Master Production Scheduling (MPS) Basic Techniques

MPS: Role in the MPC System MPS Defined MPS Approaches Single Level MPS Time-Phased Record Customer Order Processing Rolling through Time (Transactions)
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Manufacturing Planning and Control System

MPS Defined
Anticipated Build Schedule a statement of production not market demand The MPS is: Stated in terms of product specifications Concerned with product mix while Sales and Operations Planning is concerned with volume The 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

MPS Approaches
Make to Stock Make to Order Assemble to Order

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 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? Product A Gross requirements Scheduled receipts Projected available balance Planned order release Q = lot for lot; LT = 0; SS = 10 1 2 Period 3 4 5 6

Single Level MPS Record Processing

Product A Gross requirements Scheduled receipts Projected available balance 50 Planned order release Q = lot for lot; LT = 0; SS = 10 1 30 30 50 2 30 20 Period 3 4 30 30 10 20 10 30 5 30 10 30 6 30 10 30

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.
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Customer Order Promising Example

The MPS planner at Murphy Motors uses MPS time-phased records for planning end item production. The planner is currently working on a schedule for the P24. The production lot size is 70 and the safety stock is 5.
Item: P24 Forecast Orders Available Available to promise MPS (completion) On hand = 20, MPS Lot Size = 70 Period 1 2 3 4 5 6 7 8 30 30 30 40 40 40 45 45 13 8 4

Customer Order Promising Example

a. Complete the MPS time-phased record for P24. b. Can Murphy accept the following orders? Update the MPS time-phased record for accepted orders.

Order Amount Desired Period 1 40 4 2 30 6 3 30 2 4 25 3

Customer Order Processing Procedure

a.
Period Item: P24 1 2 3 4 5 6 Forecast 30 30 30 40 40 40 Orders 13 8 4 Available 60 30 70 30 60 20 Available to promise 69 66 70 MPS (Completion) 70 70 70 On hand = 20, MPS lot size = 70 7 8 45 45 45 70 70 70 70 70

b.

Order Amount Desired Period 1 40 4 2 30 6 3 30 2 4 25 3

Customer Order Processing Procedure

Order Amount Desired Period Accept (Y or N) 1 40 4 Y 2 30 6 Y b. 3 30 2 Y 4 25 3 Y
Item: P24 1 2 3 Forecast 30 30 30 Orders 13 38 29 Available 60 22 62 Available to promise 39 1 MPS (Completion) 70 70 On hand = 20, MPS lot size = 70 Period 4 5 40 40 40 22 52 40 70 6 40 30 12 7 45 37 70 70 8 45 62 70 70

The convention of the greater of forecast or orders is used in determining the projected available balance.

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Rolling Through Time Transactions Example

The following MPS time phased record has been prepared at the start of period 1.
Period Item: Smell fresh 1 2 3 4 5 6 Forecast 20 20 20 30 30 30 Orders 5 3 2 Available 50 30 10 30 50 20 Available to promise 60 50 50 MPS (Completion) 50 50 50 On hand = 20, MPS lot size = 50 7 8 30 30 40 10 50 50
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Rolling Through Time Transactions Example

The following events occurred during period 1: Actual demand during period 1 was 25 units. Marketing forecasted that 40 units would be needed for period 9. An order for 10 in period 2 was accepted. An order for 20 in period 4 was accepted. An order for 6 in period 3 was accepted. The MPS in period 1 was produced as planned.
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Rolling through Time -Transactions/ Processing

b. Update the record below after rolling through time.
Smell fresh Period Forecast Orders Available Available to promise MPS (Completion) On Hand = 45, MPS 4 5 6 30 30 30 20 25 45 15 30 50 50 50 lot size = 50 2 3 20 20 13 8 25 5 24 7 8 9 30 30 40 35 50 50 5 15 50 50

Beginning On Hand Period 1 = 20 Period 1 Actual Demand = -25 MPS Receipt Into Stock =+50 Beginning on Hand Period 2 = 45

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Session 8 Master Production Scheduling (MPS) Managing the MPS

Example Company MPS Records Handling MPS Lead Time Incorporating Capacity Constraints MPS Stability Managing the MPS Master Production Schedulers Job Concluding Principles
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Jet Spray Corporation Master Planning Schedule

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Handling MPS Lead Time

The Spencer Optics Company produces an inexpensive line of sunglasses. The manufacturing process consists of assembling two plastic lenses (produced by the firm's plastic molding department) into a finished frame (purchased from an outside supplier).

The firm's sales manager has prepared a 10-period sales forecast for one of the more popular sunglasses (the Classic model). The forecast is 100 orders per period. Spencer has customer orders of 110 units, 80 units. 50 units, and 20 units in periods l , 2, 3, and 4, respectively. The sunglasses are assembled in batches of 300. Presently, three such batches are scheduled: one in period 2, one in period 5, and one in period 8.
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Spencer Optics (Continued)

a. Complete the time-phased record.
a. Classic Model Period 1 2 3 4 Forecast 100 100 100 100 Orders 110 80 50 20 Available 30 230 130 30 Available to Promise 30 150 MPS (Completion) 300 On-hand = 140, MPS lot size = 300

5 6 7 8 9 10 100 100 100 100 100 100 230 130 30 300 300 230 130 30 300 300

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Spencer Optics (Continued)

b. Prepare the MRP record for the assembly of the sunglasses. The final assembly quantity is 300, lead time is 2 periods, and theres a scheduled receipt in period 2. Note that no inventory is shown for the assembled sunglasses in this record, since its accounted for in the MPS record.

b. Final Assembly - Classic Model Period 1 2 3 4 5 6 Gross requirements 300 300 Scheduled receipts 300 Projected available balance 0 0 0 0 0 0 0 Planned order release 300 300 Q = 300; LT = 2; SS = 0

8 9 10 300 0 0 0

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Incorporating Capacity Constraints

End Product Beginning Inventory Period Forecast Lot size Hours per lot size

A B C

60 20 30

10 5 15

30 20 50

30 20 50

a. Prepare the master production schedule for these items during the next four periods using the Ethan Allen master production scheduling method.
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Incorporating Capacity Constraints

a. Capacity=
Hours 40 35 30 25 20 15 10 5 0 Period 1 Period 2 Period 3 Period 4

C C B C C

B A

Produce Period 1 Period 2 Period 3 Period 4 A 60/10 = 6 50 / 10 = 5 30 / 10 = 3 B 20/5 = 4 15 / 5 = 3* 25 / 5 = 5* C 30 / 15 = 2* 55 / 15 = 3.7 85 / 15 = 5.67

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Incorporating Capacity Constraints (Continued)

b. Should the plant increase or decrease the capacity of the final assembly line? The plant should decrease capacity by 10 hours/period because the total units forecast each period totals 30 units (10 + 5 + 15) and the time to produce each unit is 1 hour. Therefore, 30 hours of capacity are required each period versus 40 units of available capacity.
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Incorporating Capacity Constraints (Continued)

c. Suppose that the master production schedule is frozen for the next three periods. What specific impact would the policy have on the firm's performance? Freezing the MPS for the next three periods would not allow the plant to adjust to any radical changes in demand but it would stabilize plant operations.
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MPS Stability
Freezing the MPS Time Fencing
Demand Fence Planning Fence

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Ethan Allen Firm Planned Order Approach

Production Hours

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Period

Managing the MPS

Overstated MPS MPS Performance Measures Monitoring the MPS

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MPS Performance Measures

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Mitels Master Production Scheduler Job Description

A. Identifying Information Job Title: Master Scheduler Department/Unit: Planning & Administration Job Location: Kanata, Ontario B. Job Purpose and Mandate The incumbent of this position is responsible for the day to day management of the Master Production Schedule, as it relates to actioning unplanned forecast demand, forecast shortfalls, production and inventory changes, allowing accurate and up-to-date information which in turn drives material and capacity requirements and customer order dating. An advanced level of material planning and manufacturing process knowledge is required. Organization Structure The Master Production Scheduler reports to the Manager, Planning who reports to the Director, Planning and Administration.
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C.

D. 1.

Job Description Specific Activities and Accountabilities: Responsible for the creation and continuous update of the master schedule that satisfies customer demand, maintains stability in terms of material and capacity requirements and minimizes RAW. WIP, and Finished Goods inventory levels by: Managing day to day increases/decreases to the schedule through interface with Materials, Manufacturing and Order Administration. Working with Materials to ensure smooth E.C.O. transition into factory Continuously monitor the impact of ''Performance to Forecast'' on inventory levels for the current month, and implement any necessary changes to the schedule; i.e. cut rollover, Increase availability through Fast-Man MRP tool. Act as a focal point between N.A. Order Administration, Manufacturing and Distribution to ensure configured system orders are: Scheduled to meet customer cut-over requirements Scheduled to meet manufacturing cell capacity. Quoted and reviewed with manufacturing, initiating 28 build and test.

Mitels Master Production Scheduler Job Description

Mitels Master Production Scheduler Job Description

Continuously monitor problem inventory, taking advantage of any conversion opportunities, making recommendations for scrapping, or potential ''Fire Sale's". Assess the impact to capacity, inventory levels, purchase order activity and problem inventory levels that result from any proposed major change to the master schedule, utilizing the Fast-Man MRP tool. Direct ( ) Indirect ( )

2.

Supervisory Responsibilities:

3.

Key relationships (internal and external) Internal and external auditors Marketing Order Administration Distribution A1l levels of management within Mitel Traffic Manufacturing Materials Planning Product Management
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Mitels Master Production Scheduler Job Description

E.

Job requirements superior product knowledge 3-4 years progressive experience in materials or production control knowledge of internal Mitel processes and procedures APIC's Certification a definite asset knowledge gained through APIC's Certification organizational and planning skills secondary education high degree of initiative and personal motivation personal computer skills broad based knowledge of supply/demand process

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MPS Concluding Principles

The MPS unit should reflect the company's approach to the business environment in which it operates. The MPS is one part of an MPC system-the other parts need to be in place as well for a fully effective MPS activity. Time-phased MPS records should incorporate useful features of standard MRP record processing. Customer order promising activities must be closely coupled to the MPS. Available-to-promise information should be provided to both the master scheduler and the sales department.

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MPS Concluding Principles

A final assembly schedule (FAS) should be used to convert an anticipated build schedule (MPS) into an actual build schedule. The master production scheduler must keep the sum of the parts (MPS) equal to the whole (production plan). The MPS activity must be clearly defined organizationally. Stability must be designed into the MPS and managed. The MPS should be evaluated with a formal performance measurement system. The MPS can be usefully considered as a set of firm planned orders.

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