Chapter 12: Production Flashcards
(26 cards)
A set of tactical and execution level business activities that includes master scheduling, material requirements planning, and some form of production activity control and vendor order management
Planning and control
A detailed planning process that tracks production output and matches this output to actual customer orders
Master scheduling
5 key pieces of information in a master schedule record
Forecasted demand Booked orders Projected inventory levels Production quantities Units still available to meet customer needs (Available to Promise)
In the context of master scheduling, a company’s best estimate of demand in any period
Forecasted demand
In the context of master scheduling, confirmed demand for products
Booked orders
The amount of product that will be finished and available for sale at the beginning of each week. Drives more detailed planning activities such as material requirements planning
Master production schedule
A field in the master schedule record that indicates estimated inventory level at the end of each time period
Projected ending inventory
A field in the master schedule record that indicates the number of units that are available for sale each week, given those that have already been promised to customers
Available to promise (ATP)
The amount of time the master schedule record or MRP record extends into the future. In general, the longer the production and supplier lead times the longer this must be.
Planning horizon
A capacity planning technique that uses the master production schedule to monitor key resource requirements
Rough-cut capacity planning
A planning process that translates the master production schedule into planned orders for the actual parts and components needed to produce the master schedule items
Material requirements planning (MRP)
Inventory items whose demand levels are tied directly to the production of another item
Dependent demand inventory
MRP is based on what three related concepts
The bill of material (BOM)
Backward scheduling
Explosion of the bill of material
According to APICS, a listing of all the subassemblies, intermediates, parts, and raw materials that go into a parent assembly showing the quantity of each required to make an assembly
Bill of material (BOM)
A record or graphical rendering that shows how the components in the BOM are put together to make the level 0 item
Product structure tree
In the context of MRP, the time from when a component is ordered until it arrives and is ready to use
Planning lead time
The process of working backward from the master production schedule for a level 0 item to determine the quantity and timing of orders for the various subassemblies and components. Underlying logic used by the MRP
Exploding the BOM
6 components of the MRP Record
Gross requirements Scheduled receipts Projected ending inventory Net requirements Planned receipts Planned order releases
Total demand for all parts, how many are needed?
Gross requirements
Units already on order
Scheduled receipts
How many units are you short of demand
Net requirements
New orders
Planned receipts
The logical linkage between higher and lower level items in the BOM
Parent/child relationship
A term used to refer to the observation that any change, even a small one, in the requirements for items at the top of the bill of material can have drastic effects on items further down the bill of material
MRP nervousness
