Computer Aided Production Management (CAPM)

Question 1

MRP

Answer 1

• Materials Requirement Planning
• Uses bill of material, inventory data, and the master production schedule to calculate time-phased requirements for materials
• Basic MRP really only works where lead times are reliable and consistent, which doesn’t happy much in most manufacturing organisations where production is constantly being rescheduled in response to customer demands

Question 2

MRPII

Answer 2

• Manufacturing Resource Planning
• Integrates the sales and business/financial management systems with the operational/manufacturing system, for effective planning of all resources of manufacturing businesses

Question 3

ERP

Answer 3

• Enterprise Resources Planning
• Same as MRPII with additional features, and a higher level of integration generally.
• ERP systems may include personnel management and salaries, document control and maintenance modules.

Question 4

Why do these systems fail to deliver?

Answer 4

-Inaccurate data
>To control an organisation the information needs to be at least 95% accurate (preferable 98%)

-Inappropriate packages
>Systems that do not meet the needs of the business or are so complex that the users never understand them

-IT dominated
>The exclusion of individuals, intentionally or not, when CAPM implementation becomes an IT dominated exercise

-Inadequate training
>problem lies within the business having trouble adopting the CAPM system

-Use of consultants
>balance has to be struck between wasting resources and handing over ownership of the system to consultants

-Championing the issue
>Success of a CAPM system will be inextricably linked to the support it recieves from the senior management. A high level of commitment must be made by an individual to the exercise

-Cultural issues
>system wont work until everyone involved understands how their departmental behaviour impacts on it’s effectiveness

-Performance measures
>Traditional departmental performance measures may well be at odds with the new integrated management that results from a CAPM or ERP system

-Lack of discipline
>without discipline the data in the system will never be accurate

Question 5

What are the benefits of these systems?

Answer 5

• CAPM system is a tool to help achieve the customers orders on time in the most efficient and cost effective way possible
• should allow sales force to quote realistic delivery dates
• should allow production manager to plan his capacity to meet predicted demand
• should allow the purchasing department to order the right materials in the right quantities at the right time
• should ensure that the right operations are carried out in the right order and at the right time
• should provide the organisation with the ability to be flexible and reschedule at minimum cost whilst satisfying the customer
• should provide accurate management information and reports on production status, performance etc.
• should have a substantial impact on productivity