Materials Planning
Fundamental principles for understanding the concept of material requirements planning
- MRP plans and controls manufacturing of dependent-demand inventory items
- Inventory control system
- Production and inventory control system
- Enterprise resource planning system
- There are 3 principal inputs of part-explosions
- Master schedule
- BOM
- Inventory records
- Two principal outputs
- Purchase orders
- Shop orders
- Both the input and out put systems use MRP
- Master schedules should consider both marketing and production
- A realistic plan should be represented
- Use S & OP and master schedule for planning and controlling the business
- Accuracy is important in the entire inventory record system
- Steady planning, significant resource, and patience in execution is advised
- Shop floor control inhibits the flow of materials through the factory
- Promotes effective utilization of time while manufacturing is taking place.
- When properly managed, safety stock can be eliminated.
- For a MRP to succeed;
- Implementation planning should be done
- There should be reliable computer support
- There should be sufficient management support
- User knowledge is also key
- People and systems should be devised to successfully be solved by MRP
- The benefits include;
- Reduced inventory
- Increased customer service
- Improved efficiency
- If properly installed, all manufacturing and service firms can benefit
- Both large and small firms benefit
- The information integrated can be used for:
- Marketing
- Sales
- Finance/accounting
- Human resource management
- ERP systems are very popular
- ERP systems can be integrated with suppliers and customers
- ERP systems are expensive and time consuming during implementation
- Their failures are uncommon