Glossary
Key Terms
Shop Calendar
The definition of operating or working days available for material and capacity planning, production order release and execution
Item Master
A part master record that lists its description, unit of measure, dimensions, family and group classification, production or purchasing ordering data, and other pertinent information.
Bill of Materials
A structured list of the items used in making a parent assembly that reflects the actual production process in terms of timing and quantities consumed. BOMs are used by the MRP function to calculate component requirements when given a parent demand, and in building product costs.
Work Center
A physical or logical production area used as a unit for scheduling and routing operations. It is usually defined as being either labor or machine constrained, and while it may contain multiple machines or personnel they are considered identical in terms of the capability to process products assigned to that center.
Routing
The detailed description of the requirements to produce a given item, which includes the operations performed, the order in which they are done, the labor or machine resources required at each operation, and the rate those resources process the item at each operation. It may also include tooling and process or other specifications, and serves as the basis for manufacturing lead time calculations, detailed capacity planning and the cost standards associated with production.
Master Production Schedule (MPS)
The schedule of manufactured items usually created to fill 'outside' demand from forecasts, customer orders and interplant orders that specifies the exact item numbers, dates and quantities for production but is not in itself a production order to be released to the floor. Once accepted, the MPS specifies the date and quantity requirements used by MRP to explode demand through the bill of materials. The MPS is the main driver for the rest of the planning and scheduling system, and the level of success in attaining a realistic MPS often indicates how well the other detailed parts of the system function.
Capacity Requirements Planning (CRP)
A process using demand from open production orders and MRP planned orders, and work center/production line rate and capacity data to determine over or under capacity conditions. A short- term, detailed view of capacity that verifies the feasibility of firming up planned orders and releasing them to the floor. CRP systems normally function as a capacity status report, without generating exception messages that recommend order reschedules or moving production to alternate work centers or lines.
Materials Requirements Planning (MRP)
The process that uses the MPS as demand, explodes the bill of material for specified MPS items, nets those requirements against on-hand inventory and existing open orders, and recommends placing new production and purchase orders and changes to existing orders based on parameters that consider safety stock levels, lot sizes and lead times. MRP in general is just a calculator and depends completely on the accuracy of the MPS, bills of material and order date and quantity information to be useful.
Inventory
Raw, intermediate or finished items that are physically stocked by an organization, or for which they are financially liable.
Purchase Order
The contractual agreement with a supplier of goods or services that specifies payment terms, delivery dates, item identification, quantities, freight terms and all other obligations and conditions.
Manufacturing Order
An order that authorizes manufacture of a specific quantity of an item or group of items, contains release and due dates, and documents requirements for the materials and resources used.