over view mrp
DESCRIPTION
SAP PP MRPTRANSCRIPT
www.capgemini.com
The information contained in this presentation is proprietary.© 2015 Capgemini. All rights reserved. Rightshore® is a trademark belonging to Capgemini.
About Capgemini
With almost 145,000 people in over 40 countries, Capgemini is one of the world's foremost providers of consulting, technology and outsourcing services. The Group reported 2014 global revenues of EUR 10.573 billion.Together with its clients, Capgemini creates and delivers business and technology solutions that fit their needs and drive the results they want. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore ®, its worldwide delivery model.
and
MATERIAL REQUIREMENT PLANNING
Apr 2015
By : Syed Mateenuddin
3Copyright © Capgemini 2013. All Rights Reserved
January 2013and
What is MRP
MRP is Materials Requirement Planning
MRP helps in answering the following questions :
What items are required?How many are required?When are they required?...
4Copyright © Capgemini 2013. All Rights Reserved
January 2013and
History of MRP
MRP in its very basic form dates back to as early as 12 th – 16th century.We see MRP everyday in our Kitchens.Wars were one of the main reasons for development of MRPThe huge uncertanity and rapidly fluctuating situations in Wars required
proper and quick response in terms of planning, which primarily was soldiers.
By late 16th century, European armies started numbering more than 100,000 soldiers. Improper planning for food and water many a times let to self defeat of armies.
WW II was the turning point in history of planning. Multiple sub wars at different locations gave rise to the need to plan and deploy the right number of soldiers, ammunition, food, horses etc at the right place and time. It also gave the necessity to calcuate the quantity required to be on battle field for X days as well as to be prepared if the war prolonged.
5Copyright © Capgemini 2013. All Rights Reserved
January 2013and
History of MRP
In 1964, Toyota came up its Just in time production system.This necessiated its suppliers to come up with accurate strategies to meet
demand.Joseph Orlicky was the first person to come up with the modern MRP
system. It was first implemented at Black and Decker in 1964.
6Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Organisational Level in SAP
7Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Output of MRP
The output of MRP is either a purchase requisition or a planned order.
For inhouse manufactured materials, MRP run results in a planned orer.Planned order will then be converted to a production order ( traveller)
For externally procured items, MRP run results in a Purcase requisition, which is then converted to a purchase order.
8Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Order to Cash Cycle & MRP
9Copyright © Capgemini 2013. All Rights Reserved
January 2013and
MRP , Procurement and Sales
10Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Types of MRP
Materials planning
MRPConsumption
based
Reorder point Planning
Does not consider Demand. Just stock and ROP
Driven by Demand from sales order or PIR
11Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Output of MRP
The output of MRP is either a purchase requisition or a planned order.
For inhouse manufactured materials, MRP run results in a planned orer.Planned order will then be converted to a production order ( traveller)
For externally procured items, MRP run results in a Purcase requisition, which is then converted to a purchase order.
12Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Types of MRP
Re-order Point Planning:MRP Type is “VB”Used for B and C class materials / consumables.PR is generated if stock falls below re order point.
STOCK REORDER POINT RESULT OF MRP
200 200 No action
250 200 No action
199 200 PR created
100 200 PR created
0 200 PR created
13Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Types of MRP
Demand Based planningMRP Type is “PD”Used for A class materials / BoM itemsPR is generated based on demand
STOCK (A) DEMAND (B) SAFETY STOCK ('C) (B+C) - D RESULT OF MRP
0 0 10 10 PR created
0 10 10 20 PR created
10 0 5 -5 No Action
10 5 5 0 No Action
10 0 10 0 No Action
10 10 10 10 PR created
14Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Steps in MRP
15Copyright © Capgemini 2013. All Rights Reserved
January 2013and
How Much to Order ( Lot Size)
The PR or planned order quantity is decided by the lot size maintained in material master.Primarily we use lot sizes FX( Fixed lot) , EX (lot for lot) and MB (Monthly Lot)
16Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Lot Size
Fixed Lot : FXHere the lot size is fixed in Material master. Example 1 : Demand is 23 and Fixed Lot =50 PR created for 50Example 2 : demand is 60 and Fixed Lot =50 Two PRs created for 50 ea
Lot for Lot : EXHere system clubs the requirements and creates a single PR or planned order.Example : If total demand is 73pcs, then MRP creates a singel PR or planned order
for 73pcs.
Monthly Lot
17Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Stock /Requirement List
MD05 gives results of last MRP run.MD04 gives the current stocks Vs Requirement data, taking into account the latest Stock and demand situation.Other transactions can be accessed from MD04
18Copyright © Capgemini 2013. All Rights Reserved
January 2013and
BoM and Its Explosion
19Copyright © Capgemini 2013. All Rights Reserved
January 2013and
MRP relevant Scrap
20Copyright © Capgemini 2013. All Rights Reserved
January 2013and
Demo On SAP System
21Copyright © Capgemini 2013. All Rights Reserved
January 2013and