Running Header: PROCESS DESIGN Process Design University of Phoenix OPS/571 January 11, 2010 Process Design Corporations are moving forward with almost any move directed at removing the man in the middle. An important factor stems from companies gaining a competitive by integrating processes through an effective operations information system.
Maintaining an efficient flow of services and materials from suppliers and managing internal activities relating to materials and other resources remain essential to the smooth operations of value chains. The order fulfillment process ensures that all resources necessary for the production of finished services or products are available at the right time. For manufacturers, this task means keeping track of the subassemblies, components, and raw materials as well as the capacities.
The process at currently in place with Riordan Manufacturing (RM) requires developing a proposal for the material requirements planning (MRP) concerning for the manufacturing of the Riordan electric fans, a new process design for the production of the Riordan electric fans; developing a supply chain that takes advantage of global opportunities and lowers labor cost, establishing a production forecast, an implementation plan, including a Gantt chart of the design process. Material Requirements Planning
Material Requirement planning (MRP) refers to computerized information systems developed specifically in aiding companies in managing demand inventory and scheduling replenishment orders, from this aspect alone, the MRP system proves beneficial to many companies. Dependent Demand Chase, F. , Jacobs, F. , and Aquilano, N. , (2005, p. 630) reflect that MRP relates to dependent demand for a higher level item. Tires, wheels, and engines are dependent demand items based on the demand for automobiles; whereas demand for a product relates to independent demand, because the arket conditions influence a specific type of product, rather any other product in the inventory. RM maintains maintain adequate quantities of electric motors in stock to meet all its order requirements, its on-time deliveries over the past year have averaged only 93% (University of Phoenix, 2009). Benefits of MRP According to Krajewski, L. , and Ritzman, L. , (2005, p. 726) mention how “companies would manage production and delivery of dependent demand inventories with independent demand systems, but the outcome was seldom satisfactory. The important factor at this point is how MRP recognizes dependent demands, enabling businesses to reduce inventory levels, using labor and facilities as well as improving customer services. These successes reflect three distinctive advantages definitively by Krajewski and Ritzman (2005, p. 726) as the following: 1. Statistical forecasting for components demand results in large forecasting errors; compensating for such errors by increasing safety stock remains costly, however MRP calculations for the dependent demand of components from production schedules provides a better forecast of component requirements. . MRP systems provide managers with information essential for planning capacities and estimating financial requirements. Production schedules and materials purchases translate into capacity requirements and dollar amounts forecasting information when they will appear. Planners use this information on parent item schedules identifying times when the unavailability of needed components because of capacity shortages and supplier delays. 3.
MRP systems automatically update the dependent demand and inventory replenishment schedules of when the production schedule of parent items change, this process results in alerting the planner for implementing immediate action for any component. University of Phoenix (20090 mentions RMs China plant currently “operates as a decentralized unit of Riordan Manufacturing, preparing their own forecast of electric fan sales throughout the world, which includes the United States, scheduling production of these fans to meet the forecasted sales. This process in most cases meets demand; however, lacks a concrete methodology of forecasting for the future. Inputs to MRP Key inputs of an MRP system include a bill of materials, a master production schedule, and an inventory record database. Employing MRP systems identifies actions operations must take to stay on schedule, such as releasing new production orders, adjusting order quantities, and expediting late orders.
An MRP system translates the master production schedule and other sources of demand, like an independent demand for replacement parts, and maintenance items, into the requirements for all subassemblies, components, and raw materials necessary for producing the required parent items. This process identifies the MRP explosion that coverts the requirements of various products into a material requirement plan specifying the replenishment schedules of all subassemblies, components and raw material requirements. Bills of Materials According to Chase et al. , (2005, p. 27) All firms maintain a bill of materials (BOM) file, which is simply the sequence of everything that goes into the final product. The BOM often called a record, a product structure tree, a schematic, or a flow diagram, showing the order of creating the item. This database contains specifications about each item, identifying purchasing and production information, and the required time for production of the item. This process also identifies a process the RM plants should change. The current system lacks structuring for actively tracking end items resulting in a laborious annual inventory.
The next process involves master production scheduling. Master Production Scheduling Master Production Scheduling (MPS) identifies the time-phased plan specifying how many and when the firm plans to build each end item. These decisions result from the responding pressures from various functional areas, such as the sales department (meet the customer’s promised due date), finance (minimize inventory), management (maximize productivity and customer service, minimize resource needs), and manufacturing (have level schedules and minimize setup time).
Chase et al. , (2005) The bases for communicating change within RM reflect a need for automation and technological changes. Currently, RM reception of orders and inventory remain outdated, this process contributes wasted man-hours and redundancy. The plan of action requires implementing and continuing with RMs system of inventory by bring this process online with a database file system. The MRP Computer Program As mentioned earlier the next step in streamlining a new supply design begins with a new database process.
The material requirements planning program operates using information from the inventory records, the master schedule, and the bill of materials. The process of calculating the exact requirements for each item managed by the system refers to action known as the explosion process. Working from the top level downward in the bill of materials and requirements from parent items require calculating the requirements for component items. Consideration is taken of current on-hand balances, and orders scheduled for receipt in the future. RM also must work to establish a system of going green in society both globally and locally.
Each plant contributes some degree of waste products to the environment. The Gantt chart The Gantt chart (GC) serves as tool for monitoring the progress of work and allows viewing the loads on workstations. The chart takes to forms: (1) the job or activity progress chart and (2) the workstation chart. The GC graphically displays the current status of each job or activity relative to any scheduled completion date. This process allows managers at each level to see and monitor progress work weak points or improving such MRP and the Environment Consumer and governmental concerns about deterioration of the natural environment continue plaguing RM.
The process drives manufacturers to reengineer their processes, becoming environmentally friendly. RM contributes by recycling base materials establishes RMs concerns for the environment, yet leaves room for improvement. Establishing filtering and monitoring devices can reduce the carbon foot-print; this process also includes monitoring periodically the waste released in the water systems. An important step requires RM modifying the MRP system to assist in tracking all waste and in planning for the disposition, a process RM performs well. Scheduling Customer Demand
Capacity in the form of employees or equipment remains crucial for service providers and manufacturers. Managing capcity involves a scheduling system to schedule customers for definite periods of order fulfillment. Scheduling Employees Another method to manage capacity with a scheduling involves specifying the on-duty and off-duty periods for each employee over a certain period. The workforce capcity available each day must meet or exceed daily workforce requirements. When the process does not meet the goals, the scheduler must rearrange days off until the requirements are met. Conclusion
Managers at all levels must understand the intricate details associated with the MRP system. Managers engaging in the MRP process effectively, will meet the demands of the organization, his customers, and his client base by providing forward visibility for planning and problem-solving, while invoking a positive change. References Chase, R. , Jacobs, F. , and Aquilano, N. , (2005) Operations management for competitive advantage, 11th ed. Retrieve from EBSCOhost November 16, 2009 Krajewski, L. and Ritzman, L, (2005) Operations management: strategy and analysis, 7th ed. Retrieved from EBSCOhost 11 January 2008