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Introduction to Materials Management

Introduction to Materials Management. Chapter 3 – Master Scheduling. The Master Schedule is:. The formal link between production planning and actual production The basis for calculation of resources needed The driving force behind the material requirements plan

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Introduction to Materials Management

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  1. Introduction to Materials Management Chapter 3 – Master Scheduling

  2. The Master Schedule is: • The formal link between production planning and actual production • The basis for calculation of resources needed • The driving force behind the material requirements plan • The primary priority plan for manufacturing

  3. Information Needed to Develop an MPS • Production Plan data • Forecasts • Actual customer orders • Inventory levels • Capacity constraints

  4. Relationship to Production Plan

  5. Objectives and Steps for the MPS • Objectives – • Maintain good customer service • Make effective use of resources • Maintain effective levels of inventory • Accomplished by: • Develop a preliminary MPS • Check MPS against capacity and resources • Reconcile any differences

  6. MPS Example

  7. Rough-cut Capacity Planning • Establishes whether critical resources are available • Bottleneck operations • Critical labor resources • Critical material • Often uses a resource bill for a single product

  8. Example Resource Bill

  9. Master Schedule “Focal Points” • Make-to-Stock – Limited end products, many components • Make-to-Order – Many end products, fewer components • Assemble-to-Order Many end products, combination of components and subassemblies

  10. Example MPS Environments

  11. Final Assembly Schedule • Assembly according to customer schedule • Generally used in an Assemble-to-Order environment • Many options • Too many possible final configurations to forecast or master schedule • MPS usually done at the option level

  12. MPS, FAS and Other Planning Activities

  13. MPS Planning Horizon • Minimum time horizon over which the master schedule must extend to ensure complete planning • Calculated as the longest end-to-end lead time of the product structure

  14. EXAMPLE - Cumulative Planning Horizon • For this product – Minimum Planning Horizon 12 weeks

  15. Delivery Promises • MPS is a plan for what production can and will do • Sales delivery promises can be made from • “Consumption” of forecasts – Projected available balance • Available to Promise calculations • MPS values for a given time period left after actual customer orders are subtracted.

  16. Available to Promise Example

  17. Projected Available Balance • Within demand time fence (forecast not taken into account) • PAB = Prior period PAB + MPS – customer orders • Outside of demand time fence • PAB = Prior period PAB + MPS – greater of customer order or forecast

  18. Example of MPS with ATP and PAB (Demand time fence at end of week 3)

  19. Time Fences • Points in the planning horizon to define the flexibility allowed in the MPS • Frozen Zone (closest to current date) • Capacity and materials committed to customer orders, forecast generally ignored • Senior management approval for changes • Slushy Zone • Less commitment of materials and capacity • Tradeoffs negotiated between marketing and manufacturing • Liquid Zone – All changes allowed within limits of the Production Plan

  20. Time Fences

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