How to Select The Appropriate Time Bucket for the MRP Process

Executive Summary

  • The MRP process requires the selection of a planning bucket.
  • The planning bucket changes based upon the application.
  • When selecting a planning bucket for MRP users face a trade-off that must be considered.

Introduction to Selecting the Right Planning Bucket

The planning bucket is one of the primary control areas of the planning system. You will learn about the planning bucket and its interactions in this article.

What is the Planning Bucket?

The planning time bucket is how the timeline is divided for planning purposes.

It should not be confused with the storage bucket. The storage bucket is how the planning data is stored by the system which is a different relationship to the MRP process. Of course, the storage bucket must always be smaller than the planning bucket.

How the Planning Bucket Changes Depending Upon the Application

Some typical timings in different planning systems are listed below:

  • In demand planning, it is normally a week.
  • In supply planning, it is either a day or a week.
  • In production planning and scheduling, it is normally the day.

Plossl’s Observations on the Timing of the MRP Process

George Plossl had an interesting observation on the planning bucket from his book Orlicky’s Material Requirement’s Planning..

“When selecting the size of the MRP time bucket, users face a trade off between the desire to have planned events pinpointed in time and the need for clear and simple ordering data. Specifying order completions by month is less than helpful to shop supervisors. They need to know what next to produce for this week or better yet today. When several hundreds or thousands of shop orders are due in October, but MRP schedules provide no relative priority information, shortage lists and expediting will replace the formal system and performance will deteriorate. Planning is not an exact science, in spite of the apparent rigor of MRP calculations. A one week time bucket is most common, except in a few businesses like food, pharmaceuticals and fine chemical manufacturing, where production times are very short. In other types of manufacturing, one week is reasonable for order releases, completions, priorities, lot sizing and load reporting.”

This indicates important trade-offs for the MRP process and the setup of the MRP system. It is important to acknowledge that these trade-offs exist and their implications on the timing settings of the MRP system.

Conclusion

George Plossl is correct, this is the most common planning bucket for the MRP process. However, it is interesting to hear the positives and negatives laid out by a person quite experienced in the area.

Learn about the history of MRP at this link.

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References

Brightwork MRP & S&OP Explorer for Tuning

Tuning ERP and External Planning Systems with Brightwork Explorer

MRP and supply planning systems require tuning in order to get the most out of them. Brightwork MRP & S&OP Explorer provides this tuning, which is free to use in the beginning. See by clicking the image below:

Plossel, George. Orlicky’s Material Requirement’s Planning. Second Edition. McGraw Hill. 1984. (first edition 1975)

I cover MRP in the following book.

Repairing the MRP System Book

MRP System

Repairing your MRP System

What is the State of MRP?

MRP is in a sorry state in many companies. The author routinely goes into companies where many of the important master data parameters are simply not populated. This was not supposed to be the way it is over 40 years into the introduction of MRP systems.

Getting Serious About MRP Improvement

Improving MRP means both looking to systematic ways to manage the values that MRP needs, regardless of the MRP system used. It can also suggest evaluating what system is being used for MRP and how much it is or is not enabling MRP to be efficiently used. Most consulting companies are interested in implementing MRP systems but have shown little interest in tuning MRP systems to work to meet their potential.

The Most Common Procedure for Supply and Production Planning?

While there are many alternatives to MRP, MRP, along with its outbound sister method DRP, is still the most popular method of performing supply, production planning, and deployment planning. In the experience of the author, almost every company can benefit from an MRP “tune up.” Many of the techniques that the author uses on real projects are explained in this book.

Chapters

  • Chapter 1: Introduction
  • Chapter 2: The Opportunities to Improve MRP
  • Chapter 3: Where Supply Planning Fits Within the Supply Chain
  • Chapter 4: MRP Versus MRP II
  • Chapter 5: MRP Explained
  • Chapter 6: Net Requirements and Pegging in MRP
  • Chapter 7: Where MRP is Applicable
  • Chapter 8: Specific Steps for Improving MRP
  • Chapter 9: Conclusion
  • Appendix A: Calculating MRP

Supply Planning Book

SUPPLY

Supply Planning with MRP, DRP and APS Software

Showing the Pathway for Improvement

Supply planning software, and by extension supply planning itself, could be used much more efficiently than it currently is. Why aren’t things better?

Providing an Overall Understanding of Supply Planning in Software

Unlike most books about software, this book showcases more than one vendor. Focusing an entire book on a single software application is beneficial for those that want to use the application in question solely. However, this book is designed for people that want to understand supply planning in systems.

  • What methods fall into APS?
  • How do the different methods work and how do they differ in how they generate output?
  • What is the sequence of supply planning runs?

These types of questions are answered for readers in this book.

This book explains the primary methods that are used for supply planning, the supply planning parameters that control the planning output as well as how they relate to one another.

Who is This Book For?

This book as a practical primer for anyone looking to perform a supply planning software selection, any person beginning a supply planning project, or anyone who just wants to understand supply planning software simply better.

Chapters

  • Chapter 1: Introduction
  • Chapter 2: Where Supply Planning Fits Within the Supply Chain Planning Footprint
  • Chapter 3: MRP Explained
  • Chapter 4: DRP Explained
  • Chapter 5: APS Supply Planning Methods
  • Chapter 6: APS for Deployment
  • Chapter 7: Constraint-based Planning
  • Chapter 8: Reorder Point Planning
  • Chapter 9: Planning Parameters
  • Chapter 10: How MRP, DRP, and APS Relate to One Another
  • Chapter 11: Supply Planning Visibility and Master Data Management
  • Chapter 12: Understanding the Difference Between Production Versus Simulation