SCM 6

rough cut capacity plan (RCCP)

a medium range capacity plan used to check the feasibility of the master production schedule

material requirements planning

a software based production planning and inventory control system for computing dependent demand and timing requirements

planned order releases

a specific order to be released to the shop or the supplier to ensure that it is available on the need date POR of the parent translate into gross req of the components

chase production strategy

adjust capacity to match the demand pattern hire/lay off workers to match its production rate to demand -->workforce fluctuates, but finished goods inventory remains constant

indented bill of materials

an illustration of multilevel BOM at each level of indentation, the level number increases by one

product family

different products that share similar characteristics, components or manufacturing processes

make to stock manufacturing firms

emphasize immediate delivery of off the shelf, standard goods at relatively low prices

bill of materials (BOM)

engineering doc that shows an inclusive listing of all component parts and subassemblies making up the end item

capacity

firm's labor and machine resources max amount of output that an org is capable of completing in a given period of time

legacy MRP system

label used to describe an older info system that usually works at an operational level to schedule production within an org

resource requirements planning (RRP)

long range capacity planning module used to check whether aggregate resources are capable of satisfying the agg production plan

aggregate production plan

long-range materials plan hierarchical planning process that translates annual business plans and demand forecasts into a production plan for all products -capacity is usually considered fixed during the planning horizon

match or tracking capacity strategy

moderate strategy that adjusts capacity in small amounts in response to demand and changing market conditions

closed loop MRP

natural extension of MRP that added capacity reqs planning and feedback to describe the progress of orders being manufactured

enterprise resource planning (ERP)

new MRP system to enable users to perform more sophisticated analyses and integrate org wide activities, including operations and facilities that are located in different countries from the head office -managing an enterprise's functional activities, suppliers and customers

planning factor

number of components needed to produce one unit of the parent item

manufacturing resource planning (MRP II)

outgrowth of the closed loop MRP system concept: link internal operations to financial function to provide management with current data (sales, purchasing, production, inventory, cash flow)

single integrator approach

picks all the desired apps from a single vendor for the ERP system -fit less complex business environments

best of breed solution

picks the best application or module for each individual function in the SC -better suited for more intricate workplaces

lead capacity strategy

proactive approach that adds or subtracts capacity in anticipation of future market conditions and demand

make to order manufacturing firms

produce one of a kind, specialty products based on customer specifications cannot build ahead of orders

lag capactiy strategy

reactive approach that adjusts its capacity in response to demand

level production strategy

relies on constant output rate and capacity while varying inventory and backlog levels to handle the fluctuating demand pattern -more suites for firms that require highly skilled labor

time fence system

separates the planning horizon into 2 segments: firmed and tentative firmed- demand time fence, which usually stretches from the current period to a period several weeks into the future production plan or MPS cannot be altered except with the authorization of senior management

capacity requirements planning (CRP)

short range capacity planning technique that is used to check feasibility of the MRP

system nervousness

situation wherein a small change int he upper level production plan causes a major change in the lower level production plan

cloud computing or software-as-a service (SaaS) models

subscription based ERP systems owned by a third party and provided over the internet

planning time fence

tentative segment -stretches from end of firmed segment to several weeks farther into the future

independent demand item

the final product has a demand pattern that is subject to trends and seasonal variations and general market conditions

dependent demand items

the reqs for all items in Level 1 and below

available to promise (ATP) quantity

the uncommitted portion of the firm's planned production difference b/w confirmed customer orders and the quantity the firm planned to produce, based on the MPS

distribution requirements planning (DRP)

time phased finished goods inventory replenishment plan in a distribution network -determines agg time phased net reqs of the ifnished goods, and provides demand info for adjusting the MPS

master production schedule

time phased, detailed disaggregation of the aggregate production plan, listing the exact end items to be produced planning horizon is shorter than APP but longer than production lead time

super bill of materials

useful for planning purposes planning BOM, pseudo BOM, phanton BOM, family BOM state percentage of each option instead of panning factor

option overplanning

when exact proportion of each option is uncertain, the percentage can be increased slightly to cover the uncertainty