Page 136 - Orlicky's Material Requirements Planning

C HAP TE R 7

Processing Logic

The term logic, when used in the context of material requirements planning (MRP), per-
tains to the reasoning behind a procedure or a system of procedures rather than to spe-
cific procedural steps. The validity of the results a procedure or system will yield is a
function of the soundness of this reasoning. This chapter describes the inner workings of
an MRP system at a level of detail required to make this description reason ably compre-
hensive. The problem in doing so, however, is that there are alternative approaches to
MRP system implementation and that the indi vidual systems installed in different indus-
try applications cover a spectrum of special features, functions, and procedures. How an
MRP system works therefore must be described largely in terms of processing logic
rather than in terms of specific procedure. Chapters 15 through 18 provide additional
information on the specific application of MRP to a variety of industries.

INVENTORY STATUS

The status of an inventory item must be known before it can be determined what, if any,
inventory management action is to be taken on that item. Inven tory status (or stock sta-
tus) is expressed by means of data that define an item’s current position. Status informa-
tion is intended either to answer or to help answer (depending on how complete the
information is) the es sential questions of:

■ What do we have?
■ What do we need?
■ What do we do?
The answer to the last question follows from an evaluation of the status, which can
be performed either by an inventory planner or by a computer executing an evaluation
procedure.

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