BRUNSWICK MOTORS, INC. (A) Dr. N. Sambandam IBS Mumbai Recently, Phil Harris, the Production Control Manager at Brunswick, read an article on Time-phased Requirements Planning. He was curious about how this technique might work in scheduling scheduling Brunswick’s Brunswick’s engine assembly assembly operations, operations, and decided to prepare prepare an example to illustrate the use of Time-phased requirements planning. Phil’s first step was to prepare a master schedule for one of the engine types produced by Brunswick – Model 1000 engine. This schedule indicates the number of units of the Model 1000 engine to be assembled each week during the next twelve weeks, and is shown in Figure 1. Figure 1: Model 100 Master Schedule
Weeks:
1
Quantity: 15
2
3
4
5
6
7
8
9
10
11
12
5
7
10
0
15
20
10
0
8
2
16
Next, Phil decided to simplify his requirements planning example by considering only two of many components, which are needed to complete the assembly of the Model 1000 engine. These two components, the Gear Box and the Input shaft, are shown in the Product Structure Diagram in Figure 2. Figure 2: Model 1000 product Structure
Crankcase (1) LT = 2 Wks
Engine Assembly
Level 0
Gear Box (1) LT = 2Wks
Level 1
Input Shaft (2) LT -2-= 3 Wks
Level 2
Phil noted that the gear Box is assembled by the Sub-assembly Department, and is subsequently sent to the main engine assembly line. The Input shaft is one of several component parts manufactured by Brunswick that are needed to produce a gearbox subassembly. Thus, levels 0, 1, and 2 are included in figure 2 to indicate the three manufacturing stages that are involved in producing an engine: the Engine Assembly Department, the Sub-assembly Department, and the Machine Shop. The manufacturing lead times required to produce the gearbox and the Input Shaft components are also indicated in Figure 2. Note that two weeks are required to produce a batch of gearboxes, and that all of the Gear Boxes must be delivered to the assembly line parts stock-room before Monday morning of the week in which they are to be used. Likewise, it takes three weeks to produce a lot of Input shafts, and all of the shafts that are needed for the production of Gear boxes in a given week must be delivered to the sub-assembly Department stockroom before Monday morning of the week. In preparing the MRP example Phil planned to use the attached worksheets, and to make the following assumptions: 1. Seventeen gearboxes are on hand at the beginning of Week 1 and five Gear boxes are currently on order to be delivered at the start of Week 2. 2. Forty Input Shafts are on hand at the start of Week 1 and twenty-two are scheduled for delivery at the beginning of Week 2. Assignment Questions:
1. Please prepare the MRP example for Phil. If the ordering costs are negligible for the two product components, determine the sequence of planned orders for the Gear Box and the Input Shaft component over the next twelve weeks. 2. Phil would like to include the ordering and inventory carrying costs for the gear Box and the Input shaft in this example, and has supplied the following data: Particulars Ordering cost Inventory Carrying Cost (Per Unit per week) Average Weekly Demand
Gear Box $ 90.00 $ 2.00
Input Shaft $ 40.00 $ 1.00
10
20
Using Period Order Quantity (POQ) and Part Period Balancing (PPB) procedures, determine the planned orders for the Gear Box and Input Shaft components. For this question assume the following: a) On hand inventory is 78 for the input shafts at the start of period 1, and no receipts are scheduled for the 12 weeks. b) Inventory carrying cost is charged on the inventory balance at the end of each week. There are no scheduled receipts for the Input shaft outstanding. c) The status of the gearboxes is the same as indicated in assumptions 1 and 2. ***********
MATERIAL REQUIREMENTS PLANNING WORKSHEET Engine Assembly Master Schedule
Weeks Qty.
1
2
3
4
5
6
7
8
9
10
11
12
8
9
10
11
12
8
9
10
11
12
Gear Box Requirements Weeks
1
2
3
4
5
6
7
Gross requirement On Hand Inventory Scheduled Receipts Net Requirement Planned Order Release
Input Shaft Requirements Weeks Gross Requirement On Hand Inventory Scheduled Receipts Net Requirement Planned Order Receipt
1
2
3
4
5
6
7
MATERIAL REQUIREMENTS PLANNING WORKSHEET
Engine Assembly Master Schedule
Weeks Qty.
1
2
3
4
5
6
7
8
9
10
11
12
8
9
10
11
12
8
9
10
11
12
Gear Box Requirements Weeks
1
2
3
4
5
6
7
Gross Requirement On Hand Inventory Scheduled Receipt Net Requirement Planned Order Receipt
Input Shaft Requirements Weeks Gross Requirement On Hand Inventory Scheduled Receipt Net Requirement Planned Order Receipt
1
2
3
4
5
6
7