Operations and Supply Chain Management The Core

278 OPERATIONS AND SUPPLY CHAIN MANAGEMENT
exhibit 9.12
Number of Units On-Hand and Lead Time Data That Would
Appear on the Inventory Record File
ITEM ON-HAND INVENTORY LEAD TIME (WEEKS) SAFETY STOCK ON-ORDER
A 50 2 0
B 60 2 0 10 (week 5)
C 40 1 5
D 200 1 20 100 (week 4)
MRP calculations (often referred to as an explosion) are done level by level, in conjunction
with the inventory data and data from the master schedule.
Exhibit 9.13 shows the details of these calculations. The following analysis explains
the logic in detail. We will limit our analysis to the problem of meeting the gross requirements
for 1,250 units of meter A, 470 units of meter B, and 270 units of transformer D, all
in week 9.
exhibit 9.13
Material Requirements Planning Schedule for Meters A and B, and
Subassemblies C and D
Week
Item
4 5 6
7 8 9
A
LT = 2 weeks
On-hand = 50
Safety stock = 0
Order qty = lot-for-lot
Gross requirements
Scheduled receipts
Projected available balance
Net requirements
Planned-order receipts
Planned-order releases
50
50 50 50
1,200
1,250
50 0
1,200
1,200
B
LT = 2 weeks
On-hand = 60
Safety stock = 0
Order qty = lot-for-lot
Gross requirements
Scheduled receipts
Projected available balance
Net requirements
Planned-order receipts
Planned-order releases
10
60 70
70 70
400
470
70 0
400
400
C
LT = 1 week
On-hand = 40
Safety stock = 5
Order qty = 2,000
Gross requirements
Scheduled receipts
Projected available balance
Net requirements
Planned-order receipts
Planned-order releases
400+
1,200
35 35 35 435
1,565
2,000
2,000
435 435
D
LT = 1 week
On-hand = 200
Safety stock = 20
Order qty = 5,000
Gross requirements
Scheduled receipts
Projected available balance
Net requirements
Planned-order receipts
Planned-order releases
100
280
4,000 1,200
270
280 1,280 80 80 4,810
3,720
190
5,000
5,000
5,000 5,000