Page 149 - Orlicky's Material Requirements Planning

128 PART 2 Concepts

since the late 1950s when the first MRP systems were implemented. Because there are so
many different lot-sizing techniques to be described, an entire chapter (Chapter 8) will be
devoted to the subject.

EXPLOSION OF REQUIREMENTS
The key to the entire MRP (replanning) process is the linkage between parent and com-
ponent-item records. There is only one logical link between items on contiguous levels of
the product structure, and that is the parent planned-order release and the component
gross re quirement. These coincide in time because the component item(s) must be
planned to be available at the time the parent order is released for produc tion, at which
time the component item(s) will be consumed. The linkage of parent and component
inventory records is shown in Figure 7-9.
The MRP process, that is, the so-called explosion of requirements from the MPS
down into the various component-material levels, is guided by the logical linkage of
inventory records. Gross requirements for the high-level items are processed against
inventory (on hand and on order in each time period) to determine net requirements,
which then are covered by planned orders. The quantity and timing of planned-order
releases determine, in turn, the quantity and timing of component gross requirements.
This procedure is carried out repetitively for items on suc cessively lower levels until a
purchased item is reached, at which point the explosion progression terminates. The
MRP process stops when all the explosion paths that follow the branches of the BOM
have reached purchased items (component parts or raw materials). The results of a
requirements explosion for three items on contiguous levels are illustrated in Figure 7-10.

FIGURE 7-9
Period
Linkage of parent
and component Parent 1 2 3 4 5 6
records.

Planned-order releases 20 25

Component
Gross requirements 20 25