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Overview

Overview. Dependent demand Master production schedule Bill of materials MRP Time-phased product structure Gross material requirements plan Net requirements plan Lot-sizing techniques Extensions of MRP. Furniture Mfg. Produces 3-types of chairs Ladder-back chair Kitchen chair

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Overview

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  1. Overview • Dependent demand • Master production schedule • Bill of materials • MRP • Time-phased product structure • Gross material requirements plan • Net requirements plan • Lot-sizing techniques • Extensions of MRP

  2. Furniture Mfg. • Produces 3-types of chairs • Ladder-back chair • Kitchen chair • Desk chair

  3. Master Production Schedule April May 1 2 3 4 5 6 7 8 Ladder-back chair 150 150 Kitchen chair 120 120 Desk chair 200 200 200 200 Aggregate production plan 670 670 for chair family

  4. Bill of Materials • List of components & quantities needed to make product • Provides product structure (tree) • Parents: Items above given level • Children: Items below given level

  5. Bill of Materials Back slats Seat cushion Leg supports Seat-frame boards Back legs Front legs A Ladder-back chair

  6. A Ladder-back chair Back slats Seat cushion B (1) Ladder-back subassembly C (1) Seat subassembly D (2) Front legs E (4) Leg supports Leg supports Seat-frame boards F (2) Back legs G (4) Back slats H (1) Seat frame I (1) Seat cushion Back legs Front legs A Ladder-back chair J (4) Seat-frame boards Bill of Materials

  7. Dependent vs. Independent Demand • Demand for chairs • A finished product • Independent • Demand for front legs • A component or subassembly • Depends on the demand for chairs (parent)

  8. Dependent vs. Independent Demand Materials With Materials With Independent Demand Dependent Demand Demand Company Customers Parent Items Source Material Finished Goods WIP & Raw Materials Type Method of Forecast & Booked Calculated Estimating Customer Orders Demand Planning EOQ & POQ MRP Method

  9. Requirements for Effective Use of Dependent Demand Inventory Models • master production schedule • specifications or bills-of-material • inventory availability • purchase orders outstanding • lead times

  10. Cooperstown Cars, Inc. • Produces toy cars • Body • Axles (2) • Wheels (4)

  11. Cooperstown Cars, Inc. - Each component has a known lead time

  12. Cooperstown Cars, Inc. • Demand for Toy Car in Week 8 is 100 • Schedule production for: • Toy car assembly • Wheel assembly • Body • Axle • Wheels

  13. Time-Phased Product Structure

  14. Time-Phased Product Structure

  15. Time-Phased Product Structure

  16. Time-Phased Product Structure

  17. Time-Phased Product Structure

  18. Time-Phased Product Structure

  19. More complexity/Scheduled receipts

  20. More complexity/Scheduled receipts

  21. More complexity/Scheduled receipts Explanation: Gross requirements are the total demand for wheels. Projected on-hand inventory in week 1 is 30 + 200 – 150

  22. Scheduled or planned receipts in week t Projected on-hand inventory balance at end of week t Inventory on hand at end of week t - 1 Gross requirements in week t = + – More complexity/Scheduled receipts

  23. More complexity/Scheduled receipts

  24. Lot-Sizing Rules • When there is a net requirement, how much should we order? • Lot-for-lot – L4L • Economic Order Quantity – EOQ • Part Period Balancing - PPB • Wagner-Whitin Algorithm

  25. Lot-Sizing Rules: L4L L4L- order the amount needed to fulfill requirements

  26. Lot-Sizing Rules: L4L

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