Question Description

Recently, Phil Harris, the production control manager at
Bmnswick, read an article on time-phased requirements
planning. He was curious about how this technique rnight
work in scheduling Brunswick’s engine assembly operations
and decided to prepare an example to illustrate the
use ol iirne-phased requirernents planning.

Phil’s first step was to prepare a master schedule lor one
ol the engine Lypes produced by Brunswick: the Model
1000 engine. This schedule indicates the number of units of
thc Modcl 1000 cnginc to bc asscmbled cach weck during
the last 12 weeks and is shown below. Next, Phil decided to
simplify his rcquircments planning examplc by considering
only two of the many components that are needed to complcte
thc asscmbly ol’thc Modcl I000 enginc. Thcsc two
components, the gear box and the input shaft. are shown
in the product structure diagram below. Phil noted that the
gear box is assembled by the Subassembly Department and
suhsequently is sent to the main engine assemhly line. The
input shaft is one of several component parts manufactured
by Brunswick that are needed to produce a gear box subassembly.
Thus. levels 0, l, and 2 are included in the product
structure diagrarn to indicate the three manufaururing
stages that are involved in producing an engine: the Engine
Assembly Department, the Subassembly Department, and
the Machirie Shop.

The manufacturing lead times required to produce the gear
box and input shali components are also indicated in the product
struclure diagram. Note that two weeks are required to produce
a batch ol’geir boxes antl ilrat all thc gear boxes must be
delivered to thc assembly line parts stockroom befbre Monday
moming o1’thc wcck in which they arc to be used. Likcwiso.
it takes three weeks to produce a lot ofinput shatts, and all the
MRP Explosionshafis
that are needed fbr the production of gear boxes in a
given week must be delivcred to the Suba.ssembly Department
stockroom before Monday moming of that week.
In prepiuing the MRP example Phil planned to use the
worksheets shown on the next page and to make the fbllowing
assumptions:
1 . Seventeen gear boxes are on hand at the beginning ol
Week 1, and five gear boxes are currently on order to
be delivered at the start of Week 2.
2. Forty input shafts arc on hand at thc staft of Week l,
and,22 are scheduled for delivery at the beginning ot’
Week 2.
1 initially, assume that Phil wants to minimize his inventory
requircrrents. Assume that cach ordcr will bc
only for what is required for a single period. Using the
following fbrms. calculate thc net rcquirements and
planned order releases lbr the gear boxes and input
shafts. Assumc that lot sizing is clone using lot-for-lot
(L-4L).
2 Phil would like to cilnsider the costs that his accoun-
[ants are currently using for inventory carrying and
setup f’or the gear bores and input shafis. These costs
are as fbllows:
PART
SetuP : $9g/order
lnventory carrying cost – S2lunit/week
SetuP: $45lorder
lnventory carrying cost : S1/unit/week
Exe
Mo
Gear Box
lnput Shaft
Model 1000 master schedule
Model 1000 product structure
Gcar hox
I-eadtirne:2weeks
Used: 1 per engine
Input shafr
Leadtime:3weeks