Presentation on theme: "Chapter 15 - Material & Capacity Requirements Planning(MRP/CRP)"— Presentation transcript:
1 Chapter 15 - Material & Capacity Requirements Planning(MRP/CRP)
2 Planning Objectives Satisfy customer demand Ensure availability and efficient use of resourcesMaterialCapacityKEY - Balance demand and resources
3 Planning and Control System Questions What are we going to make, and when?What does it take to make it?What do we already have?What must we get, and when?Successful answers result in right:goods, quantity, quality, time, cost
4 Types of Resource Planning Systems Material Requirements Planning (MRP) -A set of techniques that uses bill of material data, inventory data, and the master production schedule to calculate time-phased requirements for materials. Recommends release of replenishment orders and rescheduling of open orders as conditions (priorities) change.APICS Dictionary - 9th Ed.
5 MRP’s Objectives What to Order How Much to Order When to Order When to Schedule Delivery
7 Material Requirements Planning InputsMaster schedule: States which end items to produce, when, and in what quantities.Bill of materials: Raw materials, parts, subassemblies, and assemblies needed to produce one unit of a product (Single vs. multiple level).Product structure tree: Visual depiction of a bill of materials, with all components listed by levelsInventory status/transactions: Location, quantity, ins, outs, picks, changes.Planning Factors: Lead time, scrap allowance, yield factors, lot sizes, safety stock/safety lead time
8 Material Requirements Planning A Final PointMRP focuses on materials ONLY and DOES NOT guarantee that the plan can be implemented from a capacity/resource perspective. To close the loop, it’s necessary to do capacity requirements planning (CRP)
9 Capacity Requirements Planning The process of determining short-range capacity requirements from MRP outputsLoad reports/profiles show known and expected future capacity requirements vs. expected capacity availability
13 Types of Resource Planning Systems Manufacturing Resource Planning (MRP II)A method for the effective planning of all resources of a manufacturing company. Provides simulation capability to answer “what-if” capability and is made up of a variety of planning functions, each linked together. Output from these functions is linked with other business functions and financial reports. An extension of MRP.Modified from APICS Dictionary - 9th Ed.
14 Types of Resource Planning Systems Enterprise Resource Planning (ERP)A method for the effective planning and control of all resources needed to take, make, ship, and account for customer orders. Differs from typical MRP II in technical requirements such as graphical user interface, relational database, 4GL languages, client-server architecture and open-system portability (Example SAP R/3)Modified from APICS Dictionary - 9th Ed.
15 Trends in Resource Planning Systems More powerful/sophisticatedMore encompassingMore integrated/flexibleMore optionsMore user-friendly/robustMore data-base focusedMore data-intense
17 JIT/Lean ProductionJust-in-time: Repetitive production system in which processing and movement of materials and goods occur just as they are needed, usually in small batchesJIT is characteristic of lean production systemsJIT operates with very little “fat”
18 Just-In-Time Concepts jit - Inventory/production control systemJIT - Philosophy of continuous improvementSimplification/ExecutionElimination of WasteReduced transaction processingMulti-pronged approachHigh quality, Quick response, Flexibility
19 JIT vs. MRP/ERP Similar goals MRP II JIT Right products, right place, right timeMRP IIComputer-based, manages complexityJITManual systems, simplicity/executionThe Super Bowl of Planning & ControlChoice? - play to strengthsMRP – Planning; JIT - execution
20 JIT Characteristics A Fixed, Steady Rate of Production Low Inventories Uniform flowLinear productionLow InventoriesLess space, investmentUncover defectsSmall Lot SizesLess WIPFlexibility/VelocityFast feedback
23 JIT Characteristics Reliable Vendors A Pull System of Moving Goods Dock-to-stockMuch smaller numberLong-term relationshipsA Pull System of Moving GoodsRequest-basedKanban signalProblem Solving/Continuous Improvement