Page 286 - Orlicky's Material Requirements Planning

CHAPTER 14 System Effectiveness: A Function of Design and Use 265

net requirements, and that parts on hand or in process be commingled. Lot sizing, safety
stock, scrap allowances, and the level-by-level planning process itself tend to obscure (or
even erase) a clean path connecting noncontiguous levels.
Full pegging is feasible and desirable in a limited number of situations, such as when
the product is custom-engineered and made to order, when the different standard prod-
ucts have few or no common components, or when the MPS consists of special contracts.
Common component usage and repetitive production tend to make full pegging imprac-
tical. With MRP, eggs are deliberately scrambled, as it were. Full pegging attempts to keep
the eggs from getting scrambled in the pan—an awkward and often impossible task.

The Firm Planned Order

This term denotes a capability by the system to accept a command to “freeze” the quan-
tity and/or timing of a planned-order release. This is another important tool of the inven-
tory planner by means of which he or she is able to solve certain types of problems
(reviewed below).
The firm planned-order command immobilizes the order in the schedule, forcing
the MRP system to “work around” it in adjusting coverage of net requirements. The firm
planned order forbids the system to put another planned order into the “frozen” bucket,
which in some cases may result in a given net requirement not being fully covered. This
special capability therefore should be used judiciously and for a specific planned order
only rather than for the whole planned-order release schedule.

THE SYSTEM AND THE INVENTORY PLANNER

The inventory planner (also called the inventory analyst, inventory controller, etc.) is
responsible for the planning and control of a group of specific inventory items, and in an
MRP, he or she interacts continuously with the MRP system. He or she is the recipient of
the system’s principal outputs, and his or her first duty is to take inventory order action
based on information supplied by the system. The inventory planner inquires into the
system’s files for the data needed for purposes of analysis, and he or she handles a mis-
cellany of problems that arise in the course of this work. The inventory planner’s specif-
ic job description varies from company to company, but in the typical case, his or her
function consists essentially of the following responsibilities:
■ Releasing orders for production
■ Placing purchase requisitions
■ Changing the quantity of orders and requisitions, including cancellation
■ Changing the timing of (i.e., reschedule) open shop orders
■ Requesting changes in the timing of open purchase orders
■ Activating special procedures for the handling of engineering changes affecting
items under the planner’s control
■ Approving requests for unplanned stock disbursements