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Market competitiv
Process technology
Capacity Decisions
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Supply Network Behaviour Network dynamics Quantitative Qualitative Network Management Coordinate Differentiate Reconfigure
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supply networks vs. supply chains buyer-supplier relationship a supply network is a system of organisations connected by server-client links - upstream/downstream - that service processes & activities (operations) bringing added value to each client and ultimately the end customer.
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Company B
p stream
Company C
Down str
X X
X X X
For Company A Internal supply network Immediate supply network Total supply network
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Structural Improvement
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Forward and Backward Integration Major process simplification Changing the configuration of factories, warehouses, or retail locations Major product redesign Outsourcing logistics to a third party.
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Supply relationships
a company can trade with first tier and second tier customers at the same time - but consider the % balance of each immediate suppliers vs suppliers of suppliers in the total network relationships between companies in the network need not be exclusive - multi-sourcing. Company C - seems to single source (exclusive supply) item X Types of relationship:
o
close and intimate? Make or contract in (outsource)? What items: strategic, trivial? Many suppliers or a few. Keiretsu? Transactional (arms-length only) or collaborative? Loyalty in buyers and sellers markets?
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Design changes
Master production schedule Time-phased plan (MPS) how many + when we will build each end item. MRP1 Inventory record
Bill of material
Reports
Stock movements
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dependent demand info. system to determine o No. of parts, components, materials needed for a product order scheduling information - dates when o orders for materials should be released, based on lead times. o batches of materials, parts, components should be ordered/produced based on a master production schedule (MPS)
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materials parts components production sequence modular BOM subassemblies planning BOM fractional options
Inventory record status according to time windows or buckets identify each parent item that created demand
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1. Schedule no. of units of A backwards to allow for lead time. 2. place order for 50 of A at week 8 to receive in week 10
9 50
10 50
Lot sizing Lot-for-lot (L4L) Economic order quantity (EOQ) Least total cost (LTC) Least unit cost (LUC)
LT = 1 week
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MRP
Week: A Required Order Placement B Required Order Placement 1 2 3 4 5 6 7 8 9 50 200 10 50
20 20 200
surplus
schedule components of A. 4 Bs in each A (50x4) = 200Bs. back the schedule up for 2 weeks lead time.
LT = 2
A B(4)
C(2 )
E(1) D(3 ) F(2)
D(2 )
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MRP
Week: A LT=1 B LT=2 C LT=1 D LT=3 E LT=4 F LT=1 Required Order Placement Required Order Placement Required Order Placement Required Order Placement Required Order Placement Required Order Placement 1 2 3 4 5 6 7 8 9 50 200 100 55 55 20 200 200 200 400 300 20 200 400 100 300 10 50
20
20
200
Part D: Wk 6 40 + 15 spares
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Time Fencing
Frozen o No schedule changes allowed within the time frame Moderately Firm o Specific changes allowed within product groups as long as parts are available. Flexible o Significant variation allowed as long as overall capacity requirements remain at the same levels.
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o
o o
Planned orders - to release at a future time. Order release notices - execute planned orders Changes in due dates of open orders due to rescheduling Cancellations or suspensions of open orders due to cancellation or suspension in the MPS. Stock status data Planning reports e.g. forecasting inventory requirements over time. Performance reports e.g. actual vs. planned usage and costs. Exception reports e.g. serious discrepancies, late/overdue orders.
Secondary
o
o
Gross Requirements On-hand Net requirements Planned order receipt Planned order release
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MRP Example
X A(2) C(3 )
Spares
Item
B(1)
X A B C D
50 75 25 10 20
2 3 1 2 2
C(2 )
1 2
D(5 )
3 4
Requirements include 95 units (80 firm orders and 15 forecast) of X in wk 10 plus the following spares:
5 6 7 7 10 8 9 12 10
A B C D
15
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MRP Example
C Gross Requirements LT=2 On-Hand=10 Net Requirements Planned Order Receipt Planner Order Release D Gross Requirements LT=2 On-Hand=20 Net Requirements Planned Order Receipt Planner Order Release
45 10 35 35 35 36
36 36 36 64 15 15
130
C(2 )
D(5 )
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Should MRP carry safety stock? How much safety stock should be carried? Issue of safety lead time Danger of informal system driving out the formal system Expansion of MRP to other functions (finance, HRM, etc.) of business
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Goal: Plan & monitor all resources of a manufacturing firm (closed loop):
o o o o
ERP
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JIT Requirements
Problem-solving
Root problem Long-term solution Team contribution Line-specialist cooperation Learning Measure performance CQI Monitor & report