The Material Requirements Planning (MRP) Module is the heart of Inventory Control. In ManEx, the Material Requirements Planning actions drive the user towards zero inventory on hand through the scheduling and rescheduling of open orders for products and parts.
When the Material Requirements Planning module runs, it accumulates all of the demands for products and parts, determines the available supply and recommends actions to be taken to meet the demand in the time required. (The attached Print Screens below <<BOM_Setup_MRP_Actions.docx>> displays an example of a BOM setup and how MRP gives the actions). The MRP module will also modify those recommendations by MRP policies established in the MRP Default Setup and in the Inventory Control Mgmt MRP Info for each part. MRP runs through a large number of tables and records to compile its calculations, and provides a snapshot of suggested actions at the same time it is ran. If users are changing things during this process it could definitely cause some strange outcome. To prevent this situation we strongly suggest that you use the Nightly MRP trigger. (Refer to Article #416 for more detail on trigger setup). Note: If you find the need to re-run MRP during the production work day then we suggest that you notify all departments that MRP is going to be ran and ask them to remain out of the system until the MRP run is complete. This will help assure that the most accurate MRP run is possible.
Run Scrap and Setup Scrap
If the Top Level Assembly has a run scrap and user would like MRP to calculate this run scrap in the demands for all parts on the BOM, it must be set up in the MRP Defalut Setup Screen.
If the user has scrap setup in the Inventory Control module and wants MRP to calculate it they must set it up in MRP Defalut Setup Screen. Note: If this field is changed it will update the setting in the Kit Default Setup and visa versa.
If the user wishes for the setup scrap qty’s to be included in the Kitting and MRP calculations, the Setup Stcrp box MUST be checked on the BOM. Checking this box along with a Standard Bld qty will tell the system to use Setup Scrap when calculating the standard cost. Note: The "Exclude Scrap & Setup Scrap" options within the Kitting Setup module will overwrite this option.
All lead times are calculated with the Production Calendar.
Policies may be used to determine whether the part is ordered on a Lot for Lot basis, on a Daily basis, Weekly, Semi-Monthly, Monthly, or quarterly basis. (Refer to Article #3032 for further detail on how the AVL Pref Codes affect MRP based on the Order Policy). The part may have minimum and multiple order quantities that influence the recommendations. Note: If the Order Policy happens to be left blank within the Inventory Control module, MRP will enforce the Order Policy of "Lot to Lot". If the Stock UoM is different than the Purchase UoM MRP will instruct you to Purchase the Stock qty UoM, not the Purchase UoM.
NOTE: When creating a PO for an item with different purchasing and stocking UoMs, be sure to enter the MRP suggestion into the Stocking qty field rather than the purchasing qty field. The system will automatically convert the stocking unit into the purchasing unit for the purchase order qty.
For example if the buyer is creating a PO for an item that is used by inches but sold by the foot, the user would enter qty of 24 into the stocking qty field and the PO would automatically convert it to 2 feet in the purchasing qty field. So the supplier deals in feet, but ManEx deals in inches. The conversion between the two are established in the Unit of Measure & Conversion module.
Article #3597 explains the process MRP goes through to optimize the On-Hand Inventory to Demands.
Buffer times for placing purchase orders and for placing work orders may be defined and included.
The Dock to Stock value (setup in the ABC types ) is taken into consideration for MRP leadtime calculations in the projected requirement of the receipt of purchased parts. (For more detail refer to Article #1469).
If a part has a Production Off-set time setup in the Bill of Materials , this is also taken into consideration for MRP leadtime calculations. (For more detail refer to Article #572).
The Material Requirements Planning module will run the Master Production Schedule generation automatically before running the Material Requirements Planning module.
ManEx Material Requirements Planning module may be run without logging users off the system. The work station used to run Material Requirements Planning should have at least 120MB available on the hard drive, and works best with 96MB memory or more.
A Material Requirements Planning regeneration creates time-phased material requirements at the part (component) level by netting demand from the Master Production Schedule (MPS), open Sales Orders, Internal orders, Shortages and open Work Orders (released but not picked) against supply from inventory, open purchase orders and Finished Goods.
The regeneration must also occur with demand synchronized: Master Production Schedule forecasted demand that has been consumed by Sales Orders should be relieved and Work Orders that are released but not picked should be picked or cancelled.
MRP Actions for Make/Phantom parts - If the actions originates from a higher level assembly for the Make/Phantom, then the MRP will display "Phantom" in the action section. This indicates to the user that there are no actions required and is listed so users can investigate where component actions are originating from. If the Make/Phantom is required directly for an Order itself, it will follow the same WO action rules as a regular Make product.
Planned Purchase Orders from previous demand that have been placed must be entered and/or firmed.
A Firm Planned Purchase Order tells MRP that the purchasing decision was intentional and MRP will NOT try to override.
Discrepant material should either be moved into Material Review Board or Inspection Hold for disposition. If Material Review Board or Held material is not to be looked at as available material for Material Requirements Planning purposes, it should be in a Non-nettable warehouse or inventory location. For example: (If parts are rejected in PO receiving the parts are dispositioned into the MRB warehouse (which is Non-nettable) so MRP is not seeing the qty in MRB but is seeing the open PO). Transactions must be current with the location of materials. WIP (Work In Process) shrinkages must be expressed as Work Order shortages in the system.
MRP is designed to calculate from the Kit Shortage and not from the Lead times once the parts have been pulled to the kit and the kit status is changed to "Kit in Process". Once the parts have been pulled to the kit, the systems is assuming that the shortages are needed by the WO due date, rather than the Prooduction lead time, so MRP then calculates using the due date of the WO as the date the materials must be on hand, MRP no longer takes the production lead time into consideration.
NOTE: The Re-Order Point/Qty fields have NO AFFECT on MRP at all. MRP will NOT consider these fields for any calculations (these fields have no connection with MRP). These fields are intended to control stock on overhead items. Print the "Inventory Material Reorder List" report (located in the Inventory Control module) to show items which have dropped below re-order point minimums.
MATERIAL REQUIREMENTS PLANNING PROCESS
Confirm status of system data for Material Requirements Planning validity
Updated Forecast and Master Schedule
Updated Item Master file data
Lead Times entered and up to date
Shrinkage factors current
Order policies set
Orders firmed as required
Independent Demand items identified
Inventories current
Receivings current
Safety Stocks appropriate
Bills of Material current and complete
Confirm system availability to run Material Requirements Planning
Timing good for snapshot of data
Transactions current
Set the parameters for running the Material Requirements Planning
Netable Inventory Locations flagged
Discrepant material dispositioned
Horizon set
Time fences set for change control
Bucket size and number set
When executed, the Material Requirements Planning Module takes a snap-shot of the demand for parts and assemblies (created by Sales Orders, Work Order Shortages, Forecasts) and compares it with supply (on-hand inventory, open Purchase Orders with scheduled qty, open Work Orders) in order to generate an Action List of planned new orders and changes to existing ones to meet demand. The comparison is done one day at a time using the make and/or buy parameters from the Item Master/Material Requirements Planning Information screen in Inventory Control Management.
The Parameters include:
· Order Policy
· Minimum Order Quantity
· Order Multiples
· Purchase Lead Time
· Kitting Lead Time
· Transit Days
· Pull In Days
· Push Out Days
If the AVL suggested to the PO actions is flagged as "DO NOT PURCHASE" MRP will give Release PO actions if there is a need for the part and the part will be displayed on the Create PO screen with the Mfgr and MPN fields blank. This should flag the user to further investigate and see that it is flagged as "DO NOT PURCHASE" and that they will need to either remove the flag or add additional AVL's to ful-fill the demands. Notice at the top there is a note that explains what the empty "MFGR" field means.
Sales Orders on Hold
When the Sales Order is on HOLD it does NOT drive MRP.
User does have the ability to turn off the function of the Sales order driving the demands for the MRP and just use the Work Order for buying components by checking the MRP on Hold box in the Sales Order module per line item or in the System Setup/Sales Order Default module.
If the MRP on Hold is checked in the SO module, MRP will instruct you to cancel all PO(s) you have open for the components needed for this SO.
If the MRP on Hold is checked in the SO module and you create a WO Manually, the MRP will tell you to cancel the WO since there is no SO demand. This can be solved one of two ways.
Use the MPS module (Forecast) or Open/Create Firm planned WO’s so the MRP will NOT keep instructing you to cancel the order.
This is a perfect solution for customer who wants to build products based on forecast or promised to maintain certain amount of FGI in inventory. The can use the MPS module to accomplish this and use the SO to ship products from FGI inventory.
MRP will consider any SO items for the demands unless marked as MRP on Hold. See Article #1244 for further information.
Check on Work Orders on either Admin or Production hold. Production Hold on a Work order will disallow movement of the parts. See Article #896 for more detail. MRP is checking work orders to be sure that they aren’t cancelled or closed. Everything else will be considered. MRP checks Sales Orders for OPEN status. Everything else is ignored. If the objective is to stop the shipment from the Sales Order, then in the Sales Order, the user may uncheck the “Sales Ack” box and then shipping won’t be able to initiate a Packing List.
Inventory Items Allocated
MRP does NOT distinguish between inventory items allocated to projects nor Purchase orders allocated to projects in the determination of the available supply (current and future). To do so would enormously complicate the MRP process. MRP WILL determine that the supply will meet the demand, whatever it is.
Should we have locked the requirements by project in MRP, then we could have the situation where we have unallocated inventory on hand, but since it's not for a specific product that requires it, MRP action could create an order action to buy more of the parts specifically for that project. This could result in an enormous amount of excess inventory. Since our objective in MRP is to drive to zero inventory, we do NOT want to ignore any available inventory that might satisfy demands. Conversely, when inventory is allocated to a specific project, and the demands created for another project are analyzed, the inventory on hand will be available to meet the other project demands, but also create the order actions to supply parts for the original project, if there are still demand requirements.
In the case of having just enough inventory on hand for a given Project (A), but there are new requirements for Project (B) that precede those for the same parts as project (A), MRP will assume that the inventory on hand will be used for Project (B) first, but get more parts to meet the later date of Project (A). As long as there is inventory available to meet every demand, it will be up to the user to reallocate inventory for the most urgent need.
If for some reason user has inventory that belongs to a specific customer and does not want MRP to consider it for any other customer they can change the inventory location to non-nettable.
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