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ManufacturingManufacturing

Resoures PlanningResoures PlanningPresented byPresented by

Muhammad Atif RazaMuhammad Atif Raza0707--Met Met--5959



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CONTENTSCONTENTSCONTENTSCONTENTS

Definition of Manufacturing Resources PlanningDefinition of Manufacturing Resources Planning

Manufacturing TypesManufacturing Types

Modules in MRP SystemModules in MRP System

Basic Functions of MRPBasic Functions of MRP

MRP ProcessingMRP Processing

Benefits of MRP In Different LevelsBenefits of MRP In Different Levels



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Manufacturing Resource PlanningManufacturing Resource Planning ((MRPMRP))Manufacturing Resource PlanningManufacturing Resource Planning ((MRPMRP))

Is defined as a method for the effective planning of all resource of aIs defined as a method for the effective planning of all resource of a

manufacturing company.manufacturing company.



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MANUFACTURING TYPESMANUFACTURING TYPESMANUFACTURING TYPESMANUFACTURING TYPES

There are two types of manufacturing.There are two types of manufacturing.

Pull manufacturingPull manufacturing

Push manufacturingPush manufacturing



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Push Manuf acturingPush Manuf acturingPush Manuf acturingPush Manuf acturing

This is generally suitable for Make to stock situation.This is generally suitable for Make to stock situation.

Push systemsPush systems

Driven by a forecasted demandDriven by a forecasted demand

Specialized equipmentSpecialized equipment

Specialized labor Specialized labor



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Pull Manuf acturing Pull Manuf acturing Pull Manuf acturing Pull Manuf acturing

A Pull system on the contrast is based on Made to

Order situation.

Pull systems

Driven by customer demand

General purpose equipment

Cross trained labor



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Diff erence between pull and pushDiff erence between pull and push

manuf acturingmanuf acturing

Diff erence between pull and pushDiff erence between pull and push

manuf acturingmanuf acturing

The main difference between push and pull is theThe main difference between push and pull is the

direction in which the information flows.direction in which the information flows.

In the push system, information flows in the sameIn the push system, information flows in the samedirection as production, whereas in the pull system,direction as production, whereas in the pull system,

information flows in the opposite direction.information flows in the opposite direction.



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Manufacturing Resource Planning is the Study of the PlanningManufacturing Resource Planning is the Study of the Planning

and Materials Flow.and Materials Flow.

Supply Chain Management (SCM) is the Study of this LinkedSupply Chain Management (SCM) is the Study of this Linked

Chain of Activities.Chain of Activities.

Supply Chain Diagram:Supply Chain Diagram:

Supplier Supplier pp Manuf acturer Manuf acturer pp DistributionDistributionpp Customer Customer

SystemSystem



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The Modules In MRP SystemThe Modules In MRP System

What are we going to make ?

The Master Production Schedule

What do we (already) have ? I nventory Record

What is it made up of ?

The Bill Of Materials



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The Master Production ScheduleThe Master Production Schedule

Master schedule:Master schedule: One of three primary inputs in MRP; states which end itemsOne of three primary inputs in MRP; states which end items

are to be produced, when these are needed, and in whatare to be produced, when these are needed, and in what

quantities.quantities.

The master schedule should cover a period that is at leastThe master schedule should cover a period that is at leastequivalent to theequivalent to the cumulative lead timecumulative lead time

Cumulative lead time: Cumulative lead time:

The sum of the lead times that sequential phases of a processThe sum of the lead times that sequential phases of a process

require, from ordering of parts or raw materials to completionrequire, from ordering of parts or raw materials to completion

of final assembly.of final assembly.



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Cumulative Lead TimeCumulative Lead TimeCumulative Lead TimeCumulative Lead Time

1 2 3 4 5 6 7 8 9 10

Procurement

Fabrication

Subassembly

Assembly



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Inventory R ecordsInventory R ecordsInventory R ecordsInventory R ecords

Includes information on the status of each item by timeIncludes information on the status of each item by time

period, called period, called time bucketstime buckets

Information aboutInformation about

Gross requirementsGross requirements

Scheduled receiptsScheduled receiptsExpected amount on handExpected amount on hand

Other details for each item such asOther details for each item such as

Supplier Supplier

Lead timeLead time

Lot sizeLot size

Changes due to stock receipts and withdrawalsChanges due to stock receipts and withdrawals

Canceled orders and similar eventsCanceled orders and similar events



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Bill of Materials (BOM)Bill of Materials (BOM)Bill of Materials (BOM)Bill of Materials (BOM)

A listing of all of the raw materials, parts,A listing of all of the raw materials, parts,

subassemblies, and assemblies needed to producesubassemblies, and assemblies needed to produce

one unit of a productone unit of a product

Product structure treeProduct structure tree

A visual depiction of the requirements in a billA visual depiction of the requirements in a bill

of materials, where all components are listed byof materials, where all components are listed by

levelslevels



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Benefits of a BOMBenefits of a BOM

Improve material management by responding to

changes in production

Reduce inventory levels Reduce manufacturing cost



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Product Structure TreeProduct Structure TreeProduct Structure TreeProduct Structure Tree



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LowLow--Level CodingLevel CodingLowLow--Level CodingLevel Coding

LowLow--level codinglevel coding

Restructuring the bill of material so that multipleRestructuring the bill of material so that multiple

occurrences of a component all coincide with the lowestoccurrences of a component all coincide with the lowest

level at which the component occurs.level at which the component occurs.

Level 3

Level 2

Level 1

Level 0 X

B(2)

D(3)

E(4) E

C

E(2)

F(2)



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Basic FunctionsBasic Functions

The right parts

Identified in the BOM module

The right quantities

Identified in the BOM module, an then compares tothe on-hand quantities held in inventory control

The right timing

Calculated within MRP, based on purchasing andmanufacturing lead times held in the BOM



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Fundamental Requirements To

Successful Run MRP

Fundamental Requirements To

Successful Run MRP

Absolute accuracy in Bill of Materials

Design changes timely recorded togetherwith their

effectively start dates

Accurate inventory records Accurate purchasing records



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MRP ProcessingMRP Processing


Schedule receiptsSchedule receipts

Projected on handProjected on hand Net requirements Net requirements

PlannedPlanned--order receiptsorder receipts

PlannedPlanned--order releasesorder releases



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MPR ProcessingMPR ProcessingMPR ProcessingMPR Processing


Total expected demandTotal expected demand

Scheduled receiptsScheduled receipts

O pen orders scheduled to arriveO pen orders scheduled to arrive

Planned on handPlanned on hand

Expected inventory on hand at the beginning of Expected inventory on hand at the beginning of

each time periodeach time period



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MPR ProcessingMPR ProcessingMPR ProcessingMPR Processing

Net requirements Net requirements

Actual amount needed in each time periodActual amount needed in each time period

PlannedPlanned--order receiptsorder receipts

Quantity expected to received at the beginning of Quantity expected to received at the beginning of

the periodOffset by lead timethe periodOffset by lead time

PlannedPlanned--order releasesorder releases

Planned amount to order in each time periodPlanned amount to order in each time period



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Coca Cola: "Always" Class A MRPCoca Cola: "Always" Class A MRPCoca Cola: "Always" Class A MRPCoca Cola: "Always" Class A MRP

Significant Payback Achieved BySignificant Payback Achieved ByCocaCoca--colacola



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Coca Cola: "Always" Class A MRPCoca Cola: "Always" Class A MRPCoca Cola: "Always" Class A MRPCoca Cola: "Always" Class A MRP

Inventory levels:Inventory levels: downdown

Productivity:Productivity: upup

Customer delivery performance:Customer delivery performance: improvedimproved

Supplier delivery performance:Supplier delivery performance: betterbetter Business Processes:Business Processes: improvedimproved

Data integrity:Data integrity: highhigh

Cost of goods:Cost of goods: downdown Team Spirit:Team Spirit: highhigh



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Benefits In Different Levels



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For ManagementFor ManagementFor ManagementFor Management

An accurate, consistent and effective way to runAn accurate, consistent and effective way to run

the whole businessthe whole business

The ability to manage orderly growthThe ability to manage orderly growth

The ability to cope with difficult economicThe ability to cope with difficult economic

conditionsconditions



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For Management InformationFor Management InformationFor Management InformationFor Management Information

Quicker, better information on which to baseQuicker, better information on which to base

decisionsdecisions

Consistent information at all levels, in allConsistent information at all levels, in alldepartmentsdepartments

Accurate records for internal and external useAccurate records for internal and external use



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For Sales / MarketingFor Sales / MarketingFor Sales / MarketingFor Sales / Marketing

Improved onImproved on--time deliveries to customerstime deliveries to customers

Faster, more accurate delivery promisingFaster, more accurate delivery promising

Improved responsiveness to customer needsImproved responsiveness to customer needs



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For ProductionFor ProductionFor ProductionFor Production

Improved productivity and resource utilizationImproved productivity and resource utilization

Increased through outputIncreased through output

Better reliability of production plansBetter reliability of production plans



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For Materials ManagementFor Materials ManagementFor Materials ManagementFor Materials Management

Better control of inventoriesBetter control of inventories

Improved schedulingImproved scheduling

Productive relationships with suppliersProductive relationships with suppliers



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For Design / EngineeringFor Design / EngineeringFor Design / EngineeringFor Design / Engineering

Improved design controlImproved design control

Better quality and quality controlBetter quality and quality control



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CONCLUSIONCONCLUSIONCONCLUSIONCONCLUSION

The primary objective of anThe primary objective of an manufacturing resourcesmanufacturing resources planning planning in any organization is to ensure that thein any organization is to ensure that the

desired products are manufactureddesired products are manufactured

at the right time,at the right time,

in the right quantities,in the right quantities,

meeting quality specifications, and at minimummeeting quality specifications, and at minimum

costcost



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ConlusionConlusionConlusionConlusion

More efficient use of resourcesMore efficient use of resources

Reduced inventoriesReduced inventories

Less idle timeLess idle time

Better priority planningBetter priority planning

Quicker production startsQuicker production starts

Schedule flexibilitySchedule flexibility



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ConlusionConlusionConlusionConlusion

Improved customer serviceImproved customer service

Meet delivery datesMeet delivery dates

Improved qualityImproved quality

Lower price possibilityLower price possibility Improved employee moralImproved employee moral

Better management informationBetter management information



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The EndThe End

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