Operations Management Flashcards

Flashcards for vocabulary terms in Operations Management, focusing on Material Requirement Planning.

Aggregate planning

Development of a long-term output and resource plan in aggregate units of measure

Disaggregation

Translating aggregate plan into short term operational plans that provide the basis for weekly and daily schedules and detailed resource requirements

Master Production Schedule (MPS)

Deals with end items (finished goods items sold to customers) and is a major input to the MRP process

Bill of Material

The complete product description

Dependent Demand

Directly related to the demand of other SKUs and can be calculated without needing to be forecasted

Bill of materials (BOM)

Hierarchical relationships between all items that comprise a finished good, purchased parts, and manufactured in-house parts

Bill of labor (BOL)

Hierarchical record analogous to a BOM that defines labor inputs necessary to create a good or service

End items

Finished goods scheduled in the MPS or FAS that must be forecasted

Parent item

Manufactured from one or more components

Components

Any item other than an end item that goes into a higher-level parent item

Subassembly

Composed of at least one immediate parent and at least one immediate component

Materials Requirements Planning (MRP)

Forward-looking, demand-based approach for planning the production of manufactured goods and ordering materials and components to minimize unnecessary inventories and reduce costs

MRP explosion

Process of using the logic of dependent demand to calculate the quantity and timing of orders

Time buckets

Time period size used in the MRP explosion process

Lot-for-lot (LFL)

Ordering schedule that covers the gross requirements for each week

Fixed order quantity (FOQ)

Uses a fixed order size for every order or production run

Gross requirements (GR)

Total demand for an item derived from all of its parents

Scheduled or planned receipts (S/PR)

Orders that are due or planned to delivered

Planned order receipt (PORec)

Specifies the quantity and time an order is to be received

Planned order release (PORel)

Specifies the planned quantity and time an order is to be released to the factory or a supplier

Projected on-hand inventory (POH)

Expected amount of inventory on-hand at the beginning of the time period (or available balance)