Concept explainers
Videos
a)
To develop: A gross requirements plan for all the items.
Introduction:
Gross requirements plan:
The gross requirements plan is the plan where the independent and dependent demand for a product or a component before the on-hand inventory and the scheduled receipts are netted with.
a)
Explanation of Solution
Given information:
Product structure:
Master production
| MPS for X1 | ||||||
| Period | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 50 | 20 | 100 | |||
Inventory and lead time:
| Item | X1 | B1 | B2 | A1 | C | D | E |
| Lead time | 1 | 2 | 2 | 1 | 1 | 1 | 3 |
| On hand | 50 | 20 | 20 | 5 | 0 | 0 | 10 |
Item X1:
| Week | ||||||||||||
| Item X1 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 50 | 20 | 100 | |||||||||
| Order release | 50 | 20 | 100 | |||||||||
The gross requirements are 50, 20 and 100 (1 assembly of X1) in weeks 8, 10 and 12 respectively derived from the master production schedule of X1. The lead time is 1 week. Therefore, the order release will be 50, 20 and 100 in weeks 7, 9 and 11 respectively.
Item B1:
| Week | ||||||||||||
| Item B1 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 50 | 20 | 100 | |||||||||
| Order release | 50 | 20 | 100 | |||||||||
The order release of X1 will become the gross requirements of B1. The gross requirements are 50, 20 and 100 (1 assembly of B1) in weeks 7, 9 and 11 respectively. The lead time is 2 weeks. Therefore, the order release will be 50, 20 and 100 in weeks 5, 7 and 9 respectively.
Item B2:
| Week | ||||||||||||
| Item B2 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 100 | 40 | 200 | |||||||||
| Order release | 100 | 40 | 200 | |||||||||
The order release of X1 will become the gross requirements of B2. The gross requirements are 100, 40 and 200 (2 assemblies of B2) in weeks 7, 9 and 11 respectively. The lead time is 2 weeks. Therefore, the order release will be 100, 40 and 200 in weeks 5, 7 and 9 respectively.
Item A1:
| Week | ||||||||||||
| Item A1 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 50 | 20 | 100 | |||||||||
| Order release | 50 | 20 | 100 | |||||||||
The order release of B1 will become the gross requirements of A1. The gross requirements are 50, 20 and 100 (1 assembly of A1) in weeks 5, 7 and 9 respectively. The lead time is 1 week. Therefore, the order release will be 50, 20 and 100 in weeks 4, 6 and 8 respectively.
Item C:
| Week | ||||||||||||
| Item C | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 200 | 80 | 400 | |||||||||
| Order release | 200 | 80 | 400 | |||||||||
The order release of B2 will become the gross requirements of C. The gross requirements are 200, 80 and 400 (2 assemblies of C) in weeks 5, 7 and 9 respectively. The lead time is 1 week. Therefore, the order release will be 200, 80 and 400 in weeks 4, 6 and 8 respectively.
Item D:
| Week | ||||||||||||
| Item D | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 100 | 40 | 200 | |||||||||
| Order release | 100 | 40 | 200 | |||||||||
The order release of B2 will become the gross requirements of D. The gross requirements are 100, 40 and 200 (2 assemblies of C) in weeks 5, 7 and 9 respectively. The lead time is 1 week. Therefore, the order release will be 100, 40 and 200 in weeks 4, 6 and 8 respectively.
Item E:
| Week | ||||||||||||
| Item E | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 200 | 50 | 80 | 20 | 400 | 100 | ||||||
| Order release | 200 | 50 | 80 | 20 | 400 | 100 | ||||||
The order release of B1 and D will become the gross requirements of E. The gross requirements are 50, 20 and 100 (1 assembly of E) in weeks 5, 7 and 9 respectively. The lead time is 3 weeks. Therefore, the order release will be 50, 20 and 100 in weeks 2, 4 and 6 respectively.
The gross requirements are 200, 80 and 400 (2 assembly of E) in weeks 4, 6 and 8 respectively. The lead time is 3 weeks. Therefore, the order release will be 200, 80 and 400 in weeks 1, 3 and 5 respectively.
b)
To develop: A net requirements plan for all the items.
Introduction:
Net requirements plan:
The net requirements plan is the plan which is established on the gross requirements plan formed by deducting the stock on and the scheduled receipts. If the total requirement is below the safety stock levels, a planned order is made based on the given lot sizing technique.
b)
Explanation of Solution
Given information:
Product structure:
Master production schedule for X1:
| MPS for X1 | ||||||
| Period | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 50 | 20 | 100 | |||
Inventory and lead time:
| Item | X1 | B1 | B2 | A1 | C | D | E |
| Lead time | 1 | 2 | 2 | 1 | 1 | 1 | 3 |
| On hand | 50 | 20 | 20 | 5 | 0 | 0 | 10 |
Item X1:
| Week | ||||||||||||
| Item X1 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 50 | 20 | 100 | |||||||||
| Scheduled receipt | ||||||||||||
| On hand (50) | 50 | 0 | 0 | |||||||||
| Net requirement | 0 | 20 | 100 | |||||||||
| Planned order receipt | 20 | 100 | ||||||||||
| Planned order release | 20 | 100 | ||||||||||
Week 8:
The gross requirement is 50 (1 assembly)derived from the master production schedule of X1. The on hand inventory is 50. Hence, the net requirement is 0. The lead time is 1 week. Therefore, there will be no planned order release.
Week 10:
The gross requirement is 20 (1 assembly) derived from the master production schedule of X1. The on hand inventory is 0. Hence, the net requirement is 20. The lead time is 1 week. Therefore, the planned order release will be 20 in week 9 which will be the planned order receipt in week 10.
Week 12:
The gross requirement is 100 (1 assembly) derived from the master production schedule of X1. The on hand inventory is 0. Hence, the net requirement is 100. The lead time is 1 week. Therefore, the planned order release will be 100 in week 11 which will be the planned order receipt in week 12.
Item B1:
| Week | ||||||||||||
| Item B1 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 20 | 100 | ||||||||||
| Scheduled receipt | ||||||||||||
| On hand (20) | 20 | 0 | ||||||||||
| Net requirement | 0 | 100 | ||||||||||
| Planned order receipt | 100 | |||||||||||
| Planned order release | 100 | |||||||||||
Week 9:
The gross requirement is 20 (1 assembly) derived from the planned order release of X1. The on hand inventory is 20. Hence, the net requirement is 0. The lead time is 2 weeks. Therefore, there will be no planned order release.
Week 11:
The gross requirement is 100 (1 assembly) derived from planned order release of X1. The on hand inventory is 0. Hence, the net requirement is 100. The lead time is 2 weeks. Therefore, the planned order release will be 100 in week 9 which will be the planned order receipt in week 11.
Item B2:
| Week | ||||||||||||
| Item B2 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 40 | 200 | ||||||||||
| Scheduled receipt | ||||||||||||
| On hand (20) | 20 | 0 | ||||||||||
| Net requirement | 20 | 200 | ||||||||||
| Planned order receipt | 20 | 200 | ||||||||||
| Planned order release | 20 | 200 | ||||||||||
Week 9:
The gross requirement is 40 (2 assembly) derived from the planned order release of X1. The on hand inventory is 20. Hence, the net requirement is 20. The lead time is 2 weeks. Therefore, the planned order release will be 20 in week 7 which will be the planned order receipt in week 9.
Week 11:
The gross requirement is 200 (2 assembly) derived from planned order release of X1. The on hand inventory is 0. Hence, the net requirement is 200. The lead time is 2 weeks. Therefore, the planned order release will be 200 in week 9 which will be the planned order receipt in week 11.
Item A1:
| Week | ||||||||||||
| Item A1 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 100 | |||||||||||
| Scheduled receipt | ||||||||||||
| On hand (5) | 5 | |||||||||||
| Net requirement | 95 | |||||||||||
| Planned order receipt | 95 | |||||||||||
| Planned order release | 95 | |||||||||||
Week 9:
The gross requirement is 100 (1 assembly) derived from the planned order release of B1. The on hand inventory is 5. Hence, the net requirement is 95. The lead time is 1 week. Therefore, the planned order release will be 95 in week 8 which will be the planned order receipt in week 9.
Item C:
| Week | ||||||||||||
| Item C | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 40 | 400 | ||||||||||
| Scheduled receipt | ||||||||||||
| On hand (0) | 0 | 0 | ||||||||||
| Net requirement | 40 | 400 | ||||||||||
| Planned order receipt | 40 | 400 | ||||||||||
| Planned order release | 40 | 400 | ||||||||||
Week 7:
The gross requirement is 40 (2 assembly) derived from the planned order release of B2. The on hand inventory is 0. Hence, the net requirement is 40. The lead time is 1 week. Therefore, the planned order release will be 40 in week 6 which will be the planned order receipt in week 7.
Week 9:
The gross requirement is 400 (2 assembly) derived from planned order release of B2. The on hand inventory is 0. Hence, the net requirement is 400. The lead time is 1 week. Therefore, the planned order release will be 400 in week 8 which will be the planned order receipt in week 9.
Item D:
| Week | ||||||||||||
| Item D | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 20 | 200 | ||||||||||
| Scheduled receipt | ||||||||||||
| On hand (0) | 0 | 0 | ||||||||||
| Net requirement | 20 | 200 | ||||||||||
| Planned order receipt | 20 | 200 | ||||||||||
| Planned order release | 20 | 200 | ||||||||||
Week 7:
The gross requirement is 20 (1 assembly) derived from the planned order release of B2. The on hand inventory is 0. Hence, the net requirement is 20. The lead time is 1 week. Therefore, the planned order release will be 20 in week 6 which will be the planned order receipt in week 7.
Week 9:
The gross requirement is 200 (1 assembly) derived from planned order release of B2. The on hand inventory is 0. Hence, the net requirement is 200. The lead time is 1 week. Therefore, the planned order release will be 200 in week 8 which will be the planned order receipt in week 9.
Item E:
| Week | ||||||||||||
| Item E | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
| Gross requirements | 40 | 400 | 100 | |||||||||
| Scheduled receipt | ||||||||||||
| On hand (10) | 10 | 0 | 0 | |||||||||
| Net requirement | 30 | 400 | 100 | |||||||||
| Planned order receipt | ||||||||||||
| Planned order release | 30 | 400 | 100 | |||||||||
Week 6:
The gross requirement is 40 (2 assembly) derived from the planned order release of B2. The on hand inventory is 10. Hence, the net requirement is 30. The lead time is 3 weeks. Therefore, the planned order release will be 30 in week 3 which will be the planned order receipt in week 6.
Week 8:
The gross requirement is 400 (2 assembly) derived from the planned order release of B2. The on hand inventory is 0. Hence, the net requirement is 400. The lead time is 3 weeks. Therefore, the planned order release will be 400 in week 5 which will be the planned order receipt in week 8.
Week 9:
The gross requirement is 100 (1 assembly) derived from the master production schedule of B1. The on hand inventory is 0. Hence, the net requirement is 100. The lead time is 3 weeks. Therefore, the planned order release will be 100 in week 6 which will be the planned order receipt in week 9.
Want to see more full solutions like this?
Chapter 14 Solutions
Pearson eText Principles of Operations Management: Sustainability and Supply Chain Management -- Instant Access (Pearson+)
- northeastern insurance company is considering opening an office in the US. The two cities under consideration are going to be Philadelphia New York. Factor ratings (higher scores are better) are in the table. The best location for northeastern insurance company to open would be which with a total weighted score of ? (response rounded to two decimal places)arrow_forwardWhen football fans watch a game, they believe the other side commits more infractions on the field than does their own team. This favoritism can best be termed _____. Group of answer choices A. ethnocentrism B. the fundamental attribution error C. the affiliation bias D. marginalizationarrow_forwardWhen football fans watch a game, they believe the other side commits more infractions on the field than does their own team. This favoritism can best be termed _____. Group of answer choices ethnocentrism the fundamental attribution error the affiliation bias marginalizationarrow_forward
- Which of the following best describes the differences between egalitarianism and hierarchy as cultural values in negotiation? Group of answer choices A. Egalitarian cultures communicate directly; hierarchical cultures communicate indirectly. B. Egalitarian cultures treat people equally; hierarchical cultures discriminate among people. C. Egalitarian cultures divide things equally; hierarchical cultures divide things according to merit and status. D. Egalitarian cultures believe that status is permeable through effort and achievement; hierarchical cultures believe that superiors should take care of the needs of subordinates.arrow_forwardWhich of the following best describes the differences between individualism and collectivism as cultural values in negotiation? Group of answer choices A. Individualists see themselves as autonomous entities; collectivists see themselves in relation to others. B. Individualists prefer to work in groups; collectivists prefer to work alone. C. Individualists are cooperative; collectivists are competitive. D. Individualists focus on relationships; collectivists focus on money.arrow_forwardWhen it comes to resolving conflict, managers from hierarchical cultures prefer _____. Group of answer choices A. to attribute a disagreeable person's behavior to an underlying disposition and desire formal dispute resolution procedures B. an interests model that relies on resolving underlying conflicts C. to regulate behavior via public shaming D. to defer to a higher status personarrow_forward
- The tripartite model of culture is based on three cultural prototypes that represent negotiators’ self-views and are highly correlated with particular geographic regions. Give an example of the three. Face Dignity Honorarrow_forwardThe personality and unique character of a social group is best known as its _____ and includes the values and norms shared by its members and encompasses the structure of its social, political, economic, and religious institutions. Group of answer choices group identity group potency group stereotype culturearrow_forwardagree or disagree with this post Face - “Face” or dignity in a negotiation has been called “one of an individual’s most sacred possessions.”102 Face is the value a person places on his or her public image, reputation, and status vis-à-vis other people in the negotiation. Direct threats to face in a negotiation include making ultimatums, criticisms, challenges, and insults (Thompson, 2019). A good example of face is when I go to the negotiation table with a counterpart that is known to be difficult or not as knowledgeable about the category as they should be, my approach wouldn't be to point out their weakness, I will respect their thought process, show consideration for their perspective, all while guiding the conversation in the direction of my intended negotiation strategy in hopes to achieve my desired outcome. Dignity - endorses views such as, “People should stand up for what they believe in, even when others disagree,” and “How much a person respects oneself is far more…arrow_forward
- 16:53 ◄ Mail 5G CSTUDY_Jan25_SCMH_O...Final_20250220143201.pdf CHOOSING FORECASTING MODELS gradienting are more mode. Yet when selecting a forecasting method, the door forecasts in fact, each of the three methods has different strength and can play important ing importance of the factors, such as the index and cast model, or a unified approach, ch del runs individual series separately A galable manufacturer is facing changes with demand fuctuations due to economiyapply make changes. Comment on why this has been the case and propose a forecasting approach that can be utilised t Question 13 ashit from a batch production process to a continuous flows to enhance efficiency. Critically analyse the trade- A public hospital in Free State is experiencing increasing patient wait times due to limited operacity. The hospital management is considering either expanding existing facilities orating more efficient Question 1.5 A farming consponsible for planting grain crops in Free State As expected…arrow_forwardHow can a college basketball coach use lean system strategies to improve the team's performance and win the national championship? What wastes can be eliminated from the team's training and equipment? How can performance data be used to adjust the team's strategy and tactics?arrow_forwardHow much does self-awareness influence the Interpersonal Trust Scale's results?arrow_forward
MarketingMarketingISBN:9780357033791Author:Pride, William MPublisher:South Western Educational Publishing
Purchasing and Supply Chain ManagementOperations ManagementISBN:9781285869681Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. PattersonPublisher:Cengage Learning
Contemporary MarketingMarketingISBN:9780357033777Author:Louis E. Boone, David L. KurtzPublisher:Cengage Learning
Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,