OPS MODULE 7 Flashcards
It is a computer-based information system that translates master schedule requirements for end items into phased requirements for subassemblies, components, and raw materials
Materials Requirement Planning (MRP)
The MRP is designed to answer three questions:
- WHAT is needed?
- HOW MUCH is needed?
- WHEN it is needed?
It is one of the three primary inputs in MRP which states which end items are to be produced, when these are needed, and in what quantities
Master Schedule
T or F: Managers like to plan far enough into the present so they have estimates of upcoming demands
False (future not present)
T or F: The master schedule should cover a period that less than the cumulative lead time
False (at least equivalent not less than)
It is the sum of the lead times that sequential phases of a process require, from ordering of parts or raw materials to completion of final assembly
Cumulative lead time
It is a listing of all of the assemblies, subassemblies, parts, and raw materials needed to produce one unit of a product
Bill of Materials (BOM)
It is a visual depiction of the requirements in a bill of materials, where all components are listed by levels
Product Structure Tree
______ involves restructuring the bill of materials so that multiple occurrences of a component all coincide with the lowest level at which the component occurs
Low-level coding
Inventory records includes information on the status of each item by time period, called _______
Information about
- Gross requirements, schedules receipts and expected amount on hand
Other details for each item such as
- Supplier, lead time, lot size policy, changes due to stock receipts and withdrawals, and canceled orders and similar events
time buckets
What are the primary output of MRP?
POC
- Planned orders
- Order releases
- Changes
It is a schedule indicating the amount and timing of future orders
Planned orders
It involves authorizing the execution of planned orders
Order releases
It involves the revisions of the dates or quantities, or the cancellation of orders
Changes
It is one of the secondary outputs of MRP and evaluation of system operation, including deviations from plans and cost information
- e.g. missed deliveries and stockouts
Performance-control reports
T or F: Planning reports is one of the secondary outputs of MRP and a data useful for assessing present material requirements
-e.g., purchase commitments
False (future not present)
It is one of the secondary outputs of MRP and a data on any major discrepancies encountered
- e.g., late and overdue orders, excessive scrap rates, requirements for non existent parts
Exception reports
MRP Processing takes the end item requirements specified by the master schedule and “_____” them into _______ requirements for assemblies, parts, and raw materials offset by lead times
explodes ; time-phased
MRP Record
_____ is the total expected demand
_____ is the open orders schedules to arrive
_____ is the expected inventory on hand at the beginning of each time period
Gross requirements
Schedules receipts
Projected available
MRP Record
_____ is the actual amount needed in each time period
_____ is the planned amount to order in each time period
Net requirements
Planned-order releases
T or F: MRP Record includes the planned-order receipts expected to receive at the end of the period offset by lead time
False (beginning not end)
T or F: The product structure tree diagram is based on the MRP
False (The MRP is based on the product structure tree diagram)
In MRP development, requirements are determined ____ by _____, beginning with the end item and working down the tree
Level by level
T or F: In MRP development, requirements are determined level by level, beginning with the end item and working up the tree
False (down not up)
In MRP development the timing and quantity of each “_____” becomes the basis for determining the timing and quantity of the “_____” items directly below it
parent ; children
T or F: The “children” items eventually becomes the “parent” items for the next level, and so on
True
It is the process of identifying the parent items that have generated a given set of material requirements for an item
Pegging
T or F: An MRP is a static document
False (An MRP is not a static document because:
As time passes,
- Orders get completed or are nearing completion
- New orders will have been entered
- Existing orders will have been altered (quantity changes, delays, and missed deliveries)
What are the two basic systems in MRP?
- Regenerative System
- Net-change system
T or F: Regenerative system is an approach that updates MRP records continuously while the Net-change system updates MRP periodically
False (regenerative - periodically ; net-change system - continuously)
It is essentially a batch system that compiles all changes that occur within the time interval and periodically updates the system
Regenerative System
T or F: A revised production plan is developed in the same way the original plan was developed
True
T or F: In a net-change system, the production plan is unmodified to reflect changes as they occur
False (it is modified)
T or F: In a net-change system, only the changes are exploded through the system
True
T or F: Theoretically, MRP systems should require safety stock
False (should not require)
______ may necessitate the strategic use of safety stock
Variability
A _________ process or one with varying scrap rates may cause shortages in downstream operations
bottleneck
T or F: Abundance may occur if orders are late or fabrication or assembly are longer than expected
False (shortages not abundance)
When lead times are variable, the concept of ______ is often used
Safety time
It involved scheduling orders for arrival or completions sufficiently ahead of their need so that the probability of shortage is eliminated or significantly reduced
Safety time
_________ ordering
- The order or run size is set to equal to the demand for that period
- Minimizes investment in inventory
- It results in variable order quantities
- A new setup is required for each run
Lot-for-Lot (L4L)
______ can lead to minimum costs if usage of items is fairly uniform
- This may be the case for some lower-level items that are common to different ‘parents’
- Less appropriate for ‘lumpy demand’ items because inventory remnants often
Economic Order Quantity (EOQ)
Types of demand
____ ; stable demand
____ ; lumpy demand
Independent demand
Dependent demand
_____ provides coverage for some predetermined no. of periods
Fixed Period Ordering
MRP Benefits
Enables managers to easily:
- Determine the _____ of each component of a given order size
- To know when to _____ orders for each component
- To be _____ when items need attention
quantities ; release ; alert
T or F: Additional benefits of MRP is the high levels of in-process inventories as well as the ability to track material requirements and evaluate capacity requirements and a means of allocating production time
False (low not high)
_____ is the ability to easily determine inventory usage
- Exploding an end item’s BOM to determine the quantities of the components that were used to make the item
backflushing
T or F: A computer and necessary software to handle computations and maintain records is required to maintain an effective MRP system
True
An effective MRP system requires the integrity of data files as well as accurate and up-to-date?
Master schedules
Bill of Materials
Inventory Records
T or F: One of the difficulties of MRP is the consequence of inaccurate data that includes:
- Missing parts
- Ordering the correct number of items
- Inability to stay on schedule
As well as other problems like:
- Assumption of changing lead times
- Products being product differently from the BOM
- Failure to alter a BOM when customizing a product
- Inaccurate forecasts
False (incorrect not correct ; constant lead times not changing)
_______ is the expanded approach to production resource planning involving other areas of the firm in the planning process and enabling capacity requirements of planning
Manufacturing resource planning (MRP II)
Most ______ have the capability of performing simulation to answer a variety of “what if” questions so they can gain a better appreciation of available options and their consequences
Manufacturing resource planning (MRP II)
_______ refers to when MRP II systems began to include feedback loops
Close Loop MRP
T or F: Systems evaluate a proposed material plan different to available capacity
False (relative not different)
______ refers to the evaluation that requires the revision of a proposed plan if it is not feasible
Capacity requirements planning
It is the process of determining short-range capacity requirements
Inputs:
- Planned-order releases for the MRP
- Current shop loading
- Routing information
- Job time
Key outputs:
- Load reports for each work center
Capacity Requirements Planning (CRP)
______ is the department or work center reports that compare known and expected future capacity requirements with projected capacity availability
Load reports
_________ was the next step in evolution that began with MRP and evolved into MRPII and typically has an MRP core. It also provides a system to capture and make data available in real time to decision makers and other users throughout an organization
Enterprise Resource Planning (ERP)
T or F: MRP systems are composed of a collection of integrated modules such as:
- Accounting/Finance, Marketing, Human Resources, Purchasing, Production Planning, Inventory Management, Distribution, Sales, and Supply Chain Management
False (ERP not MRP)
The _______ is the most ambitious and difficult implementation approach where companies cast off all their legacy system at once and implement a single ERP system across the entire company
Big bang
______ is more appropriate for smaller companies expecting to grow into ERP since ERP dictates the process design where the focus is on a few key processes
Slam dunk
_________ suits large or diverse companies that do not share many common processes across business units. Independent ERP systems are installed in each business unit of the enterprise while linking common processes across the enterprise
Franchising strategy
READ ONLY
ERP Considerations
- How can ERP improve a company’s business performance?
-How long will an ERP implementation project take?
-How will ERP affect current business processes?
-What is the ERP total cost of ownership?
-What are the hidden costs of ERP ownership?
okay pi
