Material requirements planning
(MRP): Computer-based information system that translates master schedule requirements for end items into time-phased requirements for subassemblies, components, and raw materials.
Independent and
Independent Demand
Dependent Demand
Dependent Demand
A
C(2)
B(4)
D(2)
E(1)
D(3)
F(2)
Independent demand is uncertain.
Dependent demand is certain.
Dependant Demand
Dependent demand: Demand for items that are subassemblies or component parts to be used in production of finished goods.
Once the independent demand is known, the dependent demand can be determined.
MRP Inputs
MRP Processing
MRP Outputs
Changes
Order releases
Master schedule Planned-order schedules Primary reports Bill of materials Inventory records MRP computer programs Secondary reports Exception reports
Planning reports
Performancecontrol
reports
Inventory transaction MPR Inputs
Master Production Schedule
Time-phased plan specifying timing and quantity of production for each end item.
Material Requirement Planning Process
c u d o Pr e e r
T
t
u r t
S
e r u ct a e L
i
T
d
s e m
Master Schedule
Master schedule: One of three primary inputs in MRP; states which end items are to be produced, when these are needed, and in what quantities.
Cumulative lead time: The sum of the lead times that sequential phases of a process require, from ordering of parts or raw materials to completion of final assembly. Planning Horizon
Assembly
Subassembly
Fabrication
Procurement
1
2
3
4
5
6
7
8
9
10
Bill-of-Materials
Bill of materials (BOM): One of the
three primary inputs of MRP; a listing of all of the raw materials, parts, subassemblies, and assemblies needed to produce one unit of a product.
Product structure tree: Visual depiction of the requirements in a bill of materials, where all components are listed by levels.
Product Structure Tree
Level
0
1
Chair
Leg
Assembly
2 Legs (2)
3
Cross bar Seat
Back
Assembly
Side Cross
Back
Rails (2) bar Supports (3)
Inventory Records
One of the three primary inputs in
MRP
Includes information on the status of each item by time period
Gross requirements
Scheduled receipts
Amount on hand
Lead times
Lot sizes
And more …
Assembly Time Chart
Procurement of raw material D Fabrication of part E
Subassembly A
Procurement of raw material F
Procurement of part C
Final assembly and inspection
Procurement of part H
Fabrication
of part G
Procurement of raw material I
1
2
3
Subassembly B
4
5
6
7
8
9
10
11
MRP Processing
Gross requirements
Schedule receipts
Projected on hand
Net requirements
Planned-order receipts
Planned-order releases
MPR Processing
Gross requirements
Scheduled receipts
Total expected demand
Open orders scheduled to arrive
Planned on hand
Expected inventory on hand at the beginning of each time period
MPR Processing
Net requirements
Actual amount needed in each time period
Planned-order receipts
Quantity expected to received at the beginning of the period
Offset by lead time
Planned-order releases
Planned amount to order in each time period Updating the System
Regenerative system
Updates MRP records periodically
Net-change system
Updates MPR records continuously
MRP Outputs
Planned orders - schedule indicating the amount and timing of future orders.
Order releases - Authorization for the execution of planned orders.
Changes - revisions of due dates or order quantities, or cancellations of orders. MRP Secondary Reports
