MRP & Production Planning

Course ObjectivesUnderstand the principles of Demand Management (DM)Define the Materials Requirements Planning (MRP) processDescribe how to valuate MRP planning runsPerform DM and MRP transactions

Table of contentsModule 1: Master DataModule 2: Demand ManagementModule 3: Material Requirements PlanningModule 4: MRP Planning RunsCourse MapModule 5: Summary

PP flow & Integration

Sales & Ops Planning

MRP

Capacity Req. Planning

Long Term Capacity Planning

Demand Management

Production Execution

Master Data Related Transactions Practice the following transactions

MM03 Display Material MasterCS03 Display BOMCR03 Display Work CenterCA23 Display Rate routingMM03 Display Production Version

Table of contentsModule 1: Master DataModule 2: Demand ManagementModule 3: Material requirements PlanningModule 4: MRP Planning RunsCourse MapModule 5: Summary

What is Demand Management?Demand Management is used to determine requirement quantities and delivery dates for finished products Demand Management provides a demand program which is used by MRP to generate production plansDepending on the planning strategy chosen in the material master, the demand program can use forecasts of demand, actual demand, or combinations of bothActual demand is created in sales order management (customer orders) and materials management (warehouse replenishment)Forecasts of demand are represented by planned independent requirements which are copied from the Sales and Operations Plan

What is the DM Process (1)?SOP plans are transferred to Demand Management as Independent Requirements for end productsThe actual sales orders are for information purpose only and are not considered in planning.In case the sales orders significantly vary from the forecasted demand; Planners revise the demand before running MRP to generate manufacturing orders and purchase requisitions

Who is Responsible for DM?Planner (DEM)Responsible for managing the demand by comparing the actual demand with the forecast and manipulate the plan based on the actual demand before executing MRP

DM Related TransactionsPractice the following TransactionsMM03 Display StrategyMD63 - Display Independent RequirementsMD04 - Display Stock Requirements ListMD74 Reorganise Independent Requirements

Table of contentsModule 1: Master DataModule 2: Demand ManagementModule 3: Material Requirements PlanningModule 4: MRP Planning RunsCourse MapModule 5: Summary

Materials Requirements PlanningMRP compares the requirements for end products, from Demand Management, with the current stocks and creates planned manufacturing orders

DemandProgram

MRP stands for: Materials Requirements Planning.

The function of MRP is to provide material availability, that is, it is used to procure or produce the requirement quantities on time. This process involves the monitoring of stocks and demand, leading to the automatic creation of procurement proposals for purchasing or production.

The main objective of MRP is to determine which material is required, the quantity required and by when it is required.

What is MRP?

What is the MRP Process (1) ?MRP compares the requirements for end products, from Demand Management, with the current stocks and planned manufacturing ordersMRP chooses a Production Version which indicates the Bill of Material and Routing to be used MRP then explodes the product BOMs to determine the dependent requirements for intermediate products and purchased raw materials

What is the MRP Process (2) ?MRP will normally be run weekly.

The MRP process assumes infinite capacityThe Rough-Cut Capacity Planning check in SOP ensures that the loading is broadly correct before MRP runs.

MRP Type For the MRP procedure, use MRP type PD in the material masterMRP creates planned orders or requisition receipts to balance the demand planSafety stock can be used to cover unplanned requirements

TimeReceiptsRequirements

Who is Responsible for MRP?MRP ControllerResponsible for running and operating the material requirement planning to check and track the planned requirement for both finished products and raw material in order to generate Production Orders and Purchasing Requisitions

Table of contentsModule 1: Demand ManagementModule 2: Material requirements PlanningModule 3: Master DataModule 4: MRP Planning RunsCourse MapModule 5: Summary

EvaluationsThere are several options for analyzing the Planning runMRP listBy materialCollectivelyStock requirements listBy materialCollectivelyPrinted MRP list

Planning ResultMRP list

MRP listUse the MRP list to analyze the planning resultThe MRP list displays the future stock/requirements situation at the time of the last planning run By using the collective display, you can select a specific MRP list based on plant and MRP controllerAnalyze the exception messages in the MRP list, judge and or solve problemsUse the processing indicator to indicate that you checked the material

Planned orderIs the output of an MRP runAre automatically createdPlanned orders may be converted to production / process orders or purchase requisitionsMRPPlanned Order102030

Requirements

MRP Related TransactionsPractice the following exercise

MD01 Total Planning Run OnlineMD02 Single-Item, Multi-LevelMDBT Total Planning in BackgroundMD07 Stock Requirements List CollectiveMD05 Evaluate MRP ListMD44 Planning Situation Material