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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-
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