1 35000014410 2017-09-21T20:58:41-05:00 35000021803 false MRP 5 2017-09-21T20:58:41-05:00 1 1 2017-11-21T15:22:53-06:00 0 0 DBA does not include any type of multi-level BOM demand explosion capability because it is counter-productive and incompatible with Time to Shipment MRP’s just in time architecture. Just in time manufacturing is item-based Just in time manufacturing is item-based.  This means that demand for each sell item, subassembly, and purchased item is independently assessed in each MRP session without regard to any particular sales orders, jobs, or product structures to which the item may belong.     You don’t make a product structure With just in time manufacturing you rarely make an entire product structure like you see depicted in a multi-level BOM view.  Subassemblies and purchased items in a product structure are often independently planned for stocking and many such items are used in multiple BOMs and often have interdependent demand from multiple jobs. BOM demand explosion is a traditional planning method BOM demand explosion is a traditional planning method whereby demand for a parent item is exploded down through all levels so that the entire product structure can be made with a set of linked jobs.    BOM explosions are counter-productive BOM explosions isolate demand into separate product structures and force all subassemblies in the structure to be made to order.  This planning method is counter-productive. BOM explosions fail to account for interdependent demand from multiple jobs and result in an excessive number of fragmented jobs with inefficient run sizes.    BOM explosions force subassembly items to be made to order, even in cases where it would be more efficient to plan the item for stocking to reduce time to shipment.   Linking occurs naturally with item-based manufacturing With item-based manufacturing, linking of a sorts occurs naturally when supply events happen to align with demand events. Unlike hard-linking, natural linking also flexibly allows one supply event to align with multiple demand events.    The Stock Status inquiry shows the destination of any item It is not necessary to use hard-linking on job travelers to know the destination of a finished subassembly item.  The Stock Status inquiry, which can be accessed within the Job Receipts and Job Schedule screens, indicates which jobs are pending for the item.   WARNING: Do not attempt a simulated BOM explosion Do not attempt to create your own BOM demand explosions and manual jobs to simulate your traditional planning method in DBA.  This is completely incompatible with Time to Shipment MRP’s item-based architecture and interferes with time to shipment planning, item order policies, scheduling dates, and job release. <p>DBA does not include any type of multi-level BOM demand explosion capability because it is counter-productive and incompatible with Time to Shipment MRP’s just in time architecture.</p><p><br></p><h4><strong>Just in time manufacturing is item-based</strong></h4><p><br></p><p>Just in time manufacturing is item-based.  This means that demand for each sell item, subassembly, and purchased item is independently assessed in each MRP session without regard to any particular sales orders, jobs, or product structures to which the item may belong.    </p><p><br></p><h4><strong>You don’t make a product structure</strong></h4><p><br></p><p>With just in time manufacturing you rarely make an entire product structure like you see depicted in a multi-level BOM view.  Subassemblies and purchased items in a product structure are often independently planned for stocking and many such items are used in multiple BOMs and often have interdependent demand from multiple jobs.</p><p><br></p><h4><strong>BOM demand explosion is a traditional planning method</strong></h4><p><br></p><p>BOM demand explosion is a traditional planning method whereby demand for a parent item is exploded down through all levels so that the entire product structure can be made with a set of linked jobs. </p><p> </p><h4><strong>BOM explosions are counter-productive</strong></h4><p><br></p><p>BOM explosions isolate demand into separate product structures and force all subassemblies in the structure to be made to order.  This planning method is counter-productive.</p><p><br></p><ul><li>BOM explosions fail to account for interdependent demand from multiple jobs and result in an excessive number of fragmented jobs with inefficient run sizes.</li></ul><p>  </p><ul><li>BOM explosions force subassembly items to be made to order, even in cases where it would be more efficient to plan the item for stocking to reduce time to shipment.  </li></ul><p><br></p><h4><strong>Linking occurs naturally with item-based manufacturing</strong></h4><p><br></p><p>With item-based manufacturing, linking of a sorts occurs naturally when supply events happen to align with demand events. Unlike hard-linking, natural linking also flexibly allows one supply event to align with multiple demand events. </p><p> </p><h4><strong>The Stock Status inquiry shows the destination of any item</strong></h4><p><br></p><p>It is not necessary to use hard-linking on job travelers to know the destination of a finished subassembly item.  The Stock Status inquiry, which can be accessed within the Job Receipts and Job Schedule screens, indicates which jobs are pending for the item.  </p><p><br></p><h4><strong>WARNING: Do not attempt a simulated BOM explosion</strong></h4><p><br></p><p>Do not attempt to create your own BOM demand explosions and manual jobs to simulate your traditional planning method in DBA.  This is completely incompatible with Time to Shipment MRP’s item-based architecture and interferes with time to shipment planning, item order policies, scheduling dates, and job release.</p><p><br></p> 35000021803 86 35000022522 2017-11-21T16:16:50-06:00 35000323220 1 2 0 0 Why is a BOM demand explosion not available? 2017-11-21T15:38:23-06:00 35000323220 1 2017-11-21T15:49:24-06:00 0 1 Inventory accuracy is essential for net demand calculations MRP cannot function without an accurate inventory, which is essential for the net demand calculations that drive job and PO generation.  If you are operating with an unreliable inventory, you will be unable to use DBA with any success.  There are two key practices you can implement to remedy this problem:    Remedy #1 - Make BOM accuracy an absolute requirement Make BOM accuracy an absolute requirement in your company culture.  Whenever BOM errors are encountered during the course of a job, make sure the parent BOM gets corrected for the benefit of future jobs.  BOM errors are the source of many inventory problems.    Remedy #2 - Issue materials to jobs in real time Issue materials to jobs in real time within the Work Center Schedule instead of after the fact at time of job receipt.  This takes no extra time because it must be done at some point anyway and in most cases only a few clicks using the Pre-Fill option.  Real time job issues eliminate delays to job receipts and will engender user confidence that inventory numbers are reliable. <p><strong>Inventory accuracy is essential for net demand calculations</strong></p><p><br></p><p>MRP cannot function without an accurate inventory, which is essential for the net demand calculations that drive job and PO generation.  If you are operating with an unreliable inventory, you will be unable to use DBA with any success.  There are two key practices you can implement to remedy this problem:</p><p>  </p><p style="margin-left: 20px;"><strong>Remedy #1 - Make BOM accuracy an absolute requirement</strong></p><p style="margin-left: 20px;"><br></p><p style="margin-left: 20px;">Make BOM accuracy an absolute requirement in your company culture.  Whenever BOM errors are encountered during the course of a job, make sure the parent BOM gets corrected for the benefit of future jobs.  BOM errors are the source of many inventory problems.</p><p style="margin-left: 20px;">  </p><p style="margin-left: 20px;"><strong>Remedy #2 - Issue materials to jobs in real time</strong></p><p style="margin-left: 20px;"><br></p><p style="margin-left: 20px;">Issue materials to jobs in real time within the <em>Work Center Schedule</em> instead of after the fact at time of job receipt.  This takes no extra time because it must be done at some point anyway and in most cases only a few clicks using the <em>Pre-Fill </em>option.  Real time job issues eliminate delays to job receipts and will engender user confidence that inventory numbers are reliable.</p> 35000021803 59 35000022532 2017-11-21T16:18:33-06:00 35000323220 2 2 0 1 Why does MRP require an accurate inventory? 2017-11-21T15:52:04-06:00 35000323220 1 2017-11-21T16:11:12-06:00 0 0 Item MRP settings are essential Item MRP settings are essential because they determine time to shipment targets and the supply pipelines that replenish inventory.  These settings are vitally important no matter how many stock items you may have. At first glance, applying MRP settings to thousands of items may seem a daunting task, but when you examine how settings are actually maintained, it is a much smaller-scale effort that is well within any planner’s capability to manage.  Let’s break down how settings are established and maintained.   P items can be mass-updated by default supplier Each P item is assigned to a default supplier.  Most items sourced by a supplier have the same Lead Days, so even though you may have thousands of P items, you most likely have a relatively small number of default suppliers.  You can filter the MRP Settings screen by default supplier and then enter the same Lead Days against all or most of the items.  You can also export the grid contents to a spreadsheet, copy and paste the desired Lead Days against all items, and then use the P Items – MRP Settings import utility to import the values.    Many M items have the same Job Days Most companies typically have far fewer M items than P items.  Among M items, many have similar processes and can therefore be given the same or similar Job Days allocation.  The actual number of Job Days decisions is therefore much smaller than the number of M items.  Job Days allocations are not subject to frequent revision.      The Stocking (Safety Factor) order policy settings remain fixed        Many items planned for stocking can be assigned the Stocking (Safety Factor) order policy, which uses a fixed monthly Safety Factor setting to calculate the Reorder Point that triggers stock replenishment.  This is a “set it and forget it” stocking method because there is no need for periodic review of monthly usage.  This order policy is suited for lower value items where minor over-stocking has minimal impact on working capital or storage space.    Supply Days intervals are rarely subject to change All stocking order policy items are given a Supply Days interval to calculate the Min Order quantity that determines the size and frequency of jobs or POs.  A substantial number of items will be given the same Supply Days interval and once it is established, it is rarely changed.    Use MRP analysis codes to schedule monthly demand reviews The item settings that should be reviewed on a periodic basis are the monthly Sales or Usage and Safety Factor buffer maintained against items with a Stocking (Monthly Demand) order policy.  Higher value, more critical items benefit from more frequent review, whereas lower value, less critical items can be reviewed less often.    Use the MRP Analysis Codes screen to create analysis codes that are then scheduled for settings review at periodic intervals.  Items are assigned to appropriate analysis codes.  The screen indicates when analysis codes are due for review and the Action button is used to initiate a settings analysis for its associated items in the MRP Settings screen. <p><strong>Item MRP settings are essential</strong></p><p><br></p><p>Item MRP settings are essential because they determine time to shipment targets and the supply pipelines that replenish inventory.  These settings are vitally important no matter how many stock items you may have.</p><p><br></p><p>At first glance, applying MRP settings to thousands of items may seem a daunting task, but when you examine how settings are actually maintained, it is a much smaller-scale effort that is well within any planner’s capability to manage.  Let’s break down how settings are established and maintained.</p><p>  </p><p><strong>P items can be mass-updated by default supplier</strong></p><p><br></p><p>Each P item is assigned to a default supplier.  Most items sourced by a supplier have the same <em>Lead Days</em>, so even though you may have thousands of P items, you most likely have a relatively small number of default suppliers.  You can filter the <em>MRP Settings</em> screen by default supplier and then enter the same<em> Lead Days</em> against all or most of the items.  You can also export the grid contents to a spreadsheet, copy and paste the desired <em>Lead Days</em> against all items, and then use the <em>P Items – MRP Settings</em> import utility to import the values.</p><p>  </p><p><strong>Many M items have the same Job Days</strong></p><p><br></p><p>Most companies typically have far fewer M items than P items.  Among M items, many have similar processes and can therefore be given the same or similar<em> Job Days</em> allocation.  The actual number of <em>Job Days </em>decisions is therefore much smaller than the number of M items.  <em>Job Days</em> allocations are not subject to frequent revision.</p><p>    </p><p><strong>The Stocking (Safety Factor) order policy settings remain fixed</strong></p><p>      </p><p>Many items planned for stocking can be assigned the <em>Stocking (Safety Factor)</em> order policy, which uses a fixed monthly <em>Safety Factor</em> setting to calculate the <em>Reorder Point</em> that triggers stock replenishment.  This is a “set it and forget it” stocking method because there is no need for periodic review of monthly usage.  This order policy is suited for lower value items where minor over-stocking has minimal impact on working capital or storage space. </p><p><strong> </strong></p><p><strong>Supply Days intervals are rarely subject to change</strong></p><p><br></p><p>All stocking order policy items are given a<em> Supply Days</em> interval to calculate the<em> Min Order</em> quantity that determines the size and frequency of jobs or POs.  A substantial number of items will be given the same <em>Supply Days</em> interval and once it is established, it is rarely changed.</p><p>  </p><p><strong>Use MRP analysis codes to schedule monthly demand reviews</strong></p><p><br></p><p>The item settings that should be reviewed on a periodic basis are the monthly <em>Sales</em> or <em>Usage</em> and <em>Safety Factor</em> buffer maintained against items with a <em>Stocking (Monthly Demand)</em> order policy.  Higher value, more critical items benefit from more frequent review, whereas lower value, less critical items can be reviewed less often. </p><p> </p><p>Use the<em> MRP Analysis Codes</em> screen to create analysis codes that are then scheduled for settings review at periodic intervals.  Items are assigned to appropriate analysis codes.  The screen indicates when analysis codes are due for review and the <em>Action</em> button is used to initiate a settings analysis for its associated items in the <em>MRP Settings</em> screen.</p> 35000021803 119 35000022536 2017-11-21T16:11:12-06:00 35000323220 3 2 0 0 How can MRP settings be maintained against thousands of items? 2017-11-21T16:13:18-06:00 35000323220 1 2017-11-21T16:26:02-06:00 0 0 Padding allocations is counter-productive With just in time manufacturing it is counter-productive to pad or inflate item Lead Days and Job Days allocations because it distorts Time to Shipment targets for sell items and you lose the ability to track late POs and late starting jobs.   Allocations are inter-connected Item allocations are inter-connected.  Whenever an item has a To Order policy, its Lead Days and/or Job Days allocations contribute to the lead times of higher level items.  So whenever you pad or inflate allocations at one level, it can inflate allocation values at the next higher level.  Furthermore, the inflation effect magnifies at each higher level and can result in severely distorted Time to Shipment targets for top level items.  This defeats one of the core purposes of Time to Shipment MRP, which is to achieve realistic and reliable ship dates. Realistic PO due dates are important   P item Lead Days allocations establish PO due dates.  If you pad or inflate Lead Days allocations, PO due dates are not realistic and you lose the valuable ability to track and expedite late POs in the PO Schedule.    Realistic job dates are important M item Job Days allocations establish job start and finish dates.  If you pad or inflate Job Days allocations, planned start dates are not meaningful and you lose the ability to track late starting jobs in the Release Jobs screen.    Meet don’t beat the schedule To be successful with Time to Shipment MRP, make it your planning objective to meet, not beat the schedule.  Strive for realistic Lead Days and Job Days allocations so that Time to Shipment targets are plausible and achievable and so that job and PO dates provide the feedback needed for staying on schedule so that orders get shipped on time. <p><strong>Padding allocations is counter-productive</strong></p><p><br></p><p>With just in time manufacturing it is counter-productive to pad or inflate item<em> Lead Days</em> and<em> Job Days</em> allocations because it distorts<em> Time to Shipment</em> targets for sell items and you lose the ability to track late POs and late starting jobs.  </p><p><br></p><p><strong>Allocations are inter-connected</strong></p><p><br></p><p>Item allocations are inter-connected.  Whenever an item has a<em> To Order</em> policy, its <em>Lead Days</em> and/or <em>Job Days</em> allocations contribute to the lead times of higher level items.  So whenever you pad or inflate allocations at one level, it can inflate allocation values at the next higher level.  Furthermore, the inflation effect magnifies at each higher level and can result in severely distorted<em> Time to Shipment</em> targets for top level items.  This defeats one of the core purposes of Time to Shipment MRP, which is to achieve realistic and reliable ship dates.</p><p><strong><br></strong></p><p><strong>Realistic PO due dates are important  </strong></p><p><br></p><p>P item<em> Lead Days</em> allocations establish PO due dates.  If you pad or inflate <em>Lead Days</em> allocations, PO due dates are not realistic and you lose the valuable ability to track and expedite late POs in the<em> PO Schedul</em>e.</p><p>  </p><p><strong>Realistic job dates are important</strong></p><p><br></p><p>M item <em>Job Day</em>s allocations establish job start and finish dates.  If you pad or inflate <em>Job Days</em> allocations, planned start dates are not meaningful and you lose the ability to track late starting jobs in the<em> Release Jobs</em> screen.</p><p>  </p><p><strong>Meet don’t beat the schedule</strong></p><p><br></p><p>To be successful with Time to Shipment MRP, make it your planning objective to meet, not beat the schedule.  Strive for realistic <em>Lead Days </em>and<em> Job Days </em>allocations so that<em> Time to Shipment</em> targets are plausible and achievable and so that job and PO dates provide the feedback needed for staying on schedule so that orders get shipped on time.</p> 35000021803 86 35000022540 2017-11-21T16:26:02-06:00 35000323220 4 2 0 0 Why is it harmful to pad Lead Days and Job Days allocations? 2017-11-21T16:30:06-06:00 35000323220 1 2017-11-21T16:47:42-06:00 0 1 When an M item is flagged for CTO linking, a job is generated and hard-linked to each sales order line for the exact quantity ordered.  CTO linking is automatically applied to one-off, custom items that are made to order and never stocked.    CTO linking is counter-productive for standard items For standard items, however, CTO linking is counter-productive and should be avoided.   Standard items are interchangeable from order to order and are potentially subject to stocking.     There is no ability to adjust CTO jobs to account for stock on hand or to consolidate demand into more efficient job sizes. CTO linking forces items to be made to order, even in cases where items with frequent orders could be planned with a Stocking order policy to enable immediate shipment from stock. Linking occurs naturally with item-based manufacturing Some companies use the CTO setting solely to get the sales order number and customer referenced on the job traveler.  This practice is contrary to just in time manufacturing, which is item-based rather than order-based.  With item-based manufacturing, linking of a sorts occurs naturally when supply events happen to align with demand events. Unlike hard-linking, natural linking also flexibly allows one supply event to align with multiple demand events.   The Stock Status inquiry shows the destination of any item It is not necessary to use the job traveler to know the destination of an item or what is available to ship.  The Stock Status inquiry, which can be accessed within the Job Receipts and Job Schedule screens, indicates which sales orders are pending for the item or whether the item is intended for stock.  The Shipment Planner within the Order Picking screen lets you know when items are ready for shipment.    Avoid the CTO setting for efficient manufacturing For efficient just in time manufacturing, avoid using the CTO setting with standard items and discontinue relying on the job traveler for sales order references. <p>When an M item is flagged for CTO linking, a job is generated and hard-linked to each sales order line for the exact quantity ordered.  CTO linking is automatically applied to one-off, custom items that are made to order and never stocked.</p><p>  </p><p><strong>CTO linking is counter-productive for standard items</strong></p><p><br></p><p>For standard items, however, CTO linking is counter-productive and should be avoided.  </p><p><br></p><ul><li>Standard items are interchangeable from order to order and are potentially subject to stocking.    </li></ul><p><br></p><ul><li>There is no ability to adjust CTO jobs to account for stock on hand or to consolidate demand into more efficient job sizes.</li></ul><p><br></p><ul><li>CTO linking forces items to be made to order, even in cases where items with frequent orders could be planned with a <em>Stocking</em> order policy to enable immediate shipment from stock.</li></ul><p><br></p><p><strong>Linking occurs naturally with item-based manufacturing</strong></p><p><br></p><p>Some companies use the CTO setting solely to get the sales order number and customer referenced on the job traveler.  This practice is contrary to just in time manufacturing, which is item-based rather than order-based.  With item-based manufacturing, linking of a sorts occurs naturally when supply events happen to align with demand events. Unlike hard-linking, natural linking also flexibly allows one supply event to align with multiple demand events.  </p><p><br></p><p><strong>The Stock Status inquiry shows the destination of any item</strong></p><p><br></p><p>It is not necessary to use the job traveler to know the destination of an item or what is available to ship.  The <em>Stock Status</em> inquiry, which can be accessed within the <em>Job Receipts</em> and <em>Job Schedule</em> screens, indicates which sales orders are pending for the item or whether the item is intended for stock.  The <em>Shipment Planner</em> within the<em> Order Picking</em> screen lets you know when items are ready for shipment.</p><p>  </p><p><strong>Avoid the CTO setting for efficient manufacturing</strong></p><p><br></p><p>For efficient just in time manufacturing, avoid using the CTO setting with standard items and discontinue relying on the job traveler for sales order references.</p> 35000021803 95 35000022564 2017-11-21T16:47:42-06:00 35000323220 5 2 0 1 Why is it harmful to use CTO linking with standard items? 2017-11-21T16:49:28-06:00 35000323220 1 2017-09-21T21:52:25-05:00 1 0 DBA is not designed for manual planning.  The master schedule and all its inter-connected dates can only be generated by MRP based on item MRP settings and cannot be replicated manually.  Job release, which adjusts the schedule based on material availability, and job prioritization, which governs shop control, are dependent on the integrity of the master schedule.   The Release Jobs, Shop Control Panel, Job Schedule, and PO Schedule will not make sense unless they interact with an MRP-generated master schedule. <div rel="clipboard_data">DBA is not designed for manual planning.  The master schedule and all its inter-connected dates can only be generated by MRP based on item MRP settings and cannot be replicated manually.  Job release, which adjusts the schedule based on material availability, and job prioritization, which governs shop control, are dependent on the integrity of the master schedule.   The Release Jobs, Shop Control Panel, Job Schedule, and PO Schedule will not make sense unless they interact with an MRP-generated master schedule.</div><p><br></p> 35000021803 57 35000001727 2017-09-21T21:52:25-05:00 35000002609 7 2 1 0 Is manual planning a viable alternative to MRP? 2017-11-27T11:54:06-06:00 35000002609 1 2017-09-22T08:37:19-05:00 2 0 There is a perception among some that MRP is only suitable for standardized products.  With DBA this is not the case at all.  In fact, using MRP is what makes DBA ideal for custom manufacturing of any kind, including engineering to order, remanufacturing, and disassembly.   One-off BOMs are generated in quotes and are used to customize routing, component, and output details prior to job generation.  When MRP generates the job, custom details are automatically incorporated into the master schedule exactly the same as with standard products.  If job details must be modified during the course of the job, this automatically affects item demand profiles and MRP will respond accordingly with additional supply as needed.   <p>There is a perception among some that MRP is only suitable for standardized products.  With DBA this is not the case at all.  In fact, using MRP is what makes DBA ideal for custom manufacturing of any kind, including engineering to order, remanufacturing, and disassembly.  </p><p><br></p><p>One-off BOMs are generated in quotes and are used to customize routing, component, and output details prior to job generation.  When MRP generates the job, custom details are automatically incorporated into the master schedule exactly the same as with standard products.  If job details must be modified during the course of the job, this automatically affects item demand profiles and MRP will respond accordingly with additional supply as needed.  </p><p><br></p> 35000021803 63 35000001774 2017-09-22T08:37:19-05:00 35000002609 8 2 2 0 Can MRP be used for totally customized products? 2017-11-27T11:54:06-06:00 35000002609 1 2017-09-22T08:32:42-05:00 0 0 The item Reorder Point is not a fixed value.  It is dynamically calculated by the program whenever an item’s monthly demand rate, Lead Days, or Job Days value is changed.  It is a trigger point for MRP generation that has no relationship to a stocking level.  In fact, the Reorder Point amount has no inherent meaning unless it is in context with the item’s other settings.   If you have been using the Reorder Point as a target stocking level for manual planning, which has never been a recommended practice, this is no longer possible because it is now a calculated value rather than a fixed entry field.  <p>The item Reorder Point is not a fixed value.  It is dynamically calculated by the program whenever an item’s monthly demand rate, Lead Days, or Job Days value is changed.  It is a trigger point for MRP generation that has no relationship to a stocking level.  In fact, the Reorder Point amount has no inherent meaning unless it is in context with the item’s other settings.  </p><p><br></p><p>If you have been using the Reorder Point as a target stocking level for manual planning, which has never been a recommended practice, this is no longer possible because it is now a calculated value rather than a fixed entry field. </p><p><br></p> 35000021803 63 35000001767 2017-09-22T08:32:42-05:00 35000002609 9 2 0 0 Is the Reorder Point the same thing as a stocking level? 2017-11-27T11:54:06-06:00 35000002609 1 2017-09-22T08:31:09-05:00 0 0 Excessive inventory ties up working capital and occupies limited storage space.  MRP can be used to reduce inventory in the following ways:   Do not reduce inventory by making and buying items to order when it is not necessary.  For items with predictable demand, it is more efficient to maintain some stock using a Stocking order policy to reduce times to shipment and boost cash flow and sales.     For items that you stock (those with a Stocking order policy), use the item Supply Days interval to eliminate the risk of over-stocking.  The Supply Days interval limits stock to an amount that covers planned usage for a specified number of days.   Even if planned usage for an item proves to be wrong and does not materialize, the amount of stock will never exceed the amount triggered by the Supply Days interval.  MRP is demand-driven and will not generate a new job or PO unless it is triggered by actual demand.   The item Supply Days interval is your primary tool for “right sizing” your inventory.  It ensures that sufficient stock is provided for shortening times to shipment, but also limits over-stocking.  Apply an appropriate Supply Days interval to all your Stocking order policy items and you can dramatically reduce inventory without risk of shortages.    <p>Excessive inventory ties up working capital and occupies limited storage space.  MRP can be used to reduce inventory in the following ways:  </p><ul> <li>Do not reduce inventory by making and buying items to order when it is not necessary.  For items with predictable demand, it is more efficient to maintain some stock using a Stocking order policy to reduce times to shipment and boost cash flow and sales.    </li> <li>For items that you stock (those with a Stocking order policy), use the item Supply Days interval to eliminate the risk of over-stocking.  The Supply Days interval limits stock to an amount that covers planned usage for a specified number of days.  </li> <li>Even if planned usage for an item proves to be wrong and does not materialize, the amount of stock will never exceed the amount triggered by the Supply Days interval.  MRP is demand-driven and will not generate a new job or PO unless it is triggered by actual demand.  </li> </ul><p><br></p><p>The item Supply Days interval is your primary tool for “right sizing” your inventory.  It ensures that sufficient stock is provided for shortening times to shipment, but also limits over-stocking.  Apply an appropriate Supply Days interval to all your Stocking order policy items and you can dramatically reduce inventory without risk of shortages.   </p><p><br></p> 35000021803 60 35000001766 2017-09-22T08:31:09-05:00 35000002609 10 2 0 0 How can I reduce inventory? 2017-11-27T11:54:06-06:00 35000002609 1 2017-09-22T08:35:22-05:00 1 0 The planning period is the number of days allocated by MRP for assessing net demand and is determined by the item’s replenish time.    Think of the planning period as the item’s “action window.”  When net demand causes an item’s required date to fall within its planning period, a job or PO must be generated to replenish stock by the required date.  When a required date lies beyond the planning period, however, no action is needed because there is ample time to wait and generate a job or PO later when the required date eventually falls into the action window.         Taking premature action against future requirements is problematic because additional demand can materialize day by day as the required date draws closer to the action window. Generating a job or PO prematurely reacts to an incomplete demand profile and corrupts the “just in time” principle that keeps inventory and WIP as lean as possible.  If you expect a lower-level job or PO to be generated and it does not occur within the current MRP session, do not worry and do not intervene with any manual action.  The job or PO will be generated in a future MRP session without fail and has no possibility of being forgotten and missed.     <p>The planning period is the number of days allocated by MRP for assessing net demand and is determined by the item’s replenish time.   </p><p><br></p><p>Think of the planning period as the item’s “action window.”  When net demand causes an item’s required date to fall within its planning period, a job or PO must be generated to replenish stock by the required date.  When a required date lies beyond the planning period, however, no action is needed because there is ample time to wait and generate a job or PO later when the required date eventually falls into the action window.        </p><p><br></p><p>Taking premature action against future requirements is problematic because additional demand can materialize day by day as the required date draws closer to the action window. Generating a job or PO prematurely reacts to an incomplete demand profile and corrupts the “just in time” principle that keeps inventory and WIP as lean as possible. </p><p><br></p><p>If you expect a lower-level job or PO to be generated and it does not occur within the current MRP session, do not worry and do not intervene with any manual action.  The job or PO will be generated in a future MRP session without fail and has no possibility of being forgotten and missed.    </p><p><br></p> 35000021803 64 35000001770 2017-09-22T08:35:22-05:00 35000002609 11 2 1 0 Why should I not take action on requirements outside the planning period? 2017-11-27T11:54:06-06:00 35000002609 1 2017-09-22T08:33:56-05:00 0 0 When MRP generates a top level job, it is natural to expect to see associated lower level jobs and POs generated during the same MRP session.  This would be the case if all manufacturing events were to occur on the same day.   In reality, however, manufacturing events unfold over time.  Any subassembly item that is required immediately will be given a job within the current MRP session.  But any subassembly item that is not required at this time will be given a job in a future MRP session.  That future job quantity may incorporate additional demand for the item that happens to materialize in the intervening time.      The same principle applies to purchased items.  Any item that is required immediately will be given a PO within the current MRP session.  But any item that is not required at this time will be given a PO in a future MRP session.  That future PO quantity may incorporate additional demand for the item that happens to materialize in the intervening time. What determines when an item is required?   An item is only needed now when its required date falls within its planning period, which is the number of days allocated by MRP for making or buying the item.   <p>When MRP generates a top level job, it is natural to expect to see associated lower level jobs and POs generated during the same MRP session.  This would be the case if all manufacturing events were to occur on the same day.  </p><p><br></p><p>In reality, however, manufacturing events unfold over time.  Any subassembly item that is required immediately will be given a job within the current MRP session.  But any subassembly item that is not required at this time will be given a job in a future MRP session.  That future job quantity may incorporate additional demand for the item that happens to materialize in the intervening time.     </p><p><br></p><p>The same principle applies to purchased items.  Any item that is required immediately will be given a PO within the current MRP session.  But any item that is not required at this time will be given a PO in a future MRP session.  That future PO quantity may incorporate additional demand for the item that happens to materialize in the intervening time.</p><p><br></p><p>What determines when an item is required?   An item is only needed now when its required date falls within its planning period, which is the number of days allocated by MRP for making or buying the item.  </p><p><br></p> 35000021803 42 35000001768 2017-09-22T08:33:56-05:00 35000002609 12 2 0 0 Why do I not always see jobs and POs generated at lower levels? 2017-11-27T11:54:06-06:00 35000002609 1 2017-09-22T08:36:22-05:00 0 0 MRP is designed for “just in time” planning that relies on daily job and PO generation.  Daily generation is needed because all dates in the master schedule are inter-connected in end-to-end fashion to meet required dates.  Running MRP at less than daily intervals injects late dates into the schedule that cause job release delays and late shipments.    If your objective is to generate fewer and larger quantity jobs and POs, never attempt to accomplish this by delaying MRP generation.  Instead, use the item Supply Days setting as needed to increase the size and reduce the frequency of POs or jobs. <p>MRP is designed for “just in time” planning that relies on daily job and PO generation.  Daily generation is needed because all dates in the master schedule are inter-connected in end-to-end fashion to meet required dates.  Running MRP at less than daily intervals injects late dates into the schedule that cause job release delays and late shipments.   </p><p><br></p><p>If your objective is to generate fewer and larger quantity jobs and POs, never attempt to accomplish this by delaying MRP generation.  Instead, use the item Supply Days setting as needed to increase the size and reduce the frequency of POs or jobs.</p><p><br></p> 35000021803 52 35000001772 2017-09-22T08:36:22-05:00 35000002609 13 2 0 0 Should I run MRP less frequently to consolidate jobs and POs? 2017-11-27T11:54:06-06:00 35000002609 1 2020-01-30T10:20:04-06:00 0 0 Switching an Item from Manufactured to Purchased and Vice Versa You must have separate part numbers for your manufactured and purchased Item IDs and make a deliberate designation as to what MRP will be using for all active BOMs. Why Different Item IDs?   There are different lead days, material requirements, and costs involved when you manufacture or purchase an item. Separate item history is important to maintain in order to make informed decisions.  It is also imperative that MRP has definitive specifications as to whether you will be using the manufactured part number or purchased part number in your production plan. Steps to change from M to P Go to Inventory > Stock Items and create a new Item ID for the P Item with the appropriate estimated cost and supplier sourcing. Go to BOM > Component Replace and select the old M item to be replaced by the new P item in all active revisions. Go to BOM > Cost Rollup > Batch Rollup to update estimated costs for all places this new P Item ID is used. Now when you run MRP the new P item will be used in all newly generated Jobs.   If you must keep the original Item ID  Go to Utilities > ID Changes > Item ID Change and change the Item ID of the M Item to something different Go to Inventory > Stock Items and create a new Stock Item for the P Item with the same Item ID as the original manufactured version of the Item.  Enter the appropriate estimated cost and supplier sourcing. Use BOM > Component Replace to select the old M version and replace with the new P version for all active BOMs Go to BOM > Cost Rollup > Batch Rollup to update estimated costs for all places this P Item ID is used. If this is a For Sale item, make sure to enter a Base Price (Sales > Discounts & Pricing > Base Prices) for the new Item ID and consider removing the Base Price for the old M item ID. Optionally, you may want to set the old M item Item ID to In-active (Inventory > Stock Items >Details tab). Inactive items are filtered off most lookups and reports by default. Now when you run MRP the new P item will be used in all newly generated Jobs.   <h2>Switching an Item from Manufactured to Purchased and Vice Versa</h2><p><br></p><p>You must have separate part numbers for your manufactured and purchased Item IDs and make a deliberate designation as to what MRP will be using for all active BOMs.</p><p><br></p><h3>Why Different Item IDs?</h3><p> </p><p>There are different lead days, material requirements, and costs involved when you manufacture or purchase an item. Separate item history is important to maintain in order to make informed decisions.  It is also imperative that MRP has<span style='color: rgb(51, 51, 51); font-family: "Helvetica Neue", Helvetica, Arial, sans-serif; font-size: 13px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; display: inline !important; float: none;'> definitive specifications as to whether you will be using the manufactured part number or purchased part number in your production plan.</span></p><p><br></p><h3>Steps to change from M to P</h3><ol><li>Go to <em>Inventory &gt; Stock Items</em> and create a new Item ID for the P Item with the appropriate estimated cost and supplier sourcing.</li><li>Go to <em>BOM &gt; Component Replace</em> and select the old M item to be replaced by the new P item in all active revisions.</li><li>Go to <em>BOM &gt; Cost Rollup &gt; Batch Rollup</em> to update estimated costs for all places this new P Item ID is used.</li><li>Now when you run MRP the new P item will be used in all newly generated Jobs.  </li></ol><h3>If you must keep the original Item ID </h3><ol><li>Go to <em>Utilities &gt; ID Changes &gt; Item ID Change </em>and change the Item ID of the M Item to something different</li><li>Go to <em>Inventory &gt; Stock Items</em> and create a new Stock Item for the P Item with the same Item ID as the original manufactured version of the Item.  Enter the appropriate estimated cost and supplier sourcing.</li><li>Use <em>BOM &gt; Component Replace</em> to select the old M version and replace with the new P version for all active BOMs</li><li>Go to <em>BOM &gt; Cost Rollup &gt; Batch Rollup</em> to update estimated costs for all places this P Item ID is used.</li><li>If this is a For Sale item, make sure to enter a Base Price (<em>Sales &gt; Discounts &amp; Pricing &gt; Base Prices</em>) for the new Item ID and consider removing the Base Price for the old M item ID.</li><li>Optionally, you may want to set the old M item Item ID to In-active (<em>Inventory &gt; Stock Items &gt;Details tab)</em>. Inactive items are filtered off most lookups and reports by default.</li><li>Now when you run MRP the new P item will be used in all newly generated Jobs.  </li></ol><p><br></p><p><br></p><p><br></p> 35000021803 32 35000147831 2020-01-30T10:40:32-06:00 35000002609 14 2 0 0 Can I switch an item from Manufactured to Purchased and vice versa? 2020-01-30T10:56:58-06:00 35000002609 1 2017-10-06T10:23:52-05:00 0 0 How to handle an item that is both purchased and manufactured Occasionally, an item will cross between purchased and manufactured, depending on the scenario.  DBA's recommendation to handle this would be to use two separate item numbers: one for the manufactured version and one for the purchased version.   As far as MRP is concerned, you must make a definitive choice as to whether you will be using the manufactured part number or purchased part number in all of your active default BOM revisions.  You can use the BOM - Component Replace to designate the part in all active revisions where the part is used. You may choose to use essentially the same item code but just append an appropriate suffix to one or both (such as ITEMCODE-P for the purchased version).  Each code should reflect, in the Stock Items screen, its associated M or P setting (M for the manufactured version and P for the purchased version). Aside from this being the only way to handle this scenario in DBA, there is a benefit in costing and lead day scheduling.  Each code will maintain its own inventory value, which can be helpful since, usually, the manufactured version will have a different costing impact than the purchased version. When listing the item as a BOM component, just make sure to choose the most common version used by your company.  So, for example, if the item is purchased 90% of the time (and manufactured the other 10%), it's more logical to list the purchased version in active BOMs.   If you want to switch to your manufactured item instead of purchasing you can use the BOM - Component replace to swap out the M item code.   Lastly, as you might imagine, having two separate item codes, each containing quantities of the same exact item, can be problematic.  So, you may consider the following solution for managing these separate item codes.  Pick the item code which is the most common.  In other words, figure out whether you would most likely be purchasing this item most of the time or if you would be manufacturing it most of the time.  Then, for the least common method's item code, set the default receipt location to be some sort of "review" location (a location with a name that indicates it should be reviewed).  Then, develop a company process to often review these locations, if quantities exist in them.  During that review, the Stock Adjustments module could be used to "transfer" the quantities into the more common item code. For example, I usually purchase red wagons.  Occasionally, though, I'll build them.  They are the exact same product, just different ways of obtaining them.  So, I set up a REDWAGON-P item code and a REDWAGON-M item code.  The REDWAGON-P item code gets received into a location where it is inventoried.  The REDWAGON-M item code, though, has a default receipt location of 'NEED-STOCKADJ'.  My company often reviews the 'NEED-STOCKADJ' location to see if there are any of these REDWAGON-M's in it.  When there are, the Stock Adjustments screen is used to decrease those quantities (paying attention to the cost involved in that decrease).  Then, still in the Stock Adjustments screen, an equal increase is performed against the REDWAGON-P item code *at the same cost that was involved in the decrease*.  So, ultimately you're just moving the quantity (and cost) to the most common version of the item code. <h2 style="">How to handle an item that is both purchased and manufactured</h2><p style=""><br></p><p style="">Occasionally, an item will cross between purchased and manufactured, depending on the scenario.  DBA's recommendation to handle this would be to use two separate item numbers: one for the manufactured version and one for the purchased version.   As far as MRP is concerned, you must make a definitive choice as to whether you will be using the manufactured part number or purchased part number in all of your active default BOM revisions.  You can use the <em>BOM - Component Replace</em> to designate the part in all active revisions where the part is used.</p><p style=""><br></p><p style="">You may choose to use essentially the same item code but just append an appropriate suffix to one or both (such as ITEMCODE-P for the purchased version).  Each code should reflect, in the Stock Items screen, its associated M or P setting (M for the manufactured version and P for the purchased version).</p><p style=""><br></p><p style="">Aside from this being the only way to handle this scenario in DBA, there is a benefit in costing and lead day scheduling.  Each code will maintain its own inventory value, which can be helpful since, usually, the manufactured version will have a different costing impact than the purchased version.</p><p style=""><br></p><p style="">When listing the item as a BOM component, just make sure to choose the most common version used by your company.  So, for example, if the item is purchased 90% of the time (and manufactured the other 10%), it's more logical to list the purchased version in active BOMs.   If you want to switch to your manufactured item instead of purchasing you can use the BOM - Component replace to swap out the M item code.  </p><p style=""><br></p><p style="">Lastly, as you might imagine, having two separate item codes, each containing quantities of the same exact item, can be problematic.  So, you may consider the following solution for managing these separate item codes.  Pick the item code which is the most common.  In other words, figure out whether you would most likely be purchasing this item most of the time or if you would be manufacturing it most of the time.  Then, for the least common method's item code, set the default receipt location to be some sort of "review" location (a location with a name that indicates it should be reviewed).  Then, develop a company process to often review these locations, if quantities exist in them.  During that review, the Stock Adjustments module could be used to "transfer" the quantities into the more common item code.</p><p style=""><br></p><p style="">For example, I usually purchase red wagons.  Occasionally, though, I'll build them.  They are the exact same product, just different ways of obtaining them.  So, I set up a REDWAGON-P item code and a REDWAGON-M item code.  The REDWAGON-P item code gets received into a location where it is inventoried.  The REDWAGON-M item code, though, has a default receipt location of 'NEED-STOCKADJ'.  My company often reviews the 'NEED-STOCKADJ' location to see if there are any of these REDWAGON-M's in it.  When there are, the Stock Adjustments screen is used to decrease those quantities (paying attention to the cost involved in that decrease).  Then, still in the Stock Adjustments screen, an equal increase is performed against the REDWAGON-P item code *at the same cost that was involved in the decrease*.  So, ultimately you're just moving the quantity (and cost) to the most common version of the item code.</p><p><br></p> 35000021803 72 35000005100 2018-01-04T13:47:49-06:00 35000002609 15 2 0 0 How to handle an item that is both purchased and manufactured 2017-11-27T11:54:06-06:00 35000002609 1 2017-10-06T18:13:42-05:00 0 0 Can we run MRP Job generation and PO generation separately? This is not possible in DBA.  The Job generation process always precedes the PO generation process.  If you purchase before jobs you can create shortage gaps.  For best results, with the least amount of gaps, it's best for the production person(s) to book the jobs and then have the PO person(s) sign in and continue with the MRP session without regenerating. <h2 style="">Can we run MRP Job generation and PO generation separately?</h2><p style=""><br></p><p style="">This is not possible in DBA.  The Job generation process always precedes the PO generation process.  If you purchase before jobs you can create shortage gaps.  For best results, with the least amount of gaps, it's best for the production person(s) to book the jobs and then have the PO person(s) sign in and continue with the MRP session without regenerating.</p><p><br></p> 35000021803 38 35000005240 2017-10-06T18:13:42-05:00 35000002609 18 2 0 0 Can we run MRP Job generation and PO generation separately? 2017-11-27T11:54:06-06:00 35000002609