Managing dependent demand inventory

Assignment Help Operation Management
Reference no: EM131735318

Below includes the major points of MRP and ERP systems for managing dependent demand inventory.

An MRP system is an information system used to plan and control manufacturing of dependent-demand inventory items. There are three types of MRP systems: type I, an inventory control system (order launching); type II, a production and inventory control system (closed loop); and the third type an enterprise resource planning system. Each of these systems expands the scope and se of MRP.

The parts-explosion process has three principal inputs: master schedule, BOM, and inventory record. There are two principal outputs: purchase orders and shop orders Parts explosion is the heart of the MRP system.

An MRP system follows a requirements philosophy-parts are ordered only as required by the master schedule. Past demand for parts is irrelevant, and component inventories are not replenished when they reach a low level.

Master schedules should be based on both marketing and production considerations. They should represent a realistic build plan within factory capacity. Top management should use the S&OP and master schedule to plan and control the business through a cross-functional planning team.

The BOM contains the list of parts used to make the product. To maintain the accuracy of the bill of materials, an engineering-change-order system is needed.

The accuracy of the inventory record system should be maintained through cycle counting. Daily cycle counting can be used in place of annual physical inventories.

Shop-floor control is used to control the flow of materials through the factory. This is done by managing lead times dynamically as the product is manufactured. If lead times are properly managed, much safety stock can be eliminated.

A successful MRP system requires (1) implementation planning, (2) adequate computer support, (3) accurate data, (4) management support, and (5) user knowledge. Both system and people problems must be solved to use MRP successfully. When this is done, benefits include reduced inventory, increased customer service, and improved efficiency.

All manufacturing and service firms can benefit from MRP if it is properly installed and operated. This includes large and small firms and all industries.

Enterprise resource planning systems integrate a basic MRP system with information from marketing, dales, finance/accounting, and human resources through a common database. ERP systems can be the basis for cross-functional and supply chain integration.

Please outline these major points

Reference no: EM131735318

Questions Cloud

Characterize it as programmed or non programmed : Think of any decision you recently made. would you characterize it as a programmed or non programmed?
Diagram to illustrate direct indirect-multi channel strategy : Draw a diagram to illustrate direct, indirect and multi- channel strategy. Explain how vertical and horizontal integration are beneficial to Nike's bottom line.
The crossover point for timroom nights : Based on the given information related to costs for each of the options, the crossover point for Timroom nights
Could the pawnshop have given good title to hollander : Hollander purchased a computer from a pawnshop for use in his real estate office. Could the pawnshop have given good title to Hollander?
Managing dependent demand inventory : Below includes the major points of MRP and ERP systems for managing dependent demand inventory.
Some rehabilitation center get involved : Why would some rehabilitation center get involved providing income source for patient and his member if treatment is long lasting.
What might explain their dissatisfaction : According to Herzberg’s theory of motivation, what might explain their dissatisfaction?
How the movie shows the given time period : Assignment: HOLLYWOOD HISTORY- Demonstrate using examples from the film (storyline, dialogue, setting) how this movie shows this time period.
Describe an essay on americas involvement in world war i : Describe an essay on America's involvement in World War I: How did World War I begin? What events led to American involvement in WWI?

Reviews

Write a Review

Operation Management Questions & Answers

  Book review - the goal

Operations Management is about a book review. Title of the book is "Goal". This book has been written by Dr. Eliyahu Goldartt. The book has been appreciated by many as one of those books which offers an insight into the operations and strategic capac..

  Operational plan in hospitality enterprise

Operational plan pertaining to a hospitality enterprise is given in detail in the solution. The operational plan is an important plan or preparation which gives guidelines regarding the role and responsibilities of each and every operation at all lev..

  Managing operations and information

Recognise the importance of a strategic approach to the development and deployment of organisational information systems. Demonstrate an understanding of the importance of databases and their integration to the organisation's overall information mana..

  A make-or-buy analysis

An analysis of the holding costs, including the appropriate annual holding cost rate.

  Evolution and contributor of operations management

Briefly explain Evolution and contributor of Operations management.

  Functions and responsibilities of an operations manager

A number of drivers of change have transformed the roles, functions and responsibilities of an operations manager over recent years. These drivers have not only been based on technological innovations but also on the need for organisations to develop..

  Compute the optimal order quantity

Compute the Optimal Order quantity of DVD players. Determine the appropriate reorder point.

  Relationship to operations practice in the organisation

Evaluate problems in operations and identify approaches to overcoming them. Critically evaluate operating plans and identify areas for improvement. Justify, implement and evaluate changes to operations in line with modern approaches.

  A make or buy analysis

Develop a report for Figi Fabricating that will address the question of whether the company should continue to purchase the part from the supplier or begin to produce the part itself.

  Prepare a staffing plan

Prepare a staffing plan showing the change of your unit from medical/surgical staffing to oncology staffing.

  Leadership styles in different organizations

Ccompare the effectiveness of different leadership styles in different organizations

  Risk management tools and models

Be able to understand the concept of risk, roles and responsibilities for risk management and risk management tools and models.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd