Production Planning & Control

The Management of Operations

ISSN: 0953-7287 (Print) 1366-5871 (Online) Journal homepage: http://www.tandfonline.com/loi/tppc20

Development of finite capacity material

requirement planning system for assembly
operations

Teeradej Wuttipornpun & Pisal Yenradee

To cite this article: Teeradej Wuttipornpun & Pisal Yenradee (2004) Development of finite
capacity material requirement planning system for assembly operations, Production Planning
& Control, 15:5, 534-549, DOI: 10.1080/09537280412331270797

To link to this article: http://dx.doi.org/10.1080/09537280412331270797

Published online: 21 Feb 2007.

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 Production Planning & Control,
Vol. 15, No. 5, July 2004, 534–549

Development of finite capacity material

requirement planning system for
assembly operations
TEERADEJ WUTTIPORNPUN and PISAL YENRADEE
Downloaded by [Gazi University] at 18:36 18 January 2016

Keywords Material requirement planning, finite capacity,
theory of constraints, assembly operations, application in
industry
Abstract. A conventional material requirement planning
(MRP) logic considers infinite capacity of machines. A planner
must manually solve capacity problems (if any) after the mate-
rial requirement plan has been generated. This paper tries to
alleviate the capacity problems by developing a finite capacity
material requirement planning (FCMRP) system for assembly
operations. The FCMRP system is capable of automatically
allocating some jobs from one machine to another and adjust-
ing timing of the jobs considering a finite available time of all
machines. The FCMRP system has been tested using real data
from a steering-wheel factory. Effects of options – namely,
scheduling, rearranging and adjusting options in the FCMRP
system on the performance measures – are statistically analysed.
The FCMRP system can reduce required overtime if the jobs
are allowed to be completed earlier than the due dates.
The required overtime can be further reduced if the jobs are
allowed to be completed later than the due dates.
1. Introduction
Nowadays, one of the most well-known production plan-
ning and control systems is manufacturing resources

Authors: Teeradej Wuttipornpun and Pisal Yenradee (corresponding author), Industrial

Engineering Programme, Sirindhorn International Institute of Technology, Thammasat
University, Pathum Thani 12121, Thailand. E-mail: pisal@siit.tu.ac.th

TEERADEJ WUTTIPORNPUN is a doctoral student in the Industrial Engineering Program at

Sirindhorn International Institute of Technology (SIIT), Thammasat University. He holds a
B.Eng. degree in Electrical Engineering from King Mongkut’s University of Technology
Thonburi (KMUTT) and a M.Eng. degree in Industrial Engineering from King Mongkut’s
Institute of Technology North Bangkok (KMITNB). His research interests include production
planning and inventory control, simulations, and applied operations research.

PISAL YENRADEE is an Associate Professor in Industrial Engineering Program at Sirindhorn

International Institute of Technology (SIIT), Thammasat University. He holds a B.Eng. degree
in Production Engineering from King Mongkut’s Institute of Technology and M.Eng. and D.Eng.
in Industrial Engineering and Management from the Asian Institute of Technology. His research
interests focus on production planning and inventory control systems, JIT, ERP, TOC, finite
capacity scheduling systems, aggregate production planning, master production scheduling, supply
chain, and applied operations research. He has published papers in and served as a reviewer for
many international journals. He is currently a regional editor of Industrial Engineering and
Management Systems (IEMS) journal.

Production Planning & Control ISSN 0953–7287 print/ISSN 1366–5871 online # 2004 Taylor & Francis Ltd
http://www.tandf.co.uk/journals
DOI: 10.1080/09537280412331270797
 Finite capacity material requirement planning system for assembly operations
planning (MRP II). However, it still has some weak
points. Kochar (1979) Wight (1983) and Taal and
Wortmann (1997) stated that a weak point of the MRP
II system is that it does not solve the capacity problem.
There are two main factors that make the MRP II system
unsuccessful. First, the MRP II system assumes constant
production lead times. In practice, the lead times are
variable and depend on many factors: for example, the
production lot-size, load level of work centre, and job
priority. Second, the MRP II system assumes infinite
capacity of machines. A production planner has to
solve capacity problems manually. Shopfloor control
techniques may be applied to revise the production
plan generated by the MRP II system. Many companies
have tried to solve shopfloor problems by implementing
shopfloor control (SFC) systems. Nagendra et al. (1994)
reported that a capacity requirement planning (CRP)
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system could be used to check the capacity for all
resources. The CRP provides only information but
not the solution to the planner. When a capacity
problem is detected, the planner needs to find out some
ways to solve it manually, which is very time consuming.
Bakke and Hellberg (1993) stated that capacity prob-
lems should be prevented at the MRP level. They
concluded that the SFC system is unable to solve prob-
lems that are created at the higher planning level.
Thus, the finite capacity material requirement planning
(FCMRP) system has been developed for solving these
problems.
While there are many research works related to the
SFC systems, there are relatively few research works
specifically related to the FCMRP area. Billington and
Thomas (1983, 1986) developed linear programming
(LP) and mixed-integer programming (MIP) models
for capacity-constrained MRP systems. A series of
heuristic and compression techniques were developed
in an effort to increase the solution efficiency of their
models. Tardiff et al. (1993) proposed a technique called
MRP-C. They applied a capacity-aggregated LP formu-
lation similar to that of Billington and Thomas (1983).
The MRP-C yields an optimal solution when there is one
product or multiple products with the same routeing.
An advantage of this method is to provide information,
which can be used by the planner to get a feasible plan.
The weaknesses of this method are: (1) it only considers
the lot-for-lot technique, (2) it assumes a fixed lead time
and (3) it cannot be used for multiple products and
multiple routeing environments. Nagendra et al. (1994)
developed an algorithm of FCMRP using the LP model
and heuristics to generate the schedule. The capacity
of machines is checked during the generation of MRP
level-by-level. If infeasible orders are found, they are
moved earlier by one period. Hastings et al. (1982)
applied a forward-loading technique to schedule the
535
jobs on the machines. This guarantees feasible release
and due dates for production orders. A weak point of
this scheduling method is that it ignores the main goal
of MRP: minimizing inventory cost by starting the pro-
duction orders as late as possible. Sum and Hill (1993)
presented a method that not only adjusts lot sizes to
minimize set-up time but also determines the release
and due times of production orders while checking the
capacity constraints. They split or combine the produc-
tion orders to minimize set-up and inventory costs.
Pandey et al. (2000) developed an FCMRP algorithm,
which is executed in two stages. First, capacity-based
production schedules are generated from the input
data. Second, the algorithm produces an appropriate
material requirement plan to satisfy the schedules
obtained from the first stage.
This paper aims to develop a new FCMRP system that
can be used in real industries. The FCMRP system is
designed to handle industries with the following charac-
teristics:
(1) There are multiple products.
(2) Some products may have multi-level BOM with
sub-assembly and assembly operations. Other
products may require only fabrication without
assembly operation.
(3) Some parts must be produced by just one machine,
while others can be produced by two alternative
machines (the first and second priority machines).
(4) Some machines are bottleneck machines and
others are non-bottleneck machines.
The FCMRP system has the following limitations:
(1) Number of parts produced by bottleneck machines
in each path of the BOM is limited to one.
Consider a BOM as shown in figure 1. There are
five paths starting from each purchased part to
1
Path E
2 3 4
Path D
Path C
5 6 7 8
Path B
Path A
9 10
Figure 1. Paths in a BOM.
 536 T. Wuttipornpun and P. Yenradee

the finished product. For example, path A is Generate production and purchasing
composed of parts 9, 5, 2 and 1. The algorithm plan using variable
of the FCMRP system cannot work well if there leadtime MRP system
is more than one part produced by the bottleneck
machines in any path, e.g. if parts 9 and 2 are
produced by the bottleneck machines. The reason
for this limitation will be explained in step 6 of Schedule jobs to first priority
the FCMRP system. machines
(2) The lot-sizing rule is lot-for-lot.
(3) Overlapping of production batches, to reduce
production lead time of sequential processes, is
not allowed.
Rearrange jobs by priority rules
The FCMRP system has three main distinct character-
istics. First, the initial schedule is generated by a variable
lead-time MRP system instead of a fixed lead-time one.
Second, the initial schedule is completely generated by
exploding all levels and all items in the bill of materials;
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after that the schedule will be adjusted considering
finite capacity of all machines. Third, the schedule of
the bottleneck machines has no idle time or overtime,
which complies with the optimized production technol-
ogy (OPT) or theory of constraints (TOC) concept (see
Goldratt 1990, Fry et al. 1992 and Yenradee 1994).
However, the schedule of non-bottleneck machines may
have idle time and overtime in order to allow the
schedule of bottleneck machines to be free of idle time
and overtime.
This paper is organized as follows. The main ideas
of the FCMRP system are described in section 2.
Section 3 presents two experiments. The first one is to
analyse the effects on scheduling performance of options
available in the proposed FCMRP system. The second
one is to evaluate the effectiveness of the proposed
FCMRP system by comparing its performance measures
to those of the variable lead-time MRP system. The
experimental results are analysed and discussed in
section 4. Finally, the results are concluded in section 5.
2. The FCMRP system
A block diagram of the FCMRP system is shown in
figure 2. The system is described step-by-step and
illustrated by an example as follows.
2.1. Generate production and purchasing plan
using variable lead-time MRP system
The production and purchasing plans are initially
generated by an MRP system called TSPICs (Thai
SME production and inventory control system). TSPICs
was developed by Sirindhorn International Institute of
Allocate excess jobs to the second
priority machines, if possible
Adjust the timing of jobs to
eliminate capacity problem of each
machine
Revise the production and
purchasing plan
Figure 2. Block diagram of FCMRP system.
Technology and implemented in some factories in
Thailand. It is different from the conventional MRP
system in that it assumes variable lead times. The
total lead time in TSPICs is a function of lot size, unit
processing time and set-up time. The release time of jobs
is calculated from the due date minus the total lead time
considering a detailed work calendar of the factory.
Thus, the release time of jobs from TSPICs is more
realistic than that of the conventional MRP system.
An example of calculating the release date and time
can be described by tables 1, 2 and 3. Table 1 shows
details of customer orders consisting of order number,
part name, order quantity, and due date and time. For
simplicity of illustration, the due time is assumed to be
5:00 pm. In real application the due times are different
according to the results of TSPICs. Table 2 shows
manufacturing-related data of each part including,
the first and second priority machines, unit processing
time and set-up time. The release date and time of
 Finite capacity material requirement planning system for assembly operations 537

Table 1. Customer order detail. Table 4. Job schedules based on SR and SD methods.
Part Quantity Due SR method SD method
Order number name (pcs) date/time
Day Machine 1 Machine 2 Machine 1 Machine 2
1 M 20 1/5:00 pm
2 N 5 1/5:00 pm 1 M1, N2 S8 M1, N2 S8
3 M 7 2/5:00 pm 2 M3, P4 T9, S10 M3, P4 T9, S10
4 P 7 2/5:00 pm 3 N5, P6 T11 N5 T11
5 N 8 3/5:00 pm 4 M7 S13, T12 P6, M7 S13, T12
6 P 50 4/5:00 pm M1 means part M of order number 1.
7 M 20 4/5:00 pm
8 S 11 1/5:00 pm
9 T 24 2/5:00 pm
10 S 10 2/5:00 pm each part is calculated using formulas (1) and (2) and
11 T 16 3/5:00 pm presented in table 3.
12 T 9 4/5:00 pm
13 S 11 4/5:00 pm Release date and time ¼ Due date and time
ð1Þ

Total lead time ðhrsÞ
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Total lead time ¼ ½Order quantity ðpcsÞ

Table 2. List of parts and their manufacturing related data.  unit processing time ðhrs=pcsÞ
Unit þ Set-up time ðhrsÞ ð2Þ
First Second processing Set-up
Part priority priority time time Note that the FCMRP system uses a lot-for-lot sizing
name M/C M/C (hrs/pc) (hrs) rule since it is the simplest and results in the lowest inven-
M 1 2 0.25 0.5 tory level.
N 1 2 0.50 0.5
P 1 2 0.22 0.5
2.2. Schedule jobs to the first priority machines
S 2 1 0.20 0.5
T 2 1 0.25 0.5
Jobs may be produced by more than one machine as
shown in table 2. The most efficient or most appropriate
machine is called the first priority machine, and the next
Table 3. Calculation of the release date/time of each order. most appropriate one is the second priority machine.
The aim of this step is to check the capacity requirement
Total lead on each machine when jobs are scheduled on the
Part Due time Release
Order number name date/time (hrs) date/time most appropriate machines. There are two proposed
methods to schedule the jobs on the first priority
1 M 1/5:00 pm 5.50 1/10:30 am machines. The first one is to schedule the jobs to be
2 N 1/5:00 pm 3.00 1/02:00 pm produced on the day that they are released (denoted by
3 M 2/5:00 pm 2.25 2/02:45 pm the SR method). The second one is to schedule the jobs
4 P 2/5:00 pm 2.04 2/02:57 pm
to be produced on the day that they are due (denoted
5 N 3/5:00 pm 4.5 3/11:30 am
6 P 4/5:00 pm 11.5 3/01:30 pm
by the SD method). Based on the information in the
7 M 4/5:00 pm 5.5 4/10:30 am last column of table 3, the SR method determines the
8 S 1/5:00 pm 2.7 1/02:18 pm schedule as shown in table 4. Similarly, the SD method
9 T 2/5:00 pm 6.5 2/09:30 am uses the information in column 3 of table 3 to determine
10 S 2/5:00 pm 2.5 2/02:30 pm the schedule as shown in table 4.
11 T 3/5:00 pm 4.5 3/11:30 am
12 T 4/5:00 pm 2.7 4/02:18 pm
13 S 4/5:00 pm 2.75 4/02:15 pm 2.3. Rearrange jobs scheduled on the same day by priority rules
Machine working time ¼ 8:00–12:00 am and 1:00–5:00 pm (lunch break
It can be seen from table 4 that there are two jobs
12:00–1:00 pm).
Total lead-time ¼ (Order quantity
Unit processing time) þ Set-up (M1 and N2), which are produced on day 1 on machine 1.
time. Therefore, the sequence of jobs scheduled on the same
Release date/time ¼ Due date/time  Total lead time. day can be determined by applying some priority rules.
 538 T. Wuttipornpun and P. Yenradee
Time
Work centre no. 1
M7
5:00 PM
N2 Capacity = 8 hrs
P6
M1 P4
N5
M3
8:00 AM
1 2 3 4
(a)
Figure 3. Load profile on machines obtained from SD method and ERT rule.
Downloaded by [Gazi University] at 18:36 18 January 2016
There are two priority rules under consideration:
namely, earliest release time (ERT) and earliest due
time (EDT). The ERT rule will produce the job with
earliest release time first and the job with later release
time later. Thus, the job with later release time may
exceed the available capacity of the machine. The job
that exceeds the capacity of the machine is called an
‘excess job’, which will be allocated to the second priority
machine in the next step. Similarly, the EDT rule will
produce the job with earliest due time first and the
job with later due time later. If there are some jobs,
which have the same release time (or due time) on the
same day, the sequence of these jobs can be determined
arbitrarily.
Figure 3 shows the load profile on machines 1 and 2 of
the schedule obtained from SD method and ERT rule.
The x-axis shows the day and the y-axis shows the time
of day. Note that after applying the ERT rule, jobs M1,
N2, M3, P4, N5, P6 and M7 are produced sequentially
on machine 1, and jobs S8, T9, S10, T11, S13 and T12
are produced sequentially on machine 2, which are the
first priority machines for the jobs.
2.4. Allocate excess jobs to the second priority machines
This step tries to reduce capacity problem on the first
priority machine by moving the excess jobs from the first
priority machine to the second priority machine on the
same day if the movement will not make the jobs become
excess jobs on the second priority machine. The whole
job may be moved (not a fraction of the job) to avoid
additional set-up. From figure 3(a), the excess job
N2 on machine 1 in day 1 can be moved to machine 2
(see figure 4(b)). Similarly, from figure 3(b), the excess
Time
Work centre no. 2
5:00PM S10
Capacity = 8 hrs
T9 T12
T11
S8 S13
8:00 AM
Day 1 2 3 4 Day
(b)
job S10 on machine 2 in day 2 can be moved to machine
1 (see figure 4(a)). However, the excess job M7 on
machine 1 on day 4 cannot be moved to machine 2
since the slack capacity of machine 2 is not enough to
accept job M7.
Note that if jobs normally need a relatively long time
(e.g. 2–3 days) of processing on a machine, the duration
of the time period used in steps 3 and 4 should be
increased from one day to many days (e.g. one week).
This modification will increase the number of jobs that
are rearranged by priority rules and also increase a
chance that the excess jobs will be moved to the second
priority machine. As a result, the effect of the priority
rules will be more clearly seen.
2.5. Adjust the timing of jobs to eliminate capacity
problem of each machine
This step tries to eliminate the capacity problem on all
machines by shifting some jobs to the left or to the right
without changing the sequence of jobs on the machines.
The flowchart of this step is shown in figure 5.
There are two important procedures in the flow-
chart. The first one involves moving jobs to the left
(ML–Start Early), which makes the jobs start and
complete earlier. The second one is to move the
jobs to the right (MR–Delay Job), which delays them.
The moving assumption in this step is different from
step 4 since this step tries to move the jobs scheduled
on the same machine, whereas step 4 tries to move the
jobs from the first to the second priority machines. The
capacity problem can be solved by allowing some jobs
to be completed earlier than their due dates (increase
inventory holding costs) or allowing some jobs to be
 Finite capacity material requirement planning system for assembly operations 539

Time Time

m/c no. 1
m/c no. 2
M7

5:00 PM 5:00 PM
Capacity = 8 hrs Capacity = 8 hrs
P6
S10
N2 T12
P4 T9
M1 N5 T11
M3 S8 S13
8:00 AM 8:00 AM
1 2 3 4 Day 1 2 3 4 Day

(a) (b)
Figure 4. Load profile on machines after allocating excess jobs to the second priority machine.
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Find the first excess job date

(Start from current date)

No
Found? Stop

Yes

Find the time to complete the

excess jobs

Find the available time

between current date and the
first excess job date

No Move the jobs to the right

Available time > 0?
(MR–Delay Job)

Yes

Check how long the time (for

excess jobs) can be adjusted

Move the jobs to the left

(ML–Start Early)

Figure 5. Flowchart for adjusting timing of jobs to eliminate capacity problem.

 540 T. Wuttipornpun and P. Yenradee
Time

m/c no. 1
First excess job date
M7

Capacity = 8 hrs
P6
S10

M1 P4
N5
M3
1 2 3 4 Date
(a) Before applying ML–Start Early
Time

m/c no. 1
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P4 M7 Capacity = 8 hrs
M3 N5
P6

M1 S1 0 P6
P4 N5
1 2 3 4 Date
(b) After applying ML–Start Early
Time

m/c no. 1

P4 Capacity = 8 hrs
N5 M7
M3
P6

M1 S1 0 P6
P4 N5 M7
1 2 3 4 5 Date
(c) After applying MR–Delay Job

Figure 6. Example of ML–Start Early and MR–Delay Job methods.

completed later than their due dates (increase late
delivery to the customers). Although both are undesir-
able, completing the job early is assumed to be better
than completing the job late. Therefore, the ML–Start
Early procedure is applied first. If the ML–Start
Early procedure cannot entirely solve the capacity
problem, there are two alternatives. First, the capacity
problem may be solved by applying overtime. Second,
if applying overtime is undesirable, the MR–Delay
Job procedure will be applied to solve the capacity
problem.
Figure 6(a) shows a load profile of machine 1. The
first day that the excess jobs (entire job M7 and part
of job P6) occur is day 4. The slack capacity is available
from day 1 to day 3, which allows the ML–Start Early
procedure to be applied. After the ML–Start Early
procedure is applied, the slack capacity on day 1 to
day 3 disappears, but part of job M7 is still an excess
job (see figure 6(b)). This problem can be solved using
overtime. However, if the overtime is undesirable,
the MR–Delay Job procedure is applied. Figure 6(c)
shows the load profile after applying the MR–Delay
 Finite capacity material requirement planning system for assembly operations
Job procedure. It can be seen that the capacity problem
does not exist but job M7 will be completed one
day late. After applying these rules, the sequence of
jobs is not changed but their release and due times
are changed. From figure 6(c), jobs P4, N5 and M7
seem to be fractional but actually they can be pro-
duced continuously with only one set-up time. For
instance, in figure 6(c), job P6 is started on day 3
(after job N5) and finished on day 4 (before starting
job M7).
2.6. Revise the production and purchasing plans
In step 5, the timing of some jobs on each machine has
been adjusted independently without considering prece-
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dence relationships between jobs. Thus, it is possible that
the release and due times of jobs for producing parts
of the same product (parts in the same BOM) are in
Release time = 10
A
Due time = 8 Due time = 12
B C
Figure 7. Conflict between due time of item C and release time
of item A.
Release time=15
New Release time=16
Part B produced on bottleneck machine A, Lt=2
Release time=13 B, Lt=3 Due time=16
Release time=13
Release time=10 Due time=13 Release time=12
Due time=13
D, Lt=3 E, Lt=1
Release time=8
Release time=7 Due time=12 Release time=7 Due time=12
X, Lt=5 Y, Lt=5
New Release time=5 New Due time=10
Figure 8. Example of revising the production and purchasing plan.
541
conflict. This step tries to solve the conflict by revising
the release and due times of some jobs if necessary. The
conflict and how to solve it are explained as follows.
Figure 7 shows that job C (a predecessor of job A) has
a due time of 12 but job A has a release time of 10, which
is earlier than the due time of job C. There are two ways
to solve the conflict. One is to change the release time
of job A to 12. The other is to change the due time of
job C to 10.
On a shopfloor, some machines are bottleneck
machines and others are non-bottleneck machines.
The schedule of jobs on the bottleneck machines should
be fixed since it is very tight. The schedule of jobs on the
non-bottleneck machines may be revised (to comply with
that on the bottleneck machines) since it has slack times.
To make it more comprehensive, a new example of
BOM, as shown in figure 8, is used to illustrate how the
production and purchasing plans are revised. Product
A has a BOM as presented in table 5 and figure 8. The
release and due times of each part are obtained from step
5. Suppose that part B is produced on the bottleneck
machine and it has a release time of 13 and due time of
16. The schedule of the parts produced on the bottleneck
machine should be maintained and the schedule of
parts produced on the non-bottleneck machine should
be revised accordingly. The due times of parts D and E
have no conflict with the release time of part B, thus,
they will not be revised. The due time of part X (equal
to 12) is in conflict with the release time of part D
(equal to 10). Therefore, the due time of part X must
Due time=17
New Due time=18
Release time=14 Due time=15
C, Lt=1
Due time=14 Release time=13 Due time=14
F, Lt=1 G, Lt=1
Due time=13 Release time=8 Due time=13
Z, Lt=5 W, Lt=5
Part F produced on bottleneck machine
 542 T. Wuttipornpun and P. Yenradee

Table 5. BOM-related data and job schedule.

Part name Type Parent part Total lead-time (days) Release time Due time Machine
A Finished product None 2 15 17 Non-bottleneck
B Component A 3 13 16 Bottleneck
C Component A 1 14 15 Non-bottleneck
D Component B 3 10 13 Non-bottleneck
E Component B 1 12 13 Non-bottleneck
F Component C 1 12 14 Bottleneck
G Component C 1 13 14 Non-bottleneck
X Purchased part D 5 7 12 –
Y Purchased part E 5 7 12 –
Z Purchased part F 5 8 13 –
W Purchased part G 5 8 13 –

be changed from 12 to 10. As a result, the release time 3.1. Experiment to analyse the effects of options
of part X must also be changed from 7 to 5 since the available in the proposed FCMRP system
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total lead time of part X is 5. Considering the pre-

cedence between parts B and A, part A has the
release time of 15, which is in conflict with the due
time of part B that is 16. Thus, the release time of
part A must be revised from 15 to 16, which in turn
changes the due time of part A from 17 to 18 (total
lead time of part A is two days). Suppose part F is
also produced on the bottleneck machine and it has
a release time of 13 and due time of 14. The precedence
constraints of part F and other parts are not violated,
thus release and due times of other parts will not be
revised.
This step has a limitation as explained in section 1.
Suppose parts B and X are produced on bottleneck
machines. Both parts are on the same path of the BOM.
In this case, the algorithm of this step cannot work well.
If the schedule of part B is fixed, the schedule of part X
must be revised accordingly. However, part X is
produced on a bottleneck machine, for which the
schedule cannot be revised easily.
Note that if there are some products for which parts
do not pass through any bottleneck machine, the produc-
tion and purchasing plans of the parts will be revised
(if they are conflicting) based on the schedule of the
finished products.
3. Design of experiments
This section presents two experiments. The first
one aims to analyse the effects of options available in
the proposed FCMRP system. The second one is to
evaluate the effectiveness of the proposed FCMRP
system. To accomplish this, TSPICs has been further
developed to integrate the features of the proposed
FCMRP system.
The effects of the options available in the FCMRP
system on the performance measures of the generated
schedules will be analysed. Results of the analysis will
indicate how the options can be selected to obtain
the desirable performance. Independent and dependent
variables of the experiment are described as follows.
3.1.1. Independent variables
The independent variables of the experiment are the
options available in the proposed FCMRP system. They
are presented as follows.
(1) Options for scheduling jobs to the first priority
machines (Scheduling Option).
There are two options for scheduling jobs to
the first priority machines as described in section
2, namely, SD and SR methods.
(2) Options for rearranging jobs scheduled on the
same day (Rearranging Option).
There are two options for rearranging jobs
scheduled on the same day, namely, ERT and
EDT.
(3) Options for adjusting timing of jobs to eliminate
capacity problems (Adjusting Option).
There are two options. The first one is to apply
ML–Start Early method only. The second one is
to apply ML–Start Early and then MR–Delay Job
methods.
3.1.2. Dependent variables
The dependent variables are performance measures
of the schedule generated by the FCMRP system.
 Finite capacity material requirement planning system for assembly operations 543

There are five performance measures, namely, number
of early jobs, number of tardy jobs, total earliness
(in days), total tardiness (in days), and total overtime
needed to complete the jobs (in hours).
3.1.3. Experimental case
To prove that the FCMRP can be applied in a real
situation, the experiments are performed on a selected
manufacturing company. The company produces steer-
ing wheels and gearshift knobs for the automobile
industry. The company has an assembly operation that
has 25 items of finished goods with 3 to 10 levels in the
bill of materials, and 20 machines. Some products can
be produced on more than one machine. The first and
second priority machines are specified by the planner.
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3.2. Experiment to evaluate the effectiveness of the proposed
FCMRP system
After analysing the available options of the proposed
FCMRP system as presented in sub-section 3.1, possible
settings of FCMRP options will be set. To analyse the
effectiveness of the possible settings of the FCMRP
system, the performance measures of the generated
schedules are compared to those of the schedules gen-
erated by a variable lead-time MRP system (TSPICs).
One-way ANOVA is used to statistically analyse the
effectiveness of the possible settings of FCMRP system.
4. Results and discussions
The results and discussions are divided into two sec-

They have the same unit processing time and set-up
time. The machines have different working hours.
Some of them are operated 16 hours a day and others
are operated eight hours a day. There is a bottleneck
machine in the system, which is machine 15. In this
study, the overlapping of production batches (to reduce
lead time and work-in-process) is not allowed. The lot-
sizing technique being used is a lot-for-lot since it can
avoid the lot-sizing buffering effect and it is the most
popular lot-sizing technique employed by MRP users
(Haddock and Hubicki 1989). The customer demand of
each product is assumed to follow a uniform distribution
where the maximum and minimum demands are 15%
of the mean demand. The actual demand of each product
in a month is used as the mean demand. The experiment
is conducted with 30 replications using 30 sets of ran-
domly generated demands. Note that the number of
replications of 30 is used since it results in a desired
accuracy level of not more than 5% for 95% confidence
intervals of population means of all performance mea-
sures. A full factorial design of experiment is used to
statistically analyse effects of the independent variables
on the performance measures.
tions. The first one is the analysis of the effects of the
options available in the proposed FCMRP system.
The second is the analysis of the effectiveness of the
proposed FCMRP system.
4.1. Analysis of the effects of the options available
in the proposed FCMRP system
The ANOVA results of the experiment used to ana-
lyse the effects of the options available in the proposed
FCMRP system are shown in table 6. It reveals that
the scheduling and adjusting options have a signifi-
cant effect on all performance measures, namely,
number of early jobs, total earliness, number of tardy
jobs, total tardiness and total overtime, whereas the
rearranging option has no significant effect on any
performance measure. The interaction effects between
the scheduling and adjusting options for all perfor-
mance measures are significant but other two-way
and three-way interactions are insignificant. Table 7
shows the average values of performance measures for
only significant options.

Table 6. Analysis of variance results.

p-value
Factors No. of early jobs Total earliness No. of tardy jobs Total tardiness Total overtime
Scheduling option (S) 0.000* 0.000* 0.000* 0.000* *0.000
Rearranging option (R) 0.156 0.732 0.572 0.503 0.809
Adjusting option (A) 0.000* 0.000* 0.000* 0.000* *0.000
SR 0.106 0.864 0.397 0.098 0.329
RA 0.224 0.775 0.542 0.513 0.061
SA 0.000* 0.000* 0.000* 0.000* *0.000
SRA 0.071 0.995 0.397 0.092 0.055
*Means the effect is significant at significant level of 0.05.
 544 T. Wuttipornpun and P. Yenradee

Table 7. Average values of performance measures for significant options.

Average value of performance measures
No. of Total earliness No. of Total tardiness Total overtime
Factors early jobs (days) tardy jobs (days) (hrs)
Scheduling options
SR 50.88 114.48 31.75 214.6 235.48
SD 42.78 104.18 28.3 189.18 201.43
Adjusting options
ML–Start Early 52.18 121.03 0 0 337.36
ML–Start Early/MR–Delay job 41.48 97.63 60.05 403.78 99.54

400

350
Total overtime (Hrs)

300
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250

200

150

100

50

0
SR SD

ML–Start Early
Scheduling options
ML–Start Early/MR–Delay

Figure 9. Interaction between scheduling and adjusting options on total overtime.

According to table 7, when the ML–Start Early
method was applied, the number of early jobs, total
earliness and total overtime are relatively high but
there is no tardy job. When the ML–Start Early and
MR–Delay Job methods were applied, the total over-
time, number of early jobs and total earliness can be
significantly reduced but the number of tardy jobs and
total tardiness are significantly increased. It occurs since
the MR–Delay Job method tries to delay the excess jobs
to reduce the overtime. From table 7, it can be seen that
the SD option outperforms the SR option for all perfor-
mance measures.
Since the interaction effects between the scheduling
and adjusting options for all performance measures are
significant, the effects of both options should be con-
sidered simultaneously to understand the interactions.
Graphs showing the interaction between the scheduling
and adjusting options on the total overtime, and total
tardiness, are presented as examples in figures 9 and
10, respectively. Note that the interaction graphs of the
number of early jobs and total earliness are similar to
that of the total overtime presented in figure 9, while
that of the number of tardy jobs is similar to that of
the total tardiness presented in figure 10. Considering
the total overtime, number of early jobs, and total
earliness (see figure 9), the interaction graphs show
that when the adjusting option is ML–Start Early/
MR–Delay Job, SR and SD scheduling options result
in the same level of performance measures while the
adjusting option is ML–Start Early, the SD option out-
performs the SR option. Considering the total tardiness
and number of tardy jobs (see figure 10), when the
adjusting option is ML–Start Early/MR–Delay Job,
SD option outperforms the SR option while the adjust-
ing option is ML–Start Early the SR and SD options
are indifferent.
Based on table 6, the effect of the rearranging option
(ERT and EDT) is insignificant. There are two possible
reasons for this result. First, based on the current data of
the company, the second priority machines are available
for only 15% of all jobs. After applying the ERT or EDT
option, the excess jobs on the first priority machines
 Finite capacity material requirement planning system for assembly operations 545
500

450

400

Total tardiness (days)

350

300

250

200

150

100

50

0
SR SD
−50
ML–Start Early
Scheduling options
ML–StartEarly/MR–Delay
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Figure 10. Interaction between scheduling and adjusting options on total tardiness.

Table 8. Possible setting of FCMRP options.
FCMRP Scheduling
setting option
FCMRP 1 SR
FCMRP 2 SR ML–Start Early/MR–Delay Job
FCMRP 3 SD
FCMRP 4 SD ML–Start Early/MR–Delay Job
will be allocated to the second priority machines on the
same day if the second priority machines exist and have
available the required capacity. Therefore, most excess
jobs cannot be allocated to the second priority machines.
Second, the duration of time period in steps 3 and 4 of
the FCMRP system is one day, which is quite short. As a
result, there are few jobs to be rearranged by the ERT
and EDT rules. It is expected that if the second priority
machines are available for most jobs and the duration of
the time period is longer, the effect of the rearranging
option may be significant.
4.2. Analysis on the effectiveness of the proposed
FCMRP system
In this section, the performance of the schedules
obtained from the FCMRP system will be compared to
those of the schedules obtained from the variable
lead-time MRP system. To determine the performance
measures of the schedule obtained from the variable lead-
time MRP system, the jobs generated must be scheduled
only on the first priority machines and the scheduling
options are SR and SD (the second step of the FCMRP
system).
Adjusting The FCMRP system has three options (scheduling,
option
rearranging and adjusting options). Based on table 6,
ML–Start Early the rearranging option has no significant effect on
performance measures. Therefore, the two scheduling
ML–Start Early options and two adjusting options are combined to
construct four possible FCMRP settings as shown in
table 8. Consequently, two MRP systems (based on
the SR and SD method) and four FCMRP systems
will be compared.
The average value of the performance measures of
MRP and FCMRP systems and their rank as obtained
by Tukey’s test are shown in table 9. Note that the
ranks are presented in parentheses, and the lower rank
has better performance than the higher rank. It can be
seen from table 9 that the MRP (based on the SR and
SD) system has neither tardiness nor earliness but
requires extremely high overtime (SR is the highest).
FCMRP 1 and FCMRP 3 have no tardiness and
require overtime that is only 47.44% and 38.45% of
the overtime required by the MRP system. However,
FCMRP 1 and FCMRP 3 require some jobs to be
completed earlier than the due dates, which increase
the inventory holding costs. If the overtime needs to be
further decreased, FCMRP 2 and FCMRP 4 are
recommended. FCMRP 2 and FCMRP 4 require an
overtime that is, respectively, only 12.51% and 12.84%
of the overtime required by the MRP system.
However, they result in tardiness and earliness of
some jobs. Note that FCMRP 1, 2, 3 and 4 have a
percentage of early jobs ranging from 16.51% to
24.00%, and FCMRP 2 and 4 have a percentage of
 546 T. Wuttipornpun and P. Yenradee

Table 9. Comparison of means and ranking results of FCMRP and MRP systems.
Average value and rank of performance measures
No. of early jobs/ Total No. of tardy jobs/ Total Total overtime (hrs)/ Overall
Factors % of all jobs earliness % of all jobs tardiness % of MRP overtime performance index
MRP (SR) 00.00/00.00% (1) 00.00 (1) 00.00/00.00% (1) 00.00 (1) 785.56/100.00% (5) 112.22 (4)
MRP (SD) 00.00/00.00% (1) 00.00 (1) 00.00/00.00% (1) 00.00 (1) 656.49/83.57% (4) 93.78 (3)
FCMRP 1 60.25/24.00% (4) 133.35 (5) 00.00/00.00% (1) 00.00 (1) 372.70/47.44% (3) 72.29 (2)
FCMRP 2 41.50/16.53% (2) 99.65 (3) 63.50/25.29% (3) 429.20 (3) 100.83/12.84% (1) 334.27 (6)
FCMRP 3 44.10/17.56% (3) 108.70 (4) 00.00/00.00% (1) 00.00 (1) 302.03/38.45% (2) 58.68 (1)
FCMRP 4 41.45/16.51% (2) 95.60 (2) 56.60/22.55% (2) 378.35 (2) 98.26/12.51% (1) 298.89 (5)
Total number of jobs ¼ 251.

tardy jobs of 25.29% and 22.55%, respectively. It can 5. Conclusions

be concluded that the FCMRP system can greatly
reduce the overtime, but increases the earliness and/ This paper aims to develop a practical FCMRP
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or tardiness of jobs to some extent.
When the planner desires to reduce the overtime
but tardiness is not allowed, FCMRP 1 and FCMRP 3
should be considered. To further reduce the overtime
when tardiness is allowed, FCMRP 2 and FCMRP 4
should be selected.
An overall performance index can be determined using
a weighted average of some performance measures.
Based on an opinion of the planner of this company, one
hour of total overtime is as important as one day of total
earliness while one day of total tardiness is five times
as important as one day of total earliness. Thus, the
weights of total earliness, total tardiness, and total over-
time are 0.14, 0.72 and 0.14, respectively. The overall
performance indices are presented in table 9. It indicates
that FCMRP 3 results in the best overall performance
index calculated based on the opinion of the planner of
this company.
When the adjusting option is ML–Start Early/MR–
Delay Job method, which corresponds to FCMRP 2
and FCMRP 4, the generated schedule is similar to
the schedule obtained from the TOC concept. The
characteristics of the TOC schedule is that the schedule
on the bottleneck machine has no idle time or overtime
but the schedule on the non-bottleneck machine may
have idle time and overtime. The load profiles on the
bottleneck machine for the MRP and FCMRP 4 are
shown in figure 11. It can be seen that the bottleneck
machine schedule using the FCMRP system has no idle
time or overtime but that of the MRP system has
significant idle time and overtime. The load profiles
on a selected non-bottleneck machine of the MRP
and FCMRP 4 are shown in figure 12. It clearly
shows that the load profile of the FCMRP system is
smoother than that of the MRP system; however, it
still requires overtime in some periods.
system for a manufacturer with assembly operations
and bottleneck stations. The developed FCMRP system
has three options, namely, scheduling, rearranging and
adjusting options. The effects of the options on the per-
formance measures are statistically analysed using the
data from a real case study. Statistical results show that
all options except the rearranging option have signifi-
cant effects on the performance measures. Therefore,
the options should be carefully designed and selected in
order to obtain the desirable scheduling performances.
The options investigated in this paper are simple. It is
possible to develop more sophisticated options that can
offer better performances.
Performances of the FCMRP system are compared
to those of the MRP system. The MRP system results
in no earliness or tardiness but extremely high over-
time. An application of FCMRP system can greatly
reduce the overtime but increase earliness and/or tardi-
ness to a certain extent. Based on the opinion of the
planner of this company, one setting of the FCMRP
system (FCMRP 3) has the best overall performance
index.
Characteristics of the schedule generated by the
FCMRP system comply with those generated by the
TOC concept in that the schedules of the bottleneck
machines are free of idle time and overtime. However,
the schedule of non-bottleneck machines may have
idle or overtime in some periods to deliver parts to
the bottleneck machines whenever they are required.
Although the proposed FCMRP system works well
in this study, there are some limitations. It considers
only the lot-for-lot sizing rule and the overlapping of
production batches is not allowed. It can handle a
production system where the number of parts produced
by bottleneck machines on each path of the BOM is
not more than one. Otherwise, step 6 of the FCMRP
 Finite capacity material requirement planning system for assembly operations 547

200,000

180,000

160,000

140,000

120,000

100,000

80,000

60,000

40,000

20,000
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0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Demand Periods
Capacity

(a) MRP
200,000

180,000

160,000

140,000

120,000

100,000

80,000

60,000

40,000

20,000

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Demand Periods
Capacity

(b) FCMRP 4

Figure 11. Load profile on bottleneck machine (machine 15).

 548 T. Wuttipornpun and P. Yenradee

60,000

50,000

40,000

30,000

20,000

10,000

0
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34

Periods
Demand
Capacity

(a) MRP
60,000

50,000

40,000

30,000

20,000

10,000

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34

Demand Periods
Capacity

(b) FCMRP 4

Figure 12. Load profile on non-bottleneck machine (machine 20).

 Finite capacity material requirement planning system for assembly operations
system must be modified. For further study, the
FCMRP system should be developed to allow the over-
lapping of production batches and to consider other
lot-sizing decisions.
Acknowledgement
This research has been supported by the Royal Golden
Jubilee PhD Programme of Thailand Research Fund,
Contract No. PHD/0026/2543.
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