MRP

Question 1

What is MRP? Why do companies use this system?

Answer 1

MRP determines the number of pieces, components and raw materials needed for production according to the forecast. Compagnies uses MRP to improve customer service, minimize investment in inventory and maximize efficiency for production.

MRP also helps in planning material needs and schedules in great detail

Question 2

Why is having shorter planning windows in MRP important?

Answer 2

Having shorter planning in MRP is important since

1) It increases flexibility and responsiveness
- The adaptibility to demand changes and we are able to make rapid changes in case of disruptions

2) Reduced inventory levels

• lowers holding costs and minimizes excess inventory

3) Increases customers satisfaction
- with shorter planning windows we are more able to meet the deadlines and also customize and personnalize our orders if needed.

4) More accurate forecast

Question 3

To which questions do MPC/MRP process give answers

Answer 3

MPC answers the questions like
- What to produce?
- When to produce it?
- How much to produce?
- What are the ressources needed?
- How to monitor and control production?

Where as MRP answers to question like:

• What materials are needed (BOM)
• How much of each do we need
• When are materials needed
• when to place orders
• How much inventory do we keep

Question 4

What are basic assumptions of the requirements planning?

Answer 4

• Fixed lead time
• BOM
• Accurate demand forecasts
• Stable production process
• Constant lot sizes
• Accurate inventory records
• Limitations and adaptations

Question 5

How can we classify different industries

Answer 5

1) Assemble to stock - High benefits of MRP
- Combines multiple components into a finished product wich meets demand.

2) Fabricate to stock - Low benefits of MRP
- Items are manufactured by a machine rather than being assembled from components.

3)Assemble to order - High benefits
- The customer chooses from standard options

4) Fabricate to order - Low benefits
- Items made by machines to an order

5) Manufacture to order- High benefits
- Articles are manufactured or assembled by order of the customer

6) Process - Low benefits of MRP
- pulp and paper, plastic, rubber

Question 6

What impact different planning windows may have to business (from flexible to frozen)

Answer 6

First of all the other planning methods are:

1) ressource planning
- Transfers monthly/annual production plans into aggregate ressources (labor-hours, stock space etc)

2) Demand management
- Forecasting, order entry, due dates, customer service

3)Production planning
-Long term plan, strategy financial plans.

After that, the times barriers in different planning are

1) Frozen
- no change of the program authorized within the time interval

2) Moderately firm
- some specific changes are allowed within the group of products until pieces are available

3) Flexible
- Variations allowed until the exigencies linked to the global capacity stay at the same level. long LT should not be involved.

Question 7

How do you calculate utilization, cycle time, lead time, capacity and bottleneck of a simple process? How does these process affect outcomes?

Answer 7

1) Utilization: average time all workers are actually working (workers divided by time)

2) Cycle time: time elapsed between completion of successive units –> the bottle neck

3) Lead time: amount of time that elapses from the start of a process to its end

4) Capacity is how much we can take we find it by deviding 60 by the bottleneck

5) Bottleneck: The slowest step

Question 8

How does inventory affects process?

Answer 8

inventory affects processes in multiple ways, impacting everything from production efficiency and cost management to customer satisfaction and financial performance. Proper inventory management is crucial for balancing these various effects to ensure smooth, cost-effective, and responsive operations.

For instance inventory affects:

1) Customer service
- Adequate inventory ensures that customer orders can be fukfilled promptly

2) Cost implications
- Holding costs
- Ordering costs: large infrequent orders might reduce ordering costs while frequent smaller orders can have opposite effects

3) Lead time reduction
- keeping inventory on hand reduces lead times since materials and finished goods are readily available when needed rather to wait for them to be produced and/or delivered

• JIT production: While holding too much inventory might be costly a well managed inventory system can support JIT when they arrive just in tume to minimize holding costs