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Flashy Flashers Inc.

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by

Lauren Rierson

on 1 April 2014

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Transcript of Flashy Flashers Inc.

Performing MPR Calculations
Chapter 9 Summary
Chapter 9 Summary

Master production schedule (MPS)
A time-phased plan specifying how many and when the firm plans to build each end item.


Whether or not flexibility within a
master production schedule
depends on several factors:
Production lead time
Commitment of parts & components to a specific end time
Relationship between customer & vendor
Amount of excess capacity
Willingness to make changes




Group #5
Tuesday April 1,2014
Chapter 9
Chapter 9 Summary
Company Background
Flashy Flashers is a
medium sized firm
employing 500 persons and 75 managerial and administrative personnel.

The firm
produces a line of automotive electrical components
.

Johnny Bennet
is the
president and founder
of Flashy Flashers. Bennet started the company in his garage and eventually built it into a major supplier. He built Flashy Flashers on a
foundation based on thorough customer service
.

The
company motto
: “Love thy customer as thyself” .

The company’s two most popular products are the front side lamps and headlamps

With booming demand for their products and increasing orders, Prout recommended and Bennet approved a new inventory management system, a MRP system.


Flashy Flashers Inc.
Company Background
Problem
The new MRP system has created a problem with delivering products on time and complete.

According to Jacobs, there is a new explosion of work each week, causing an inconsistent work flow.

The MRP system is lacking a formal system of priority planning, which is causing confusion on the shop floor.



Master Production Schedule and Replacement Part Demand Flashy Flashers Inc.
Materials requirement planning (MRP)
The logic for determining the number of parts,components, and materials needed to produce a product.

MRP
is a key piece that ties the production function together from a material planning and control view

MRP
is the most valuable in industries where products are made in batches using the same productive equipment.
Bill of materials (BOM)
The complete product description, listing the materials, parts, and components, and also the sequence in which the product is created.
A modular bill of materials is the term for a buildable item that can be produced and stocked as subassembly.
A super bill of materials includes items with fractional options (A super bill can specify, for example, 0.3 of a part).
The MRP calculations (explosion) are done by level, in conjunction with the inventory data and data from the master schedule.
A MRP record is kept for each item managed in the system. The record contains gross requirements, scheduled receipts, projected available balance, net requirements, planned order receipts, and planned order releases data.
Material Requirements Planning Schedule for Flashy Flashers Inc.
Questions:
What does "MRP" stand for?

What is one of the problems the flashy flashers face?

What was the problem of the new MRP system?

What lot sizing method is most common?

What recommendations would YOU recommend?
Chapter 9 Summary

Overall Summary
Since 1970 MRP has grown to being used as an integral part of enterprise planning that ties together all functions of a firm

The MRP engine takes information from a master schedule that is a detailed plan for future production. Master scheduling is important to the sales and operations planning process to ensure the strategy is sucessfully completed

The bill of materials shows how exactly a firm makes items in the master schedule. The structure (Product Structure) can show how raw materials and purchased parts come together.


"The MRP "explosion" process is the heart of the system" Using all parts, bill of material, schedules, can show the exact timing the material will be needed.


Jacob’s talked to the head of the other two apartments involved, Purchasing and Production.
Production blamed the problem on the inconsistent work flow.
Claimed that at times they have no work and they overproduce to have work for the employees and other times they are struggling to cover the orders that come in.
The Purchasing department claimed that there is no time for creative buying due to the fact they are all tied up dealing with late deliveries and scrambling to get the necessary parts to keep up with production.
Company Background

Problem
Last year, on Prout’s recommendation—and for better
management of the inventory system—Bennett approved
the installation of a new MRP system.

Prout worked closely with the task force created to bring MRP on-line.

He frequently attended the training sessions for selected
employees.

On the day the system “went up,” there was an aura of tranquility and
good-will. The days of the informal system of fire fighting
were over!


Company Background

Problem

Months down the road, Prout’s enthusiasm has changed quite a bit. Inventoryand overtime levels had not dropped as much as expected,customer service was getting worse, and there were toomany complaints about late shipments.

Convinced that this should not happen with MRP, Prout wants to find out what is going wrong.
Company Background
Problem
The MPS or Master Production schedule records the number of items to be produced during specific time periods.
Lot sizing (part quantities issued in MRP) is also calculated in the schedule by using L4L, EOQ, LTC, and LUC.
And the replacement orders are filed by customers following the acquisition of defective products that are in need of parts or replacement.

Having end-item requirements presented in the MPS as well as status of inventory and lead times we were able to complete a proper order release form.
This will include the item description and number of parts to be produced over a specific period.

Completed MRP Worksheets for Flashy Flashers Inc.
The material requirements planning calculations are then done level by level in conjunction with inventory data to calculate part production for a period of time.
An MRP record is kept for each part and contains gross requirements, scheduled receipts, projected balance, net requirements, planned order receipts, and planned order releases.

What does "MRP" stand for?
The logic for determining the number of parts,components, and materials needed to produce a product.

What is one of the problems the flashy flashers face?
Lacking a formal system of priority planning, which is causing confusion on the shop floor


What was the problem of the new MRP system?
The new MRP system has created a problem with delivering products on time and complete.

What lot sizing method is most cost effective?


Lauren Rierson
Matt Beauregard
Jacob Rivera
Austin O'Donnell
What does "MRP" stand for?
The logic for determining the number of parts,components, and materials needed to produce a product.

What is one of the problems the flashy flashers face?
Lacking a formal system of priority planning, which is causing confusion on the shop floor


What was the problem of the new MRP system?
The new system created a problem with delivering products on time and complete.

What lot sizing method is most common?
Lot-4-lot

Full transcript