material requirement and planning
TRANSCRIPT
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INDUSTRIAL ECONOMICS AND MANGEMENT
MUHAMMAD ASIM
14ME127
SECTION-A
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INTRODUCTION
Production Planning and Control(PPC)
has three phases namely
• Planning Phase
• Action Phase
• Control Phase
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“Getting the right materials to the right place at the right time”.
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WHAT IS MATERIAL REQUIREMENT PLANNING??
“Materials Requirement Planning (MRP) is a technique for determining the quantity and timing for the acquisition of dependent demand items needed to satisfy master production schedule requirements.”
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MATERIAL REQUIREMENT PLANNING(MRP)• Material Requirements Planning (MRP) is a production planning,
scheduling, and inventory control system used to manage manufacturing processes. Most MRP systems are Software-based, but it is possible to conduct MRP by hand as well.
• It is a planning and scheduling technique with fixed lead time.
• It is a technique used to plan and control manufacturing inventories (these manufacturing inventories support the production process).
• It is computerized inventory system.
• Material Requirement Planning (MRP) is a system of planning and scheduling the time phased material requirements for releasing materials and receiving materials that enable the master production schedule to be implemented.
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HISTORY
• In 1964, as a response to the Toyota Manufacturing Program(TMP), Joseph Orlicky developed Material Requirements Planning (MRP). The first company to use MRP was Black & Decker in 1964, with Dick Alban as project leader.
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WHEN IT IS REQUIRED
• Manufacturing industries generally face the problems that demand is high than production. This requires some level of planning.
• Information Technology plays a major role in designing and implementing. Material Requirements Planning systems and processes provides information about manufacturing needs and also about inventory
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OBJECTIVES
The MRP system should have at least these objectives.
• To assure that the materials and components are available for planned production.
• Maintain the lowest possible level of inventory.
• Plan manufacturing activities, delivery schedules and purchasing activities
• Reduction in the manufacturing and delivery lead times
• Realistic delivery commitments
• Increased efficiency
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• Specifically organizational objectives of MRP are identified among three main dimensions, as
follows.
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MRP SYSTEM
The inputs to the MRP system are
• A master production schedule
• An inventory status file
• Bill of materials (BOM).
The output of MRP system are
• Orders to be placed.
• Order rescheduling.
• Planned orders for future.
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CLASSES OF MRP USER/COMPANIES
MRP systems fall into four categories, in terms of use and organizational implementation. • Class A represents full implementation of MRP. System is tied up with company’s
financial system as well as capacity planning etc.• Class B represents a less than full implementation. MRP system is confined in
the manufacturing area.• Class C represents a classical MRP approach in which the system is confined to
management of inventories. • Class D represents a data processing application of MRP. System is used for
keeping track of data rather than as decision-making tool.
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ADVANTAGES OF MRP
• Improved Business Results
• Improved Manufacturing Results
• More Accurate And Timely Information
• Less Inventory
• Material wastage is less
• Higher Reliability
• More Responsiveness To Market Demand
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DISADVANTAGES OF MRP
• Increase In Material Acquisition Cost
• Higher Transportation Costs And Higher Unit Cost
• Potential Hazard Of A Production Slowdown Or Shutdown
• Use Of Standardized Software Packages
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