Reference no: EM133146455
Case Study Discussion
WAS NOT GIVEN WITH A REFERENCE
A few solutions that were given to this question previously, were very difficult to follow. If someone can explain it in simple terms, that would be fantastic!
A Company produces several lines of products, but one (they call it "product X") uses unique parts to produce it and the demand is very seasonal. There are some possible variations in the design, so the company tends to use available-to-promise logic to master schedule the product. Since the components to produce it are quite expensive, the company tries very hard to minimize any inventory of the product or its components during the seasons with very low sales. Product X is just now entering the low season, and the following chart represents the forecast data and actual customer orders for the next ten weeks:
|
Week
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
|
Forecast
|
25
|
20
|
16
|
16
|
15
|
15
|
13
|
11
|
10
|
9
|
|
Customer Orders
|
27
|
21
|
16
|
13
|
11
|
9
|
7
|
4
|
3
|
2
|
|
Master Production Schedule
|
|
50
|
|
|
50
|
|
|
50
|
|
|
There are currently (at the start of week 1) 27 product X left in inventory. The following represents the product structure for product X:
X = A, D, B(2), C(2)
The following table gives the relevant data for components A, B, C, and D at the start of week 1:
|
Component
|
A
|
B
|
C
|
D
|
|
Starting Inventory
|
0
|
22
|
212
|
63
|
|
Lead Time (weeks)
|
2
|
1
|
2
|
4
|
|
Lot Size
|
60
|
100
|
250
|
100
|
|
Safety Stock
|
0
|
0
|
0
|
0
|
In addition, component A has a scheduled receipt of 60 units for week 2.
You are asked to:
1. Complete the master schedule for product X,
2. Create MRP grids for each of the components for the next 5 weeks.
3. Discuss the situation that if they cannot promise to deliver in the specified deadline (for example, three additional units of product X for week 4), what is the best that you can do based on the information you have?