MRP_II_AND_ERP for final year mechanical students

Process planning

1. Module 6:MRP II & ERP Mechanical – 2020- 21 – PPC Lokpriya Gaikwad Assistant Professor Dept . of Mechanical Engineering , SIES Graduate School of Technology 1

2. 2 MANUFACTURING RESOURCES PLANNING MRP II evolved from MRP in the 1980s because manufacturers recognized additional needs. It is an expanded scope of materials planning to include capacity requirements planning, and to involve other functional areas of the organization such as marketing and finance in the planning process.

3. 3 MANUFACTURING RESOURCES PLANNING MRP II systems are good at simulation and help answer "what if" questions i.e., to foresee the consequences of their options and other alternatives. One of the most important features of MRP II is its ability to aid managers in capacity planning.

4. 4 MANUFACTURING RESOURCES PLANNING

5. 5 MANUFACTURING RESOURCES PLANNING Closed-Loop MRP A system used for production planning and inventory control, with an information feedback feature that enables plans to be checked and adjusted. It synchronize the purchasing or materials procurement plans with the master production schedule. The system is called a closed loop MRP because of its feedback feature, which is also referred to as “closing the loop.” 

6. 6 MANUFACTURING RESOURCES PLANNING Closed-Loop MRP

7. 7 MANUFACTURING RESOURCES PLANNING CAPACITY REQUIREMENTS PLANNING The process of determining short-range capacity requirements. It is an important part of ensuring that a company can meet production expectations.

8. 8 MANUFACTURING RESOURCES PLANNING CAPACITY REQUIREMENTS PLANNING Key Inputs: Planned-order releases for MRP, the current shop load, routing information, and job times Key Output: Load reports for each work center

9. Develop a tentative master production schedule Use MRP to simulate material requirements Convert material requirements to resource requirements Is shop capacity adequate? Firm up a portion of the MPS Change Capacity Can capacity be change to meet requirements? Revise tentative master production schedule Time Period An overview of the capacity planning process using MRP A Hypothetical Department Load Profile No No Yes Yes

10. Also referred to as distribution requirements planning. A method used for planning orders in a supply chain. Its goal is to achieve a balance of supply and demand throughout the supply chain. Distribution Resource Planning for the Supply Chain MRP II MANUFACTURING RESOURCES PLANNING

11. It begins with a forecast of demand plus actual orders for future periods at the distribution end of a supply chain. Other information needed includes the quantity and timing of scheduled receipts at various points in the supply chain as well as on-hand inventories, and any safety stock requirements. Distribution Resource Planning for the Supply Chain MRP II MANUFACTURING RESOURCES PLANNING

12. ERP

13. ERP Software solution that addresses the enterprise needs , taking a process view of the overall organization to meet the goals, by tightly integrating all functions and under a common software platform. It represents an expanded effort to integrate standardized record keeping that will permit information sharing among different areas of an organization in order to manage the system more effectively. ENTERPRISE RESOURCE PLANNING WHAT IS ERP?

14. ERP ERP software provides a system to capture and make data available in real time to decision makers and other users throughout an organization. It provides a set of tools for planning and monitoring various business processes to achieve the goals of the organization. It composed of a collection of integrated modules. ENTERPRISE RESOURCE PLANNING WHAT IS ERP?

15. Module Brief Description Accounting/Finance A central component of most ERP systems. It provides a range of financial reports, including general ledger, accounts payable, accounts receivable, payroll, income statements, and balance sheets. Marketing Supports lead generation, target marketing, direct mail, and sales. Human Resources Maintains a complete database of employee information such as date of hire, salary, contact information, performance evaluations, and other pertinent information. Purchasing Facilitates vendor selection, price negotiation, making purchasing decisions and bill payment. Production Planning Integrates information on forecasts, orders, production capacity, on-hand inventory quantities, bills of material, work in process, schedules and production lead times. Inventory Management Identifies inventory requirements, inventory availability, replenishment rules, and inventory tracking. Distribution Contains information on third-party shippers, shipping and delivery schedules, delivery tracking. Sales Information on orders, invoices, order tracking, and shipping. Supply Chain Management Facilitates supplier and customer management, supply chain visibility, and event management An overview of some ERP software modules

16. ERP Employees Managers and Stakeholders How Do ERP Systems Work? Central Database Reporting Applications Human Resource Management Applications Financial Applications Manufacturing Applications Inventory And Supply Applications Human Resource Management Applications Service Applications Sales and Delivery Applications Sales Force And Customer Service Reps Customers Back-office Administrators And Workers Suppliers Source: Davenport, Thomas, “Putting the Enterprise into the Enterprise System”, Harvard Business Review, July-Aug. 1998.

17. An ERP Example: Before ERP Customers Customer Demographic Files Sales Dept. Vendor Orders Parts Accounting Accounting Files Purchasing Purchasing Files Order is placed with Vendor Invoices accounting Inventory Files Warehouse Checks for Parts Calls back “Not in stock” “We ordered the parts” “We Need parts #XX” “We ordered the parts” Sends report Sends report Sends report Ships parts

18. An ERP Example: After ERP Database Customers Sales Dept. Purchasing Warehouse Accounting Vendor Inventory Data If no parts, order is placed through DB Orders Parts Order is submitted to Purchasing. Purchasing record order in DB Order is placed with Vendor And invoices accounting Financial Data exchange; Books invoice against PO Books inventory against PO Ships parts

19. To integrate financial data To standardize manufacturing processes To standardize HR information Why ERP? Source: Christopher Koch, “ABC: An Introduction to ERP,” Cio.com, Copyright 2008 CXO Media. Used with permission

20. Training Integration and testing Data conversion Data analysis Consultants ad infinitum Replacing your best and brightest Implementation teams can never be stop Waiting for ROI Post-ERP Depression The Hidden Cost of ERP

21. The big bang - The most ambitious and difficult of approaches to ERP implementation, companies cast off all their legacy systems at once and implement a single ERP system across the entire company. How do Companies Organize their ERP Projects?

22. Franchising strategy - This approach suits large or diverse companies that do not share many common processes across business units. Independent ERP systems are installed in each unit, while linking common processes such as financial bookkeeping, across the enterprise. How do Companies Organize their ERP Projects? Source: Christopher Koch, “ABC: An Introduction to ERP,” Cio.com, Copyright 2008 CXO Media. Used with permission

23. Slam-dunk - ERP dictates the process design in this method, where the focus is on just a few key processes, such as those contained in an ERP system’s financial module. The slam-dunk is generally for smaller companies expecting to grow in ERP. How do Companies Organize their ERP Projects? Source: Christopher Koch, “ABC: An Introduction to ERP,” Cio.com, Copyright 2008 CXO Media. Used with permission

24. 10. Believing the journey is complete at “go live” 9. Not planning for- and minimizing-the interim performance dip after start up 8. Failing to balance the needs and power of integration with seek quick business hits. 7. Staring too late to address all things data (architecture, standards, management, cleansing, and so on.) The Top 10 ERP Mistakes

25. 6. Failing to staff the team with “A” players from business and technical sides of the organization, including program management. 5. Starting without an effective and dedicated senior governance council, including a single executive sponsor. 4. Selecting a strong system integrator and then not heeding its advice. The Top 10 ERP Mistakes

26. 3. Trying to create a solution incompatible with the company’s culture. 2. Treating this as a technical project vs. a change that balances people, process, and technology; not using power of the new, integrated information. 1. Embarking on the journey without solid, approved business case, including mechanisms to update the business case continuously and to ensure the savings are baked into operational budgets. The Top 10 ERP Mistakes

27. The difference among MRP,MRP II and ERP

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