Planning for Material and Resource Requirements

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CHAPTER 13

Planning for Material and Resource Requirements
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Learning Objectives

• Explain the relationship between the aggregate
  plan and the master production schedule.
• Given a weekly schedule of forecast demand and
  customer orders booked, calculate projected
  on-hand inventory and determine when to master
  schedule more production.
• Given a weekly schedule of forecast demand,
  customer orders booked, projected on-hand
  inventory, and master schedule, calculate
  available-to-promise for any week in which
  production is scheduled.
• Use the method of overall factors to calculate
  capacity requirements.

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Learning Objectives (contd)

• Interpret a product structure tree diagram.
• Given a master schedule and product structure,
  calculate planned order releases for an item at
  any level.
• Combine requirements from several sources in
  determining gross requirements.
• Define Manufacturing Resource Planning.

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Maine Woods Co. Aggregate Plan, Wheel-Goods
Product Group
Regular Over
Forecast Time
Time Inventory
Month Demand Production
Production Beginning Ending Sept.
2,500 2,000
1,000 500 Oct.
2,900 2,000
400 500
0 Nov. 2,400 2,000
400 0
0 Dec. 2,000
2,000
0 0
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Maine Woods Co. Master Production Schedules,
Wheel-Goods Product Group
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Maine Woods Co. Master Production Schedule Based
on Demand Forecast and Booked Customer Orders for
Toy Wagons
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To determine projected inventory on hand for a
specific week, perform the following calculations

• Add either actual inventory on hand from the
  preceding week or projected on-hand inventory
  from the preceding week to any quantity shown in
  the Master schedule row for the week being
  calculated.
• Determine the larger of forecast demand or
  customer orders booked.
• Subtract the amount determined in step 2 from the
  amount in step 1.

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Calculation of Available-to-Promise for November
and December for Maine Woods Co.
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Calculation of Total Capacity Requirements for a
Master Schedule
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Calculation of Total Capacity Requirements for a
Master Schedule
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Calculation of Total Capacity Requirements for a
Master Schedule
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Calculation of Estimated Capacity Requirements
for Individual Work Stations
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Independent vs. Dependent Demand

• Independent demand items usually include finished
  products, such as the completed tricycle, or
  replacement parts sold to customers.
• Dependent demand is usually demand for an item
  that is generated by a company's own production
  process.

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Exploded View ofMaine Woods Tricycle
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Product Structure Tree Diagram for Maine Woods
Tricycle
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Table for MRP
Transparency 15.13
(Exhibit 15.16)
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MRP for Front Assemblies
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Partially Completed MRPFront Assemblies
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Completed MRPFront Assemblies
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MRP for a Level 2 ItemFront Axle Supports
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Combining Demand from Multiple Sources and Levels
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Manufacturing Resource Planning (MRP II)

• Includes requirements for resources other than
  materials (usually financial)
• Cost Control
• Simulation