 55 66
Time (weeks)Time (weeks)
NormalNormalcapacitycapacity
120 120 –
110 110 –
100 100 –
90 90 –
80 80 –
70 70 –
60 60 –
50 50 –
40 40 –
30 30 –
20 20 –
10 10 –
0 0 –
Remedies for UnderloadsRemedies for Underloads
1.1. Acquire more workAcquire more work
2.2. Pull work ahead that is scheduled Pull work ahead that is scheduled for later time periodsfor later time periods
3.3. Reduce normal capacityReduce normal capacity
Remedies for OverloadsRemedies for Overloads
1.1. Eliminate unnecessary requirementsEliminate unnecessary requirements
2.2. Reroute jobs to alternative machines or Reroute jobs to alternative machines or work centerswork centers
3.3. Split lots between two or more machinesSplit lots between two or more machines
4.4. Increase normal capacityIncrease normal capacity
5.5. SubcontractSubcontract
6.6. Increase the efficiency of the operationIncrease the efficiency of the operation
7.7. Push work back to later time periodsPush work back to later time periods
8.8. Revise master scheduleRevise master schedule
Adjusted Load ProfileAdjusted Load ProfileH
ou
rs o
f ca
pac
ity
Ho
urs
of
cap
acit
y
11 22 33 44 55 66
Time (weeks)Time (weeks)
NormalNormalcapacitycapacity
120 120 –
110 110 –
100 100 –
90 90 –
80 80 –
70 70 –
60 60 –
50 50 –
40 40 –
30 30 –
20 20 –
10 10 –
0 0 –
Pull aheadPull aheadPush backPush back
Push backPush backOvertime
Work an
extra shift