1. MAX Material Requirements Planning
Vince Stefanetti, Exact MAX Americas Trainer

2. Introduction
MAX Material Requirements Planning

3. References PDFs installed with your system Exact Customer Portal
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Material Requirements Planning

4. What you will learn…. Theory of MRP Setup Requirements
Using MAX Prior to MRP
Planning and Scheduling with MRP
Reviewing MRP Output
Inquiries and Reports
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Material Requirements Planning

5. Bills of Materials 99% Inventory 95% Overview 9/19/2018
Material Requirements Planning

6. Material Requirements Planning
Lead times
Planned receipts
BOM
Inventory
What does it take to make it?
What do we already have
Production advice
Orders
Forecasts
Purchase advice
What are we going to make?
What must we get?
MRP

7. Theory of MRP
Material Requirements Planning is a process of balancing demand and supply for all component parts needed to meet the requirements of the Master Schedule.
The MRP process performs two essential tasks: it reschedules existing orders to meet changes in the current demand, and it initiates new orders (order signals or planned orders), if required, to balance supply with demand.
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8. Theory of MRP
To accomplish these tasks, MRP uses the processes of "netting" requirements, "offsetting" orders by the lead-time, and "exploding" the Bill of Materials.
"Netting" in MRP simply refers to the calculation of net available inventory for a part. This is:
Beginning On-Hand
+ Scheduled Receipts
- Independent Demand
- Dependent Demand
= Net Available
Note: When considering pseudo parts, netting omits the on- hand quantity from the calculation.
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9. Theory of MRP
Independent Demand consists of part requirements unrelated to other parts and driven directly by orders, such as customer and forecast orders. Dependent Demand consists of part requirements related to other (usually “parent”) parts at higher levels of the Bill of Materials.
A negative Net Available amounts indicates a part shortage. When shortages occur, MRP either reschedules an existing open order to cover the shortage or creates a new order to meet the demand.
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10. Theory of MRP
The Due Date of the component part's order is calculated through "backward scheduling". This process simply "offsets" the date in which the order is needed against the parent part's lead-time to ensure the component's arrival by the date of the estimated shortage (time-phase requirements planning).
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11. Theory of MRP
Whenever an order is rescheduled or a new order is created, the demand on the part's components must be changed accordingly. The system does this automatically by "exploding" the Bill of Materials for the order and updating the requirement dates for each component part needed for that order.
Each time the MRP Explosion option is requested (see MRP Batch Menu), all parts in the System requiring rescheduling are reviewed by the System to determine if further action should be recommended to the planning staff (Net Change).
Most companies begin by running the MRP Explosion weekly and then eventually move to a daily run. But this will depend on your business requirements.
The system also provides the option of running a "Regen" MRP Explosion. This option deletes all previously suggested planned orders and refreshes the database so that a new Explosion can be run. This helps you take advantage of changes to order policies, lead-times or product structures.
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Material Requirements Planning

12. Requirements
Within a closed-loop MRP II system, the MRP module is a scheduling tool. It examines orders already released and detects when an order is out of phase with when it is actually needed. MRP has the ability to recommend rescheduling existing orders and suggesting new orders.
The MRP module accomplishes these goals by accessing information from all other parts of the closed-loop system including:
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13. Requirements
Master Schedule -- the statement of end-item (finished goods) demand, i.e., what you plan to make in a given period of time. MRP uses this as the cornerstone and determines what is required to fulfill the goals of the Master Schedule.
Bill of Materials -- a delineation of components required to make the end items specified by the Master Schedule. The MRP module uses this information to ascertain what components will be required and when in order to meet the Master Schedule specifications.
On-hand inventory balances from the Inventory Control module -- advises how many parts are already in stock. This information helps the MRP Module to evaluate open orders and to plan new orders.
Open order status of shop orders and purchase orders -- accounts for items already on order and due in as scheduled receipts within a specified time period.
The MRP module requires additional information about a part before it can plan the component requirements. This information includes:
Lead-time for the component part -- the number of days needed for a part to be ordered based on how long it takes to make or buy it, plus the length of time it takes to receive it into the shop or inventory.
Order Policy -- this determines how parts should be ordered each time an order is required.
Order modifiers like Minimum Order Quantity, Maximum Order Quantity, and Multiple Order Quantity -- all are used to modify or control the order quantity.
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14. Demand Types Independent Demand Dependent Demand
Customer and Forecast Orders
Dependent Demand
Demand related to Parent Parts or higher level assemblies
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15. Negative Available
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16. MRP Explosion
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17. MRP Data Master Schedule Bills of Materials On-Hand Scheduled Receipts
Shop Orders
Purchase Orders
Leadtimes
Order Policy (how parts should be ordered)
Order Qualifiers (modify order quantities)
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18. MRP Setup Part Type Codes A = Normal MRP Manufactured Part
B = Normal MRP Purchased Part
C = Reorder Point Manufactured Part
D = Reorder Point Purchased Part
E = Maintenance Object
F = Family Part
M = Master Schedule Part
O = Outside Vendor Processing
P = Phantom
R = Resource
S = Pseudo
T = Tool
X = Bulk Manufactured Part
Y = Bulk Purchased Part
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19. Is the part on the pick list?
Part Type Codes
Part type code
Does MAX plan orders?
Is the cost in the BOM?
Is the part on the pick list? M No
Yes
A / B
C / D
P / S
X / Y
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20. MRP Setup Reorder Point Reorder Quantity Order Policy Order Qualifiers
Firm Planned
Safety Stock
Periodic Days
Planner ID
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21. MRP Setup – Order Policy / Qualifiers
Order Policies
Order Qualifiers L W D R F O P
On-Hand
Yes No
Minimum OQ
Set
Maximum OQ
Multiple OQ
Safety Stock
Reorder Point
Reorder Qty
Periodic Days
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22. MRP Setup – Order Policy Summary
Lot for Lot
One Planned Order Per Day
Forecast and Customer Demands
Each type is summed together over the planning period and the greater total is subtracted from the net available
Min Max and Multiple Order Quantities = Y
Safety Stock = Y
ROP and ROQ = N
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23. MRP Setup – Order Policy Summary
One Planned Order Per Demand Order
Forecast and Customer Demands
Each type is summed together over the planning period and the greater total is subtracted from the net available
Min Max and Multiple Order Quantities = Y
Safety Stock = Y
ROP and ROQ = N
The reference description from the original order will be carried through to the planned orders for this part's components
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24. MRP Setup – Order Policy Summary
Periodic
One Planned Order Per Value of Period Days
Forecast and Customer Demands
Each type is summed together over the planning period and the greater total is subtracted from the net available
Min Max and Multiple Order Quantities = Y
Safety Stock = Y
ROP and ROQ = N
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25. MRP Setup – Order Policy Summary
Weekly
One Planned Order Per Week (Monday)
Forecast and Customer Demands
Each type is summed together over the planning period and the greater total is subtracted from the net available
Min Max and Multiple Order Quantities = Y
Safety Stock = Y
ROP and ROQ = N
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26. MRP Setup – Order Policy Summary
Discrete
One Planned Order Per Demand Order
Forecast and Customer Demands
Forecast Ignored – Only Customer Demand is subtracted from net available
Min Max and Multiple Order Quantities = N
Safety Stock = Y
ROP and ROQ = N
The reference description from the original order will be carried through to the planned orders for this part's components
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27. MRP Setup – Order Policy Summary
Fixed
One Planned Order Per Day
Forecast and Customer Demands
Each type is summed together over the planning period and the greater total is subtracted from the net available
Min Max and Multiple Order Quantities = N
Safety Stock = N
ROP and ROQ = N
Uses the larger of the ROP and SS as the value for the min, max and multiple
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28. MRP Setup – Order Policy Summary
Time Phased Reorder Point
One Planned Order Per Day
Forecast and Customer Demands
Each type is summed together over the planning period and the greater total is subtracted from the net available
Min Max and Multiple Order Quantities = N
Safety Stock = Y
ROP and ROQ = Y
When the net available falls below ROP, an order is planned for the ROQ. If the net is still less than the SS, another order for the ROQ is planned. Use this method for a min / max technique
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29. Order Policy Summary
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30. Reorder Quantity
MAX Reorder Quantity is a value associated with a part ID that specifies how many units of a part ID should be ordered to restock inventory.
Reorder Quantity values must be entered using Bill of Materials Units of Measure. Reorder Quantity values can be assigned using the MAX Bill of Materials module
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31. Firm Planned
MAX parts can be firm planned using the Bill of Materials Part Master Planner tab or the MRP Detail dialog box.
To firm plan a part ID using the MRP Detail dialog box, select that Part ID and then mark the Firm Planned checkbox.
If a MAX part ID is firm planned, then any MAX order for that part is a firm planned order by default. MRP does not reschedule firm planned orders.
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32. Safety Stock
The amount of inventory kept on-hand for unplanned usage, such as scrap, breakage, changes in demand, or delivery variations.
All Order Policies consider Safety Stock.
For Lot-for-Lot, Order, Weekly and Fixed Order Policies, if there are no requirements for a part and the current inventory level is less than Safety Stock, an order will be generated. The due date of that order will be today plus the part's lead-time (manufacturing lead-time for a Part Type Code of A, purchasing lead-time for a Part Type Code of B).
If there are current requirements for a part, the net available will never be allowed to fall below Safety Stock. However, if the current inventory level is less than Safety Stock and there are no requirements until a future period, the Safety Stock will be considered for the first requirement.
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33. Periodic Days Planner ID
The number of days in the period for an order policy of P. You can enter up to 999.
Up to 3 alphanumeric characters that represent a planner. A planner ID may be associated with a part, using the Part Master or with a manufacturing order, using either Shop Order Maintenance or MRP Detail. Users may store a default Planner ID for the Shop Floor Control module using SFC Application Preferences, and for the MRP module using MRP Application Preferences.
Planner IDs associated with orders display in the Order Navigator..
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34. Order Navigator
1. Select a range of Part IDs, Current Due Dates, Order Numbers, Planner IDs,
User Defined Keys, or Commodity Codes using the Select By drop down list box.
i. To view all orders, leave the Start and End fields blank.
ii. To limit the view of records in a range, enter a value only the End field.
iii. To limit the number of orders displayed by order status or part type, check
the box to the left of each Order Status or Order Part Type you want included in the display grid.
2. Click Query.
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35. MRP Summary
The MRP Summary presents a weekly summary of MRP demand and supply information for a given part.
A total of 52 weekly periods are shown, in addition to a Past Due period (everything prior to this week), and a Future period for everything beyond one year.
Inquiry & Report
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36. Part Shortage Inquiry
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37. MRP and Running Planned Mode
How to run the MRP Explosion program and other activities that relate to running in planned mode.
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38. Regen – Batch Menu
This screen is used to delete unapproved planned (PL) orders which were created in previous MRP Explosion runs. No other types of orders are affected by this option. A regeneration (regen) clears out old data (status 1 planned orders) which may no longer reflect the current status of your business. For example, if you’ve changed your product structures or ordering parameters (such as the Order Policy), existing planned orders are updated to reflect the change.
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39. Regen
Planned orders may be directly created through the Master Schedule and Shop Floor Control. Other planned orders are created by the MRP Explosion.
Running the Regenerate Requirements programs updates any MPN information on a 30,000,000 series order. For example, a 30,000,000 series order is created with an initial MPN relationship and then the parent component relationship changes. Running the Regenerate Requirements program updates all status 1 and 2 orders that reference the MPN with the new parent component relationship.
Regenerating requirements deletes the old information so that new orders can be created (during the next MRP Explosion) which accurately reflect changes in your environment. To re-create the planned orders you must run an MRP Explosion.
Choose whether you want to run a Recalc or Clear.
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40. Regenerate Requirements
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41. Regen Using Recalc
Recalc deletes all planned orders (Order Type = PL) that are unapproved (Status = 1) whether they are Firm Planned or not.
The MRP Explosion is also flagged to re-plan all of the parts in the database.
Master Scheduled Orders (30,000,000 series) create Dependent Demand (Order Type = RQ) on the component parts required. A Recalc deletes these RQ demands for the components of any Master Schedule Order that is not yet released to production (Order Status = 1 or 2). Note: If you are using the Configurator module, requirements for configured Master Schedule Orders will not be deleted.
These RQs will be re-created by the regen based on the now- current product structure information. However, no RQ records will be created for parts with a negative Quantity Per Assembly, or a Part Type Code of X or Y (Bulk Issue Manufactured or Bulk Issue Purchased Parts).
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42. Regen – Clear
Clear deletes all planned orders (Order Type = PL) that are unapproved (Status = 1) and not Firm Planned (Firm Planned Code = N). The MRP Explosion is also flagged to re-plan all of the parts in the database.
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43. Requirement Status Update
This option will update all component requirements for shop orders with an order status of 4 or 5 so that the order and requirement are the same. When a shop order (30,000,000 or 50,000,000 series) is received into inventory using Receipt To Stock (see Inventory Control) and the balance due on the order goes to zero, then the status of the order is changed to 4 (completed). The shop order may also be changed to a status 5 (closed).
However, the component requirement is not updated. This allows compensation for late issues, back flushing, etc.
When the order and the component demand is totally satisfied, this option may be used to update the requirement detail file to change the status for the component requirements to match the status of the shop order (4 or 5).
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44. MRP Explosion
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45. MRP Explosion
The Explosion accesses parts in Low Level Code sequence, starting at the top of the product structure. If the Low Level Codes are inaccurate, the results of the Explosion are invalid.
You may suppress the explosion of individual parent/component relationships by entering those product structures with a BOM Type Code of "E".
If you are using the Configurator module, you must generate Batch Master Schedule Orders before beginning the explosion or you will receive an error message and will not be allowed to continue with the explosion. Supervisory rights are required to run an MRP explosion with unprocessed master schedule orders.
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46. Explosion Options
The explosion can be limited to a range of the following fields:
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47. Explosion Options
You can also limit the explosion to include only part type codes A or B, or both.
For accurate data, we recommend that you click All and select both A and B parts.
Horizon: If Horizon is enabled, the explosion ignores all demand with a due date outside the horizon date range.
Time Fence: This is only used for parts with an Order Policy of "W" (Weekly). Planned orders are not created within this stability window timeframe. If there is a positive net available at the end of the window, then an exception message is created for that part specifying that condition. Please note that in the system, every five days is a week; therefore a four week stability window would be entered as 20 days.
Unit of Measure: You can designate how you want MRP to round a specific (or all) units of measure for all requirements and planned orders at the time of creation.
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48. Order Generating Logic
Alternate BOM/Routing
For parts that have an entry in the Part Master Planner Tab Current Alternate BOM and Current Alternate Routing fields, the MRP Explosion will create new planned orders based on the alternate bom and routing information.
For existing orders, the MRP Explosion reads the value in the Order Master Table ALTBOM and ALTRTG fields to determine which BOM and Routing are to be used. These fields are populated at the time of order creation.
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49. Order Generating Logic
Phantoms
If “Calc SP Leadtime” in System Configuration (System Manager>Activity>System Configuration>System Switches) is set to No, parts with a Part Type Code of P are not demanded or ordered. Instead, the demand passes through to their component parts. If the switch is set to Yes, then the MRP Explosion program backs off for a pseudo or phantom (part type S or P respectively) part's leadtime when covering a requirement stemming from dependent demand.
For a component on several levels, the demand is accumulated and one order is generated having the leadtime of the longest branch. For example, part Q is used on level one with a two-day leadtime and is also a component of a phantom so that Q is a level two with a cumulative 5-day leadtime, then the demand will take the 5-day lead-time and create one order of the sum of the two demands.
If a Manufacturers Part Number component exists more than once in a BOM structure and the default MPN differs in any two instances, the MRP Explosion writes an exception message to the MPN log: "MPN Conflict " and leaves the default MPN and Manufacturer blank
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50. Order Generating Logic
Pseudos
If “Pseudo Net Switch” is set to Y in System Configuration (System Manager>Activity>System Configuration>Costing), any on-hand quantities will be used to satisfy independent demand only. Any requirements generated from dependent demand are passed through to the component parts as with the Phantom logic above.
If "Calculate Leadtime on 'S' or 'P'" in System Configuration is set to Yes, the MRP Explosion program backs off for a pseudo or phantom (part type S or P respectively) part's leadtime when covering a requirement stemming from dependent demand.
A pseudo part can also have independent demand. The MRP Explosion will always back off for the pseudo part's lead time to cover a requirement for independent demand.
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51. How Phantom and Pseudo Parts are Used
Part Type Built/Stocked Sold
P Never Never
S Sometimes Sometimes
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52. Reorder Point and Bulk Parts
Parts with Part Type Codes of C, D, X or Y are not exploded; however demand is tracked. When the demand causes the net available to drop below the Reorder Point, then an exception message is triggered.
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53. Scrap
When the actual scrap for an order exceeds the amount of scrap planned for that order, the MRP Explosion will generate a new planned order to make up the difference.
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54. Forecast Versus Customer Demand
Forecast and Customer demand for parts with Part Type Codes of A or B will be considered. For parts with an Order Policy of W (Weekly), the greater of the Forecast or Customer demand for the week will be subtracted from the net available and a new order generated if necessary. For parts with an Order Policy of P (Periodic), the greater of the Forecast or Customer demand for the period will be subtracted from the net available and a new order generated if necessary. For parts with an Order Policy of D (Discrete), Forecast demand is ignored. Only Customer demand will be subtracted from the net available. For parts with Order Policies of F (Fixed), L (Lot-for-Lot), and R (Time-Phased Reorder Point), the greater of the Forecast or Customer demand for each day will be subtracted from the net available. Again, a new order will be created if necessary.
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55. Check/Restart Logic
The MRP Explosion has a feature built in to help ensure database integrity. If for some reason the Explosion does not finish (the power goes off, the printer runs out of paper, etc.) you can restart the Explosion and it will pick up where it left off.
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56. Yield
All orders created by the MRP Explosion may be increased in quantity if the part being planned has a Planned Yield. For example, if a part has a demand of 100 units and the Planned Yield for the part is 90%, then the Explosion will plan an order for 111 units (this number may vary depending on the order policy and order qualifiers).
If the parent/component relationship was also assigned a planned scrap, MRP plans the additional quantity needed to cover the scrap. If the scrap is 5% for component B in relation to parent A, and 100 A’s need to be built, the requirement for B will be 105. If B also has a planned yield in the part master, then the 105 will be divided by the yield to determine the order quantity.
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57. Multi-Level Order Reference Tracking
Discrete Order Policy
Order Order Policy
Multi-Level Pegging
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58. MRP Explosion Preferences
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59. Planner Action
Upon completion of an MRP Explosion, click the Exceptions button to bring up the Planner Action window.
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60. Exception Messages
BR Part below reorder point -- this is used for parts with Part Type Codes of C, D, X, and Y to indicate that you need to order more.
DE Order was de-expedited -- de-expedite means to reschedule the order to a date of 12/31/2030 (or current last day of the shop calendar). This means that the order is never needed but can't be automatically deleted.
DF Firm plan order not de-expedited -- this order is not needed, but firm planned orders cannot be de-expedited by the explosion. Please verify that you still desire this order.
LL (Less Than Leadtime) Order has a past due start date -- a new planned order was created with a start date (= order due date - part leadtime) earlier than the system date. This order should be expedited.
NA Negative available in window, Pull in order -- At the end of the specified stability window there was not enough supply. Supply needs to be pulled into window area. This message only applies to parts with an order policy of W (weekly) when the MRP Explosion is run using a time fence (see MRP Explosion)
NI No activity index for part -- all parts require an activity index record. Activity index records are created when the part is added or when low level codes are calculated.
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61. Exception Messages
PA Positive available in window, Push out order -- At the end of the specified stability window supply was greater than needed. Order can be rescheduled later. This message only applies to parts with an order policy of W (weekly) when the MRP Explosion is run using a time fence (see MRP Explosion)
RE Order was rescheduled -- current due date on this order was changed.
PD Order rescheduled to past due date -- existing order was rescheduled and the start date is now prior to today's system date. This order should be expedited.
RI Firm planned order pull in -- this order should have been rescheduled earlier, but the explosion does not change due dates on firm planned orders.
RO Firm planned order push out -- this order should have been rescheduled later, but the explosion does not change due dates on firm planned orders. Verify the date that this order is now required.
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62. MRP Detail
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63. Explosion Shortage Graph
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64. Implosion Shortage Graph
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65. Order Navigator
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66. Bulk Order Approval
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67. MRP Summary Inquiry
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68. Explosion Shortage Inquiry
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69. Reports Master Part List Report MRP Summary Report MRP Detail Report
Planned Order Report
Implosion Shortage Report
Net Available Analysis Report
Planned Orders by Reference Report
Order Shortage Report
Part Shortage Report
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70. Running MRP from the Command Line
Example Shortcut Properties:
c:\exact\RMCLIENT\EFW\MRP.exe - UserID=MANAGER -Password=PASSWORD \CALCLLC \REGEN \MRPEXP \HFROM 05/16/2004 \HTO 02/22/2006 \BATCHMS\ REBATCH
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71. What you learned Theory of MRP Setup Requirements
Using MAX Prior to MRP
Planning and Scheduling with MRP
Reviewing MRP Output
Inquiries and Reports
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72. Additional Resources MAX Documentation PDF Files Customer Portal
Available Through the System Manager Document Links
Additional Documents in the \RMServer\Doc Folder on your Server
Customer Portal
Professional Services
Customer Advocate
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