Involvements process passive no efforts towards

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Involvements process Passive- no efforts towards change Active- tries to improve and change system, and to lower inventory Data requirements Detailed and strict data accuracy Much lower and tend to be visible Operations Computerized Simple, manual shop floor controls such as Kanban
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Issues in MRP Lot-sizing Net change versus regenerative MRP Safety stock Assemble-to-order firms MRP I to MRP II Evaluation of MRP
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MRP II MRP II Figure 16.15 Manufacturing resource plan Cost and financial data Purchasing reports Financial/ accounting reports Sales and marketing reports Human resource reports Manufacturing reports Inventory records Inventory transactions Bills of materials Routings Time standards MRP MRP explosion explosion Master production schedule Customer orders Forecasts Material requirements plan
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MRP: Implementation Issues Prerequisites Management support Data (input) integrity: accurate, timely, realistic Bill of materials structure Magnitude of lot size Operating environment volatility Application Guidelines: MRP is most useful in managing large numbers of dependent demand items- when there are many levels in the bills of materials Relative advantages of MRP are greatest with more BOM levels and larger lit sizes MRP operates best when there is only moderate volatility in the operating environment
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Development of MRP: Manufacturing resource planning (MRP II) Ties MRP to firm’s financial system MRP Ii can be used by managers in manufacturing, purchasing, marketing, finance, accounting, and engineering MRP and the environment Companies can modify MRP to assist them in tracking and planning the disposition of potentially harmful waste products Distribution Requirements Planning (DRP) Refers to stock of items held at retailers and distribution centers DRP requires an integrated information system and it can help avoid self-induced swing in demand MRP: Implementation Issues (II)
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MRP Application in Service Operations Service Resource Planning The basics of MRP can be used by service providers The concept of dependent demand can be defined to include demands for resources that are driven by forecasts of customer requests for services or by plans for various activities in support of services the company provides The concept of a BOM changes to a bill of resources (BOR), which identifies the type of resources and the quantity needed for a given service that is provided. The BOR can be complex.
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Bill of Resources Bill of Resources Figure 16.16 Figure 16.16 (a) (a) Level 1 Discharge Level 2 Intermediate care Level 3 Postoperative care (Step down) Level 4 Postoperative care (Intensive) Level 7 Preoperative care (Testing) Level 5 Surgery Level 6 Preoperative care (Angiogram) Nurse (6 hr) MD (1 hr) Therapy (1 hr) Bed (24 hr) Lab (3 tests) Kitchen (1 meal) Pharmacy (10 medicines) (b) Level 6 Preoperative care (Angiogram)
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Enterprise Resource Planning (ERP)
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