Material Requirement Planning (MRP) & Enterprise Resource Planning (ERP) In the first part of this session, you will further examine the important challenge and opportunity of production scheduling. You will learn how production scheduling is a key aspect of operations management which allows an increase in business value by fulfilling demand while managing cost and limiting process lead times. In particular. you will learn the logic of Material Requirement Planning (MRP) how it can be used to schedule production. You will also learn how MRP has evolved over time into Enterprise Resource Planning (ERP), as well as the benefits and challenges and the latest development of ERR In the second part, we will discuss the Three Jays Corporation case. This case allows us to apply the EOQ model for the analysis of inventory policy at a manufacturing firm The case will also illustrate the limit of the EOQ model that we have discussed in class, and how one might extend some of the fundamental concepts of the model to scenarios in which the assumptions for the model are violated_ Case: Three Jays Corporation (HBS, 9-915-531)
Case Preparation Questions: I. Making use of the data in case Exhibit 4 and the 2012 annual demand, calculate the EOQ and ROP quantities for the five SKUs scheduled to be produced in the last week of June. How do these amounts compare with those calculated in 2010/ Compare the increase in EOQs with the increases in annual demand. (6 pts) 2. Brodie is uncertain if the costs presented in case Exhibit 2 are appropriate for determining the EOQs. What changes would you recommend, and why; Should the cost of the three idle part-time workers be included when the production line is down’ Making use of the 2012 annual demand, and your recommendations, recalculate the EOQs for the five SKUs. (6 pts) 3. Compare your results in Question 2 with those obtained using the data in case Exhibit 2. What do you attribute the differences to/ (3 pts) 4. Compare the established EOQ/ROP procedure (described in case Exhibit 2) with the one that Jake and Josh are using Why are Jake and Josh not following the established system; Which system do you prefer’ (Please )ustify your answer-) What improvements do you recommend? (7 pts) Answers to these preparation questions need to be handed in as a GROUP CASE WRITE-UP together with an Excel spreadsheet showing all the computations.
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