MASTER SCHEDULE
FOR END ITEMS
MRP
DETAILED SCHEDULE FOR
RAW MATERIALS
&
•Dependent demand
•lumpy COMPONENTS
USED IN THE END PRODUCTS
Avg.
rate of
demand
Inv.
LEVEL
TIME
Inv.
LEVEL
t1 t2 t 3 t4 t 5 t6
TIME
Ordering Lead Time:
(for purchased parts)
Initiation of Receipt of item from vendor
purchase (off shelf / fabricate)
requisition
Manufacturing Lead Time:
Process part through sequence of
Place order machines as given on route sheet Item delivered
(operation + non-productive times)
BASIC RAW MATERIAL
COMPONENTS
C1 C2 C3 Cn
PRODUCTS
P1 P2 P3 PN
Service
Customer Sales Parts
orders forecasts requirements
Master
Engg. Production Inventory
changes schedule transactions
Bill of Inventory
MRP
Materials Record
PROCESSOR
file file
OUT PUT
REPORTS
…
Gross & Net Capacity vs Shop floor Production Order
requirements report Load report Planning Status & exceptions
report report
Week no 6 7 8 9 10
Product P1 50 100
Product P2 70 80 25
Etc.
Firms customer orders
DEMAND Forecasted demand
Often excluded from MPS, Demand for individual component
since it does not include end Parts (for repair and service)
product demand.
Level 0
(product) P1
Level 1
(sub-assemblies) S1 (1)
S2 (2)
Level 2
(raw materials) C1 C2 C3 C4 C5 C6
(1) (4) (1) (2) (2) (1)
Ordering Purchasing
Lead time records
Process
Manufacturing
Route
Lead time
sheets
P1 P2
S1(1) S2(2) S3(1) S4(1)
C1 C2 C3 C4 C5 C6 C4 C6 C7 C2 C8
(1) (4) (1) (2) (2) (1) (1) (4) (2) (2) (1)
M4
PRODUCT STRUCTURE FOR PRODUCTS P1 & P2
Initial inventory status for M4
PERIOD 1 2 3 4 5 6
ITEM RAW MATERIAL M4
GROSS REQUIREMENTS Lead times (in weeks)
SCHEDULED RECEIPTS 40 Assembly Manufacturing Ordering
ON HAND 90 P1 = 1 C4 = 2 M4 = 3
50
P2 = 1
NET REQUIREMENTS S2 = 1
PLANNED ORDER RELEASES S3 = 1
EVOLUTION OF MRP
Improved
computational
efficiency of AN IMPROVED ORDERING METHOD
computers
Unrealistic M/c PRIORITY PLANNING
schedules, ignoring
plant capacities
Not only plans priorities CLOSED LOOP MRP
but provides feedback to (Links functions
executing the priority
plan
-Capacity planning
MRP II -Inventory management
-Shop floor control
Manufacturing -MRP)
Resource
Planning
• Links up the closed loop MRP system with the
financial systems of the company
