Chapter 3 –

Master Scheduling

The Master Schedule is:

• The formal link between production planning
and actual production
• The basis for calculation of resources needed
• The driving force behind the material
requirements plan
• The primary priority plan for manufacturing

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Information Needed to Develop an
MPS
• Production Plan data
• Forecasts
• Actual customer orders
• Inventory levels
• Capacity constraints

Relationship to Production Plan

A production plan is developed for a family of three
items:

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Relationship to Production Plan
(Cont.)

Relationship to Production Plan

(Cont.)

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Example - MPS

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Problem: The Wicked Witch Whisk Company manufactures a line
of broomsticks. The most popular is the 36-inch model, and the
sales department has prepared a forecast for 6 weeks. The opening
inventory is 30. As master scheduler, you must prepare an MPS.
The brooms are manufactured in lots of 100.

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Objectives and Steps for the MPS
• Objectives –
– Maintain good customer service
– Make effective use of resources
– Maintain effective levels of inventory
• Accomplished by:
– Develop a preliminary MPS
– Check MPS against capacity and resources
– Reconcile any differences

Preliminary MPS
An example:
- The product is made to stock,
- an inventory is kept,
- the product is made in lots of 100,
- and the expected opening inventory is 80 units.

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Problem : The Amalgamated Mailbox Company manufactures
a family of two mailboxes. The production plan and the MPS
are developed on a quarterly basis. The forecast for the product
group follows. The opening inventory is 270 units, and the
company wants to reduce this to 150 units at the end of the year.
Develop a level production plan.
Production plan

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 Problem : (Cont.)
The forecast sales for each of the mailboxes in the family also follow.
Develop an MPS for each item, bearing in mind that production is to be
leveled as in the production plan. For each mailbox, the lot size is 220.

Rough-cut Capacity Planning

• Establishes whether critical resources are
available
– Bottleneck operations
– Critical labor resources
– Critical material
• Often uses a resource bill for a single
product

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 Example Resource Bill

MPS Schedule for a week:

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10
Problem 1: The Acme Widget Company makes widgets in
two models, and the bottleneck operation is in work center
10. Following is the resource bill (in hours per part).

The master production schedule for the next 5 weeks is

Problem 1 (Cont.)
a. Using the resource bill and the master production
schedule, calculate the number of hours required in work
center 10 for each of the 5 weeks. Use the following table
to record the required capacity on the work center.

b. If the available capacity at work station 10 is 260 hours per week,

suggest possible ways of meeting the demand in week 3.

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 Resolution of Differences

overtime,
extra workers,
routing through other work centers,
subcontracting
revise the master production schedule

Master Schedule “Focal Points”

• Make-to-Stock – Limited end products,

many components
• Make-to-Order – Many end products,
fewer components
• Assemble-to-Order - Many end products,
combination of components and
subassemblies

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 Example MPS Environments

Figure 3.3 Different MPS environments

Final Assembly Schedule

• Assembly according to customer schedule
• Generally used in an Assemble-to-Order
environment
– Many options
– Too many possible final configurations to
forecast or master schedule
• MPS usually done at the option level

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 Engineer-to-order
- a form of make-to-order (MTO) products.
- the product is designed before manufacturing,
- based on the customer’s very special
needs.

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 MPS Planning Horizon

• Minimum time horizon over which the

master schedule must extend to ensure
complete planning
• Calculated as the longest end-to-end lead
time of the product structure

EXAMPLE –
Cumulative Planning Horizon
• For this product – Minimum Planning Horizon 12 weeks

Figure 3.5 Product structure critical lead time

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Production planning, MPS, and Sales

Delivery Promises
• MPS is a plan for what production can and
will do
• Sales delivery promises can be made from
– “Consumption” of forecasts – Projected
available balance
– Available to Promise calculations
• MPS values for a given time period left after actual
customer orders are subtracted.

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The MPS and delivery time

ATP - Example

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 ATP - Example

ATP - Example

Can the master planner accept an order for another 20 for delivery
in week 3?

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 ATP - Example

Example problem

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 Solve the Problem 1!
Calculate the available to promise using the
following data. There are 90 units on hand.

Solve the Problem 2!

Using the scheduled receipts, calculate the ATP.
There are 45 units on hand

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 Solve the Problem 3!
Given the following data, can an order for 20 for delivery
in week 4 be accepted? Calculate the ATP using the
following table. On hand = 50 units.

Projected Available Balance - PAB

• Consider customer orders forecast demand
• Projected available balance is now calculated
based on whichever is greater.
• Depending on whether the period is before or after
the demand time fence

For periods AFTER the demand time fence, PAB is calculated as

PAB = prior period PAB or on-hand balance + MPS - greater of customer orders or forecast

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 Solve the Problem 1!
Given the following data, calculate the projected available
balance and the planned MPS receipts. The lot size is 200.
The demand time fence is 2 weeks.

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 Solve the Problem 2!
Given the following data, calculate the projected available
balance and the planned MPS receipts. The lot size is 100.
The demand time fence is 2 weeks..

MPS - ATP – PAB

Example

Using the Amalgamated Nut Cracker, Inc., example, we now combine the two
calculations into one record. The demand time fence is at the end of 3 weeks.

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 MPS - ATP – PAB
Example

Solve the Problem!

Complete the following problem. The lead time is one
week and the demand time fence is the end of week 3.
There are 20 on hand. The lot size is 60.

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 Time Fences

MPS & Time fences

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 Time Fences
• Points in the planning horizon to define the
flexibility allowed in the MPS
– Frozen Zone (closest to current date)
• Capacity and materials committed to customer orders, forecast
generally ignored
• Senior management approval for changes
– Slushy Zone
• Less commitment of materials and capacity
• Tradeoffs negotiated between marketing and manufacturing
– Liquid Zone – All changes allowed within limits of the
Production Plan

Solve the Problem!

Product A is an assemble-to-order product. It has a lot size of 150,
and currently has an on-hand inventory of 110 units. There is a 2-
week demand time fence and a 12-week planning time fence. The
following table gives the original forecast and the actual customer
orders for the next 12 weeks:

a. Given this information, develop a realistic master schedule,

complete with ATP logic.
b. Tell how you would respond to each of the following customer
order requests. Assume these are independent requests, and do not
have cumulative effects.
• 20 units in week 3
• 40 units in week 5
• 120 units in week 7

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Error Management

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 Solve the Problem!
a. Given the following master schedule, fill in the projected available
and available to promise rows:

b. A customer wants an order of 100 in period 4. What can you tell him?
c. The customer from part (b) cancels his request, but then says he
wants 120 in period 5. What do you tell him now?
d. Sales has requested that you add an MPS of 200 in period 9 to cover
their needs for a sales promotion. What do you tell them and why?
e. What action (if any) should be taken in period 11? Why is it okay to
take the action?

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