MRP’s Limitations
Last time, we talked about how a visualized production schedule can help you respond to due dates faster than doing it manually. Now let us discuss one of the most important areas of lean manufacturing – reduction of lead times.
In today’s fast-paced business atmosphere, it is imperative that businesses strive to reduce the gap between the receipt of an order to shipment. Thus, many companies have come to the realization of development and implementation of systems, in which the old, traditional methods couldn’t accomplish.
Material Requirements Planning or MRP, for many years, has been utilized by many businesses to improve the production efficiency and products delivery. But one of the limitations of MRP has been its deterministic, fixed view of lead time – it does not take into account, for example, the capacity of each factory’s machine. Also, materials order placement, a fundamental feature of MRP, is most of the time, performed much earlier than necessary resulting in an exorbitant increase in inventory. In production management terms, this is called Infinite Capacity Scheduling.
These shortcomings of Material Requirements Planning or MRP, has been successfully corrected by Finite Capacity Scheduling, one of the features of an Advanced Planning and Scheduling software to read further, please click here