Demand management sets the demand MRP works from. Recording expected sales as numbers gives production planning its starting point.
Two kinds of requirement
| Kind | Origin | Example |
|---|---|---|
| Independent requirement | Given from outside | Sales orders, sales plans |
| Dependent requirement | Generated by BOM explosion | Components needed to build a product |
Planned independent requirements
A planned independent requirement (PIR) is a sales plan or forecast expressed as numbers, entered in MD61. In make-to-stock production it is the only demand signal there is.
| Field | Content |
|---|---|
| Material and plant | What and where |
| Version | Several scenarios can coexist; only active ones plan |
| Period | Daily, weekly or monthly buckets |
| Quantity | Planned quantity per period |
| Requirements type | Derived from the planning strategy |
Planning strategies
| Strategy | Approach | Behaviour |
|---|---|---|
| 10 | Make to stock | Plan from PIR only; orders consume stock |
| 11 | Gross requirements | Produce to PIR ignoring stock; suits flow production |
| 20 | Make to order | No PIR; sales orders drive production |
| 40 | Planning with final assembly | Produce ahead on PIR; sales orders consume it |
| 50 | Assemble to order | Plan components ahead, assemble on order |
Strategy 40 is the most widely used: production runs ahead on forecast, and actual orders consume that forecast as they arrive.
Consumption
Original PIR : April 1,000
Sales order : April due date, 300
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Remaining PIR : April 700
Total demand : 700 + 300 = 1,000 (unchanged)Without consumption, forecast and orders would both be planned and production would double.
Consumption mode and period
| Mode | Behaviour |
|---|---|
| Backward only | Consume PIRs before the order date |
| Backward then forward | Look backward first, then forward |
| Forward only | Consume PIRs after the order date |
| Forward then backward | Look forward first, then backward |