1. Material Requirements Planning (MRP)
Daniela Narváez
Quality Control

2. Material Requirement Planning
Business Process Overview
Procedure: MRP Scenario Creation
MRP Calculation Logic
MRP Order Recommendation View

3. Business Process Overview

4. Material Requirement Planning
Business Process Overview
Procedure: MRP Scenario Creation
MRP Calculation Logic
MRP Order Recommendation View

5. MRP Scenario Creation
In order to execute the Material Requirements planning (MRP), the business must define the input to be considered in the process. For this, the system divided into three tabs:
Scheduling. This tab is used for most relevant parameters for the scenario
Forecast: after creating a forecast for upcoming days, the user can assign it to the process run
Order recommendation by: the system allows to choose how the orders will be created: by day, week, month
Deliver by: planning days, this could be in a range of days or a quantity of days
Work order: the system allows to select which work order will be taking into account. If the user does not select any, the system will use by default all the work order in the range of days the MRP is running
Containment for display: in this part, the user can filter by item, group of items, or property, the MRP process

6. MRP Scenario Creation
In order to execute the Material Requirements planning (MRP), the business must define the input to be considered in the process. For this, the system divided into three tabs:
Detail. In this tab, the user customizes the input parameters, the calculation method, view and authorizations
Pegging and replenishment: the user sets in the scenario which activities from production, sales, purchases and inventory are going to be considered
Breakdown replenishment: the user sets in the scenario which transactional data will be considered in sub-assembly and bill of material
Inventory: the user can specify which documents at the warehouse are considered available to plan
Calculation: the system allows to select in the scenario if the MRP besides from quantities, also calculates material price
Authorization: in this part, the user can specify who is able to set up, view or calculate in the system

7. MRP Scenario Creation
In order to execute the Material Requirements planning (MRP), the business must define the input to be considered in the process. For this, the system divided into three tabs:
Warehouse. In this tab, the user selects which inventory the system take into account as available for calculation
Warehouse list: the user sets in the scenario which warehouse are going to be considered
(*) Consider warehouse location filters in transactions: when activated, WO receipts and issues are not taking into the inventory calculation
(*) This only occurs when the warehouse is not selected. The system only take the minimum inventory (when apply)

8. Material Requirement Planning
Business Process Overview
Procedure: MRP Scenario Creation
MRP Calculation Logic
MRP Order Recommendation View

9. MRP Calculation Logic
MRP has several parameters to configure before calculating to give the best result according to the business cases
Calculation customization: configure parameters in the configuration wizard about MRP logic: Administration > System Initialization > Configuration Wizard > Material Management > MRP Wizard > Calculation
Calculation customization: configure parameters in the configuration wizard about Forecast input: Administration > System Initialization > Configuration Wizard > Material Management > MRP Wizard > Forecast

10. At the end of the previous day
MRP Calculation Logic
The MRP works just as a calculator. The objective is to plan the inventory flow throughout the period of time according to incomes and outcomes per period
Direct Flow
Inventory
At the end of the previous day
Example:
Work Orders
Finished Goods
Finished Good
Purchase Orders
Good Receipts
Raw Material
Master Data:
Finished Good:
Delivery Date: 0 days
Minimum Inventory: 20
UofM: 1 piece
Raw Material:
Lead Time: 7 days
UofM: 5 pieces
Forecast
Work Orders
Raw Material
Sales Orders
Minimum Inventory
MRP Calculation
Total to
Produce or buy

11. MRP Calculation Logic
The MRP logic starts from the delivery date and calculates backwards. The finished good breakdowns a demand for the item in the bill of material and the system calculates the quantities and delivery dates
ILLUSTRATIVE
Finished Good
Week 1
Week 2
Week 3
Inventory 10 20 20
Work Orders 60
1 pc
Purchase Orders
5 pcs
Good Receipts 15
Forecast
150 50
100
Sales Orders 55 10 25
Minimum Inventory 20 20 20
MRP Calculation
140 60
125

12. MRP Calculation Logic
The MRP logic starts from the delivery date and calculates backwards. The finished good breakdowns a demand for the item in the bill of material and the system calculates the quantities and delivery dates
ILLUSTRATIVE
Raw Material
Week 1
Week 2
Week 3
Inventory
500
350
275
Work Orders
1 pc
Purchase Orders
150
5 pcs
Good Receipts
Forecast
250
500
Sales Orders 50
125
Lead Time 7 7 7
MRP Calculation
275

13. Material Requirement Planning
Business Process Overview
Procedure: MRP Scenario Creation
MRP Calculation Logic
MRP Order Recommendation View

14. MRP Order Recommendation View
The results of the MRP run are congregated in one complete screen as follow:

15. MRP Order Recommendation View
The results of the MRP run are recommendations that fulfill gross requirements by taking into consideration the existing inventory levels and existing Purchase and Work Orders. This upper side of the screen has three tabs: all items, purchase items and in-house production
The system gives, by default, a general vision of the results for the next 7 weeks, also an accumulative of weeks in the past and in the future after the 7º week. The user can configure the time line in periods by scenario (months, weeks, days)
This upper side of the screen has three tabs: all items, purchase items and in-house production

16. MRP Order Recommendation View
Down, on the left side of the main screen, there are two tabs:
The first tab shows outflows (forecasts, sales orders) or inflows (work orders, purchase orders) that were used to calculate the quantity needed to deliver the finished good
The second tab is called either order or produce depending on the item the user is looking. When the item is produced by the company, the tab that appears is “produce”, and when is bought, the tab is “Order”

17. MRP Order Recommendation View
Down, on the right side of the main screen, there are three tabs:
The first tab shows all current active documents from the product selected
The second tab shows the price lists including scale prices and special price list
The third tab shows the detailed information of the alternative product according to the main product planned

18. MRP Order Recommendation View
As an additional functionality from beas, there are internal documents for purchase and production order. These documents are designed preview to the final document in order to validate the amounts and details
Mode of Procurement
Intermediary Document
Final Document
Buy
Purchase request
Purchase Order
Purchase Quotation
Produce
Production demand
Work Order
(*) It is not necessary to create an intermediate document to go through the process. A final document can created directly
Document used for validating purposes

19. MRP Order Recommendation View
ILLUSTRATIVE
The pre-assignment functionality works for collective receipts or issues
The pre-assignment functionality assign quantities according to the document (Sales order, purchase order, work order).
This functionality helps the user to assigns the exact number according to the plan or negotiation

20. MRP Order Recommendation View
In more detail, the second tab is very useful to create an order (Purchase or work, depending on the item)
The pre-assignment functionality assign quantities according to the document (Sales order, purchase order, work order). This functionality helps the user to assigns the exact number according to the plan or negotiation
These results can be accumulated depending on the quantities recommended. The system allows to create a purchase order individually, summing the orders from a week, or month. If it is a work order, this can be only made if the product is make to stock when the user consider the pre-assignment function.
There are several documents that can be created: only in Beas or SAP documents

21. MRP Order Recommendation View Work Order
The system allows to create the work order directly according to the quantities calculated or adjusted manually
After creating the work order the user can view the detailed information in the work order and adjust if needed

22. MRP Order Recommendation View Production Demand
As an additional functionality from beas, there is an internal document creation for production requests
After creating the production request, the user can view the detailed information in “Production Request” screen

23. MRP Order Recommendation View Production Demand
The system allows to create a production demand according to the quantities calculated manually in order to go through a validation or adjustments before creating a work order
The system allows to create individual work order, summarized or merge production demand in order to create a new work order

24. MRP Order Recommendation View Purchase Order
The system allows to create the purchase order directly according to the quantities calculated or adjusted manually
After creating the purchase order the user can view the detailed information in the work order and adjust if needed

25. MRP Order Recommendation View Purchase Request
As an additional functionality from beas, there is an internal document creation for purchase requests
After creating the purchase request, the user can view the detailed information in “Purchase Request” screen

26. MRP Order Recommendation View Purchase Request
Purchase Request screen is a view of all purchase requests filtered by supplier and user
Detailed information can be viewed by double clicking the material. The information presented could be purchase requests (Upper screen) and purchase orders (bottom screen) with document number

27. MRP Order Recommendation View Purchase Request
Purchase Request screen allows the user to modify according to preview negotiation the supplier, quantities and dates
After creating the purchase request, the user can view the detailed information in “Purchase Request” screen

28. MRP Order Recommendation View Purchase Request
Purchase Request screen is a view of all purchase requests filtered by supplier and user
After changing the purchase request, the user can create the purchase order from the same screen