Material Requirements

Planning (MRP)
 Material requirements planning (MRP) A dependent
demand technique that uses a bill-of-material,
inventory, expected receipts, and a master production
schedule to determine material requirements.
Material requirements planning (MRP) benefits
include (1) better response to customer orders as the
result of improved adherence to schedules, (2) faster
response to market changes, (3) improved utilization
of facilities and labor, and (4) reduced inventory levels
 Master production schedule (MPS) A timetable that
specifies what is to be made (usually finished goods)
and when
 Bill of material (BOM) A listing of the components,
their description, and the quantity of each required to
make one unit of a product
 Master
Production
Schedule
Definition of MPS

 It is a timetable that specifies what is

to be made and when.

This schedule is in accordance with a

production plan
Aggregate planning vs disaggregate production
plan

Aggregate production plan is established in gross

terms such as families of products.

 MPS is established in terms of specific product.

 Master production schedule
Months Jan Feb
Example no 1
aggregate
production plan
(shows total
quantity of
amplifire 1500 1200
weeks 1 2 3 4 5 6 7 8
MPS            

240 watt amplifire 100  100   100  100 450

150 watt amplifire   500  500   450 100 

75 watt amplifire     300         

Example 2
weeks   1 2 3 4
forecast sales   75 50 30 40
projected
available 50 75 25 95 55
MPS   100  100 100

Product is made in lot of 100