The Production Plan (PP), Master Production Scheduling (MPS), and Material Requirements Planning (MRP) are major components of the Manufacturing Planning and Control System that is used to manage Production and Operations.
The Production Plan
Using objectives set by the business plan, the Production Plan takes into consideration the overall quantities of the items to be produced, desired inventory levels, and the availability of equipment, labor and material.
The idea being to develop a plan that will satisfy the market demand for the company’s products. This involves developing a plan that strikes a balance between market demand and the product availability over the planned production period(s).
The Master Production Schedule
The Master Production Schedule (MPS), whether formal or informal, is the planned or forecasted ‘build schedule’ for the products that the company has identified to sell to the market place. These numbers should match and support the Production Plan.
It is important to note that the MPS is not a sales tool. Instead, the MPS is the product mix or the configurations that the company believes it will sell but also considers the overall forecast, sales backlog, production capacity, material availability and manufacturing resources.
Material Requirements Planning
The Material Requirements Planning (MRP) program is an algorithm that is driven by the Master Production Schedule and, using the company’s item master, part numbers, bill-of-materials, etc. determines the net requirements for materials and the production work orders over discrete periods of time.
The Bottom Line. The Production Plan, Master Production Schedule, and Material Requirements Planning programs are the major components of the Manufacturing and Control System for a company. The Production Plan is developed from the company’s business plan. The Master Production Schedule is the company’s build schedule for its products. The Material Requirements Planning (MRP) system provides the ‘time-phased’ material and work order requirements needed to build products.
Materials Requirements Planning (MRP). Material Requirements Planning is a method to determine the need of purchased materials and production / shop floor orders over discrete periods of time. MRP systems can be manual or computerized. For more on this topic, please follow this link.
Inventory Management. “Can You Avoid the ‘Deadly Sins’ of Inventory Management?” The purchase and storage of raw materials typically represents the single largest investment for a manufacturing company. To learn more, please follow this link.
Sourcing Strategies. The strategic sourcing process is a subset of procurement. It is procurement’s responsibility to find and develop competent suppliers that are qualified to provide the firm with its needed materials. For more on this topic, please follow this link
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