Capacity Planning

Capacity Planning

Determining the amount of capacity required to produce goods/services in the future.

Resource Requirement Planning

Long-range capacity planning module used to check if aggregate resources can satisfy the Aggregate Production Plan (APP).

Rough-Cut Capacity Planning

Medium-range capacity planning module that checks the feasibility of the Master Production Schedule (MPS) by converting production needs to required capacity and comparing it to available capacity.

Capacity Requirement Planning

Short-range capacity planning module used to assess the feasibility of the Material Requirements Plan (MRP).

Distribution Requirements Planning (DRP)

Time-phased finished goods inventory replenishment plan in a distribution network, determining the need to replenish inventory at branch warehouses.

Key Elements of DRP

Forecast demands, current inventory levels, target safety stock, recommended replenishment quantities, and replenishment lead times by distribution center.

Enterprise Requirements Planning Systems (ERP)

Information system connecting all functional areas and operations of an organization, including suppliers and customers, via a common software infrastructure and database.

ERP Benefits

Enables supply chain members to share information, fully utilize scarce resources to meet demand, and minimize supply chain inventories.

Best of Breed ERP Implementation

Selecting the best application for each individual function, with potential integration issues.

Single Integrator Solution

Choosing all desired applications from a single vendor, facing challenges like lack of management commitment and inadequate resources.

Advantages of ERP Systems

Increased visibility, reduced supply chain inventories, standardized manufacturing processes, and improved performance measurement and communication.

Disadvantages of ERP Systems

Significant time and capital investment, complexity, and the need for firms to adapt processes to fit the ERP system.

Major ERP Applications

Accounting and finance, customer relationship management, human resource management, manufacturing, supplier relationship management, and supply chain management.

Major ERP Providers

SAP, Oracle, Microsoft.

Small Software Firms

Provide applications and full ERP solutions but may lack the necessary infrastructure (applistructure) for integration.