MIS 381 - Topic # 51

Master Production Scheduling

MIS 381 - Topic # 52

What is the MPS?

The MPS translates the Sales & Operations Plan (S&OP) into a plan for producing specific products in the future.

The MPS is a statement of planned future output.

MIS 381 - Topic # 53

As a statement of output, the MPS Forms the basic communication between

the market and manufacturing.

Is stated in product specification terms (part numbers) for which there are Bill of Materials (BOM).

[MPS is Concerned with product mix while Sales and Operations Planning is concerned with volume]

MIS 381 - Topic # 54

MPS is the basis for

Making customer delivery promises

Utilizing plant capacity effectively

Attaining the strategic objectives in the

sales and operations plan

Resolving trade-offs between

manufacturing and marketing

MIS 381 - Topic # 55

MPS conversion.

Controlled by a separate Final Assembly Schedule (FAS) which is defined at the very last moment.

Environment Basis of conversion

MTS Items are produced in batches, carrying finished goods inventories for most, if not all, end-items.

ATO MPS unit is typified by limitless number of possible end-item configurations made from combinations of basic components and subassemblies. Probably will not start final assembly until order arrives.

MTO MPS unit is defined as the particular end-item composing a customer order. Production starts before a complete product definition (BOM) has been determined.

MIS 381 - Topic # 56

Linkages to other firm activities

MIS 381 - Topic # 57

Rules for filling the MPS tables

The greater of the forecast or order receipts is considered for the calculations.

The available row = previous available + MPS – (greater of the booked orders or forecast)

Other rules follow the method used (phased, rolling through time, order promising and consuming the forecast.

MIS 381 - Topic # 58

Single Level MPS Record Example

The Zero Manufacturing Company ships Product A from the firm's plant warehouse to satisfy East Coast demand. Currently, the sales forecast for Product A at the Murphysboro plant is 30 units per period.

Product A is considered a make-to-stock item.

Plant warehouse on hand inventory = 50 units

Safety Stock = 10 units

Lot Size = L4L

Open Order for 30 units due in period 1

MIS 381 - Topic # 59

MPS TABLE

1 2 3 4 5 6

Projected available balancePlanned order releaseQ = lot for lot; LT = 0; SS = 10

PeriodProduct AGross requirementsScheduled receipts

The master production scheduler has heard that an MRP record which uses the forecast for gross requirements and has a lead time of zero can be used for master production scheduling. Complete the following MRP record. How can this be used for master production scheduling?

MIS 381 - Topic # 510

1 2 3 4 5 630 30 30 30 30 3030

Projected available balance 50 20 10 10 10 10 1020 30 30 30 30Planned order release

Q = lot for lot; LT = 0; SS = 10

PeriodProduct AGross requirementsScheduled receipts

One way viewing an MPS is as the set of planned order releases and scheduled receipts in a record such as above. The problem is that any errors in forecast will be reflected in the on-hand balance. All changes will come in the planned orders. Use of firm planned orders will reduce this instability.

MPS TABLE

MIS 381 - Topic # 511

MPS Techniques

Time phased record

Rolling through time

Order promisingAvailable to promise (ATP)

MIS 381 - Topic # 512

Level vs. Chase vs. Lot Sizing

1 2 3 4 5 6 7 8 9 10 11 12Forecast 5 5 5 5 5 5 15 15 15 15 15 15AvailableMPSOn Hand

Week

1 2 3 4 5 6 7 8 9 10 11 12Forecast 5 5 5 5 5 5 15 15 15 15 15 15AvailableMPSOn Hand

Week

1 2 3 4 5 6 7 8 9 10 11 12Forecast 5 5 5 5 5 5 15 15 15 15 15 15AvailableMPSOn Hand

Week

MIS 381 - Topic # 513

Rolling through timeactual sales = 10 instead of 5 units, and actual inventory at end of week 1 is 10 units

2 3 4 5 6 7 8 9 10 11 12Forecast 10 10 10 10 10 15 15 15 15 15 15AvailableMPSOn Hand 10

Week

2 3 4 5 6 7 8 9 10 11 12Forecast 10 10 10 10 10 15 15 15 15 15 15AvailableMPSOn Hand 10

Week

Revised table

MIS 381 - Topic # 514

Order promisingReceived orders for weeks 1,2,3 & 4

1 2 3 4 5 6 7 8 9 10 11 12Forecast 5 5 5 5 5 5 15 15 15 15 15 15Orders 5 3 2AvailableATPMPSOn Hand 20

2 3 4 5 6 7 8 9 10 11 12Forecast 10 10 10 10 10 15 15 15 15 15 15Orders 5 5 2AvailableATPMPSOn Hand 10

Week

Week

MIS 381 - Topic # 515

Consuming the forecastOrder Number Amount Desired Week

1 5 22 15 33 35 64 10 5

3 4 5 6 7 8 9 10 11 12 13 14Forecast 10 10 10 10 15 15 15 15 15 15 15 15Orders 20 2 35 10AvailableATPMPSOn Hand 30

MIS 381 - Topic # 516

The Job of the MPS Scheduler

Primary responsibility for making any additions or changes to the MPS records.

Has also responsibility for disaggregating the production plan to create the MPS and that the sum of the detailed MPS matches the Production Plan (SO&P).

Responsible for launching the FAS.

MIS 381 - Topic # 517

The Job of the MPS Scheduler

Making sure that there is only one unified database for the MPS

Measure actual performance against the MPS and production plan (SO&P)

Its useful to think of the MPS as a set of firm planned orders. The scheduler needs to convert planned orders to firm planned orders and to manage the “timing” and amounts of the firm planned orders.

MIS 381 - Topic # 518

MPS Stability

A stable MPS translates into stable component

schedules, which means improved performance

in plant operations.

Too many changes – lower productivity

Too few changes – lower customer service

levels.

MIS 381 - Topic # 519

Increasing MPS stability

Stability is monitored and managed by using:

Firm planned order treatment for the MPS

quantities

Frozen time periods for the MPS and

Time fencing to establish clear guidelines for

the kinds of changes that can be made.

Check 6.24, Text: VBMJ

MIS 381 - Topic # 520

Time Fencing

This is an extension of the freeze concept. Many companies set time fences that specify

periods in which various types of change can be handled.

The planning fence indicates the time at which the scheduler should be planning more MPS quantities.

MIS 381 - Topic # 521

Guidelines for Managing the MPS

Start by having a realistic MPS Stability and proper buffering are important to

remove all the excuses for not attaining the performance for which the proper budget has been provided.

The overstated MPS erodes belief in the formal system.

Always force the sum of the MPS to equal the production plan.

MIS 381 - Topic # 522

MPS Measures

Measure MPS in concrete terms that reflect the firm’s fundamental goals.

Measure customer service (hit promised dates, Quality, etc.).

Compare production vs. plan Keep records of backorder supply time to

improve them.