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270 PART 3 Managing with the MRP System
FIGURE 14-6
Week
Original status of Lead Time: 5
item Y. 28 29 30 31 32 33 34 35
Gross Requirements 20 25 Item Y
Scheduled Receipts 15
On Hand 5 5 5 20 0 0 0 –25
Planned-Order Releases 25
FIGURE 14-7
Week
A problem of Lead Time: 2
coverage. Order Quantity: LTC 28 29 30 31 32 33 34 35
Gross Requirements 3 7 10 6 8 10 14 10 Fabricated
Part X
Scheduled Receipts
On Hand 38 35 28 18 12 4 –6 –20 –30
Planned-Order Releases 30 25
Lead Time: 5
Gross Requirements 30 25
Raw
Material Y
Scheduled Receipts 15
On Hand 5 5 5 20 –10 –10 –10 –35 –35
Planned-Order Releases 35
inventory planner reviews this request against the current status of the item and detects
a problem: The item, which has a procurement lead time of five weeks, is needed in three
weeks.
Before placing a purchase requisition on a rush basis, the planner decides to peg to
parent items to see if the problem might be solved some other way. The record of fabri-
cated part X (see Figure 14-7), from which the gross requirement stems, indicates that the
planned order scheduled for release in week 31 covers net requirements of weeks 33, 34,
and 35 and is computed by (let us say) a least-total-cost (LTC) lot-sizing algorithm. The
solution is evident: The parent planned order can be reduced without causing a problem
in the status of item X.
The planner reduces the planned order in question to 20 via a transaction and des-
ignates it as a firm planned order by means of a special command input to the system.
This is necessary to prevent the system from increasing the planned order back up to 30
during the next replanning cycle. This planned order is now “frozen,” and after replan-