AOS 3: Material Management Flashcards
What is materials management?
Materials management is a strategy that manages the use, storage and delivery of materials to ensure the right amount of inputs are available when required in the operations system.
What are the material management strategies?
- Forecasting
- Master production schedule (MPS)
- Master requirement planning (MRP)
- Just in Time
What is forecasting?
Forecasting is a planning strategy that uses past data to attempt to determine future events so that informed decisions can be made around materials.
What are advantages of forecasting?
- Ensures fresh materials for the production process
- Ensures that materials are available when they are needed
- Ability to predict changes
- Reduces overstocking and hence reduces wastage
What are disadvantages of forecasting?
- Difficult to get accurate as its just a judgement
- Cant be used if no previous data is being collected/available
- Based on old trends
What is the master production schedule (MPS)?
Master production schedule (MPS) is a detailed outline of what is to be produced, in what quantities and when its going to be produced.
What are advantages of master production schedule (MPS)?
- Availability of the right materials required for production
- Little, if any excess stock
- Optimal use of manufacturing resources, prevents over manufacturing and in turn reduces wastage
- Timely delivery of manufactured goods to your customs
- Collecting the business data for analysis and better planning
What are disadvantages of master production schedule (MPS)?
- Production scheduling can be complex
- Can be very difficult to schedule these processes
- Cost of implementation
- Lack of flexibility
- Requires strong relations with suppliers
What is the material requirement planning (MRP)?
Material requirement planning (MRP) is an itemized list of materials that are required to meet the MPS.
What are advantages of material requirement planning (MRP)?
- Availability of the right materials required for production
- Little, if any excess stock
- Optimal use of manufacturing resources, prevents over manufacturing and in turn reduces wastage
- Timely delivery of manufactured goods to your customs
- Collecting the business data for analysis and better planning
What are disadvantages of material requirement planning (MRP)?
- Production scheduling can be complex
- Can be very difficult to schedule these processes
- Cost of implementations
- Lack of flexibility
- Required strong relations with suppliers
What is Just in Time?
Just in time is a strategy that ensures the right amount of materials arrive just as they are needed in the operations system.
What are advantages of just in time?
- Fresh/up to date raw materials
- Save storage due to no over stocking
- Lower levels of waste
- No money tired up in the stock
What are disadvantages of just in time?
- Dependent on suppliers, quality and delivery
- If a delivery is late production can be held up
- Difficult to expand production at short notice
