Page 109 - Orlicky's Material Requirements Planning

88 PART 2 Concepts

exactly how many of each casting would be required and when by consulting the master
production schedule. Such expensive manufactur ing inventory items have, in most cases,
always been treated the way an MRP system treats items under its control. Specific
demand for these items has been calculated rather than forecast; existing surplus, if any,
has been taken into account to determine net demand; the (usually long) lead time has
served to determine order release; the items have been ordered discretely; and detailed
status records have been kept. In a sense, the evolution of MRP systems is equivalent to
expanding the strict and careful treatment of high-cost, long-lead-time items to items of
successively lower cost and shorter lead time (as data-processing capability permitted)
until all items have been covered.
Present-day MRP systems, constructed and used in what has become the standard
form, imply several prerequisites and reflect certain fundamental assumptions on which
these systems are based. The first prerequisite is the existence of a master production
schedule, that is, an authoritative statement of how many end items are to be produced
and when. An MRP system presup poses that the master production schedule can be stat-
ed in its entirety in bill of material (BOM) terms, that is, BOM (assembly) numbers. The
only language an MRP system understands is part numbers, that is, inventory item num-
bers that uniquely identify specific materials, component parts, sub assemblies, and end
items. An MRP system cannot work with English-language product descriptions, with
sales-catalog model numbers, or with BOM numbers that are ambiguous in the sense that
they fail to identify a precise configuration of components for a given assembly. The abil-
ity to create a valid and complete master production schedule in BOM terms is a function
of so-called BOM structure, which is discussed further in Chapter 11.

PART NUMBERS

Another prerequisite is that each inventory item must be unambiguously identified
through a unique code (part number). This requirement also extends to the identification
of every manufactured item’s component material (what is the item made of?) and to
each item’s disposition (where is it used; i.e., what is the item a component of?).
The purpose of the number is simply to provide a unique name for each individual,
as Social Security numbers do. Parts having any differences in form, fit, or function so
that they are not interchangeable must have different numbers. Ideal numbers should
have the fewest digits, be only numeric (no alphabetic characters to speed data entry),
and be assigned serially as new parts are introduced.
A trap into which many fall, greatly complicating the problem of keeping accurate
records, is doing more with part numbers than giving each a name. Digits at each posi-
tion are given significance, identifying some characteristic such as shape, material, or
product family. This lengthens the number, shortens its useful life, and increases the like-
lihood of people making errors writing it or keying it into computer-based systems.
Significant-digit numbers are a holdover from punched-card data process ing, when the
number of columns available for item data was limited.