06_Material Requirements Planning

Question 1

Independent Demand

Answer 1

• derivation of material requirement based on consumption in the past
• ued for less valuable product e.g. screws
• no need to perform breakdown of product structures

Question 2

Dependent Demand

Answer 2

• based on results of Sales and Operation Plannung (S&OP) using producut strucutres
• more laborious therefore used for more valuable products to calculate material requirements

Question 3

ABC Classification of parts
Definition & Procedure

Answer 3

• supports the choice between independent and dependent MRP calculations

1. Choose part with highest consumption value per year [e.g. 400 out of 1000]
2. Calculate **cumulative share of parts ** [e.g. 8 parts 1/8 = 12.5% with each part added to the list]
3. Calculate cumulative share of consumption value [e.g. part 1 consumption value = 400; ∑ = 1000 -> 400 \ 1000= 40%]
4. visualize cumulative share of parts and cumulative share of consumption value in a graph
5. Use dependent demand for parts A and for B and C use independent demand

Question 4

BOM

Answer 4

Bill of Materials

Question 5

Low level codes

Product structures in context of dependent demand

Answer 5

= lowest manufacturing level at which a product occurs
- 0 being low level code for final product

Question 6

Analytic View
vs.
Synthetic View
of product structures according to manufacturing level

Answer 6

Analytic View
- Precedence graph indicating amount of parts used for each manufacturing level

Synthetic View
- part usage in a table
- e.g. Part 2 used for Part 1 (2x) and Part 3 (1x)

Question 7

The total # of levels used for low-level coding is always..

Answer 7

equal to the number of manufacturing levels

Question 8

Gozinto Graph

Answer 8

• use for product structures of **dependent demand **
• combine Material Requirements of several products into one graph
• use low level coding

Question 9

Primary Demand

dependent demand for MRP

Answer 9

• customers orders
• results of S&OP

Question 10

Secondary Demand

dependent demand for MRP

Answer 10

• derived from primary demand through product structures using low level codes

Question 11

Gross requirement (k,t)

Dependent demand for MRP

Answer 11

**∑ primary + secondary demand **
- for all level codes s - 0,…,S)
- for all products k ∈ K(s)
- for all periods t=1,…,T

Question 12

Projected available inventory (k,t)
AI (k,t)

Answer 12

= Physival Inventory (k, at the beginning of t)
(+) Scheduled receipts (k,t)
(-) reserved inventory (k,t)
(-) safety stock (k,t)

Question 13

Net requirement (k,t)
NR (k,t)

Answer 13

= max {gross requirement (kt,) - AI (k,t); 0}

Question 14

Lead time adjustment

in context of dependent demand

Answer 14

• consideration of throughput time of manufacturing system or lead time of suppliers
• order to shop flows or suppliers need to be made in advance

Question 15

Calculation of net requirements
[multiple product level, single period demand]

Answer 15

1. Following Gozinto Graph start with LLC 0 aka final products [no secondary demand -> GR = primary demand]
2. calculate NR subtracting initial inventory from GR
3. Move on to low level code 1 where GR will be primary demand + secondary demand
4. Secondary demand = ∑ of NR of final products x units required in Gozinto Graph

Question 16

Multi Period MRP with multiple product level

dependent demand

Answer 16

1. Production orders of the periods [e.g. weeks] from LLC 0 = Secondary demand of LLC 1

Question 17

MRP according to manufacturing level
vs.
low lecel codes

Answer 17

• MRP according to manufacturing level usually requires more calculation steps

Question 18

2 Methods for Calculation of net requirements

Answer 18

1. multi product level, singe-period demand
2. Multi-period MRP in big table

Question 20

When constructing product structure…

Gozinto Graph, according to Machine level or LLC

Answer 20

• check if there is a subassembly that can be used for another component