Checking Requirements and Possible Shortages for Expedited Orders

If you are running your MRP to plan for your requirements and have a limited number of BOM layers (2 or 3 layers) there is a simple solution for you to check whether an expedited production order will cause any issues/shortages in your supply and production schedules.

Let’s assume that you ran your MRP as regularly scheduled and have issued all the Purchase Orders and Production Orders as planned.  However, only a day or two into your planned schedule, a new customer order comes in and it is an urgent order that requires immediate production.  How can you find out:

1-     Whether you have all the required Raw Materials available?

2-     Whether you have all the required Assemblies available?

3-     Whether using available inventory of Raw Materials and/or Assemblies will cause shortages for regularly scheduled orders?

You could definitely re-run the MRP, but that will create what’s called ‘system nervousness’ by having a larger scope of changes for items unrelated to the expedited order.  The simpler solution is to go to your last MRP schedule and add the new requirement for the expedited item.  To ensure that all layers are planned for, a few steps will be required:

1-     Go to the last MRP schedule and navigate to ‘Summary’ tab,

2-     Select the FG item that the expedited order is being requested for,

3-     Click on ‘Schedule Event’ button

4-     On the ‘Schedule Event’ window that pops-up:

a.     select ‘Date’ for when the item needs to be ready,

b.     select ‘Finish Assembly’ or ‘Transfer to Sales’ as the ‘Event’ type,

c.      select BOM revision number (if applicable),

d.     enter required qty,

e.     enter any comments (if applicable),

f.      click ‘Schedule’ button,

g.     click ‘Close’ button.

Once the ‘Close’ button on the ‘Schedule Event’ window is clicked, you will be back at the window for the schedule you have been working with.  All shortages for the BOM items will be shown in red.  You can select each item and click on the ‘Audit’ tab to see the changes in stock levels by date and identify when/if an action is needed (i.e. bump up PO qty., create new PO etc.).  

Please note that, the above example was for a 2-layer BOM FG item (i.e. the FG BOM had ‘Assembled’ items and those ‘Assembled’ items’ BOMs didn’t have any ‘Assembled’ items in them).  If you have 3 or more layers in your BOM structure, you will need to go to each ‘Assembled’ item and ‘Schedule Event’ for the required qty. that was identified by the parent item’s planning.

Hope this helps you plan more confidently for any expedited orders.

Please contact us if you have any questions.

Arda.