Integrated MPC Systems Chapter 9

Topics MPC design options. Choosing the options to support corporate strategy and fit production process design. Evaluating choices in practice. Integrating MRP and JIT.

MPC System (VBW, Figure 9.1)

MPS Options Make-to-order approach typical when product is custom-built to individual customer specifications. Assemble-to-order used when overall manufacturing lead time exceeds customer expectations, end items are too varied and costly to invest in finished-goods inventory, and modules or options can be combined to meet customer requirements. Make-to-stock used for standardized end items with short delivery lead times. (See Figure 9.2.) ]]]]]]]]]]]

Detailed Material Planning Options Time-phased planning for individual product components is typically carried out with material requirements planning approaches. Rate-based planning users include repetitive manufacturing, assembly lines, just-in-time, and other flow manufacturing systems. (See Figure 9.3.)

Shop-Floor System Options MRP-based approach supports batch manufacturing operations. Objective is to coordinate sequencing of orders at work centers with customer delivery requirements. JIT-based approach is based on minimal flow times for the entire product. (See Figure 9.4.)

Choosing the Options Market requirements. Manufacturing task. Manufacturing process design. MPC system design MPS options (Figure 9.6). Material planning options (Figure 9.7). Shop-floor system options (Figure 9.8).

Market Requirements Review firm’s customers and targeted market segments, their present and future needs regarding the firm’s products and services, competitor’s products and services, and sales growth opportunities. Market focus, customer satisfaction, and delighting the customer are common phrases - but we must redefine the manufacturing task to create the desired results.

Manufacturing Task Must be consistent with, and support, the corporate and marketing strategy. Determine target market’s requirements—product variety, volume and delivery flexibility, low-cost production, critical product quality requirements, and other manufacturing-related capabilities.

Integrating MRP and JIT Response to business concerns (meeting world class standards, use of global benchmarking, intimidating competition) has led to JIT implementation. MRP systems sometimes limit JIT programs because of transaction processing. Techniques include creating phantom bills [of materials] for JIT-functions.

Integrating MRP and JIT Supporting physical changes: Reduce inventory transaction volume. Introduce cellular manufacturing. Strategy includes creating a disciplined use of systems and focusing on improving quality. Note that evolution can go from JIT towards MRP as well as MRP towards JIT.

Concluding Principles Since investment in MPC systems is large and fixed over a long period of time, its design must support the firm’s competitive strategy. A wide range of options are available in designing MPC systems, and the choices must be governed by the firm’s competitive needs. Business as well as technical specifications need to be considered in designing an MPC system.

Concluding Principles MPC systems design should begin with an analysis of the market requirements to support the firm’s competitive strategy. Understanding the manufacturing task is critical in developing the production process design, the MPC system design, and other elements of the manufacturing infrastructure.

Concluding Principles The manufacturing process’s particular features need to be considered in choosing among the options in MPC system design. MRP and JIT approaches can be effectively integrated in designing MPC systems. Improved company performance can result from matching MPC system design to the firm’s competitive strategy.