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a er a requ remen s p ann ng

Product structure tree, BOM

MRP logic & Time fence

- -

Pull vs. Push systems

JIT requirements

JIT in services

Readings: Chapters 18 & 13

Operations Management Note10 1Dr. Shenghao ZHANG

MRP (materials requirements planning ) is the logic

for determining how many units of each part and

component are needed and when they are needed.

MRP provides a schedule: when each part or

.

MRP is driven by dependent demand.

MRP is a software system.

2Dr. Shenghao ZHANGOperations Management Note10

Product Structure Tree & MRP LogicGiven the product structure tree and the lead time and demand

information, provide a materials requirements plan that defines

Lead Times

how many units of each component will be needed and when.

A

Product Structure Tree for Assembly A B 2 days

C 1 day

D 3 days

E 4 days

Demand

E(1)D(2) F(2)D(3)

Day 8 20 B (Spares)Day 6 15 D (Spares)


MRP: a com uterized lannin s stem MRP programs are usually run every week for a planning

.

MRP is a cost effective formal planning & control system

but it requires commitment at all organization levels.

. Master Production Schedule (MPS): the quantity and timing of

re uirement for end items.

Bill of Materials (BOM): the quantities of components required to

make each item (product structure trees).

Inventory Status: inventory on hand, scheduled receipts, orderlead time, lot size, etc.


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Firm orders

from known

Forecasts

of demandAggregate

roduct

customersrom ran om

customersplan

MasterproductionEngineering Inventory

schedule

(MPS)changes

transactions

Material

planning

Bill of

material

Inventory

record

(MRP)file file

Secondar re ortsr mary reports

Planned order schedule for

inventor and roduction control

Exception reports

Planning reports

5Dr. Shenghao ZHANG

eports or per ormance contro

Operations Management Note10

-

end item the firm plans to build and when to build them.

Aggregate Plan

(Product Groups)

MPS(Specific End Items)


Closed Loo MRP

Master Production Scheduling

Material Requirements Planning

apac y equ remen s ann ng

Realistic?No

Feedback

Yes

Capacity PlansMaterial Plans


T es of Time Fences

Frozen

No schedule changes allowed within this window

o era e y rm S ecific chan es allowed within roduct rou s as

long as parts are available

ex e

Si nificant variation allowed as lon as overall ca acit

requirements remain at the same levels


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Master Production Schedule Time Fences

Moderatelyrm

Forecast and availableCapacity

Firm Customer Orders

capacity

Weeks


Just-In-Time JIT An integrated set of activities designed to achieve high-

,

work in process, and finished goods). - - , - - .

Elimination of waste in production effort.

e t m ng o pro uct on resources e.g., parts arr ve at t e

next workstation just in time).

Ultimate goal: smooth and rapid low through the system.

Big JIT and little JIT Invented in Japan, used in various forms in other cultures.


The Demand-Pull Lo ic of JIT

Fab Vendor

Sub

Fab Vendor

Customersna

Assembly

Sub Fab Vendor

Nothin ets roduced until needed.

FabVendor

Need is created by actual demand.

firm may have both pull and push.11Dr. Shenghao ZHANGOperations Management Note10

The Ja anese A roach to Productivit

Specific product areas

Automotive assembly and consumer electronics

Imported technologies

Avoid major R & D expenditures and risks

Efforts concentrated on sho floor

High productivity and low unit costs

Two central philosophies

espect or peop e

Elimination of waste


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Respect for People Level payrolls and secure employment

No pay cut or layoff when business conditions deteriorate

Workers as assets, not as human machines

Bottom-round management style ec s on ma ng a owes eve poss e

Quality circles

Solution shared with management

Two bonuses a year in good times

Subcontractor networks Long term relationship; suppliers as part of the family


Waste in O erations

Waste is anything other than the minimum amount

w c s a so u e y essen a o pro uc on.

(1) Waste from overproduction

(2) Waste of waiting time

(4) Inventory waste

(6) Waste of motion

(7) Waste from product defects


JIT Re uirements A : Desi n of Flow Process

Balanced workstation capacities

Reduced lot sizes

Reduced setup/changeover time

Preventive maintenance


S C methods

Fail-safe methods


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a e c e u e

Level scheduling

Underutilization of capacity

Freeze windows



Standard product configuration

Reduced number of parts

Process design with product design


Problem-solving groups

Good housekeeping

Leveling of facility load

Demand-pull scheduling

Elimination of unnecessary activities

Quality at source and reliable process capabilities

,

Etc.


Note10_mrp & Jit

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