Consumption-based Planning. Material Planning (MRP Procedures) Independent Demand (Consumption-based...
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Transcript of Consumption-based Planning. Material Planning (MRP Procedures) Independent Demand (Consumption-based...
Material Planning
Material Planning(MRP Procedures)
Independent Demand(Consumption-based
Planning)
MRP-MaterialRequirements Planning
Reorder pointplanning
Forecast-basedplanning
Time-phasedplanning
Manual reorderpoint
Automatic reorderpoint
SAP Terms
SAP Exercise
Planning Process
External procurementIn-houseproduction Planning Run
Planned Order
Conversion
ProductionOrder
PurchaseRequisition
PurchaseOrder
ScheduleLine
Can be automatic
Planning Process
Planned Order: Recommendation by the MRP planning process
of quantity and timing of production or purchase order
Production Order: Actual order given to shop floor to commence
production. May be electronic or paper. Can include production details (routing, quality requirements, drawings, instructions, etc.)
Planning Process
Purchase Requisition: Request to purchasing to create purchase order
Purchase Order Request to vendor to supply materials
Schedule Line Direct request to vendor for materials, covered
by scheduling agreement (blanket PO)
Reorder Point Processing
When the inventory level for a product that is planned using consumption-based planning reaches the ROP, an order for the material is NOT created automatically
Consumption-based planning uses the Material Requirements Planning (MRP) planning process to create purchase orders
The MRP planning process is typically run overnight on a daily basis Historically, might have used weekly runs Time until MRP planning run is executed should be
considered in ROP calculation (daily runs, add 1 day to lead time)
Forward Scheduling forExternal Procurement
Tod
ay(R
elea
se D
ate)
Pur
chas
e O
rder
Dat
e
Goo
ds R
ecei
ptD
ate A
vaila
bilit
yD
ate
Processing TimeFor Purchasing Planned Delivery Time
Goods ReceiptProcessing Time
Replenishment Lead Time
MRP Planning Process
For a company with thousands of materials to plan, the computing resources needed to calculate material plans can be significant
To make sure that: Only those calculations that are necessary
are performed: Only on materials that need planning
Two “filters” are used: Planning Run Type Planning Horizon
Planning Run Types
NETCH: Net change in the total horizon In the MRP Planning Process, materials are
planned if there have been any:Changes in material stocks (receipts,
issues)Addition of purchase requisitions,
purchase orders, planned orders, dependent requirements
Changes in Material Master Data (Lot Size, ROP, etc.)
Planning Run Types
NETPL: Net change in the planning horizon Same at NETCH, EXCEPT:
Changes must occur within the planning horizon
Planning horizon keeps MRP planning process from making plans for future periods that: Do not impact current operations Will be made irrelevant through the dynamics
of business
Planning Run Types
Planning Horizon
NE
TC
H
Planning Horizon
NE
TP
L
Order/Requisition
RequirementTime
Planning Run Types
NETUPL: Regenerative Planning Plans all materials for total planning horizon
Good idea to run this option regularly (e.g. every weekend), even though it is more resource intensive Customizing changes don’t trigger planning
under NETCH or NETPL “Time passage” problem with NETPL
NETPL: Potential Problem
Planning Horizon
NE
TP
L
Today
Planning Horizon
NE
TP
L
Today
Solution: Run NETUPL
Passage of time is not an “event”Would require monitoring to detect
Planning File
A Planning File entry exists for each material Keeps track of changes that would require
material to be planned under NETCH or NETPL options
MRP Planning process looks at planning file entries for each material to see if it should be planned
Planning Run Options
Planning Run Type:NETCHNETPLNETUPL
Create Purchase Req: 1 – Purchase Requisitions 2 – Purchase Requisitions in Opening Period 3 – Planned Orders
Defined by Schedule Margin KeyUsu. does not impact consumption-based planning
Planning Run Options
Planning mode: Determines how system deals with previous plans (planned order, purchase requisitions)
Create MRP List: 1 – Yes 2 – Depending on Exception Messages 3 – No
Scheduling: Determines level of detail in schedule calculation for production orders
Display results before they are saved Lets planner make changes before the results are saved
Planning Run Options
With consumption-based planning in practice: You would not run MRP for a single
material, but do it as part of a group (MRP Area based on storage location)
You would have it scheduled to run automatically
You would have it either:Create purchase requisitions automaticallyCreate schedule lines
Net Requirements CalculationR
eord
er P
oint
Stock
Firm PlannedOrders
PurchaseOrders
Order Proposalfor Lot SizeShortage
Fixed PurchaseRequisitions
How does safety stockfigure into this process?
Exercise: Material Master Data
MRP Type: VB sets consumption-based planning
Reorder point
Lot size: FX is fixed lot size
Fixed lot size: Quantity in an order
Exercise: Material Master Data
Plnd delivery time: Vendor part of lead time
SchedMargin key: Sets opening period, among other things
Safety stock: Desired stock level when replenishment order arrives
How does it work in SAP R/3?
Exercise: Stock/Requirements List
Stock/Requirements List: Your one-stop shopping location for all things material
Exercise: Purchase Order
Purchase order screen is where the requisition is converted to a purchase order Vendors selected Price determined
Exercise: Receive Purchase Order
Goods Receipt Screen: In practice, could just be a bar-code scan Links receipt to purchase order Tell SAP R/3 system where goods have been stored