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MRP I & II

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TEAM MEMBERS

y Anup Mulay 04

y Kevin Dsilva 25

y Melissa Nazareth 30

y Stanley Thomas 53

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INTRODUCTION

y What is MRP I

y What is MRP II

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EVOLUTION

y 1950 Manual Systems.

y 1960 Inventory Management and Control.

y 1970 Material Requirement Planning. ( Joseph Orlicky )

y 1980 Manufacturing Resource Planning. (Oliver

Wight and George Plossl )

y 1990 Enterprise Resource Planning.

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WHY??

Manufacturing

Efficiency and

Cost

Profits

Competition

Survive and

Grow

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MRP is a software based production,

planning and inventory control systemused to manage the manufacturing

process.

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OVERVIEWOVERVIEW

MRP by period report

MRP by date report

Planned orders report

Purchase requirements

Exception reports

MRPPrograms

Master ProductionSchedule

BOM

Lead Times(Item Master File)

(Bill-of-Material)

Inventory Data

Purchasing data

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Master Production Schedule.y Shows items to be produced

y End item, customer order, moduley Derived from aggregate plan

Bill of Materialsy

complete product descriptiony materialsy partsy componentsy production sequencey modular BOM

y subassemblies

y planning BOMy fractional options

Inventory recordy status according to time windows or bucketsy identify each parent item that created demand

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Gross Requirements

On-hand

Net requirements

Planned order receiptSafety stock

Net requirements in period = Gross requirements in period Projected inventory in period +Safety stock

Gross Requirements

On-hand

Net requirements

Planned order receiptSafety stock

Net requirements in period = Gross requirements in period Projected inventory in period +Safety stock

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y Primaryy Planned orders - to release at a future time.y Order release notices - execute planned ordersy Changes in due dates of open orders due to reschedulingy Cancellations or suspensions of open orders due to

cancellation or suspension in the MPS.y Stock status data

y Secondaryy Planning reports e.g. forecasting inventory requirements over

time.

y Performance reports e.g. actual vs. planned usage and costs.y Exception reports e.g. serious discrepancies, late/overdue

orders.

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y Safety Stock.

y Lot Sizing.

y Lot-for-Lot Ordering.

y EOQ Model.

y Fixed Period Ordering.

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y Lower levels of in process inventory.

y The ability to keep track of material required.

y The ability to evaluate capacity requirements generated by a

master schedule.

y A means of allocating production time.

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In order to implement and operate an effective

MRP system, it is necessary to have,

y A computer and the necessary software programs to handlecomputation and maintain records.

y Accurate up to date

y Master Schedule.

y Bills of Material.

y Inventory Records.

y Integrity of file data.

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MRP 2

y Manufacturing Resource Planning (MRP II) is

defined by APICS as a method for the effective planning of all

resources of a manufacturing company.

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Key features

y Master Production Schedule (MPS)

y Item Master Data (Technical Data)

y Bill of materials (BOM)(Technical Data)

y Production Resources Data (Manufacturing Technical Data)y Inventories and Orders (Inventory Control)

y Purchasing management

y Material Requirements Planning (MRP)

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y Shop Floor Control (SFC)

y Capacity planning or Capacity Requirements Planning (CRP)

y Standard Costing (Cost Control)

y Cost Reporting / Management (Cost Control)

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MPS

y (MPS) is a plan for production, staffing, inventory, etc.[1] It is

usually linked to manufacturing where the plan indicates

when and how much of each product will be demanded.

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An Example

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BOM

y A BOM can define products as they are designed

(engineering bill of materials), as they are ordered (sales bill

of materials), as they are built (manufacturing bill of

materials), or as they are maintained (service bill of

materials).

y BOM Explosion and Implosion.

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PurchasingManagement

y Purchasing management is the management of

purchasing process, and related aspects in an organization.

Because of production companies purchase nowadays about

70% of their turnover, and service companies purchase

approximately 40% of their turnover [1], purchasing

management is one of the most critical areas in the entire

organization and needs intensive management.

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Capacity PlanningorCRP

y Capacity planning is the process of determining the

production capacity needed by an organization to meet

changing demands for its products.[1] In the context of

capacity planning, "capacity" is the maximum amount of

work that an organization is capable of completing in a given

period of time.

y For eg. Parle Hide N Seek.

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Conclusion

y MRP 1 and MRP 2 are the techniques important for

companies seeking backward integration or following

backward integration.

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Thank You