MRP is king, reigning supreme since the 1970s. What seems to not need to be “rocket science” continues to attract vast sums of money justified by the continued dominance of costs of materials and supply chain elements of any manufacturing business.
Since the 1970s, pretty much everything about MRP has been improved. The sales forecasting is getting close to being “rocket science” as effects of things like promotions, market competition, fashion trends and even the weather is factored in. Companies can know really quite accurately now about what products manufacturing should make and when they are required.
Look also at manufacturing technology; the new generations of machines and processes that are flexible yet fast, far more capable now to make the demanded products when needed with a far shorter lead-time for change.
Thirdly, look at the logistics for raw materials procurement, all finely timed with excellent communication and supplier relations.
With such an “awesome” system in place, how is it that material issues continue to be the number one source of lost opportunity in electronics assembly manufacturing? Why are there such bloated inventories of materials in the warehouse and why is there such chaos on the shop-floor?
The irony is that since the 1970s, there is one missing piece of the supply chain which has not been able to keep pace with the other MRP improvements, in fact, it has been sliding backwards as materials grow more numerous and complex and speed of consumption increases. The key is inventory management, specifically the accuracy of the inventory levels.
Not convinced? Look at the chaos that happened recently with the earthquake in Japan. Companies struggled with key material suppliers; a lot of the damage to operations was actually caused by not knowing actually how many materials were already present in the manufacturing operations. Work-orders started had to cut-short, work-orders that could have run, were not.
The shop-floor continues for most to be the weakest link in the whole supply chain. A solution is out there and has been out there for some time. Read about this in my upcoming webinar on this subject; http://www.mentor.com/pcb-manufacturing-assembly/events/“
The benefits and savings improving the operation of MRP already experienced by users of this technology may blow your mind…….. Are you ready?