E-Z-MRP Material Requirements Planning System Users Guide

The software described in this manual is furnished under a license agreement and may be used only in accordance with the terms of the agreement. Information in this document is subject to change without notice. Companies, names, and data used in examples herein are fictitious unless otherwise noted. No part of this document may be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose without the express written permission of Beach Access Software.
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2004 Beach Access Software. All rights reserved.

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License Agreement
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Introduction

TABLE OF CONTENTS

PART 1 - INTRODUCTION .......................................................... 1

THANK YOU ..................................................................................... 1 THE PROBLEM ................................................................................. 1 THE SOLUTION ................................................................................. 2 THE FURTHER PROBLEM ................................................................... 3 THE FURTHER SOLUTION .................................................................. 4 WHAT IS MRP? ............................................................................... 4 A LITTLE HISTORY ............................................................................ 5 HARDWARE AND SOFTWARE REQUIREMENTS ...................................... 6 ASSUMPTIONS ABOUT YOU, THE USER ............................................... 6 SOME TERMS ................................................................................... 7 WARRANTY AND SUPPORT ................................................................ 7 CUSTOM PROGRAMMING AND DATA CONVERSION ............................... 8 INSTALLING E-Z-MRP................................................................... 8 E-Z-MRP AND MULTIPLE DATABASES ............................................ 9

PART 2 STARTING E-Z-MRP ........................................... 11

STARTING E-Z-MRP................................................................... 11 LINKING THE FRONT END TO THE BACK END FOR THE FIRST TIME ....... 11 THE OPENING FORM ....................................................................... 13 THE MAIN MENU OF E-Z-MRP..................................................... 14 THE UTILITIES ................................................................................ 15
Open Database ....................................................................................16 Backup Database .................................................................................16 Creating Your Own Database...............................................................17 Preferences ..........................................................................................17 Export Data...........................................................................................18 Delete Data...........................................................................................19 Units Of Measure..................................................................................21 User Maintenance ................................................................................22 iii

PART 3 THE BILL OF MATERIALS MODULE ........................... 23

INTRODUCTION ............................................................................... 23 THE WIDGET PRODUCT AND DATABASE ........................................... 23
The Bill of Materials Single-Level Approach .........................................25 The Where Used Feature...................................................................25 Indented Bills of Material ......................................................................25 Quantity per Assembly and Costing .....................................................25 Part Master Fields ................................................................................26 The Product Structure Fields ................................................................28 The Manufacturers Cross Reference Fields ........................................29 The Part Master Maintenance Form .....................................................30 The Product Structure Form .................................................................33 The Manufacturers Cross Reference Form..........................................34 The Part Master Report Form...............................................................35 The Bills of Material Reports.................................................................38 The Where Used Report.......................................................................42 The Manufacturers Cross Reference Report .......................................43 Compare Two Bills ...............................................................................44 Copy a Bill of Materials .........................................................................46 The Cost Roll-Up ..................................................................................46

THE DATA FIELDS OF THE BILL OF MATERIALS DATABASE ................. 26

THE BILL OF MATERIALS PROGRAMS ............................................... 29

PART 4 MATERIAL REQUIREMENTS PLANNING ..................... 51

HOW DOES MRP WORK? ............................................................... 51
The Starting Line On Hand and On Order .........................................52 Sermonette #1: The Importance of Accurate Lead Times ....................53 Sermonette #2: The Importance of Accurate Inventory ........................53 Charting the Activity..............................................................................54 The Supply Side/Demand Side Approach of E-Z-MRP .....................56 When a Supply Creates a Demand: Planned Work Orders ..................58

THE MATERIAL PLANNING MAIN MENU ............................................. 59 THE SUPPLY SIDE PROGRAM ........................................................... 59 HOW TO USE THE SUPPLY SIDE FORM ............................................. 61
iv Changing Lead Times...........................................................................61 Making Direct Changes to Quantity On Hand.......................................62 The Audit Trail Form .............................................................................63 Adding a Purchase Order Line Item .....................................................64 Receiving a Purchase Order Line Item.................................................65 Deleting Purchase Order Line Items.....................................................66

Introduction Adding Work Orders .............................................................................66 Releasing a Work Order and the Auto-Kitting Function ........................66 Completing Work Orders ......................................................................68 Deleting Work Orders ...........................................................................69

THE DEMAND SIDE PROGRAM.......................................................... 69 THE SHORTAGES FORM .................................................................. 70

Selecting Shortages By Work Order.....................................................71 Selecting Shortages By Part Number ...................................................72 Relieving a Shortage ............................................................................73 Adding a Shortage................................................................................74 Deleting a Shortage..............................................................................74 The Supply Side Report........................................................................75 The Demand Side Report .....................................................................77 The Make Report..................................................................................77 The Buy Report ....................................................................................80 The Kit List............................................................................................81 Work-In-Process...................................................................................81 Shortages .............................................................................................82 The Audit Trail Report...........................................................................83

THE MATERIAL PLANNING REPORTS ................................................ 74

THE MRP CALCULATE PROGRAM .................................................... 85 THE HOLIDAY CALENDAR ................................................................ 87 RESOLVING THE MAKE AND BUY ACTION ITEMS ................................ 88

PART 5 THE PHYSICAL INVENTORY MODULE........................ 91

INTRODUCTION ............................................................................... 91 THE MAIN MENU............................................................................. 92 ENTER/EDIT TAGS .......................................................................... 94
Adding a Tag ........................................................................................94 Going to a Specific Tag Number...........................................................95 Editing a Physical Inventory Tag Record ..............................................95 Deleting a Tag ......................................................................................95 Re-Sort .................................................................................................95

DELETE TAGS ................................................................................ 95 TAG EDIT LISTING .......................................................................... 96 PHYSICAL INVENTORY REPORT ........................................................ 96 THE PHYSICAL INVENTORY EXCEPTION REPORT ................................ 97
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PRINT PHYSICAL INVENTORY TAGS .................................................. 98 TRANSFER COUNTS ........................................................................ 98 COUNTER NAMES FORM.................................................................. 99

PART 6 THE PURCHASE ORDER MODULE .......................... 101

OVERVIEW ................................................................................... 101 FILE MAINTENANCE ...................................................................... 102
Purchase Orders ................................................................................102 The Purchase Order Header Tab .......................................................103 Adding, Editing, and Deleting Line Item Details..................................104 Special Instructions ............................................................................106 Previewing and Printing Purchase Orders ..........................................106 The Vendor Maintenance Form ..........................................................107 The Buyer Form..................................................................................108

REPORTS ..................................................................................... 108 OTHER FUNCTIONS ....................................................................... 109

Post P.O.s ..........................................................................................109 Bill To/Ship To ....................................................................................110

PART 7 THE CAPACITY PLANNING MODULE ....................... 113

OVERVIEW ................................................................................... 113 THE CAPACITY PLANNING MAIN MENU ........................................... 114 FILE MAINTENANCE ...................................................................... 115
Work Centers......................................................................................115 Routings .............................................................................................117

CALCULATING WORK CENTER USAGE ............................................ 120 THE WORK CENTER LOADING REPORTS ......................................... 121 OTHER FUNCTIONS ....................................................................... 122
Copy a Routing...................................................................................122 Transfer Labor Costs ..........................................................................123

PART 8 IMPLEMENTING E-Z-MRP - A PLAN FOR SUCCESS .......................................................................................... 125

OVERVIEW ................................................................................... 125 STEPS TO IMPLEMENTATION .......................................................... 125 THE DRY RUN .............................................................................. 126
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Introduction

IMPLEMENTATION CHECKLIST ........................................................ 127

REPORTS APPENDIX............................................................ 129 TECHNICAL SUPPORT AND SELDOM USED BUG REPORT FORM .......................................................................................... 173

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LIST OF FIGURES
FIGURE 1 INTEGRATED MANUFACTURING AND ACCOUNTING SYSTEM .......................3 FIGURE 2 INVALID TABLE LINK.............................................................................11 FIGURE 3 THE FILE OPEN DIALOG BOX................................................................12 FIGURE 4 THE OPENING FORM ...........................................................................13 FIGURE 5 THE MAIN MENU .................................................................................14 FIGURE 6 UTILITIES MENU ...................................................................................16 FIGURE 7 THE PREFERENCES FORM ...................................................................17 FIGURE 8 DELETE DATA .....................................................................................19 FIGURE 9 UNITS OF MEASURE ............................................................................21 FIGURE 10 USER MAINTENANCE ..........................................................................22 FIGURE 11 THE W IDGET PRODUCT STRUCTURE ...................................................24 FIGURE 12 BILL OF MATERIALS MAIN MENU ..........................................................30 FIGURE 13 PART MASTER MAINTENANCE FORM ...................................................31 FIGURE 14 PRODUCT STRUCTURE MAINTENANCE FORM........................................33 FIGURE 15 MANUFACTURERS CROSS REFERENCE MAINTENANCE ........................35 FIGURE 16 THE PART MASTER REPORT FORM .....................................................36 FIGURE 17 THE PART MASTER REPORT DATA SELECTIONS ................................37 FIGURE 18 BILL OF MATERIALS REPORT FORM .....................................................39 FIGURE 19 BILL OF MATERIALS REPORT FORM RANGE OF PART NUMBERS ..........41 FIGURE 20 W HERE USED REPORT FORM .............................................................43 FIGURE 21 MANUFACTURERS CROSS REFERENCE REPORT FORM ........................44 FIGURE 22 COMPARE TWO BILLS FORM ...............................................................45 FIGURE 23 COPY A BILL FORM ............................................................................46 FIGURE 24 COST ROLL-UP FORM ........................................................................47 FIGURE 25 COST ROLL-UP FORM WITH BURDEN AND DATE OPTIONS .....................48 FIGURE 26 MATERIAL PLANNING MAIN MENU ........................................................59 FIGURE 27 SUPPLY SIDE FORM FOR A MAKE PART................................................60 FIGURE 28 SUPPLY SIDE FORM FOR A BUY PART ..................................................60 FIGURE 29 ENTERING A NEW LEAD TIME ..............................................................62 FIGURE 30 AUDIT TRAIL FORM ............................................................................64 FIGURE 31 ADDING A PURCHASE ORDER .............................................................65 FIGURE 32 AUTO KIT PROMPT .............................................................................67 FIGURE 33 AUDIT TRAIL FORM ............................................................................68 FIGURE 34 DEMAND SIDE FORM ..........................................................................69 FIGURE 35 SHORTAGES FORM ............................................................................71 FIGURE 36 SHORTAGES BY W ORK ORDER NUMBER..............................................72 FIGURE 37 SHORTAGES BY PART NUMBER...........................................................72 FIGURE 38 SHORTAGES FORM W ITH SHORTAGE DISPLAYED .................................73 FIGURE 39 SUPPLY SIDE REPORT FORM ..............................................................75 FIGURE 40 MAKE REPORT FORM ........................................................................78 FIGURE 41 MAKE REPORT FORM SHOWING DATA SELECTIONS .............................78 FIGURE 42 KIT LIST FORM ..................................................................................81 FIGURE 43 W ORK-IN-PROCESS REPORT FORM....................................................82 FIGURE 44 SHORTAGES REPORT FORM...............................................................83 FIGURE 45 AUDIT TRAIL REPORT FORM...............................................................84 viii

Introduction FIGURE 46 CALCULATE MATERIAL PLAN FORM.....................................................86 FIGURE 47 HOLIDAY CALENDAR FORM ................................................................87 FIGURE 48 PHYSICAL INVENTORY MAIN MENU .....................................................92 FIGURE 49 ENTER/EDIT TAG FORM ......................................................................94 FIGURE 50 TAG EDIT LISTING FORM.....................................................................96 FIGURE 51 PHYSICAL INVENTORY REPORT FORM ..................................................97 FIGURE 52 TRANSFER PHYSICAL INVENTORY COUNTS FORM .................................98 FIGURE 53 PHYSICAL INVENTORY COUNTER NAMES FORM ..................................100 FIGURE 54 PURCHASE ORDER MAIN MENU ........................................................101 FIGURE 55 ENTER/EDIT PURCHASE ORDERS P.O. HEADER DATA .....................102 FIGURE 56 ENTER/EDIT PURCHASE ORDERS P.O. LINE ITEM DETAIL DATA ........105 FIGURE 57 ENTER/EDIT PURCHASE ORDERS SPECIAL INSTRUCTIONS ................106 FIGURE 58 VENDOR MAINTENANCE ....................................................................107 FIGURE 59 BUYER MAINTENANCE ......................................................................108 FIGURE 60 PURCHASE ORDER REPORT SORT FORM ...........................................109 FIGURE 61 POST PURCHASE ORDERS ................................................................110 FIGURE 62 BILL TO/SHIP TO ADDRESS FORM .....................................................111 FIGURE 63 CAPACITY PLANNING MAIN MENU ......................................................114 FIGURE 64 W ORK CENTER MAINTENANCE ..........................................................115 FIGURE 65 W ORK CENTER LISTING FORMATTING OPTIONS ..................................117 FIGURE 66 ROUTING MAINTENANCE ...................................................................119 FIGURE 67 CALCULATE CAPACITY PLAN .............................................................121 FIGURE 68 W ORK CENTER LOADING ..................................................................122 FIGURE 69 COPY A ROUTING .............................................................................123 FIGURE 70 TRANSFER LABOR COSTS .................................................................124

List of Tables
TABLE 1 INITIAL CONDITIONS FOR MATERIAL PLANNING EXAMPLE ..........................52 TABLE 2 ACTIVITY CHART FOR WDG-000 ............................................................54 TABLE 3 COMPLETED ACTIVITY CHART FOR WDG-000 .........................................55 TABLE 4 ACTIVITY CHART FOR SA-1 ....................................................................55 TABLE 5 ACTIVITY CHART FOR SA-1 WITH ADDED W ORK ORDER ...........................56 TABLE 6 SUMMARY OF SUPPLY AND DEMAND FACTORS .........................................58 TABLE 7 PHYSICAL INVENTORY TEST DATA ...........................................................93

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Part 1 - Introduction
Thank You
Thank you for choosing E-Z-MRP. Those of us who have been involved in the creation of this product hope that it provides you with the competitive edge you require to succeed in a difficult and competitive business. Please read the manual! We know what a pain reading manuals can be. And frankly, weve tried to design E-Z-MRP to be as intuitive as possible. With a little trial and error, you can probably find your way through the program. But if you spend a few minutes with the manual and familiarize yourself with its organization and operation now, it will make the job of implementing E-Z-MRP much easier. Besides, the manual is filled with Tips on things you can do with the program that may not be immediately obvious. The best way to read the manual is in front of your computer, displaying and playing with each of the programs and functions in E-Z-MRP.

The Problem
Manufacturing is not a piece of cake. It doesnt matter what anyone tells you. The thing is shot through with problem after problem. First you have to get the marketing people to sit still and stop changing the sales forecast every two days. Then there are those unexpected big orders that your persistent sales force insists on booking (usually close to the end of a quarter). Lets not forget those heart-rending cancellations that threaten to leave you with all kinds of unneeded inventory. And, of course, Customer Service is always trying to raid your raw materials inventory for spares they forgot to forecast. Meanwhile, the bad news from Purchasing is that lead times for some critical components have just dramatically increased. Inventory reports that you dont have quite as much of some items on hand as you thought, and on others youre well overstocked. On the other hand, most of your open purchase orders are being delivered late and over cost, and the controller is on your back because of cash flow problems youve created single-handedly. No matter what unprintable form your analysis of this situation might take, your problems can be reduced to four basic questions: 1) What do I have to make? 2) When do I have to make it?

3) What do I have to buy? 4) When do I have to buy it? A fifth recurring question, not as important to you but perhaps of inexplicable urgency to others, is: 5) What is all this making and buying going to cost?

The Solution
The ideal solution to these problems is an integrated, automated manufacturing system, incorporating an MRP (Material Requirement Planning) module. MRP, based on the status and condition of the data in your system, can give precise answers to the previous five questions. Figure 1 illustrates how this MRP manufacturing system works. The keystone of this system is a Bill of Materials database that contains the part master records, product structures, quantities per assembly, costs, and other data needed for configuration management. Other functions in an integrated manufacturing and accounting system include an on-line raw materials inventory in which all receipts and issues are recorded, a purchasing system to record buy orders, a receiving system to record receipts of those orders, a work-in-process/shop floor control system which gives control and visibility over whats in the manufacturing pipeline, a finished goods inventory system, and a sales order entry and forecasting system. In addition, there are several other auxiliary systems such as labor routings, kitting, shipping, and general accounting that complete the integrated system. When it comes time to answer the BIG FOUR (or FIVE) questions, MRP, which can see all the other data in the system, looks at the total demand for end items and then adds in all of the items that must be made or bought (by looking at the product structures). From this list of gross make and buy requirements, it subtracts out any items already in the finished goods, raw materials, or work-in-process inventories, or on order in the Purchase Order system. The net results can then be printed out in beautiful, time-sequenced reports that explain exactly what to make, what to buy, when to make it, and when to buy it!

Introduction

Figure 1 Integrated Manufacturing and Accounting System

The Further Problem

As you can readily see, getting all of the information required by an MRP program into a shared database, and maintaining it with the accuracy required to give reliable Make and Buy reports, will require more than a trivial effort. Moreover, the typical MRP system requires a powerful mainframe computer or a client/server network with multiple workstations (one or more in Purchasing, Inventory, Production Control, and other departments), and a special support staff. If you know anything at all about MRP, you probably believe: MRP is too complicated for the average person to understand

MRP requires either an advanced degree in production and inventory control systems or a certification from the American Production and Inventory Control Society Implementing MRP will require hiring and training additional staff Implementation will take 12 to 18 months Capital investment will be from $20,000 to $500,000

Yet the benefits of MRP are so great that it has become a requirement rather than just an attractive option, for any manufacturing company large enough to justify the investment.

The Further Solution

E-Z-MRP is the ideal solution for the smaller manufacturer who cant afford the investment in the mainframe MRP offerings. E-Z-MRP provides the benefits of largescale, classic MRP systems with a small fraction of the investment in time, hardware, software, and personnel. It does this by providing a fast, compact method of getting all the supply and demand factors into a concise and flexible database. And it does this on any Windows-based single-user PC or network hardware which is probably already in place in your company. And it can cut the standard 18-month implementation time to as little as 18 days.

What Is MRP?
MRP stands for Material Requirements Planning. It is simply a logical method for determining every day what you need to make and what you need to buy in order to meet the demands both firm customer orders and forecasts for your products. Most small manufacturers are already doing MRP without knowing it. Those who plan production and procurement may do it in their heads, and it may not be very accurate, but theyre doing it just the same. Consider the following typical small manufacturers thought process when confronted by a customer asking when an order for 1,000 pieces will be shipped: Well, lets see Ive got 500 on the shelf, so I need to make 500, which takes about a week. The two major subassemblies each require two weeks to make. But one of them is already in work-in-process and well be finished pretty soon hopefully. For the other subassembly, I need some components, which will take about 3 weeks to get. So, lets see, if I order the raw materials today and it takes three weeks for delivery, the two weeks for the subassemblies, and one week for final assembly Yes, sir. We can have your order delivered in six weeks!

Introduction
This thought process encapsulates the whole MRP material requirements planning process. In it, the manufacturer Mentally exploded his bill of materials (a list of all the components that make up the product) Subtracted out quantities already on-hand and on-order so he wont make or buy things he already has (a process called netting which tells what remains to be made or bought) Figured out when he should start his procurement and production activities, based on the due date and lead times of the things he had to make and buy a process known as offsetting (the order date of an activity is simply the due date minus the lead time)

This is a simple process that can be done mentally when there are very few end items with very few components. But what if instead of one order for one product, there were dozens of orders for a variety of products? What if lead times for critical components increase? What if other items are out of stock and others are overstocked? Your delivery schedule and cash flow can be devastated by these everyday changes. Monitoring and reacting to all of these changes quickly becomes more than anyone can do in their head. But as you can see, theres nothing mysterious about the process. What you need is a computer program which will do all of the grunt work for you one that will look at all of the demand and supply factors affecting your production and procurement activities, and give you timely answers to the five basic questions posed earlier. And this is exactly what E-Z-MRP is designed to do.

A Little History
E-Z-MRP is not a new program. It was first released is 1984. E-Z-MRP was originally developed by a team which had been developing and implementing a variety of manufacturing systems on mainframe and minicomputers for a number of years. Then in the early 80s, inexpensive and powerful personal computers became widely available. It seemed that, using these new machines, an MRP system could be developed for small manufacturers, which would run on a single-user personal computer if one could 1) simplify the user interface to make the program usable by someone with little or no experience in either manufacturing systems or computers as opposed to the fairly high level of experience and expertise of those maintaining mainframe manufacturing system, and 2) design the data entry so that it could all be handled by one person as opposed to the team of people who fed data into the mainframe.

The idea was widely ridiculed as impossible. Several years and hundreds of successful users later, E-Z-MRP had proven that it was possible. Translated into four languages and in use around the world, E-Z-MRP proved that even the smallest manufacturer could successfully implement an MRP system and have it run and maintained by clerical staff with little or no understanding of computers or manufacturing systems. Now E-Z-MRP is back. Instead of DOS, it is Windows-based. Instead of C-BASIC, it is developed in Microsofts Access Database System. But its still E-Z-MRP. And we guarantee that, if you use it correctly, you will be successful at implementing an MRP system in your company.

Hardware and Software Requirements

E-Z-MRP will run on any Windowsbased PC single user or network. It requires Microsoft Access 2000 (a component of the Microsoft Office 2000 Suite). It will also run under Access XP (a component of the Office XP suite). And youll need a good, fast workhorse of a printer. Thats it. You should be able to acquire all the hardware and software you need to run E-Z-MRP for under $1,000.

Assumptions About You, the User

E-Z-MRP is arguably the simplest approach to MRP and the easiest to implement of any MRP system in software history designed, as it was, for the small to medium-sized manufacturing firm or autonomous divisions of larger companies. Still, there are assumptions that have been made about the users level of knowledge and experience. First, it is assumed that you understand how to operate your computer; i.e., turning it on and off, using a mouse, copying files, navigating among the folders on your hard disk, looking at files in folders, getting the computer and the printer to work together, etc. Second, although this manual is as clear and instructive as possible, some general knowledge of the manufacturing process must be assumed. For example, if you do not know the meaning of such terms as raw materials, work-inprocess, purchase order, sales order, or forecast, you might want to enlist the aid of someone else in the company who is more familiar with these items and who can assist you through the initial setup and operation of E-Z-MRP. E-Z-MRP further assumes that you know nothing about MRP except that you may have heard enough about it to be totally intimidated. Or you may harbor one or more of the popular myths and misconceptions about its complexity, how difficult it is to

Introduction
comprehend and implement, and how it takes years of manufacturing experience before you know what youre doing. In fact, the design objective of E-Z-MRP is to demystify MRP and make it accessible to anyone for whom it would be of benefit. The operation of E-Z-MRP is quite simple. It is menu-driven, so your choices at any point are clearly displayed on the screen. Simply point and click with your mouse. If you read through this manual and do the tutorials just once you should have no further problems operating E-Z-MRP. Your attention will then be free to concentrate on the job of meeting your manufacturing plan.

Some Terms
Although E-Z-MRP is designed to be as jargon-free as possible, still there are just a few terms used throughout this manual that need to be defined. Form: A screen where you choose program functions from a menu of choices, enter data, or select options for a report is called a form. Table: You may be used to referring to your data as being stored in files or records. In modern database applications, although the term record is still used the same way, files are now referred to as tables. You can imagine the data arranged in a table much the same way that it appears on a spreadsheet. Text Box: Any place where you enter text or numeric data is referred to as a text box. Command Button: This is a button on a form that you can click in order to perform some action. For example, clicking a button on a form with the label Exit will close the form you are looking at, and return you to the previous menu. List Box or Combo Box: This is a control on a form that drops down a list from which you can make a selection by clicking on the desired entry. Click: Although you probably know this already, click means to hover the mouse pointer over a control on a form (text box, command button, etc.) and press the left mouse button.

Warranty and Support

E-Z-MRP comes with one year of free phone-in consulting service on any questions or problems related to the use of the E-Z-MRP software and any questions or problems you may have related to your manufacturing systems. Thats as simple as it gets.

Custom Programming and Data Conversion

E-Z-MRP is written in Microsofts Access. So its database is widely compatible with and accessible by a number of third party products as well as Microsofts Excel. With some training in Access, you can probably structure and develop custom features and reports yourself. However, you already have a job, and programming is probably not it. So Beach Access Software will provide quotes for developing any custom features that you require. Should we regard this feature as a valuable generic upgrade to the system, we will, as we always have, provide it to you at no charge. Most manufacturers already have some of their data in electronic form. Perhaps its just a spreadsheet with part numbers, descriptions, and costs. Whatever it is, it can generally be imported into the E-Z-MRP database so that you dont have to re-enter it manually. Contact Beach Access Software for a quote for converting your existing data into an E-Z-MRP database.

Installing E-Z-MRP
Your E-Z-MRP system is made up of two kinds of files the file that holds the E-ZMRP program (this file is referred to as the front end), and the file that holds your data (this file is referred to as the back end). The E-Z-MRP CD contains a file named E-Z-MRP.mde. This is the program file or front end. You should create a folder on your computer and copy this file into it. If you are operating over a network, create a folder on each of the work stations on your network to hold the E-Z-MRP.mde program file, and put a copy of it into that folder on each machine. Further, you should put a shortcut to this front end file on your desktop to make it convenient to start E-Z-MRP. The other files on your CD are database files. They hold your manufacturing data. There are three of them: EZMRPWDG.mdb This is the database that contains the widget that is used in the tutorials in this manual. Well be using it later to learn how to use E-Z-MRP and to learn the basics of MRP. EZMRPPEN.mdb This is another database which holds the Bill of Materials for a Ball Point Pen. You can use this database to experiment with E-Z-MRP. EZMRPNUL.mdb This is a totally empty database that is used to create additional data bases including you production database. If you are running on a single-user system, or are on a network but want to run E-ZMRP only on a single machine, simply copy these three back end files into the same folder you created for the front end.

Introduction
If you want to run E-Z-MRP on a network, you should create a folder on the machine that you are using as a server the computer where you store files and data that is to be shared by others on the network. Be sure that each of the workstations can see the folder you create on your server to hold the database. Then copy these three back end files into that folder.

E-Z-MRP and Multiple Databases

One of E-Z-MRPs most powerful features is its ability to support multiple databases. This means that you could have a separate database for engineerings research and development projects. The engineers can muck around in their own database without disrupting any of the production data, or accidentally (or deliberately) altering released production bills of material outside of your normal Engineering Change process. But further, you can use this multiple database feature of E-Z-MRP to answer various kinds of what if questions. Suppose you want to see the effect on your production or procurement plans of a sudden increase in an order. Or a cancellation. Perhaps youd like to input the forecast for the entire next fiscal year and run the MRP calculations to see what to make and buy and what it will cost. These and other questions can be simulated in a copy of your database, avoiding the need to alter your production data and then back out those alterations later. Simply make a copy of your production database, name it anything you like, then link your E-Z-MRP program file to this new database (how you do this will be explained later in the section on Utilities). Make whatever changes you want to this copy of your production data. When finished, simply delete the copy of the database. Note that since you may have more than one E-Z-MRP database, to avoid confusion or mistakenly entering data into the wrong database, the database that you are currently working with is displayed at the top of all menu forms.

Part 2 Starting E-Z-MRP

Starting E-Z-MRP
To start E-Z-MRP, simply double-click the shortcut icon on your desktop that you created during the installation of E-Z-MRP which points to the E-Z-MRP front end on your computer.

Linking the Front End to the Back End for the First Time
The data in your E-Z-MRP database is arranged in tables. Each table holds a different kind of data. One table holds the definition of each part in your database description, costs, unit of measure, etc. Another table holds the product structures a list of the components that make up an assembly. The E-Z-MRP program file front end contains pointers to the tables in the back end. Further, E-Z-MRP remembers the back end database you last used. The first time you install E-Z-MRP, the front end will be pointing to the back end at Beach Access Software that, obviously, you cant access from where you are sitting. Nor do you want to. You want to link your front end program to your own back end database. So the first time you start E-Z-MRP, you might see this message:

Figure 2 Invalid Table Link

11

This message is telling you that one of the links or pointers from the front end to the back end is not valid that probably means that the database that the pointer is pointing to is no longer in that location. To locate and link up the database you want, click Yes. The standard Windows File Open Dialog Box will appear:

Figure 3 The File Open Dialog Box

At this point you use this file open dialog box just like you would use it to locate a folder with a word processing document: 1) Using the Look In combo box or clicking on a folder displayed in the large white window, locate the folder which contains the database you want to open 2) Click the desired database name. If you are running E-Z-MRP for the first time, select the database named EZMRPWDG.MDB (that you should have copied from the CD into the folder where you are storing all of your back end databases). 3) Click the Open button. E-Z-MRP will link the front end to the selected back end.

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Starting E-Z-MRP

The Opening Form

Once E-Z-MRP is able to establish the correct linkages to the back end, the opening form will be displayed:

Staff Combo Box

Figure 4 The Opening Form

To enter the E-Z-MRP system, you have to sign in and give a password. You will learn how to enter your own staffs names and passwords later. For the moment, when you click on the gray downward pointing arrow on the right side of the Staff Combo Box, three names will appear Larry, Moe, and Curly. Their passwords are the same as their names (not too secure we hope youll be more inventive). Of the three names Larry, Moe, and Curly only Curly has Administrator level access (explained later in the section on User Maintenance). Click on Curly. Enter curly as the password. If you do this right, the Main Menu will appear:

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The Main Menu of E-Z-MRP

Figure 5 The Main Menu

The Main Menu of E-Z-MRP has eight command buttons:

1) Bills of Material Clicking this button will take you into the Bill of Materials
module of E-Z-MRP where you will enter your parts, costs, product structures, manufacturers cross references, and other information pertinent to your bills of material.

2) Material Planning Clicking this button will take you into the Material Planning
module of E-Z-MRP. Here you will find all of the functions necessary to track your manufacturing activities including: entering forecasts, entering and shipping sales orders, entering and receiving purchase orders, entering kitting and completing work orders, tracking shortages, maintaining your perpetual inventory, and other activities.

3) Capacity Planning Clicking this button will take you to the Capacity Planning
module of E-Z-MRP. Here you can define your work center, enter labor routings for each of your assemblies. Capacity Planning will produce costed labor routings, dated travelers for your work orders, and graphic and tabular reports showing each day what per cent of your work center capacities are being utilized.

4) Purchasing This module will store your vendor names, addresses, and other
contact information, print out your purchase orders, and post that information to the Material Planning tables.

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Starting E-Z-MRP 5) Physical Inventory This module is designed to assist you in taking a physical
inventory, reporting the differences between your perpetual and physical inventory counts, and adjusting your perpetual inventory to match the physical inventory.

6) Utilities Utilities allow you to enter and edit the users who should be allowed
access to the E-Z-MRP system, open a new database, make a backup copy of any of your databases, and several other useful functions.

7) Change User Clicking this button will take you back to the opening form where
you can enter a different user name and password. If you are going to leave your desk for any length of time, it is always a good idea to click this button before you go to prevent unauthorized access to the system.

8) End Program Clicking this button will close E-Z-MRP and return to your
desktop. Before proceeding into the meat of the system Bills of Material and Material Planning we will review the Utilities. Tip: Any time you see a command button on a form with one of the letters underlined, you can use a keyboard shortcut to trigger it instead of clicking it with the mouse. Hold down the Alt key on your keyboard (usually located to the right and left of the space bar) and press the underlined letter. So, for example, on the Main Menu form in Figure 5, to run the Bill of Materials function either click on the command button labeled Bills of Material, or, alternatively, hold down the Alt key and press B.

The Utilities
From the Main Menu when you click on the Utilities button, you will see this form:

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Figure 6 Utilities Menu

Open Database
As previously described in the section entitled E-Z-MRP and Multiple Databases, the ability to create and maintain different databases for different purposes is one of E-Z-MRPs most powerful features. This button opens up the standard Windows Open File Dialog Box as described previously in the section entitled Linking the Front End to the Back End for the first time. Simply navigate to the folder containing the database you wish to open, select it by clicking on it, and then clicking on the Open button. The copy of the E-Z-MRP front end you are using will be linked to the back end you selected.

Backup Database
Use this feature to make a copy or backup of your database. When you click this button again, the standard Windows File Open Dialog Box will open, but the button that normally says Open will now be labeled Save. Navigate to the folder where you want to make the copy or backup, enter the name in the box labeled File Name, and click Save. Do not put .mdb at the end of the file name to indicate that this is an Access database. The program will do that for you.

16

Starting E-Z-MRP

Creating Your Own Database

Use the Backup utility to make a new copy of this database, entering whatever name you want in the File Open Dialog Box. Then use the Open Database utility to open this new copy of the ezmrpnul.mdb database.

Tip: To create a new empty database, open the database ezmrpnul.mdb. This is a database that is totally empty except for one user. That users name is Admin, and the password is admin. Tip: You can use this same technique to create a copy or clone of your production database. Using this copy you can simulate various what if scenarios without disrupting your production data. When you are done, simply delete the database.

Preferences
The Preferences form looks like this:

Figure 7 The Preferences Form

There are six preferences you can set through this form: 1) Report Preview Zoom: When you display a report on your monitor, instead of sending it to the printer, it can be displayed in any magnification. Depending upon the size, quality, and resolution setting of your monitor, there will be an optimal magnification setting. As many monitors will display the full page but are still readable at 88% magnification, this is the default setting for E-Z-MRP.

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2) Labor Burden %: This is the percent of labor cost that determines the burden for a make, sub-contract, or phantom part. 3) Material Burden %: This is the percent of material cost that determines the burden for a buy or free stock part. 4) Auto-Burden: If checked, burden dollars will be automatically calculated during cost changes to a record in your Part Master table. 5) Sales Tax Rate: Enter the local sales tax rate to be included on your Purchase Orders, if desired. 6) Lead Times Mfgd Parts: choose to express the lead times of your manufactured parts in either days or minutes per piece. If you select days, the lead time for all orders will be the same regardless of size. If you choose minutes per piece, the lead time of the order will be the number ordered times the minutes per piece divided by the number of minutes per day and rounded up to the nearest whole day. 7) Language: E-Z-MRP supports multiple languages. Select your language preference from the drop-down list. The report preview zoom value and language preferences are local to each user so that each user can set their own report preview zoom and language preference. The other four preferences are stored in the back end database so everyone using that particular back end will see the same values.

Export Data
This function will export all of the data in your E-Z-MRP database to ACSII, comma delimited, text into the following seven files: PartMaster.txt all of your part master records including costs and current quantity on hand. ProductStructure.txt all of your product structure records. ManufacturersXref.txt all of the manufacturers names and part numbers that are associated with your part numbers. Shortages.txt all of the current shortages in work orders that have been opened and kitted. Supply.txt all of the current work orders and purchase orders in your database including any closed P.O.s or completed work orders. Demand.txt all of the forecasts and firm sales orders that have been entered including sales orders that have been shipped.

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Starting E-Z-MRP

PhysicalInventory.txt the details of the counts taken during the last physical inventory.

You can use this utility to create a file of data that you can manipulate and report using a wide variety of third party software including spreadsheets like Excel. The first record of each file contains the field names. If you have any questions about using these exported files, please contact Technical Support at Beach Access Software.

Delete Data
This is arguably the most dangerous function in the entire system. Injudicious use of this feature can result in trashing a database with thousands of hours of work in it. Of course, before using it you will have a current backup, wont you? Clicking Delete Data displays the following form:

Figure 8 Delete Data

Select the data to be deleted by clicking in each of the desired boxes so that the check mark shows. If you select All Part Master Records, the program will also place check marks in Product Structures, Manufacturers Cross References, Shortages, and Demand and Supply records. E-Z-MRP creates an audit trail record for each inventory transaction any activity which changes the quantity on hand, and stores information about the transaction including the transaction date.

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If you choose to delete All Audit Trail Records By Date Range, >= Date and <= Date boxes will be displayed where you can enter a date range of audit trail records to be deleted. If you enter a >= Date and no <= Date, then all Audit Trail records with a transaction date on or after the >= Date will be deleted. If you enter a <= Date and no >= Date, all Audit Trail records with a transaction date on or before the <= Date will be deleted. Tip: This form is particularly handy in clearing your database of old completed Purchase Orders, Work Orders, and Sales Orders. Just check one or all of the three check boxes in the right-hand column: All Completed P.O.s, All Completed W.O.s, All Completed S.O.s.

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Starting E-Z-MRP

Units Of Measure

Figure 9 Units of Measure

Use this form to enter or edit units of measure that you will use when you enter your Part Master records. The buttons along the bottom of the form control the operation of this form. Add Click to add a new Unit of Measure. Click again to cancel the Add operation. Delete Click to delete the currently displayed Unit of Measure. Save Clicking this button saves the currently displayed record. Find Clicking this button drops down a list of the Units of Measure currently in your system. Click on the desired Unit of Measure. The four navigation buttons Inside the box between the Find button and the Preview Clicking, these buttons will display the First Record, Previous Record, Next Record, and Last Record, respectively. Preview Clicking this button will display a listing of all the Units of Measure in your database on the monitor. Print Clicking this button will print a listing of all the Units of Measure in your database on the printer. Exit Clicking this button will return you to the Utilities Menu.

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User Maintenance
In order to provide a basic level of security and control the access to your database, E-Z-MRP lets you enter user names, passwords and access levels as follows: Level 1 access: Read Only allows a user to display data on forms and run reports, but is not allowed to enter or change any data. Level 2 access: Read/Write in addition to Level 1 privileges, user is allowed to enter and change data. Level 3 access: Administrator in addition to Level 1 and Level 2 privileges, user is allowed access to the Utilities.

When you click the Users button on the Utilities form, the following form appears:

Figure 10 User Maintenance

The operation of this form is the same as the operation of the Unit of Measure form described earlier. Be careful with copies of the User Listing it shows all of the passwords. And since the passwords are displayed on the monitor, be careful who is looking over your shoulder while youre working with this form.

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Part 3 The Bill of Materials Module

Introduction
What is a Bill of Materials? According to the Fifth Edition of the American Production and Inventory Control Society (APICS) Dictionary, a Bill of Material is a listing of all the subassemblies, parts, and raw materials that go into a parent assembly showing the quantity of each required to make an assembly. E-Z-MRPs Bill of Materials Processor provides a fast, flexible, and comprehensive way to enter and report Bills of Material. The E-Z-MRPs Bill of Materials Processor also provides complete part and product costing and will report Single Level, Indented, and Summary Bills of Material, either costed or uncosted. You can also report the where used for any part essentially an inverted bill of materials showing, from the bottom up, where a component is used. Changes in costs - material, labor, burden, sub-contract are quickly reflected throughout the entire database through an efficient Cost Roll-Up function.

The examples in this part of the manual are taken from the database named ezmrpwdg.mdb. This database contains a basic product called the Widget. If you want to follow along on your computer (highly recommended) with the examples in the manual, open that database now.

The Widget Product and Database

The database ezmrpwdg.mdb contains a simple, imaginary product the archetypal Widget. Its structure is shown in the following diagram:

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WDG-000 Widget

COMP-1 Smoked Glass (6)

SA-1 Black Box (2)

SA-2 White Box (1)

COMP-2 Mirror (6)

COMP-3 Chewing Gum (6)

COMP-3 Chewing Gum (10)

COMP-4 Wire (10)

Figure 11 The Widget Product Structure

As you can see, this particular widget is composed of two identical black boxes, a white box, and six pieces of smoked glass (the numbers in parentheses indicate the quantity required). Each black box in turn is made up of six mirrors, ten pieces of chewing gum, and ten pieces of wire. The white box has only one part chewing gum but it uses six pieces. To understand how the Bill of Materials Processor works, it is necessary to understand the roles of components and assemblies. A component is a part that is used in the production of another part. The combination of two or more parts is called an assembly. In Figure 11, the Black Box assembly is made up of three components Mirrors, Chewing Gum, and Wire, in varying quantities. When a component in an assembly is also an assembly (i.e., it also has components), then it is often referred to as a subassembly. In the case of the Widget, the Black Box is a subassembly. It is a component of the Widget, and has itself three components.

24

The Bill of Materials Module

It is also common to refer to a level in the product structure. In the case of the Widget, the WDG-000 is the top level assembly, also known as level zero (0). Comp-1 is at level one (1); COMP-2 is at level two (2). As noted before, E-Z-MRPs Bill of Materials system will accept structures up to ten levels deep.

The Bill of Materials Single-Level Approach

E-Z-MRPs Bill of Materials is called a single-level Bill of Materials Processing system because each of the relationships between assemblies and components is defined in the system once and only once (although the system will allow you to enter a product structure up to ten levels deep). This means that when you make a change to any part, all assemblies that use that part are automatically affected. Likewise, if you change a component of a subassembly, all assemblies which use that subassembly instantly reflect that change.

The Where Used Feature

Another benefit to the single-level approach of E-Z-MRPs Bill of Materials system is the ability to reverse the family tree and find all the assemblies where any part is used. This reverse product structure is referred to as the where-used structure. The where-used feature of the Bill of Materials system will enable you to identify quickly and accurately all assemblies that will be affected by a change order or by an obsolete part from a supplier.

Indented Bills of Material

Arranging all of the components of all fabricated parts into single-level product structures makes it possible to produce a report showing all subassemblies of an assembly, all of the sub-subassemblies of the subassembly, and so on, down to the lowest component level of the product structure. This is called an Indented Bill of Materials.

Quantity per Assembly and Costing

While you are using the Bill of Materials system to define the structure of an assembly, you are also recording the quantity of each component required to make one unit of that assembly. This information is referred to as the quantity per assembly (QPA). In addition to documenting the requirements for parts, the QPA allows you to accomplish the following valuable costing functions:

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Costed Bill of Materials This is a report that displays each component used in an assembly and the breakdown of costs for that component that contributed to the total material cost of an assembly. Cost Roll-Up The total material cost of an assembly is the sum of the material costs of the lower level assemblies plus their labor, burden, and sub-contract costs, plus the material costs of all the components in those lower level assemblies. Therefore, the labor, burden, and sub-contract costs shown on any assembly are for that assembly only; all the material, labor, burden, and sub-contract dollars of the lower level assemblies have been accumulated (rolled up) into the material cost of that assembly.

The Data Fields of the Bill of Materials Database

All of the Bill of Materials data is stored in three tables:

1) The Parts Master a grouping of data fields that completely defines a part
master record raw material, subassembly, or assembly.

2) The Product Structure information that defines the relationships among the
parts (what goes into what).

3) The Manufacturers Cross Reference attach one or more manufacturers

names and part numbers to each of your part numbers.

Part Master Fields

Each record in the Part Master table consists of the following fields or data items: Part Number A unique part number, up to 30 characters, alphanumeric. As this number uniquely identifies your part, duplicates are not allowed. Revision Level Up to three characters, alphanumeric, of the current revision level of this part. Purchasing Unit of Measure The units of measure used to purchase this part (selected from the list of Units of Measure entered in the Units of Measure Form described earlier in the section on Utilities). Bill of Materials Unit of Measure The units of measure used to describe the usage of a part in a bill of materials (selected from the list of Units of Measure entered in the Units of Measure Form described earlier in the section on Utilities). Unit of Measure Conversion The number by which the Quantity per Assembly in a Bill of Materials record (see the section on Product Structure File Maintenance) is divided in order to convert from the Bill of Materials Unit of Measure to the Purchasing Unit of Measure.

26

The Bill of Materials Module

Source Code There are five valid sources codes used by E-Z-MRP s Bill of Materials Processor: 1) B a buy or purchased part 2) M a make or produced part 3) F a free stock part (free stock items are generally not called out on bills of material but are consumables such as glue, solder, lubricants, etc.) 4) P a phantom part also known as a transient part or a blow through part (generally a non-stocked subassembly) 5) S sub-contract part (an assembly in which you supply the components to an outside contractor who performs fabrication or assembly operations and returns a finished part)

Class Code A six-character alphanumeric field used to group parts into various categories. The class coding scheme you use is entirely your own. You can build as much intelligence into it as you like. The class code has great utility in E-Z-MRPs reporting as you can choose to sort most reports by class code, and print a single class code or a range of class codes. Description An alphanumeric field of virtually unlimited length. It is recommended that you use some kind of standardized description scheme and make descriptions as concise as possible. Material Cost The direct cost of a purchased part. For assemblies or subassemblies with bills of material, this cost is calculated or rolled up from the cost of all the components that go into that assembly. Labor Cost The cost in direct labor dollars of assembling or fabricating an assembly. Burden Cost The burden or overhead cost in dollars generally calculated as a percentage of direct labor dollars. You can set this percentage during the cost roll-up function. Sub-Contract Cost The cost per piece charged by an outside contractor. Fixed Procurement or Setup Cost For buy parts, this would be the fixed cost of creating and processing a purchase order. For a make part, it would be the fixed cost of any setup operations in manufacturing. It is allocated to the unit cost of the part by dividing the Fixed Procurement or Setup Cost by the Minimum Order Quantity. Minimum Order Quantity This field can also be used to enter the Economical Order Quantity (EOQ), or the standard Lot Size.

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Drawing Number A 30-character alphanumeric field. Drawing Location A 20-character alphanumeric field. Vendor Name A 30-character alphanumeric field. For a buy or sub-contract part, this is the name of the primary vendor for this part. Lead Time The time required to order and receive purchased parts or the time required to manufacture a make part. For purchased parts, lead time in E-Z-MRP is expressed in days. For make parts, lead time can be expressed either in days or minutes per piece. But you must be consistent. If the lead time for a make part is expressed in days, the order date of a work order will be the due date minus the lead time regardless of the number of pieces in that work order. If lead time is expressed in minutes per piece, the lead time will be the number of pieces in a work order times the minutes per piece lead time, rounded up to the nearest whole work day.

Safety Stock The amount of inventory of a given item that you want to keep in stock to protect against being stocked out due to things such as manufacturing delays or late deliveries. The Safety Stock is an amount over and above all firm demands for the part. Inventory Location 1 A 10-character alphanumeric field of the primary inventory location for this part. Inventory Location 2 A 10-character alphanumeric field of the secondary inventory location for this part. Picture in this field you can store the full path and file name of an image of the part a picture or drawing file. Notes Essentially unlimited text field for notes about this part.

The Product Structure Fields

In the product structure table, each record defines a relationship between an assembly and a component. Each record in the Product Structure table consists of the following fields or data items: Assembly Part Number Part number from the Parts Master File of this assembly. Component Part Number Part number from the Parts Master File of this component. Item Number This is a sequence number, usually from the hand drawn parts list on a drawing used in a call out on the drawing to indicate the location of a component in an assembly.

28

The Bill of Materials Module

Quantity per Assembly The quantity of this component part required to make this assembly part number. Effective Date This is the date before which this component should not be used in this assembly. The Material Requirements Planning program takes this date into account and will not generate requirements for this component before its effective date. Obsolete Date This is the date after which this component should not be used in this assembly. The Material Requirements Planning program takes this date into account and will not generate requirements for this component after its obsolete date. Reference Information This is information that is unique to the use of this component in this assembly; most commonly it is used to identify locations of the component on a printed circuit board.

The Manufacturers Cross Reference Fields

The Manufacturers Cross Reference table holds manufacturers names and part or catalog numbers that correspond to your internal part numbers. You can enter as many as you like for one of your part numbers. The manufacturers cross reference is a useful tool for buyers who may find a distributor is stocked out of a part from a specific manufacturer. This list will tell them which parts from alternate manufacturers are the equivalent to the part they need. Each record in the Manufacturers Cross Reference table consists of the following fields or data items: Your Part Number a valid part number from your Part Master records. Manufacturers Part Number a 40-character field containing the manufacturers part number which corresponds to your part number. Manufacturers Name a 40-character alphanumeric field.

The Bill of Materials Programs

When you click on the Bills of Material button on the Main Menu (see Figure 5), you will see the following form:

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Figure 12 Bill of Materials Main Menu

As you can see, the functions of the Bill of Materials are grouped into three sections: 1) File Maintenance in which you can enter and edit the part master, product structure, and manufacturers cross reference data 2) Reports containing a comprehensive suite of reports for parts, bills, and manufacturers cross references 3) Other Functions copy a bill or perform a cost roll-up

The Part Master Maintenance Form

Clicking on the Part Master button on the Bill of Materials Processor Main Menu form (Figure 12) displays the following form where you can enter, edit, and delete parts from your Part Master table:

30

The Bill of Materials Module

Figure 13 Part Master Maintenance Form

Use this form to enter, edit, and delete part master records. The buttons along the bottom of the form control the operation of this form. Add Click to add a new Part Master Record. Click again to cancel the Add operation. Delete Click to delete the currently displayed Part Master Record. To delete a Part Master Record it must be completely detached from all other aspects of the database. You cannot delete a Part Master Record if it is attached to any product structure, has manufacturers cross references, has any quantity on hand, or has any sales orders, work orders, purchase orders, or shortages listed for it. Save Save the currently displayed Part Master Record. This button turns red during the Add operation or if you change any data on an existing record, as a reminder that something has changed and you need to click save to register your changes before moving on. Find This button drops down a list of the Part Master part numbers currently in your system. Click on the desired part number to display the part. E-Z-MRP uses what is termed auto-fill on boxes that drop down displaying various kinds of lists. When you enter a character into the box at the top of the list, the focus of the list - that is, the selected record that will appear highlighted moves to the first entry in the list matching that character. As you enter more characters, the focus continues to move to the first record matching all of the entered characters.

Tip:

31

Suppose, for example, your Parts Master contains 5,000 records beginning with numbers 0 through 9. If you enter 3, the focus might move to part 30000000, being the first part matching a 3. If you then enter 4, the focus would move to 34150001, this being the first part in the table with the first two characters matching 34. The four navigation buttons inside the box between the Find button and the Preview button will display the First Record, Previous Record, Next Record, and Last Record, respectively. Records are displayed in ascending part number sequence. Part Master Report will open a form that will allow you to enter options specifying the format and content of the Part Master Report. Exit Clicking this button will return to the Bill of Materials Main Menu.

There are two other handy buttons on this form in the lower right-hand corner labeled in light blue: Prod.Struct. will open up the Product Structure Maintenance Form. The form will open displaying the currently displayed part in the Parts Master form. Mfrs. Xref. will open up the Manufacturers Cross Reference form. The form will open displaying the currently displayed part in the Parts Master form.

In the upper right-hand corner is a check box labeled Auto-Burden. This check box reflects the value you set in the Preferences form of the Utilities. It can be changed on this form without changing your pre-set preference. If this box is checked, the burden dollars are automatically calculated for you every time the material cost (for a buy or free stock item) or labor cost (for a make, sub-contract, or phantom item) is changed. Pictures: you can store the full path and file name in this field of a file containing an image of your part, display the image, or delete the reference to it by using the three buttons to the right of the picture field. , which has a picture of a magnifying glass, is used to view The first button the image of the part. If you have entered the path and file name of a valid image file, then when you click this button, the part will be displayed on a separate screen. , which has a picture of a pair of binoculars, is used to The second button locate the file containing the image of your part. When you click this button, the File Open Dialog box (see Figure 3) appears. Navigate to the folder which contains your image file, select the image and click Open. The path and file name will be entered into the Picture text box.

32

The Bill of Materials Module

The third button , which contains a picture of an eraser, can be used to delete the reference to the image file. Vendor: There are two buttons to the right of the Vendor field. The first button , which has a picture of a magnifying glass, when clicked, will drop down a list of Vendors which you have entered in the Vendor Maintenance form in the Purchase Order module. , which has a picture of a pair of binoculars, will, when The second button clicked, open up the Vendor Maintenance Form in the Purchase Order module, so that you can see all the vendor information for the currently selected vendor and/or select a different vendor for this part.

The Product Structure Form

Clicking on the Product Structure button on the Bill of Materials Processor Main Menu form (Figure 12) displays the following form where you can enter, edit, and delete Product Structure records:

Figure 14 Product Structure Maintenance Form

The command buttons along the bottom of this form work in essentially the same way as the command buttons on the Part Master Maintenance form. However, there is one minor difference in the operation of the Delete command button. When you click on Delete, a small form pops up asking whether you want to delete just the currently displayed product structure record, or delete the

33

entire bill of materials. After you have made your selection, click the Delete button again to complete the delete action. Initially, this form may open up blank. To add, edit, or delete Product Structure records for a specific assembly, click the Find button to drop down a list of Assembly Part numbers those with source codes of M (Make), P (phantom), or S (sub-contract). The navigation buttons will move you forward and backward through the records of the selected assembly. You can choose to display the records in either part number or item number sequence by choosing the appropriate button in the Display Order box toward the lower left side of the form. The button labeled BOM Reports will open up a form of options you can use to specify to control the format and content of your Bill of Materials report. Operation of this form is described later. There are two other handy buttons on this form in the lower right-hand corner labeled in light blue: Part Master will open up the Part Master Maintenance Form. The form will open displaying the currently displayed assembly part in the Product Structure form. Mfrs. Xref. will open up the Manufacturers Cross Reference form. The form will open displaying the currently displayed part in the Product Structure form.

The Manufacturers Cross Reference Form

Clicking on the Manufacturers Cross Reference button on the Bill of Materials Processor Main Menu form (Figure 12) displays the following form where you can enter, edit, and delete Manufacturers Cross Reference records:

34

The Bill of Materials Module

Figure 15 Manufacturers Cross Reference Maintenance

The command buttons along the bottom of this form work in essentially the same way as the command buttons on the Part Master Maintenance form. Initially, this form may open up blank. To add, edit, or delete Manufacturers Cross References for a specific part, click the Find button to drop down a list of Part Numbers. The navigation buttons will move you forward and backward through the records. The button labeled Mfrs. Xref. Reports will open up a form of options you can specify to control the format and content of your Manufacturers Cross Reference report. Operation of that form is described later. There are two other handy buttons on this form in the lower right-hand corner labeled in light blue: Part Master will open up the Part Master Maintenance Form. The form will open displaying the currently displayed assembly part in the Product Structure form. Prod.Struct. will open up the Product Structure Maintenance Form. The form will open displaying the currently displayed part in the Parts Master form.

The Part Master Report Form

There are two ways to open the Part Master Report form. You can click on the Part Master button under the Reports label on the Bill of Materials Processor Main Menu form (Figure 12), or you can click the button labeled Part Master Report on the Part Master Maintenance form (Figure 13).

35

Either way will display the following form, where you can enter the sort, data selection, and other options that will control the format and contents of your Part Master report:

Figure 16 The Part Master Report Form

Sort Selections You can choose up to three levels of sorting for your Part Master report. If the sort selections that you see in Figure 16 are not visible, click the Sort Selections button to display them. The sort selections made for this report will be stored in the database and recalled the next time you run this report. Data Selections When you click the Data Selections button, you will see the following form:

36

The Bill of Materials Module

Figure 17 The Part Master Report Data Selections

On this form you can enter greater than or equal to (>=) and/or less than or equal to (<=) values for the Part Number, Source Code, Class Code, and Description fields. Only Part Master records matching your data selection criteria will be displayed in the report. Preview Clicking the Preview button will display the report on your monitor. Print Clicking the Print button will print the report on your default printer.

Tip:

To send the report to other than your default printer, use the Preview mode to send the report to the screen. Then press Ctrl-P (hold down the buttons labeled Ctrl and P simultaneously). This will bring up Windows Printer Dialog Box, where you can select the printer to which you would like to direct this report. When you view a report on the screen, there are three ways to close the report and return to the previous form: 1) Click the Close button that is in the toolbar at the top of the screen. 2) Click the window close button that is the box with the X in it located at the top right of the screen. Be careful to close the window with the report in it and not click the window close button that will close E-ZMRP entirely. 3) Press the ESCape key.

Tip:

37

Other Options Other options on this form allow you to: Show Mfrs Xref/No Mfr.s Xref This lets you print or suppress the Manufacturers Cross References. Costed/Uncosted Depending on where and to whom this report might be routed, you may want to suppress the costs. Page Numbers/No Page Numbers Very large reports will print much faster without page numbers.

Remember that all of the options you choose on this form will be saved. So the next time you run the Part Master report, all of these options will be pre-selected for you. This includes the entries in the Data Selection section. You can erase all of the entries in the Data Selection section by clicking the button labeled Clear All Data Selections. An example of the Part Master Report with Manufacturers Cross References printed is shown in Report 1 in the Reports Appendix. Aside from the cross references, it requires three lines to display a complete Part Master record. Although most of the field headings are self-explanatory, there are a few that may require explanation: BUM Bill of Materials Unit of Measure PUM Purchasing Unit of Measure Conv.Fact. factor by which the quantity on a Bill of Materials is divided in order to get units to be purchased SC Source Code Cl.Code Class Code Ld. Tm. Lead Time MOQ Minimum Order Quantity (may also be Economical Order Quantity or Lot Size) Proc./Setup$ - fixed procurement or setup cost Total Cost calculated as Material $ + Labor $ + Burden $ + Sub-Contract $ + (Proc/Setup$ / MOQ) where MOQ is not zero

At the end of the report is a section that recaps the Sort Selection and Data Selections used to generate this report.

The Bills of Material Reports

There are two ways to open the Bills of Material Report form. You can click on the Bills of Material button under the Reports label on the Bill of Materials Processor Main Menu form (Figure 12), or you can click the button labeled BOM Reports on the Product Structure Maintenance form (Figure 14). Either way will display the following form where you can enter the sort, data selection, and other options that will control the format and contents of your Bill of Materials report:

38

The Bill of Materials Module

Figure 18 Bill of Materials Report Form

Select the assembly for which you want to print a Bill of Materials by clicking on the button labeled Select Assembly. Report Options: Regular Format/Summary Format The Regular format of the Bill of Materials lists each component under its parent. A Summary Bill of Materials is a special form of indented Bill of Materials. It lists each component in the entire product structure tree of the assembly only once and reports the total quantity required of that component. So if a piece of hardware is used in three different subassemblies of an assembly, the Summary Bill of Materials will report that piece of hardware on one line with a total quantity of three required to build the top level assembly. Single Level/Indented Choose whether to see only the level of components directly under the chosen assembly, or all of the indented product structure. Costed/Uncosted Depending on where and to whom this report might be routed, you may want to suppress the costs. Part Number Order/Item Number Order Choose the order in which you want to see this Bill of Materials printed.

39

Full Data/One-Line Format The one-line format is more concise, especially in the uncosted format. However not all information is included in the one-line format. Show Mfr.s Xref./No Mfr.s Xref. Print or suppress the Manufacturers Cross References for each component. Eff. Date/Obs. Date Print or suppress a component based upon it effective and/or obsolete dates. If you enter a date in the Eff. Date box, parts with an effectivity date greater than the date you enter will not be printed. If you enter a date in the Obs. Date box, parts with an Obsolete Date less than the date you enter will not be printed. You can use this feature to see what a product will look like and cost today or some time in the future.

Tip: If you double-click on either the effective or obsolete date boxes, a calendar control will pop up with todays date pre-selected. Doubleclick the desired date, or click the desired date and then the OK button on the calendar control, and the selected date will be entered into the date box for you. By the way, this calendar control is available throughout the E-ZMRP system, any time you need to enter a date. Quantity To Build You can use this option to generate a report showing the total costs and quantities of components required for various quantities of the assembly. Range of Part Numbers If you check this box, two additional boxes will appear to the right of the check box, as shown here:

40

The Bill of Materials Module

Figure 19 Bill of Materials Report Form Range of Part Numbers

Using this option, you can generate a series of Bill of Materials reports from a range of assembly part numbers. Here the user is requesting to see Bill of Materials reports for all assembly part numbers between SA-1 and SA-2. Note that you do not have to enter a complete valid part number but could, for example, request Bill of Materials reports for all assemblies between 001- and 005-, or A1000 through A9999. Page Numbers/No Page Numbers Very large reports will print much faster without page numbers.

Report 2 in the Reports Appendix shows the complete indented, costed, Bill of Materials report for the widget product WDG-000 in item number sequence. These options are shown in the report heading. There are a few things worth noting about this report. First, at the left of the report, under the label Lev., there is a column that shows the level in the product structure tree where the component appears. Comparing this report with the Widget Product Structure (Figure 9), you can see that the component COMP-3 appears twice once as a component in the subassembly SA-1, where its level on the report is 2, and once as a component in the top level assembly WDG-000 where its level is 1. Second, to the left of each Part Number on the report are one or more dashes (-) or asterisks (*) that indicate the level at which this part number

41

appears. If something about this part has changed since the last cost rollup, the dashes are turned to asterisks, indicating that the costs reflected on the report may not be accurate. In addition, if any part on the report contains asterisks, a warning message is printed at the bottom of the report. Third, on the indented format of the Bill of Materials report, as opposed to the single-level report, there are two cost blocks at the bottom. The cost block on the right shows the total Material Cost for the assembly and includes all of the lower level costs material and/or fixed procurement costs, of course, from the purchased parts as well as any labor, burden, and sub-contract costs from the manufactured subassemblies. The final labor, burden, sub-contract, and setup costs of the top level assembly are added to yield the total cost of the assembly. The cost block on the left shows the costs broken out by type or account. Thus, the total material costs, total labor costs, etc., for the entire assembly are shown in this cost block. You can see an example of how this works by noting the total labor cost on the report of $26.00. The subassembly SA-1 has a labor cost of $8.00. But it takes two of them to make a WDG-000. So the total labor dollars to make a WDG-000 is $16.00. The subassembly SA-2 has a labor cost of $6.00. And the final labor cost of the WDG-000 is $4.00. So the total labor cost for the WDG-000 is $16.00 plus $6.00 plus $4.00, or $26.00. Report 3 in the Reports Appendix shows the Summary Format of the Bill of Materials report. Note the quantity per assembly (QPA) of the component COMP-3 on this report. It appears in two places in the product structure for the WDG-000. In the WDG-000 itself, 6 of them are required. The subassembly SA-1 requires 10, but it takes two SA-1s to make the WDG-000. So a total of 26 COMP-3s is required to make one WDG-000 a total that is reflected on the Summary format of the Bill of Materials report. Note also that the quantities of other components of the SA-1 COMP-2 and COMP-4 are also doubled, because it takes two SA-1s to make the WDG-000. Report 4 in the Reports Appendix is an example of the Bill of Materials one-line or condensed format report. This format is useful to provide quick overview of a single-level or indented bill of materials.

The Where Used Report

This report is useful for determining all of the assemblies in which a given component is used. Clicking on the Where Used button on the Bill of Materials Main Menu (Figure 12) will open up the Where Used Report Form:

42

The Bill of Materials Module

Figure 20 Where Used Report Form

The options and operation of this form are practically identical to the operation of the Bill of Materials Report form described in the previous section. A Single-Level Where Used Report will show all of the assemblies in the database in which that component is used. The indented format will trace these parts through the assembly in which it is used right up to the top of each product structure. In the opposite manner as an indented Bill of Materials report, where each level down the tree is indented a bit on the report from the previous level, the Indented Where Used report indents as you go up the tree, so that higher level subassemblies are indented further on the report than the lower levels. As in all E-Z-MRP reports, the options you select when you run the Where Used report will be stored and recalled the next time you run the report. Report 5 in the Reports Appendix shows an example of the Indented Where Used report for the component COMP-3. This component is used in two places in the WDG-000 as shown in the report the SA-1 subassembly and the SA-2 subassembly. Both of these subassemblies then go into the top level WDG-000.

The Manufacturers Cross Reference Report 43

Clicking the button labeled Mfr. Cross Ref. on the Bill of Materials Main Menu (Figure 12) opens the Manufacturers Cross Reference Report Form:

Figure 21 Manufacturers Cross Reference Report Form

You have three options for sorting this report. The first option Your Part Number shows only parts for which there is at least one manufacturers name and part number entered for one of your part numbers. The second and third sorts can be used to produce a parts catalog from which new products can be designed using a common parts database. Report 6 in the Reports Appendix show a sample of the Manufacturers Cross Reference report.

Compare Two Bills

This report is useful for determining all of the differences between two assemblies. Only differences are printed. Components that are the same and require the same quantities are not printed on the Comparative Bill of Materials report. Clicking on the Compare Two Bills button on the Bill of Materials Main Menu (Figure 12) will open up the Compare Two Bills Report Form:

44

The Bill of Materials Module

Figure 22 Compare Two Bills Form

Click Select Assembly #1 to be presented with a list of all assembly part numbers in your database that have bills of material. Select the first part to be compared. Click Select Assembly #2 to select the second assembly part to be compared. Click Print or Preview to generate the report. A sample of this report comparing the bills of material of subassemblies SA-1 and SA-2 is shown in Report 7 in the Reports Appendix. The column labeled QPA(1) shows the bill of materials quantity of that component in Assembly #1. The column labeled QPA(2) shows the bill of materials quantity of that component in Assembly #2. The differences between components are shown in the far right-hand column. If a component appears in Assembly #1 and not Assembly #2, as is the case with COMP-2, the quantity QPA(2) will be shown as zero. The same holds for Assembly #2. The indented format of this report will accumulate all of the quantities in an entire product structure, component by component, similar to the Summary Format of the Bill of Materials report. This report is quite useful to highlight differences between models of a family of products or the differences between an older and a newer version of an assembly.

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Copy a Bill of Materials

This function will copy a single-level bill of materials from one part number to another. This is invaluable when you want to create a new model of an existing product. The existing products bill of materials may contain a large number of components. The new product may be the same as except, with only a few changes. Simply enter the new part through the Parts Master Maintenance form, and open the Copy a Bill form by clicking on the button Copy A Bill on the Bill of Materials Main Menu. The following form will be displayed:

Figure 23 Copy a Bill Form

Select the Assembly Part Number you wish to copy from by clicking Select Assembly #1. A list will drop down of all the part numbers in your database that have bills of material. Select the Assembly Part Number you wish to copy to by clicking Select Assembly #2. A list will appear of all the part numbers i that do not have bills of material. In the form shown, the Copy a Bill function will copy the bill of materials from the WDG-000 to a new model of the widget WDG-001.

The Cost Roll-Up

As described earlier, the material cost of an assembly is composed of all costs material, labor, burden, sub-contract, and fixed setup or

46

The Bill of Materials Module

procurement of all components and subassemblies that go into that assembly. Thus, a change in cost in a part affects the cost of all the assemblies in the database that use that part, as well as any assembly on levels above those assemblies in the product structure tree. The Cost Roll-Up utility is provided so that you can periodically roll up all costs in all product structures in your database to reflect any cost changes made to any part. You display the Cost Roll-Up form by clicking the button labeled Cost Roll-Up on the Bill of Materials Main Menu:

Figure 24 Cost Roll-Up Form

The Cost Roll-Up program allows you to change the labor and material burden or overhead rates, and have new burden dollars calculated for each part. Whether the cost burdened for a particular part is labor or material depends on the parts source code. For parts coded B (buy), F (free stock), or S (sub-contract), the burden dollars are calculated from the material cost. For parts with a source code of M (make) or P (phantom), burden dollars are calculated from the labor cost. Selecting Change on the New Burden Rates option box displays the boxes where you can enter your new burden rate as shown in Figure 25:

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Figure 25 Cost Roll-Up Form with Burden and Date Options

Recalculating burden dollars is useful when your cost accountant wants to adjust the burden rate to adjust for over- or under-absorption of the overhead dollars. Normally, recalculating the burden dollars for each part in your inventory is a time-consuming and error-prone task. Using the burden rate recalculation feature of the Cost Roll-Up utility eliminates this job and even allows costing simulations or what ifs based on various burden percentages. If you opt to use Effective and Obsolete date control in your cost roll-up, two text boxes are displayed where you can enter these dates. Any component with an effective date after the date you enter will be omitted from the cost roll-up calculation. Any part with an obsolete date before the date you enter will be omitted from the cost roll-up calculation. It is not necessary to enter both dates. You can use one or the other, or both. During the Cost Roll-Up calculations, the material cost of any part with a bill of materials is set to zero in preparation for the accumulation of the lower level costs. However, if a Make part has no bill of materials, the material cost will remain unchanged. Thus, if you want to put material costs into Make parts without entering the bill of materials for that part, you may do so and the Cost Roll-Up utility will leave those costs intact. If you subsequently add a bill of materials to this part, the original, manually input cost will be retained until the next run of the Cost Roll-Up, when it will be replaced in the normal fashion by the lower level costs. If a material cost is present in a Make part due to its bill of materials, and you subsequently delete that bill of materials, the material cost will not go

48

The Bill of Materials Module

away during the next Cost Roll-Up. You must set the material cost to zero manually through the Part Master Maintenance form. Since the Cost Roll-Up process can be lengthy for larger databases, messages in the lower part of the form serve to inform you that something is indeed happening in your database. If you enter an assembly as a component to itself, this creates a logical loop, and the cost roll-up process will theoretically go on forever, as the assembly calls itself over and over again. However, once the program senses that it has reached 99 levels in a product structure, it assumes that it has encountered one of these logical loops and terminates processing with a message to this effect.

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Part 4 Material Requirements Planning

How Does MRP Work?
As discussed in the introduction to this manual, MRP stands for Material Requirements Planning. Its purpose is to answer the four (or five) questions posed in the introduction, namely: 1) 2) 3) 4) 5) What do I have to make? When do I have to make it? What do I have to buy? When do I have to buy it? What is all this making and buying going to cost?

Implicit in the questions What do I have to make? and What do I have to buy? are the corollaries HOW MANY do I have to make and HOW MANY do I have to buy?. We can illustrate how MRP goes about calculating answers to these questions by building something simple like the WIDGET (see Figure 11). As you can see, these particular widgets are composed of two identical black boxes which are make parts (that is, you must build them), a white box which is also a make or manufactured part, and some smoked glass which is a purchased (or buy) part. Each black box in turn is made up of six mirrors, ten pieces of chewing gum, and ten feet of bailing wire. The white box is made up of just six pieces of chewing gum. As you can see from the Bill of Materials Report for the widget (Report 2 in the Reports Appendix), at $68.30 per widget this is not a cheap item! Referring to the Summary Bill of Materials report for the widget (Report 3 in the Reports Appendix), we can see that for each model WDG-000 widget we need a total of six pieces of smoked glass, 12 mirrors, 26 pieces of chewing gum, and 20 feet of wire. Now lets assume that someone has placed an order for 250 WGD-000s for delivery on Friday, July 30, 2004 one month from now (assume that todays date is June 30, 2004). If you want to simulate this for purposes of following along in the tutorial that follows, you can set your system date to June 30, 2004. But dont forget to set it back when youre done. To find out whether or not that delivery can be met, we must first know how long it takes to: 1) assemble a WDG-000 from the finished boxes and smoked glass 2) build the black and white boxes 3) procure the purchased parts We also need to know:

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4) how much of each item is on already hand (so we dont make things we dont need) 5) how much of each purchased item is on order and when it will be delivered 6) if there are already any make parts in the process of being made From 1) we can figure out when we need to start assembling the widgets so that they will be in finished goods in time to make the promised ship date. From 2) we can figure out when we need to start making the black and white boxes in order to have them in inventory in time for them to be assembled into the widgets. From 3) we learn when we must place the orders for smoked glass, mirrors, chewing gum, and wire, in order to have them on hand and available to build into black and white boxes and widgets.

The Starting Line On Hand and On Order

Now we know when to build and when to buy. To figure out how many of each to make and buy, we can start with the Summary Bill of Materials report run for a quantity of 250, shown in Report 8 in the Reports Appendix. Assuming that we have no on-hand quantities, nothing on order, and nothing on the shop floor (doesnt sound like much of a business, does it?), that Summary Bill of Materials report for quantity 250 tells the story. As shown in that report, we have quite a few items to procure before we can start building, and over $17,000 to shell out before we can ship. But, of course, our assumptions about having nothing on hand and nothing on order are not realistic. Table 1 summarizes the rest of the information needed to solve the MRP puzzle:
Lead Time 3 10 5 10 10 10 4

Part WDG-000 SA-1 SA-1 COMP-1 COMP-2 COMP-3 COMP-4

On Hand On Order 100 50 0 2000 0 0 0 50 50 0 0 1000 0 0

Due Date Reference 08/16/04 07/14/04 W.O. 100

07/14/04

P.O, 2468

Table 1 Initial Conditions for Material Planning Example

Table 1 indicates that there are planned work orders for two of the three manufactured items. Fifty WDG-000s, in work order W.O. 100, are planned to be manufactured and

52

Material Requirements Planning

due in finished goods by August 16. And fifty SA-1s, the black boxes, are planned to be built and are due to hit finished goods on June 14. Of the four purchased parts in the widget, only COMP-2, the mirrors, has an open purchase order against it. One thousand mirrors, purchased under P.O. 2468, are due in raw materials inventory on June 14.

Sermonette #1: The Importance of Accurate Lead Times

In Table 1, lead time refers to the amount of time it takes to procure the part. In this case the lead time of the manufactured parts is in days although, as will be explained later, E-Z-MRP accepts lead times in minutes per piece as well. In the case of purchased parts, it is recommended that the lead time be the number of work days from the placement of the purchase order to the vendor TO AND INCLUDING the day the material reaches the stockroom and is available to be issued to a work order. Let us suppose that it takes three days to get delivery of smoked glass. You might then assume a lead time of three days for the part. However, in your company you know it takes a full day to process the paperwork and place the order, and another full day to get the material through receiving and into the stockroom. Thus, you would need to allow a five-day lead time to procure smoked glass. If the purchasing and/or receiving and/or stockroom people tend to run late, you might want to define the lead time of smoked glass as six or even seven work days. The lead times you assign to your own parts should reflect the ACTUAL conditions in your company, not your EXPECTATION of performance. The consequences of overstating your lead time by one or two days are generally less severe than underestimating them and finding yourself short of the parts needed to open a scheduled work order to meet a customers sales order. Similarly, the lead time of a manufactured part is the number of work days between and INCLUDING the day the parts are pulled from stock and the day the finished manufactured part is in finished goods and is READY to be shipped on a sales order or issued to another work order. The same warning stated before about the lead time of a purchased part applies to the manufactured part: underestimating lead times based on your expectation of performance rather than on the way things really work in your shop will lead to shortages of on-hand quantities when they are needed, which means the failure of your manufacturing plan.

Sermonette #2: The Importance of Accurate Inventory

Just as you can understand the consequences of underestimating the lead times on your make and buy items, you can project the consequences of inaccurate information in Column 3 of Table 1, the on-hand quantity.

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Here, OVERSTATING the quantity on hand has the same consequences as UNDERSTATING lead time. If you believe that you have greater quantities on hand than are actually present, you will not make or buy enough to meet the manufacturing plan. In general, the data in any manufacturing database only model or reflect conditions in the real world: the greater the degree of accuracy in the data, the greater the reliability of the information derived from the database.

Charting the Activity

Now we have a better sense of where we stand. First, we see that, of the 250 widgets needed for delivery on 7/30/04, we already have 100 on hand. So we only need to build 150 more. The 50 that are currently planned under Work Order 100 wont be ready in time to help us. We can represent the activity for WDG-000 in the following table:
Order Date

Part WDG-000

Due Date

Quant. On Hand

Comment

07/28/04 08/12/04

07/30/04 08/16/04

250 50

100 Beginning Balance -150 Sales Order 12345 -100 W.O. 100

Table 2 Activity Chart for WDG-000

The first line of Table 2 shows a beginning balance of 100 WDG-000s on hand. On July 27, we are scheduled to ship 250 units against the sales order, leaving us with a negative balance of 150. Then, on August 16, 50 more come into finished goods from a scheduled work order, leaving us with a negative balance of 100. Note: Although the lead time of a WDG-000 is three working days, the start date of W.O. 100 is August 12, giving five days to produce the WDG-000s. This is because August 15 and 16 are a weekend. For purposes of this exercise, the work week is Monday through Friday. Obviously, we are 150 units short of WDG-000s. In order to correct this situation, it is necessary to build 150 more WDG-000s. In order to have them ready to ship on Friday, July 30, they need to be in finished goods on Thursday, July 29. Given that it takes three work days to build them, we need to open a work order for 150 units on July 26. Our activity table for the WDG-000s now looks like this (where W.O. xxx refers to a new planned work order):

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Material Requirements Planning

Order Date

Part WDG-000

Due Date

Quant. On Hand 100 250 0 50

Comment Beginning Balance W.O. xxx Sales Order 12345 W.O. 100

07/27/04 08/12/04

07/29/04 07/30/04 08/16/04

150 250 50

Table 3 Completed Activity Chart for WDG-000

Opening a work order for 150 WDG-000s on Tuesday, July 27 gets them into finished goods inventory on Thursday, July 29 in time to ship on Friday, July 30. This leaves us with 50 widgets in stock on August 16. In an ideal planning situation, the objective would be to finish with zero quantity on hand, thereby reducing inventory and thus the need for working capital to a minimum. The world being the imperfect place that it is, however, most companies keep some level of safety stock on hand, and we might assume that safety stock is what these extra 50 WDG-000s represent. Next we must go through the same process for SA-1, the black box subassembly. From the Bill of Materials and the Summary Bill of Materials, we see that two SA-1s are required for each WDG-000. The activity table for SA-1 then initially looks like this:
Order Date

Part SA-1

Due Date

Quant. On Hand 50 100 -200 -300

Comment Beginning Balance W.O. 085 W.O. xxx W.O. 100

07/01/04 07/14/04 07/29/04

07/14/04 07/27/04 08/11/04

50 300 100

Table 4 Activity Chart for SA-1

Again we find ourselves 200 units short of SA-1s on July 27, the day before we are due to open the work order W.O. xxx for the 100 WDG-000s. Since the SA-1s have a lead time of ten work days, we need to start building them on July 14. They will be in finished goods inventory on July 27, just in time to be available to start the build of the WDG-000s on July 28. Scheduling a work order to take care of the 200 SA-1s we are short produces the following activity table:

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Part SA-1

Order Date

Due Date

Quant. On Hand 50 100 300 0 -100

Comment Beginning Balance W.O. 085 Supplied by W.O. yyy Needed by W.O. xxx Needed by W.O. 100

07/01/04 07/13/04 07/29/04

07/14/04 07/26/03 07/27/04 08/11/04

50 200 300 100

Table 5 Activity Chart For SA-1 with Added Work Order

In this case, by scheduling a work order (W.O. yyy) for 200 SA-1s to be due on July 26, we are left with zero units on hand, but all demands up to that date are satisfied. To gain an appreciation for this planning process, open up your Excel and try to make activity charts for the rest of the parts in the WDG-000.

The Supply Side/Demand Side Approach of E-Z-MRP

DEMANDS As you can see from the prior exercise, calculating what to make and what to buy, and when to make it and when to buy it, can be a non-trivial task, even for an oversimplified product like the WDG-000. Of course, the purpose of E-Z-MRP is to take over the task of calculating these answers and to produce the outputs as concise, neatly formatted instructions for your purchasing and manufacturing departments. Still, that leaves you with the task of organizing the inputs. All inputs into an MRP system, whether manual or automated, fall into two classes: DEMANDS and SUPPLIES. The most common form of demand is a SALES ORDER, which causes demands to be made on both production and procurement. The next most common form of demand is a FORECAST, which is a schedule of anticipated sales of various products. To the manufacturing department, forecasts represent a schedule of demands on its production and procurement facilities. Although both sales orders and forecasts are usually for end items (items found at the top of your product structures), demands for subassemblies and components can also be generated by: 1) Customer Service, which may want to stock these items for service and repair 2) forecasts from Marketing for spares and/or replacement parts sold directly to customers

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Material Requirements Planning

3) restocking demands for parts which, though they have no immediate requirement, may have fallen below re-order or safety stock points (probably because the engineers used them for projects without forecasting or scheduling their demands) These demands can all be classified as INDEPENDENT demands. They all originate from outside the manufacturing environment. But, as we saw in the prior exercise, an independent demand for an end item generates further requirements to build SUBASSEMBLIES that comprise that end item, as well as demands for the PURCHASED parts of both the end item and the subassemblies that go into it. These demands are referred to as DEPENDENT demands, because their requirement is dependent upon an independently generated demand for items above them in the product structure. SUPPLIES To offset or satisfy the independent and dependent demands for manufactured and purchased items (also referred to as Make and Buy items), Production and Procurement must create SUPPLY, the other category of input to the MRP calculation. SUPPLIES commonly fall into two categories: 1) quantities on-hand (raw materials, subassemblies and finished goods) 2) quantities on order for delivery at a later date On Order quantities can be further separated into: 1) on order quantities of Buy parts (i.e., open purchase orders, or P.O.s) 2) on order quantities of Make parts in the form of work orders, both scheduled but unopened and in process On Order quantities of Make parts can be further sub-divided into: 1) WORK-IN-PROCESS (work orders which have already been pulled or kitted and are on the floor in process) 2) PLANNED WORK ORDERS for release to the floor at a future date, for which the kit of parts has not been pulled from inventory This distinction between in-process and planned work orders is important and is discussed in further detail in the next section. To summarize then, all inputs into the MRP system fall into one of two categories, as shown in Table 6: 1) DEMANDS, both independent and dependent, for end items, subassemblies, and purchased parts

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2) SUPPLIES, in the form of quantities on hand, purchase orders, and work orders
DEMANDS Independent Sales Orders Forecasts Spares Warranty Items Safety Stock Dependent Subassemblies Components
Table 6 Summary of Supply and Demand Factors

SUPPLIES Quantities On Hand Purchase Orders Work In Process Planned Work Orders

When a Supply Creates a Demand: Planned Work Orders

We have seen how independent demands create dependent demands. But there is one instance where adding a SUPPLY factor to the MRP equation creates additional demands, and that is a PLANNED WORK ORDER. Lets go back to the widget example. Given that there are no current supplies, an independent demand for one WDG-000 creates dependent demands for SA-1 and SA-2 and COMP-1. The dependent demands for SA-1 and SA-2 in turn create dependent demands for COMP-2, COMP-3, and COMP-4 (see the widget product structure Figure 11). If we now assume that a work order is IN PROCESS for an SA-1, then no dependent demands will be created for COMP-2, COMP-3, and COMP-4. All of these components will already be in Work-In-Process (WIP). However, if, in response to the demand for an SA-1, we SCHEDULE a new work order to build and SA-1, this does not relieve us of the need to supply SA-1s components. Thus, the MRP calculations need to be able to make a distinction between work orders that are IN PROCESS, and those, which are SCHEDULED. An in process work order, which has been released to manufacturing, is assumed to have all the necessary components already in it. Thus, adding an in process work order to the supply side should generate no additional dependent demands for its components. (The concept of work order shortages will be covered later.) However, adding a scheduled work order to the supply side, for kitting and release to manufacturing some time in the future, MUST create additional dependent demands for its components. While having a work order scheduled for a given assembly removes this assembly from the unsatisfied what to make list, it does not remove its components from the unsatisfied what to buy list. Adding this SUPPLY has created additional DEMANDS.

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The Material Planning Main Menu

When you click on the Material Planning button on the Main Menu (see Figure 5), you will see the following form:

Figure 26 Material Planning Main Menu

The Material Planning Main Menu is divided into three sections: 1) Input Programs enter Supplies, Demands, and add or relieve Work Order Shortages 2) Report Programs generate reports summarizing Supplies and Demands, show What To Make and What To Buy, print Kit Lists for Work Orders, make lists of WIP and Shortages, print out an Audit Trail of all inventory transactions 3) Other Functions run the MRP Calculate program and maintain a calendar of holidays and other non-work days

The Supply Side Program

Clicking the command button labeled Supply Side on the Material Planning Main Menu brings up the Supply Side form. It has two slightly different formats depending on whether you are displaying a make part or a buy part. For the make part, the form looks like this:

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Figure 27 Supply Side Form for a Make Part

For a buy part, the Supply Side form looks like this:

Data Entry Area

Figure 28 Supply Side Form for a Buy Part

You can see that there is a very slight difference between the headings in the Supply Side form between make and buy parts. Make part headings for work orders are Quantity Planned, Quantity Released, and Quantity Complete. The buy part headings for purchase orders are Quantity Ordered, Quantity Received, and Quantity Due.

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Material Requirements Planning

Sub-Contract parts are a hybrid of make and buy parts. The orders for sub-contract parts generally originate in Purchasing so in that sense they are like a purchased part. However, the raw materials for a sub-contract part are pulled from your inventory and sent to the outside processor. So in that sense, its like a manufactured part. So when you display a sub-contract part in the E-Z-MRP Supply Side form, the headings are Quantity Ordered, Quantity Released, and Quantity Received. Most of the data entry functions of the Material Planning portion of E-Z-MRP are done through this Supply Side form (most of the rest are performed through the corresponding Demand Side form described later). And as you will see, almost all data is input in the Data Entry Area. These include: Changing lead times Making direct changes to quantity on hand Adding purchase order line items Receiving purchase order line items Deleting purchase order line items Adding work orders Releasing work orders Completing work orders Deleting work orders Generating an audit trail of all inventory transactions

There are two buttons in the lower right corner of the form labeled Shortages and Demand Side. They are there for your convenience and transfer you to the Shortages form and the Demand Side form respectively. These forms and their operation are described in a later section of this manual.

How To Use the Supply Side Form

Changing Lead Times
To change your lead time, click on the words Lead Time to the left of the text box that shows the lead time of the currently selected part. You will be prompted to enter the new lead time in the Data Entry Area:

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Figure 29 Entering a New Lead Time

Enter the new lead time in the box and press enter. If you have made a mistake in selecting the lead time and dont want to change it, simply press the Enter key with nothing in the box. The lead time is changed immediately without any confirmations required.

Making Direct Changes to Quantity On Hand

To make a direct change to quantity on hand click on the words Qty. On Hand which appear to the left of the lead time text box. You will be prompted to enter the new lead time in the Data Entry Area. There are three ways you can make a direct change to quantity on hand: 1) If you want to increase the quantity on hand by a known amount, enter a + (plus) sign before the number and that amount will be added to the current quantity on hand. 2) If you want to decrease the quantity on hand by a known amount, enter a (minus) sign before the number and that amount will be subtracted from the current quantity on hand. 3) If you want to replace the quantity on hand with a known amount, enter the new quantity without preceding it with either a + (plus) or a (minus) sign. The number you enter will replace the current quantity on hand. Press the Enter key to effect the change.

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Material Requirements Planning

The Audit Trail Form

At this point a slight digression is required. When you enter a change to quantity on hand, the Audit Trail form will appear. Each time any quantity on hand is changed either by a direct change to quantity on hand as described, or as a by-product of some other process (for example, receiving parts on a purchase order, kitting and releasing a work order, or shipping items against a sales order) a record is created of the transaction. This record contains the following data fields: Part Number Transaction Quantity Old Balance New Balance Audit Reference (something that indicates why this transaction took place a P.O. Number, a Sales Order Number, a Work Order Number, etc.; or this reference field can contain a comment you enter to explain the purpose of the transaction correction of a previous error, physical inventory count, an adjustment, a record of scrap, etc.) Serial Number Transaction Date Total Cost (at standard cost from the Part Master Record) Actual Cost (so you can generate purchase price variance reports later)

Suppose you enter +10 as a direct change to quantity on hand. When you press the Enter key to confirm the change, you will see the following Audit Trail form:

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Figure 30 Audit Trail Form

At this point you can change the Actual Cost, the Audit Reference, and the Lot/Serial Number fields. Note that the Audit Reference Direct Change To Quantity On Hand has been pre-entered for you. After making any changes you want, click OK, and the audit trail record will be added to the Audit Trail table. Later you will learn how to use the Audit Trail Report form to create many useful and valuable reports from this audit trail data.

Adding a Purchase Order Line Item

To add a line from a purchase order line item to the Supply Side, click the Add button. A line will appear where you can enter the purchase order information as shown here:

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Material Requirements Planning

Enter P.O. Number Enter Quantity Ordered Enter Due Date

Enter Quantity Received

P.O. Navigation Buttons

Click to start adding P.O. Item

Figure 31 Adding a Purchase Order

The due date will appear with todays date as a default. If thats OK, press the TAB button to move to the next field. Otherwise, you can enter the date manually, or, as with all date fields in the E-Z-MRP system, you can double-click this field and pop up a calendar from which you can select the date. Next, enter the Purchase Order (or other reference) number, the quantity ordered and the quantity received to date (if any). You will notice that as you change the quantity received, the quantity due changes to reflect the undelivered quantity. This last field is not editable. To complete the add process, click the Add button again. You will be prompted to confirm that all the data is correct and have an opportunity at that point to cancel the whole add operation. To interrupt the add operation before completing all of the data entry, simply click the add button to cancel your add operation.

Receiving a Purchase Order Line Item

To receive a purchase order line item, use the P.O. Navigation Buttons (see Figure 31) to display the desired purchase order line item. Click on the Quantity Received field of the line you want to change. You will be prompted for a new received quantity. As with the direct change to quantity on hand, you can precede your new received quantity with a + or sign, and the amount you enter will be added to or subtracted from the current quantity received. Or you can enter a quantity with no preceding sign, and the number you enter will replace the current received quantity.

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You will be asked to confirm the new number before it is recorded. If you confirm it, you will also be shown the Audit Trail Form (Figure 30) and asked to confirm the addition to the audit trail. If you know the actual price paid, you can enter it at that point.

Deleting Purchase Order Line Items

A purchase order which has been completely received has no effect on the MRP calculations. It is not a future supply, as all of the items have been received into inventory. However, from time to time, you may want to delete specific work orders which have either been completed or perhaps cancelled. You can delete a purchase order line item by first using the navigation buttons to get the desired line to display. Click the Delete button and you will be prompted to enter the line number of the record you want to delete. If you click the Delete button a second time, it will cancel the delete operation. Before the actual deleting is done, you will be prompted to confirm that you really want to delete this line.

Adding Work Orders

As you can see in Figure 27, the Supply Side form for a make part differs slightly from the Supply Side form when it is displaying a buy part. The headings on the detail lines read Quantity Planned, Quantity Released, and Quantity Complete, reflecting how a work order proceeds through its life cycle. Adding a work order follows the same operational sequence as adding a purchase order. Generally, you will add the quantity to be built in this work order in the Quantity Planned field, and zero in the quantity released. If you enter a work order that has already been partially or completely released, you can enter the quantity released at this time. However, you will not be able to auto-kit the released quantity (see the following section on Releasing a Work Order). If you want to auto-kit a newly entered work order that has already been partially or completely released, you must do it in two steps add first with zero quantity released, then release the work order (see next section).

Releasing a Work Order and the Auto-Kitting Function

To record the release of a work order, increase the quantity released using the same technique as increasing the quantity received on a purchase order. Upon releasing a work order, it is necessary to adjust the quantity on hand of every item in that work order. This can amount to hundreds of items for some assemblies.

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Material Requirements Planning

E-Z-MRP provides an auto-kitting function which will automatically decrease the quantity on hand of every item in the work order by using the current Bill of Materials quantity per assembly and multiplying that by the quantity of the work order release. In the event that one of the items on the bill is a phantom or blow-through assembly, E-Z-MRP will drop down to the next level of the product structure and adjust the inventory of all the items on that level. When you increase the quantity released on a kit, you will be prompted with a message like the one shown in Figure 32:

Figure 32 Auto Kit Prompt

This prompt is asking if you want to decrease the quantity on hand of your raw materials inventory for everything that went into the kit based on the current Bill of Materials. If you respond Yes, you will be presented with the Audit Trail Form:

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Figure 33 Audit Trail Form

Note the advice on the form that reads, Note: If auto-kitting or auto-dekitting, the part number shown is the first part number in the assembly Bill of Materials. Since we are releasing a work order for WDG-000, and the first part in the WDG-000 Bill of Materials (in item number sequence) is the SA-1, that is the part displayed. But the auto-kit process will go on to create an audit trail record for every part in the Bill of Materials reflecting the decrease in quantity on hand that went into the release of the work order. For your convenience, the work order number is pre-inserted into the audit reference field.

Completing Work Orders

As work order quantities are completed, you should record this event by increasing the Quantity Complete field of the appropriate work order on the Supply Side form in the same manner as you changed the Quantity Released number. Click on the Quantity Complete field of the appropriate work order and enter the new quantity complete. Once again, you can use the + and keys to increment or decrement this figure. The program will ask if you want to increase (or decrease) the quantity of the assembly part number by the amount complete and will present you with the standard audit trail form to confirm.

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Material Requirements Planning

As implied, you can un-complete a work order by decreasing the quantity complete number. You can also de-kit a work order by decreasing the quantity released. If you approve, the program will reverse the inventory transactions that were created when the work order was kitted, electronically replacing the raw materials on the shelf, just as is actually done with the physical parts. Audit trail records showing these transactions will be created for every part de-kitted.

Deleting Work Orders

A work order that has been totally completed has no effect on your material planning calculations as it no longer represents a supply. All of the items to be built are now in inventory. From time to time, however, you may wish to delete completed work orders or to delete work orders which have been cancelled. You can delete a work order by first using the navigation buttons to get the desired line to display. Click the Delete button, and you will be prompted to enter the line number of the record you want to delete. If you click the Delete button a second time, it will cancel the delete operation. Before the actual deleting is done, you will be prompted to confirm that you really want to delete this line.

The Demand Side Program

Clicking the command button labeled Demand Side on the Material Planning Main Menu brings up the Demand Side form which looks like this:

Figure 34 Demand Side Form

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Most of the data entry functions not done through the Supply Side form of the Material Planning portion of E-Z-MRP are done through this Demand Side form. Some functions can be performed on both forms, specifically: Changing lead times Making direct changes to quantity on hand

In addition, you use the Demand Side form to: Enter firm Sales Orders and Forecasts Ship product against Sales Orders

Once you have mastered the operation of the Supply Side form, you have really also mastered the operation of the Demand Side form, as the two forms operate identically. But, there are a couple of minor differences: Doing a direct increase or decrease to quantity on hand will not trigger the autokitting or auto-de-kitting function. That only occurs on the Supply Side. The quantity back-ordered is automatically maintained by the system as the difference between the quantity ordered and the quantity shipped. This figure is the net independent demand for end items used by the MRP calculation program.

There are two buttons in the lower right corner of the form labeled Shortages and Supply Side. They are there for your convenience and transfer you to the Shortages form and the Supply Side form, respectively. The Supply Side form and its operation have already been described.

The Shortages Form

Its an imperfect world. In spite of your best laid plans, from time to time you will go to release a work order and find that you do not have the parts necessary to complete the kit. However, given that the parts that are missing may not be needed immediately, you will go ahead and release the kit to the floor short of all of the parts required to complete the order. Then, when the parts arrive, you will take those parts out onto the floor and put them in the kit so that the work order can be completed. E-Z-MRP performs shortage tracking for you. There is a table that holds all the current shortages in your released work orders. It contains just three data fields: Part Number, Work Order Number, and Quantity Short. Shortages are automatically added to this table during the Auto-Kit function described earlier in the section titled Releasing a Work Order and the Auto-Kitting Function. During this process, if the program detects that the quantity on hand drops below zero, that amount is added to the shortage file.

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Material Requirements Planning

During the receipt of purchased parts or the completion of a work order, if the parts being received or the assembly part number being completed on the work order appear in the Shortage table, a message will appear notifying you that shortages exist against the part and asking whether you want to relieve that shortage now. Whether you respond yes to that prompt or click the Shortages button under the Input column of the Material Planning Main Menu, you will see the following form:

Figure 35 Shortages Form

The operation of this form is quite simple. There are two buttons that allow you to select the shortage one displays shortages by Work Order and the other by Part Number.

Selecting Shortages By Work Order

Clicking on the button labeled Sel. By W.O. drops down a list of shortages sorted by work order number:

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Figure 36 Shortages By Work Order Number

Here the shortages are sorted by work order number and then by part within work order number.

Selecting Shortages By Part Number

Clicking on the button labeled Sel. By Part drops down a list of shortages sorted by part number:

Figure 37 Shortages By Part Number

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Material Requirements Planning

Here the shortages are sorted by part number and then by work order within part number.

Relieving a Shortage
Selecting a shortage from this list displays the following form:

Figure 38 Shortages Form With Shortage Displayed

All of the data above the line is not editable. Only the quantity short can be changed. The data above the line gives information about: the work order the assembly part for which the work order is open the component part number you selected that is short in the work order

To relieve this shortage, enter the new quantity short in the text box labeled Quantity Short. Alternatively, you can enter the amount of the shortage being relieved by preceding the amount with a (minus) sign. Thus, in the case above, if you were going to issue 50 COMP-2s to Work Order 23-100, you could enter either 150 as the new quantity short, or 50 and the program would do the math for you. Conversely, of course, you can increase or add to a shortage by preceding the amount to increase with a + (plus) sign. In either case you must click the Save button to record the change to the shortage. Upon saving, an inventory transaction audit trail record will be created as the parts you are issuing from stock to the work order are taken from inventory.

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Adding a Shortage
To add a shortage, click the Add button. You can select from a list of current work that will drop down. Note that when you do this, the button normally labeled Sel. By W.O. is changed to read Select W.O. You can click this button to drop down the list of current work orders again if you want to change to a different work order after your initial selection. Click on the text box labeled Shtg. Part Number and select the part that is short in this work order. Enter the quantity short in the Quantity Short text box, and then click the Save button to complete the addition of the work order shortage. To abort the addition of a work order shortage in the middle of the process, click the Add button again.

Deleting a Shortage
Although occasionally a shortage get partially relieved, most often a shortage is entirely relieved in one transaction. In that case it is simplest to delete the shortage entirely rather than leaving a shortage with a quantity of zero. To delete a shortage, first select the shortage to delete. Then click the Delete button. You will be prompted to confirm a change in inventory, and an audit trail record will be created to reflect this inventory transaction. But the system will allow you to delete a shortage without actually reliving it through the issue of parts from inventory to the work order.

The Material Planning Reports

E-Z-MRP provides a comprehensive suite of flexible reports to allow you to tailor your outputs to just the information you need without having to learn complex querying languages or reporting techniques. E-Z-MRP reports include: The Supply Side Report Details and summarizes all of the supplies in your database. The Demand Side Report Details and summarizes all of the demands in your database. The Make Report Shows everything you need to make and are currently making, in an easily readable, time-sequenced format. Highlights action and late items. The Buy Report Shows everything you need to buy and are currently buying, in an easily readable, time-sequenced format. Highlights action and late items. Kit List Prints a list of items required to fill a work order from raw materials. Used by the picker to select and verify items in the kit and note shortages.

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Material Requirements Planning

Work-In-Process Details all open work orders with costs. Shortages Lists all shortages in the system, sorted by work order or by part number. Audit Trail Lists every inventory transaction. You can tailor this by date window, part number, or audit reference to track discrepancies in on-hand quantity, all material issued to a work order, the results of a physical inventory, purchase price variance, and more.

These reports provide many options for sorting and doing data selection on ranges of data similar to the Part Master report (you can review the description of this feature in the manual section titled The Part Master Report Form). The sorting and data selection options you choose are remembered by the program, so that the next time it is run, the same sort and data selection options are pre-configured for you.

The Supply Side Report

Clicking the button labeled Supply Side under the Reports column of the Materials Planning Main Menu displays the following form:

Figure 39 Supply Side Report Form

The form is divided into three parts:

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1) Sort Selections Click on any of the three text boxes and select the field by which to sort the report: Part Number, Source Code, Class Code, Due Date, and Order Number. Three levels of sorting are provided. 2) Data Selections Enter a >= (greater than or equal to) and/or <= (less than or equal to) value on any of the displayed fields to restrict your report to just the series of part numbers, a range of class codes, or a specific source code. 3) Other options: Print all parts and supply orders, only parts with supply orders for a more concise view, or parts only with no supply orders for a costed on-hand inventory report. Print or suppress the shortages. Include or suppress costs. Include or exclude manufacturers cross references. Print or suppress page numbers.

Tip: A quick total inventory value is displayed at the bottom of the form and changes based upon your data selections. So, for example, you can get a quick inventory value of all your make items by entering M in both the >= and <= source code text boxes. A sample of the full, costed Supply Side report is shown in the Reports Appendix Report 9. Although most of the field headings are self-explanatory, there are a few that may require explanation: BUM Bill of Materials Unit of Measure PUM Purchasing Unit of Measure Conv.Fact. factor by which the quantity on a Bill of Materials is divided in order to get units to be purchased SC Source Code Cl.Code Class Code Ld. Tm. Lead Time MOQ Minimum Order Quantity (may also be Economical Order Quantity or Lot Size) QOH current quantity on hand Unit Cost total rolled-up cost from the Part Master Inv. Cost Unit Cost times QOH

The supply orders (work orders or purchase orders) are shown with their total order cost below each inventory item that has them. The second page shows a complete recap of the sorting and data selection options that were used to generate this report. In addition, as with all E-Z-MRP reports, the database from which this report was generated is shown in the report header. This information will make it clear to the reader where the data came from and what conditions were used to create the report.

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If you have a lot of inventory items without supply records and want to see a condensed version of this report of only items with supply orders, select the Only Parts With Supply Orders option. Tip: Another way to view your supply information is to sort on Due Date (or Order Date). A sample of this format is shown in Report 10 Supply Side Report Due Date Sequence in the Reports Appendix. This report shows both purchase orders and work orders. But the report could easily be restricted to one or the other by using the source code data selection. This would yield a concise, time-sequenced report of activities of either purchasing or production control. These reports could further be restricted by entering a due date greater than yesterday, which would show all future activity. Conversely, one could generate a report of all the items due before today and scan it to quickly determine all the orders not yet completed or received. Note that when you select Due Date or Order Number, the Second Sort Field and Third Sort Field text boxes are locked.

The Demand Side Report

The Demand Side Report form looks and operates identically to the Supply Side Report form. And the report (a sample of which is shown in Report 11 Demand Side Report in the Reports Appendix) follows the same format as the Supply Side Report. This report, if sorted by Order Number or Due Date and restricted to due date in the future, will show you all of the unfilled orders and forecasts in your manufacturing plan.

The Make Report

The Make report tells you everything you need to make to meet the independent and dependent demands in your manufacturing plan. The Make Report form is opened by clicking on the button labeled What To Make on the Material Planning Main Menu and looks like this:

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Figure 40 Make Report Form

This view shows the sort selections. Clicking on the button labeled Data Selections shows the following view of this form:

Figure 41 Make Report Form Showing Data Selections

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ere you can see the fields in which you can enter >= and/or <= values to tailor and restrict the contents of the report to the data you are most interested in seeing. In addition to the usual sorting and data selection options, there are several report options similar to the report options in the description of the Supply Side report. However, the Make report has three report options which provide valuable variants in the presentation of the data: 1) Full Shows every supply and demand whether or not action is required. 2) Net Only Shows only items requiring action in order to meet the production schedule. 3) Order Date Sequence Like the Net Only report, this version shows all action items but sorted by Order Date from earliest to latest.

1. The Full Make Report

The Full version of the Make report is shown in Report 12 in the Reports Appendix. Here, each parts supply and demand activity is shown in detail. Looking at this report for the part SA-1, the work order W.O. 085 provides a supply on 07/14/04. In order to be done by that date, it must be started on 07/10/04. Since it is for a quantity of 50 and the beginning inventory is 50, on 07/14/04 the quantity on hand (QOH) will be 100. The next line shows a demand of 300 coming from the WDG-000 sales order S.O. 12345. It is supplied (partially) by inventory, but leaves a net of 200 in inventory. As a result you see the notification ** ACTION ** to the right. If the order date was before the date that the report was run, the notice would read ** LATE ** indicating that you need to adjust your production schedule. Given the independent demands on the demand side, you do not have enough time to make everything you need.

2. The Net Only Make Report

The Net Only Make report is shown in Report 13 in the Reports Appendix, and shows only those lines that require the attention of production control in order to meet the production schedule. Compare the data presented for SA-1 between the Full and Net Only. You see that the quantity on the second line demanded by S.O. 12345 is reduced from 300 to 200 the net quantity required to resolve the action item. The first line of the Full format is missing on the Net Only format because it is not an action item on the Full version, although it is required to meet the production schedule. Comparing the Full and Net Only formats for the WDG-000, you see that the supply of 50 WDG-000s on W.O. 100 does not appear on the Net Only version because it is not required to meet the current demands.

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3. The Order Date Sequence Make Report

Report 14 in the Reports Appendix shows all the action items from the Full format of the Make report in Order Date Sequence. If you have scheduled sufficient supplies to meet all of the demands in your production schedule, then there are no action items and this report will come out blank a quick verification that you have balanced demand with supply.

The Buy Report

The Buy report tells you everything you need to buy in order to meet the independent and dependent demands in your manufacturing plan. The Buy report form is opened by clicking on the button labeled What To Buy on the Material Planning Main Menu. The sorting, data selection, and other options operate identically to the Make Report form described previously. Like the Make report, the Buy report has three format options which provide valuable variants in the presentation of the data: 1) Full Shows every supply and demand whether or not action is required. 2) Net Only Shows only items requiring action in order to procure enough components to meet the production schedule. 3) Order Date Sequence Like the Net Only report, this version shows all action items but sorted by Order Date from earliest to latest.

1. The Full Buy Report

The Full version of the report is shown in Report 15 in the Reports Appendix. Each parts supply and demand activity is shown in detail. Note that part COMP-4 has a starting quantity on hand of zero and a safety stock of 100. Therefore, the first detail line under COMP-4 shows 500 required by W.O. 085, but a negative on hand balance of 600. It is necessary at this point not only to order the 500 required by W.O. 085, but also an additional 100 to provide the requested level of safety stock.

2. The Net Only Buy Report

The Net Only Make report is shown in Report 16 in the Reports Appendix. Only those lines that require the attention of purchasing in order to have enough raw materials on hand to make the production schedule are printed in this format. Since almost all of the items on the Full version of the Buy report (shown in Report 15 in the Reports Appendix) are actions items, the contents of the Full and Net Only formats are almost the same. However, note that COMP-1, which had no action items on the Full format, is missing from the Net Only format.

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3. The Order Date Sequence Buy Report

Report 17 in the Reports Appendix shows all of the action items from the Full format of the Buy Report in Order Date Sequence. If you have scheduled sufficient supplies to meet all of the demands in your procurement schedule, then there are no action items and this report will come out blank a quick verification that you have balanced demand with supply.

The Kit List

Prior to releasing a work order to the floor, it is necessary to pull the parts from inventory and gather them together in a kit. To assist in this process, E-Z-MRP provides a Kit List. The Kit List form is opened by clicking on the button labeled Kit List on the Material Planning Main Menu:

Figure 42 Kit List Form

To generate a kit list, you must first select the assembly part number of the assembly for which you wish to generate a kit list. Then, click the Select Work Order button, and you will be presented with a list of all the open work orders for that assembly. Click on the desired work order. Report 18 in the Reports Appendix shows the Kit List for the work order shown in Figure 42. Note that there is a box on the report where the person pulling the parts from inventory can write in the amount pulled.

Work-In-Process 81

The Work-In-Process (WIP) report summarizes all the items in every open work order. Clicking the button labeled Work-In-Process on the Material Planning Main Menu displays the Work-In-Process report form:

Figure 43 Work-In-Process Report Form

A sample of the WIP report is shown in Report 19 in the Reports Appendix. This report shows that both work orders W.O. 085 and W.O. 100 have been released. Note that the WIP report shows shortages so that the total dollars in work in process will be correct for accounting purposes.

Shortages
The Shortages report summarizes all the items missing from every open work order. Clicking the button labeled Shortages on the Material Planning Main Menu displays the Shortages Report form:

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Material Requirements Planning

Figure 44 Shortages Report Form

You can sort this report either by part number, to see the aggregate totals of each part required to fill out all the open work orders, or by work order number, which summarizes all the missing parts in each work order. You can also restrict the contents of the report by entering a range of part numbers and/or a range of work orders. A sample of the Shortage report, sorted by work order number, is shown in Report 20 in the Reports Appendix.

The Audit Trail Report

As discussed previously in the section The Audit Trail Form (under the topic How To Use the Supply Side Form), every transaction in the Material Planning module of E-Z-MRP which affects the quantity on hand of one or more parts creates a record in the Audit Trail table. Each record in the Audit Trail table contains the following data fields: Part Number Transaction Quantity Old Balance New Balance Audit Reference an entry that indicates why this transaction took place a P.O. Number, a Sales Order Number, a Work Order Number, etc. (you might

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also enter a comment to explain the purpose of the transaction correction or a previous entry, a physical inventory transaction, adjustment, scrap, etc.) Serial Number Transaction Date Total Cost (at standard cost from the Part Master Record) Actual Cost (so you can generate purchase price variance reports later)

Many very useful reports can be created from this data. The form from which these reports can be generated is displayed by clicking the button marked Audit Trail on the Material Planning Main Menu:

Figure 45 Audit Trail Report Form

The Audit Trail report can be sorted by: Part Number Audit Reference Lot/Serial Number Transaction Quantity Transaction Date Standard Cost Actual Cost

The contents of the report can be further restricted by entering >= (greater than or equal to) and/or <= (less than or equal to) values on any of those fields. In addition, there are options to print or suppress the costs, and to suppress the detail, printing only the sub-totals.

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Material Requirements Planning

Through careful use of these options, it is possible to track many kinds of activity. You could print all the transactions for a specific part for a date range to find out why the on-hand balance in the inventory does not match the balance in the system. If you capture the actual purchase price at the time of purchase parts receipt, you can generate purchase price variance reports by entering an audit reference range which will restrict the report to just audit references containing purchase order numbers. For example, if your purchase orders all begin with P followed by 5 digits and you go with E-Z-MRPs default of inserting the purchase order as the audit reference on receipts of purchased parts, you would enter in the audit reference fields >= P00000 and <= P99999. If you use the sub-totals only option, sort by part number, and enter an audit reference which will restrict the report to only materials issued to work orders, then the report will show the total usage and dollars for raw materials. Or you can restrict the report to all transactions for a specific work order to audit all the materials that were issued to it. By using these data selection fields, you can generate shipping reports, warranty and spares sales, issues to special projects by account number, etc. All you have to do is be consistent about the audit references you use. A sample Audit Trail report is shown in Report 21 in the Reports Appendix. Note the purchase price variance of $75.00 in the receipt of 500 of part COMP-2 against P.O. 2468. Note also that a direct change of +50 to the quantity on hand of SA-1 resulted in three auto-kit transactions against the components of SA-1.

The MRP Calculate Program

As discussed in the section titled What Is MRP?, the E-Z-MRP Calculate program is responsible for generating all the unsatisfied dependent demands based on: 1) independent demands (sales orders, forecasts, and safety stock requirements) 2) supplies (purchase orders, work orders, and quantities on hand) 3) the supply and demand due dates and the various lead times for these items Any time you make a change to a supply or a demand item, you must run this program before you can run the Make or Buy reports. Clicking the button labeled Calculate Matl. Plan on the Material Planning Main Menu opens this form:

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Figure 46 Calculate Material Plan Form

On this form you can set a few calculation options: Lead Times For manufactured parts (source codes M and P), you can tell the Calculate program whether you have entered your lead times in days or minutes per piece. Your preference from the Preferences Form will be reflected here. If your lot sizes are fairly constant, entering lead times in days is most convenient. However, if your work order sizes vary quite a bit, then expressing lead time in days obviously wont work. It takes much longer to make 50 of something than 5. If your work order sizes do vary quite a bit, you can enter your lead times in minutes per piece. If you select lead times in minutes per piece, the Calculate program multiplies the number of pieces in each planned and unplanned work order by the lead time for that assembly, and divides the total minutes required to build that number of pieces by the minutes per day that you enter. Fractional days thus calculated are rounded up to the nearest whole day. Effective/Obsolete Dates If you choose to use effective and/or obsolete dates, the Calculate program will ignore requirements for any part where the due date is greater than the obsolete date. And it will ignore any part where the due date is less than the effective date. Work Days Choose the work days you work in a standard work week.

The text boxes at the bottom of the screen will display the parts being inspected by the program. Since the calculations can sometimes take more than a couple of minutes, this is just to let you know that the program is still processing.

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Material Requirements Planning

After you run the Calculate program a few of times, the elapsed time displayed at the end of processing will give you an idea of how long, in the future, you can expect the program to take. Bear in mind that if you add a lot of independent demands, this will increase the processing time. You can cancel the Calculate program at any time during processing by clicking the Cancel Calculation. It may take a few seconds for the program to respond. However, if you do not let the calculations run to completion, you will not be able to run the Make and Buy reports.

The Holiday Calendar

E-Z-MRP allows you to enter holidays and non-workdays through the Holiday Calendar form. Programs which calculate order date from due date minus lead time, such as the MRP Calculate program and the Make and Buy reports, will skip around these holidays and non-workdays when determining the order date. Clicking Holiday Calendar on the Material Planning Main Menu displays the Holiday Calendar form:

Figure 47 Holiday Calendar Form

Operation of this form is straightforward. Click Add to add a new holiday, Delete to delete an existing holiday, and Save to save a new or edited holiday record. As with all text boxes containing dates in E-Z-MRP, double-clicking the First Day or Last Day text boxes will pop up a calendar where you can select the date by clicking on it. You can always enter the date manually in the mm/dd/yy format. The MRP Calculate program and other reports that have to consult the Holiday Calendar to calculate order dates from due dates and lead times, will operate slightly faster with

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fewer records in the Holiday Calendar. So it is recommended that you delete holidays which are far enough in the past to precede the earliest order date in your database.

Resolving the Make and Buy Action Items

You have seen how the MRP Calculate program creates requirements in the form of action items. These action items are resolved just as you would do in the absence of a system you schedule work orders and create purchase orders to meet the unmet demands. With E-Z-MRP, you will also enter those orders into the system to balance demands with supplies. Review Reports 12 (Full Make report) and 15 (Full Buy report) in the Reports Appendix. To resolve the Make items, follow these steps:

1) To resolve the action items for WDG-000, add a new work order W.O. N-1
with a due date of 07/30/04 and a quantity of 150. Run the MRP Calculation program and then look at the resulting Make report which is shown in Report 22 in the Reports Appendix. Note that the supply of WDG-000s provided by W.O. N-1 eliminates the actions items for that part. Note also that the dependent demands for SA-1s and SA-2s are now pegged to (demanded by) W.O. N-1. Also note that at the end of the schedule for WDG-000s, there is a work order that leaves us with a quantity of 50 with no firm demand or requirement for safety stock. In addition to alerting you to action items, a careful reading of the Make reports will also show where you have scheduled supplies without demands, consuming scarce resources and working capital without an apparent reason to do so. In this case, an alert Production Control person could delete that work order W.O. 085. 2) To resolve the action items for SA-1s, one could either schedule two work orders one for quantity 200 due on 07/24/04 and one for quantity 100 due on 08/11/04. Or, alternatively, one could schedule just one work order for quantity 300 due on 07/27/04 and carry the extra 100 in inventory for a couple of weeks until they are needed on 08/11/04. In this case we choose the latter course, and schedule work order W.O. N-2 for quantity 300 due on 07/27/04. After re-running the MRP Calculate program, the Make report now looks like Report 23. Note the carrying of the extra 100 SA-1s between 07/27/04 and 08/11/04 when they will be needed in the kit for W.O. 100.

3) To resolve the action items for SA-2, we will use a similar approach to SA-1 and
schedule one work order to satisfy both action items. That work order, W.O. N-3,

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Material Requirements Planning

will be entered on the Supply Side for quantity 200 due on 07/27/04. In this case, building 200 in one lot and carrying the extra 50 for a couple of weeks is probably more efficient than building two lots one of 150 and one of 50. After re-running the MRP Calculate program, the Make report now looks like Report 24 in the Reports Appendix. Note that there are no more action items on the Make report at this point. Supplies just balance demands over the time period shown. To resolve the Buy action items, follow these steps: 1) Re-run the Buy report to see how the action items are now pegged to the new work orders that were added in the previous section. See Report 25 in the Reports Appendix. 2) Add the following purchase orders to the supply side:
Due Date 06/30/2004 06/30/2004 06/30/2004 P.O. P.O. N-1 P.O. N-2 P.O. N-3 Quantity 2,100 4,700 3,600

3) Re-run the MRP Calculation program. The result is shown in Report 26 in the Reports Appendix. All action items have been resolved. Note that part COMP4 has a safety stock of 100. Therefore, the quantity remaining of 3500 in the first detail line reflects the subtraction of the quantity of 100 for safety stock from the order quantity of 3600. The last line shows quantity remaining of 0, but actually there are 100 available as a safety stock reserve.

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Part 5 The Physical Inventory Module

Introduction
E-Z-MRP keeps track of on-hand inventory balances, recording issues and receipts when they occur and provides management with instant visibility over current inventory levels. This is known as a perpetual inventory system. The real world being what it is, however, differences will accumulate over time between the actual on-hand quantity and the quantities recorded in your perpetual inventory system (manual or automated). Therefore, one to four times a year (or even more if required), someone must go back to the inventory area and physically count the quantities of each item in inventory. This is known as taking a physical inventory. In the most common method for taking a physical inventory, the counts are entered onto two-part, pre-printed tags containing the part number and perhaps location of each part in inventory. So you will see references to physical inventory tags throughout this module. The count is commonly recorded on both parts of the tag. One of the parts is left with the inventory to show that it has been counted, and the other part is returned to be recorded in your Physical Inventory system. Tags are usually numbered sequentially so that missing tags can be easily identified by a break in the number sequence of tags entered into the system. If you do not have or do not find it necessary to have physical inventory tags, you can use the Supply Side Report Parts Only (Inventory Report) Uncosted option to make a list of your current inventory as a hard copy document on which to record the physical inventory counts. After the physical counts of inventory have been taken, the differences between the physical inventory counts and the systems recorded on-hand balances must be entered into the system so that the systems inventory balances match the real world. For accounting purposes, a record of these changes should be produced, along with a net write-up or write-down of inventory dollars. The E-Z-MRP Physical Inventory module was designed to assist the user in: Making a hard copy record of the physical inventory counts Entering the results of the physical inventory counts into the E-Z-MRP Physical Inventory system Transferring the results of the physical to the quantity-on-hand fields in the E-Z-MRP database Providing an audit trail of inventory quantity and dollar changes for management and accounting

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Providing a comprehensive report of the physical versus perpetual inventories as well as a concise report of exceptions items which require your immediate attention

The E-Z-MRP Physical Inventory module allows you to enter an inventory location for each inventory item counted and will report by location and lets you choose which physical counts should be transferred to the on-hand quantity field. So, for example, you could count your Work-In-Process (WIP) inventory and report the total quantities and dollars in WIP but choose not to transfer those counts to the quantity-on-hand fields in your E-Z-MRP database. As noted, when the results of the physical inventory are finally used to update the quantity-on-hand fields, E-Z-MRP will, at your option, add these inventory transactions to the Audit Trail table.

The Main Menu

By clicking the button on the E-Z-MRP Main Menu labeled Physical Inventory, the Physical Inventory Main Menu is displayed:

Figure 48 Physical Inventory Main Menu

As with other modules in the E-Z-MRP system, the menu is divided into three sections: Input Programs Enter and edit physical inventory tags, and delete all tags.

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The Physical Inventory Module

Reports

1) a tag edit listing, to assist in correcting incorrectly entered, duplicate, or

missing tags

2) a physical inventory report with data selection options 3) an exception report to identify parts with quantities on hand but no physical
inventory tag The Tag Printing program is a custom program which Beach Access Software can provide you, tailored to your specific pre-printed tag format. Other Functions 1) Transfer Counts will selectively transfer your physical inventory counts to the quantity-on-hand field by location 2) Counter Names allows you to enter and edit a list of names of people who will be counting the inventory. Those names are recorded in the Enter/Edit Tags form. In the description of the Physical Inventory system, the following test data is used:

Tag No. 1 2 4 5 6 6 7

Part No. COMP-1 COMP-2 COMP-3 SA-1 SA-2 SA-2 WDG-000

Counted By Location Manny A Manny A Manny A Moe B Moe B-1 Moe B-2 Jack B

Count 1800 120 0 0 0 5 0

Table 7 Physical Inventory Test Data

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Enter/Edit Tags
The Enter/Edit Tag form with the above data entered looks like this:

Click Here to Begin Adding a Tag

Record Selector Box

Figure 49 Enter/Edit Tag Form

Adding a Tag
To Add a tag, click on the * at the end of the list of tags. Because you will often be entering tag numbers in sequence, the next tag number will be automatically entered. You can override this if you want. Select the part number from the drop-down of part numbers. Obviously, you cannot enter the count of a part that is not already in your Part Master file. If you find parts like this as you are doing the physical inventory and you want to track and account for them, enter them in the Part Master through the Bill of Materials module first. The Counted By field contains all of the Counter Names (see the section on Counter Names that follows) that you have entered before you started the physical inventory. You do not need to use this field if you do not want to track which parts were counted by whom. Location is an optional field. If you use it, you can later sort the Physical Inventory report by Inventory Location. Also, you will be able to include and exclude specific inventory locations from the program that transfers your physical inventory counts to the quantity-on-hand fields.

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The Physical Inventory Module

Finally, enter the physical inventory Count in the count field. The Entered By and Date and Time Entered fields are not editable. Tabbing past the Count field after entering the count will start the Add process again for the next record. Pressing the escape key (ESC) will terminate the Add process.

Going to a Specific Tag Number

To move to a specific tag number, enter that number in the text box at the bottom of the form labeled Go To Tag Number. A black right-facing arrow will appear in the Record Selector box to the left of the requested tag record.

Editing a Physical Inventory Tag Record

All fields except the Entered By and Date and Time Entered fields are editable. As you begin to edit a record, a pencil icon will appear in the Record Selector box. As long as this pencil is present, the changes you are making have not been recorded in the table. Leaving this record and placing the focus on any other field will write the edited values to the table. To undo any edits you have made while the pencil icon is still present, merely hit the escape (ESC) key.

Deleting a Tag
Using the scroll bar on the right side of the form to scroll down the list of tags, the Page Up and Page Down arrow keys, or the Go To Tag Number, select the record to be deleted. Make sure the black right-facing arrow appears in the Record Selector box of the desired tag record. Click the Record Selector box so that the arrow turns white with a black background. Press the delete key on your keyboard (DELETE or DEL). You can select multiple records to delete at one time by holding down the Shift or Control (Ctrl) keys and clicking on the desired records.

Re-Sort
If you have entered a tag out of sequence, the button labeled Re-Sort will cause the tag records to be re-sorted in tag number sequence.

Delete Tags
Before beginning a new physical inventory, you will want to delete all the tag information from the previous physical inventory. Clicking this button will delete all of the physical inventory tags in the Tag Table. It will not delete the table of counter names.

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Tag Edit Listing

The Tag Edit Listing form allows you select ranges of both tag numbers and/or dates of entry:

Figure 50 Tag Edit Listing Form

A sample of the Tag Edit Listing is shown in Report 28 in the Reports Appendix. Note the warning messages about a break in the tag sequence (tag 3 is missing) and a duplicate tag (tag 6 has been entered twice).

Physical Inventory Report

The Physical Inventory Report form is displayed by clicking the button labeled Physical Inventory on the Physical Inventory Main Menu:

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The Physical Inventory Module

Figure 51 Physical Inventory Report Form

This form allows you to restrict the contents of the Physical Inventory report by entering a range of Tag Numbers, Locations, or Part Numbers. It is not necessary to enter both a starting and an ending value for any of these fields. A sample of the Physical Inventory report appears in Report 29 of the Reports Appendix. Note that results of this physical inventory reveal that over $8,000 worth of inventory is missing that was in the perpetual inventory. Specifically, there are tags showing that no WDG-000s were found during the physical although there were 100 in stock. This accounts for more than $6,800 of the discrepancy. It is now up to management to determine whether the count of 100 was legitimate and that they are missing or stolen - or on the other hand, that the count of 100 is erroneous. The count of COMP-2 shows that 120 were found that were not in the quantity-on-hand of that part, as well as five SA-2s. But 50 SA-1s are apparently missing. This report should be run, obviously, before the transfer of physical counts to quantityon-hand takes place. Afterwards, this report will, of course, show no discrepancies.

The Physical Inventory Exception Report

The Physical Inventory Exception report has no form because it offers no options. It prints a concise listing of every part in your database that has quantity on hand but has

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no physical inventory tag. This report is most useful in tracking down parts that may have been missed during the physical.

Print Physical Inventory Tags

Tags used for physical inventory vary widely in size, format, and arrangement of data. If you would like to print your physical inventory tags on your tag stock, please contact Beach Access Software for a quote on creating a custom program for this purpose.

Transfer Counts
After you have approved the accuracy and completeness of the data presented on the Physical Inventory report, you are ready to transfer the physical inventory counts to the quantity-on-hand field. Clicking the button labeled Transfer Counts on the Physical Inventory Main Menu displays the following form:

Figure 52 Transfer Physical Inventory Counts Form

The window on the left lists all the locations that you have entered during the physical inventory process. Click on each inventory location that you want to include in the count transfer. That location will be displayed in the window on the right.

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The Physical Inventory Module

The button labeled Clear All will erase all of the selected inventory locations from the window on the right. Select All will cause all of the locations in the left-hand window to be displayed in the right-hand window. Each transfer that results in a change in inventory will create an audit trail record. The default audit reference is displayed in the box labeled Audit Reference. If you do not want the default reference, change it before initiating the transfer. The button labeled Transfer will cause the transfer to take place. When the transfer is complete, run an Audit Trail report of all the transactions generated by the transfer. Use the Audit Reference you entered or accepted in the Audit Reference text box during the transfer to limit the contents of the Audit Trail report to just the Physical Inventory transactions (see Figure 52). The Audit Trail report from the physical inventory data in Table 7 is shown in Report 31 in the Reports Appendix. It reflects a net write-down of $8,133.50 in inventory value and presumably reflects the adjustment of all on-hand quantities to match the actual quantities on hand in inventory.

Counter Names Form

In order to bring accountability to the process of taking physical inventory, it helps if those actually doing the counting have their names recorded along with the items they have counted. This is why there is a data field in the Enter/Edit Tags form (Figure 49) to record the name of the person who did the count. Clicking the button labeled Counter Names on the Physical Inventory Main Menu displays the Counter Names form:

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Figure 53 Physical Inventory Counter Names Form

Names of those who are no longer counters can be deleted from the list without affecting any existing data in the Physical Inventory table.

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Part 6 The Purchase Order Module

Overview
The Supply Side of the E-Z-MRP Material Requirements Planning module manages most of the activities involving the scheduling and receiving of purchased parts. E-Z-MRPs super-efficient approach to maintaining your manufacturing database requires you to enter only the minimum information needed to manage your production and procurement plan. In fact, only four pieces of data are required for each purchase order line item: Due Date, P.O. Number, Quantity Ordered, and Quantity Received. As you have seen, the Supply Side also maintains a comprehensive Audit Trail of purchased parts activity, including purchase price variance for subsequent analysis of parts usage and costs. However, if you are cutting several purchase orders a day, you want to have the same computer system that is tracking your purchasing activity print out the actual purchase orders. To this end, E-Z-MRP has a Purchase Order module that will: 1) 2) 3) 4) create a table of vendor names, addresses, and contact information accept the header and line item detail data of your purchase orders print the purchase orders post the Purchase Order detail to the Supply Side table

To start the Purchase Order module, click on the button labeled Purchase Orders on the Main Menu (see Figure 5). You will see the following form:

Figure 54 Purchase Order Main Menu

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As you can see, the functions of the Purchase module are grouped into three sections: 1) File Maintenance in which you can enter and edit purchase orders, vendor name, address and contact data, and the names of your buyers 2) Reports flexible sorting and data selection features enable you to generate summaries and details of your current P.O.s 3) Other Functions post the P.O.s entered here to the Supply Side of the Material Planning module; record various bill to and ship to boilerplate addresses for your purchase orders

File Maintenance
Purchase Orders
Clicking on the Purchase Order button on the Purchase Order Main Menu form (Figure 54) displays the following form where you can enter, edit, delete, and print purchase orders:

Figure 55 Enter/Edit Purchase Orders P.O. Header Data

The buttons along the bottom of the form control its operation:

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The Purchase Order Module

Add Click to add a new purchase order. Click again to cancel the Add operation. When adding a new purchase order, the prefix of the currently displayed purchase order (if any) is inserted into the prefix field of the new purchase order, and the purchase order number of the currently displayed purchase order is incremented by one and inserted into the purchase order number of the new purchase order. Delete Click to delete the currently displayed purchase order. Find Click to display a drop-down of all the purchase orders in your system sorted by purchase order number in descending sequence (so that the most recent purchase orders are at the top of the list). The list will also show the vendor to whom this purchase order was issued. Click the desired purchase order to display it, or click Find a second time to make the list disappear. Save Click to save the currently displayed purchase order. Undo Click to abandon all the changes you have made to the currently displayed purchase order since the last time you saved it. The four navigation buttons Inside the box between the Find button and the Preview P.O. button will be the First Purchase Order, Previous Purchase Order, Next Purchase Order, and Last Purchase Order, respectively. Purchase orders are store in ascending purchase order number sequence. To see the last purchase order you have entered, click the righthand navigation button. Preview P.O. Display on the screen the currently selected P.O. as it would appear in its printed form. Print P.O. Print the currently selected P.O. on your printer. Exit Return to the Purchase Order Main Menu.

The information on the Purchase Order form is divided into three sections, each of which can be displayed by clicking on their respective tabs: Header (see Figure 55), Detail (as shown in Figure 56), and Special Instructions (as shown in Figure 57).

The Purchase Order Header Tab

The Purchase Order Header form is shown in Figure 54. All of the fields of the purchase order header are optional. None are required. The fields on the Purchase Order Header tab of the Purchase Order form include: 1) Prefix: A 10-character alphanumeric prefix to the purchase order number. 2) P.O. Number: A 20-character alphanumeric purchase order number. 3) Order Date: The date the order is placed (double-click in this field to display a pop-up calendar from which you can select the order date). 4) Due Date: The date the order is due or promised (double-click in this field to display a pop-up calendar from which you can select the due date).

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5) Buyer: Select the buyer name from the drop-down list. 6) Requisition Number: A 20-character alphanumeric requisition number. 7) Acct.: Up to a 20-character alphanumeric account number against which this purchase order is to be charged. 8) Taxable: Click this box to enter or remove a check mark. A check in this box indicates that the entire purchase order is taxable. The value of the Taxable check box on the header will be automatically entered into the detail line teams as they are created. Each of the detail items on the purchase order has this taxable option so that this value can be over-ridden for specific line items. 9) Printed: A check mark indicates that this purchase order has already been printed. 10) Terms: A 50-character alphanumeric field for payment terms. When you select a vendor, this field is filled in automatically from the payment terms you enter in the standard terms field in the vendor record. 11) Ship To: Select the ship to address from the list of billing and shipping addresses you entered in the Bill To/Ship To form. 12) Bill To: Select the bill to address from the list of billing and shipping addresses you entered in the Bill To/Ship To form. 13) Ship Via: A 50-character alphanumeric field for shipping instructions. 14) F.O.B.: A fifty-character alphanumeric field for F.O.B. 15) Requestor: A 50-character alphanumeric field for the requestor. 16) Confirm To: A 50-character alphanumeric field for confirming instructions. 17) Deliver To: A 50-character alphanumeric field for delivery instructions. 18) Reference: A 50-character alphanumeric field of reference information.

Adding, Editing, and Deleting Line Item Details

Clicking the Detail tab on the Purchase Order Form (Figure 55) displays the line item detail of the currently selected purchase order:

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The Purchase Order Module

Record Selector Box Add a Line

Figure 56 Enter/Edit Purchase Orders P.O. Line Item Detail Data

To Add a line item, click the rightmost box on the record navigator (*). The cursor will move to the Part Number text box. If you click the down-pointing arrow to the right of the Part Number text box, a list of all part numbers in your database will be displayed from which you can select the desired part number. Alternatively, you can enter a part number not in your database. If you select a part number from your database, the description, unit of measure, and material cost data will be inserted into the line automatically. If you enter a part number that is not in your database, you will have to enter this information yourself. In either case, after you select the part number, the line number will be automatically entered for you as one greater than the largest line number in the purchase order. While you are adding the line, a pencil icon will appear in the Record Selector box of the line you are adding. When you tab through or enter a figure in the last editable field, Unit Cost, the pencil icon will disappear and the record will automatically be saved. Alternatively, you can click the Save button at the bottom of the screen at any time to save the detail record. To cancel an Add, click Undo or press the Esc (Escape) key. To edit a line, just click on the field you want to edit. All fields except for the Extension and the P.O. Total are editable.

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While you are editing a line, a pencil icon will appear in the Record Selector box of the line you are editing. Changes to the line are complete when you click on any text box not in the line you are editing. The pencil icon will disappear. Alternatively, you can click the Save button at the bottom of the screen at any time to save the edited detail record. To cancel an Edit, click Undo or press the Esc (Escape) key. To delete a line, click the Record Selector box of the line you wish to delete and press the Delete key on your keyboard. Some older keyboards may not have a delete key. So you will have to use the Del key that is shared with the decimal point on your keyboards 10-key numeric keypad. For this to work, you must turn the number lock off.

Special Instructions
Clicking on the tab labeled Special Instructions will display a large text box in which you can enter any special instructions you want to see printed on the purchase order:

Figure 57 Enter/Edit Purchase Orders Special Instructions

Previewing and Printing Purchase Orders

You can preview the purchase order on the screen or print the purchase order by clicking the Preview P.O. or Print P.O. buttons respectively on the Purchase Order

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The Purchase Order Module

form. Print P.O. will print the purchase order on the default printer. To print to a printer other than the default printer, use the Preview P.O. button and, when the purchase order is displayed, press Ctrl-P (press the Ctrl and P keys simultaneously). This will cause Windows to display the Printer Dialog box from which you can select a different printer. A sample of the purchase order is shown in Report 32 in the Reports Appendix.

The Vendor Maintenance Form

Clicking the Vendor button on the Purchase Order Main Menu (Figure 54) displays the Vendor Maintenance form:

Figure 58 Vendor Maintenance

This form operates the same as other file maintenance forms in E-Z-MRP. When you select a vendor for a purchase order on the Purchase Order Header Form (Figure 55), the payment terms and the value you enter in the Taxable box in the Vendor Maintenance form are transferred to the purchase order. A listing of all your vendors is available by clicking the Vendor Listing button.

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The Buyer Form

Clicking the Buyer button on the Purchase Order Main Menu (Figure 54) displays the Buyer Maintenance form:

Figure 59 Buyer Maintenance

This form operates the same as other file maintenance forms in E-Z-MRP. The buyer names you enter here are available in a drop-down list on the Purchase Order Header form (Figure 55). A listing of all your buyers is available by clicking the Buyer Listing button.

Reports
A comprehensive Purchase Order report is available by clicking the button labeled P.O. Report on the Purchase Order Main Menu (Figure 54). The Purchase Order Report form allows great flexibility in sorting and filtering the Purchase Order report:

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The Purchase Order Module

Figure 60 Purchase Order Report Sort Form

As shown in Figure 60, you can sort this report by Purchase Order number, Buyer, Promised Date, Vendor, and Part Number. In addition, you can enter greater than or equal to (>=) and/or less than or equal to (<=) values on these fields to restrict the contents of the report to just the sub-set of the entire purchase order database of interest. A sample of the Purchase Order report is shown in Report 33 in the Reports Appendix.

Other Functions
Post P.O.s

Line item details from the purchase order tables can be transferred to the Supply Side of the E-Z-MRP database by using this function. Selected purchase orders will have the due date, purchase order number, part number, and quantity ordered of each line item copied to the appropriate fields in the Supply Side table. Clicking on the button labeled Post P.O.s on the Purchase Order Main Menu form (Figure 54) displays the following form:

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Figure 61 Post Purchase Orders

The left side of this form displays all of the un-posted P.O.s in the Purchase Order tables. Click on the purchase orders you want to post to the Supply Side Tables. The selected purchase orders will appear in the right-hand window. If you want to post all of the un-posted purchase orders, click the button labeled Select All. When you have selected all of the purchase orders you want to post, click the button labeled Post Purchase Orders. To clear the selected purchase orders from the right side of the box and start your purchase order selections again, click the button labeled Clear Selections.

Bill To/Ship To

Even small manufacturing companies can have more than one facility to which purchased parts must be delivered. Sometimes, purchased parts need to be dropshipped directly to a sub-contractor. You can use E-Z-MRPs Bill To/Ship To form to enter and store all of these addresses:

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The Purchase Order Module

Figure 62 Bill To/Ship To Address Form

On the Purchase Order Header (Figure 55) there are drop-downs from which you can select the Bill To and Ship To addresses to be printed on the purchase order. The addresses you enter through this form appear in those drop-downs. This form operates the same as other file maintenance forms in E-Z-MRP.

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Part 7 The Capacity Planning Module

Overview
The Problem Now that you have successfully implemented the Bill of Materials and Material Planning modules, you know what to make and what to buy, and when to make it and when to buy it. Youve got great controls over your inventories. Your documentation is as close to 100 percent accurate as is humanly possible. Everyone in the organization has control over their work and their lives, and they are ecstatically happy with you for the job you and E-Z-MRP have done for them everyone, that is, except the Production Control Manager. Sure, they now know WHAT to make and WHEN to make it. But they still dont know IF they can make it. In other words, can all the manufacturing youve lined up in this terrific production schedule youve worked out actually be pushed through the narrow end of the work-in-process funnel? Only the Production Control Manager knows for sure. Maybe. And, of course the flexibility of E-Z-MRP allows you to respond to production and procurement changes twice a day if you have to. This has left the poor Production Control Manager trying to play catch-up with what might euphemistically be called a dynamic production environment. The problem, of course, is knowing what percent of each of the work centers in production is being utilized each day. The penalties for over-utilization are obvious and, unfortunately, very common backups and delays in WIP, unanticipated (i.e., co$tly) overtime, loss of quality due to production pressures, and unhappiness among workers, managers, supervisors, and, worst of all, customers, who dont get timely, high-quality shipments. The penalties for under-utilization may be less obvious, but can be just as costly idle time among workers and machines, which raises overhead and lowers job satisfaction. The Solution The solution to these problems just might be (wouldnt you know) the Capacity Planning Module of E-Z-MRP. This module allows you to define your work centers by assigning them a capacity in minutes per day, and entering a wage and burden rate for each. Then, for each manufactured part in your database, you can enter a standard routing, defining each operation in terms of its queue time, setup time, and run time per piece. Now, you can run the Capacity Planning Modules Calculate program, which combines the current scheduled work orders from the Material Planning Supply Side, and any unmet demands for which work orders have not yet been scheduled. The Calculate

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program uses demands, the routings you have input, and the work center capacities to figure out how much of each work centers capacity is being utilized every day. Now you are ready to generate reports showing each work centers activities day by day. This information can be presented in both tabular and graphic form. The graphic form shows daily percent utilization on a scale of zero to 200 percent, so you can see at a glance exactly how far over or under capacity you are. One of the beauties of this module is that, once your work centers are defined and your routings are entered, you dont have to enter any more data, unless there are changes in the work centers or routings. The information you get from the Capacity Planning module is essentially free, as the work center and routing data are very static. Operation of the Capacity Planning module is extremely easy and follows the same pattern as the Bill of Materials and Material Planning modules.

The Capacity Planning Main Menu

By clicking the button on the E-Z-MRP Main Menu labeled Capacity Planning, the Capacity Planning Main Menu is displayed:

Figure 63 Capacity Planning Main Menu

As you can see, the functions of the Capacity Planning module are grouped into three sections: 1) File Maintenance in which you can enter and edit work centers

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The Capacity Planning Module

2) Reports where you can generate graphical and tabular reports of work center utilization 3) Other Functions run the Capacity Planning Calculation program, copy routings from one assembly to another, and transfer labor costs from the routings to the Part Master table

File Maintenance
Work Centers
Clicking on the Work Centers button on the Capacity Planning Main Menu form (Figure 63) displays the following form where you can enter, edit, delete, and print a list of work centers:

Figure 64 Work Center Maintenance

This form operates the same as other file maintenance forms in E-Z-MRP. There are six fields which describe each work center. They are: Work Center Name This is the name by which you refer to the work center when defining routings or generating work center loading reports. Its maximum length is 20 characters. Do not confuse the work center name with the description.

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Work Center Description The description field is provided for a more extended description of the work center. Its maximum length is 50 characters. Days per Week A value from 1 to 7. The week is assumed to start on Monday. A four-day week would be Monday through Thursday, a five-day week Monday through Friday, and a six-day week Monday through Saturday. Capacity Capacity of a work center is expressed in minutes per day. Generally your capacity will be a multiple of 480 minutes depending on how many shifts this work center operates 960 minutes for 16 hours (or two shifts), and 1440 minutes (or 24 hours) for three shifts. However, capacity can be defined as any number of minutes. Capacity can also be related to the number of people in a work center performing identical tasks. For example, four assemblers working one 8-hour shift would give the work center a capacity of 4 x 480 minutes per day, or a total work center capacity of 1920 minutes per day.

Labor Rate This is generally the labor rate in dollars per hour paid to the workers in this work center. If there are several people of different wage rates charged to the same work center, a representative figure should be used if accurate labor costing is desired. Consult your companys cost accountants regarding this number. Burden % This is the burden or factory overhead applied to direct labor dollars as a percent of those labor dollars.

A report is available that shows these values for all Work Centers. Clicking the Work Center Listing button displays a window with two formatting options:

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The Capacity Planning Module

Figure 65 Work Center Listing Formatting Options

Here you can choose to print or suppress Routing detail. If you choose to show routing details, all routing records will be displayed with the work center that operation uses, similar to the Where Used report in the Bill of Materials module. An example of this appears in Report 34 in the Reports Appendix.

Routings
After your work centers are defined, you must enter routings for each of your manufactured parts. A routing describes each and every operation performed on your manufactured part, including inspections, testing, and so forth. The routing also contains information or instructions about these operations that may be needed by those in the work center: machining tolerances, tools or jigs required, etc. Finally, the routing contains information about the time required per piece to perform the operation, as well as fixed queue and setup times for the whole work order. The fields that define a routing record are: Assembly This is the part number of the assembly to be manufactured as entered in the Part Master table. Work Center This is the work center in which the particular operation being defined is performed. Select the work center from the drop-down list.

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Operation Each step in a routing is uniquely defined by an operation number. The sequence of operation numbers defines the order of the steps in the manufacturing process. The operation numbers do not have to be sequential. In fact, it is probably advisable, as shown in the demo database, that the operation numbers be assigned in increments of 10 (i.e., 10, 20, 30, etc.). In this way, additional operations can be inserted into the routing without having to renumber all the operations. Duplicate operation numbers are not allowed.

Operation Description This is a 50-character field which can be used to define the operation further. Queue Time Traditionally, this is total time in minutes that a job waits at the work center before the setup work is performed. However, you can also use it to describe the time it takes to move the work order from one operation to the next. Queue time is a component of total lead time and affects the time a job starts in a work center. However, it does not consume work center capacity. Its use is optional. Setup Time This is the total time in minutes that it takes to perform the setup tasks required to begin working on the pieces in the work order. It is also a component of the total lead time of the work order and is a fixed time regardless of the number of pieces in the work order. Its use is optional. Run Time This is the standard time in minutes or fractions of a minute, to produce one item in this operation. Unit run times can be entered with an accuracy of up to four digits. One second equals .0167 minutes. The smallest valid unit run time is .0001 minutes.

Clicking on the Routings button on the Capacity Planning Main Menu form (Figure 63) displays the following form, where you can enter, edit, delete, and print your routings:

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The Capacity Planning Module

Figure 66 Routing Maintenance

This form operates the same as other file maintenance forms in E-Z-MRP. Queue time and setup time are fixed for the entire work order, regardless of size. The Run Time field is run time per piece. The Routing report has several useful options. If you select All Routings, the Print/Preview option will default to Print. When you use Find to access a particular routing, the standard lot size is entered into the Quantity field. This number can be changed so that you can produce a costed routing for any run quantity. A sample of this report is shown in Report 35 in the Reports Appendix. Note that the time totals are shown in both total minutes and total hours. A Routing report can also be run for a specific work order. In that case each operation will have a start date. The work order number will be displayed on the report, and the quantity field will be changed to reflect the quantity of the work order. This report will serve as a dated traveler to go with the work order. When you select an Assembly Part Number (through the Find button), the Work Order drop down list is loaded with all of the work orders for that assembly part number. To run a Routing report for a specific work order, select the desired work order from this list. Note that when you make your selection, the quantity field is changed to reflect the quantity scheduled for that work order.

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A sample of a traveler of Part Number WDG-000 for Work Order W.O. 100 is shown in Report 36 in the Reports Appendix. Note that each operation in the routing now shows the start date and end date of the operation. The initial start date is taken from the work orders Order Date as calculated from the Due Date minus the Lead Time.

Calculating Work Center Usage

There are two approaches to calculating work center usage: finite and infinite. In finite capacity planning, the capacities of your work centers are assumed to be fixed. So the start and end dates of your work orders are moved around to level the load on the work centers and ensure that no work center is loaded to more than 100 percent of its capacity. The infinite capacity approach loads your work centers based on the desired or scheduled start dates of the work orders in your production plan. This, of course, may result in a work center being loaded to greater than 100 percent capacity. The system reports where you are over capacity but does not change your start or end date for you. E-Z-MRP uses the infinite planning approach, as it is better suited to smaller manufacturing environments. In very large operations, there may be a very long lead time to expand capacity. Therefore, work must be scheduled based upon the constraints presented by the limits of moving work through the work centers. And start and end dates are dictated by these constraints. In smaller operations there is generally a higher priority placed on meeting the customers promised date commitment. Therefore, once a production schedule is set up and an over-capacity condition is revealed, management has the charter to expand capacity, work over-time, sub-contract work, or use any of a number of alternative approaches to get the job done. If it is shown, for example, that a work center will be loaded to 109 percent of capacity for a week, a supervisor may alert the workers in that work center and provide some incentive for working a bit harder for that period, as opposed to having the computer reschedule the work and delay a shipment. To determine the loads on the work centers, the Capacity Planning program combines all of the work orders on the Materials Planning Supply Side, independent demands from the Materials Planning Demand Side for which there is no corresponding supply, and the results of the last MRP Calculation which may have generated additional dependent demands for manufacturing. The CRP Calculation program calculates the start date of each work order from the lead time as entered in the Part Master record. The finish time of each operation and the end date of the entire work order, however, is a function of the routing.

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The Capacity Planning Module

Thus, the finish date of the work order as calculated by the Capacity Planning Calculation program may differ from the Due Date shown on the Material Planning reports. Wide variances between the two should be reconciled either by adjusting the lead time in the Part Master record or by modifying the routing to reflect a more accurate total lead time. Clicking on the Calculate Capacity button on the Capacity Planning Main Menu form (Figure 63) displays the following form:

Figure 67 Calculate Capacity Plan

Click Begin Calculation to start the Calculation program, and Cancel Calculation to interrupt the processing. Before you can run this program, you must have already run the Material Planning Calculations and the Cost Roll-Up, if necessary. You will receive warning messages if those calculations are required.

The Work Center Loading Reports

Now that you have (1) defined your work centers, (2) entered your routings, (3) run the Cost Roll-Up and MRP calculations, if necessary, and (4) run the CRP Calculation program, you are now ready for the business end of this system generating the Work Center Loading reports. Clicking on the Work Ctr. Loading button on the Capacity Planning Main Menu form (Figure 63) displays the following form:

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Figure 68 Work Center Loading

As you can see from Figure 68, there are several useful options available. You can print all work centers or one specific work center, which you can select from the dropdown list. You can report all dates, or just the specific date window in which you are interested. And you can print or display the tabular format, the graphic format, or both. Report 37 in the Reports Appendix shows a sample of both the tabular and the graphic formats from the sample database ezmrp.wdg. Note that queue time does not consume any work center capacity. However, it does advance the clock, so that a job which takes 200 minutes in a work center with a capacity of 480 minutes per day might be run over two days if the job starts more than 280 minutes into the first day. The tabular format can serve as a work center dispatch report to be used by a work center supervisor. Knowing the schedule of jobs for the work center helps the supervisor better plan the activities in that work center. The work center supervisor can also alert management if the work passing through (or not passing through) the work center does not match the manufacturing plan, as shown in this tabular form of the Work Center Report. The graphic format shows the total utilization of the work center as a percent of its capacity, day by day, for each day for which utilization is greater than zero. The utilization scale ranges from zero to 200 percent, with a marker down the middle so you can easily see where you are under- and over-utilizing your work center capacity.

Other Functions
Copy a Routing
The Copy a Routing function will copy a routing from one assembly part number to another. Clicking this button displays the following form:

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The Capacity Planning Module

Figure 69 Copy a Routing

This program operates the same as the Copy a Bill function in the Bill of Materials module. Select the Assembly Part Number from which you wish to copy the routing. Then select the Assembly Part Number to which you wish to copy the routing. Then click the Copy button. Since many of your routings are going to be quite similar, this function can save a lot of data entry time and errors, by copying a close match of the desired routing and then making the few changes unique to the new routing.

Transfer Labor Costs

Because a very precise labor and burden cost can be assembled from the routing for an assembly, you can use this feature to update the labor and burden dollars of any part that has a routing. Clicking the button labeled Transfer Labor Costs on the Capacity Planning Main Menu displays the following form:

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Figure 70 Transfer Labor Costs

Before transferring these costs, you can display a report of the costs to be transferred to be certain that these are the costs you want to transfer. The report shows both the current Part Master costs, the costs calculated by the routing, and the difference. A sample of this report is shown in Report 38 in the Reports Appendix. You can also use this report simply to compare the costs calculated by your routings, given the current work center labor and burden rates, with the costs currently recorded in your Part Master records.

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Part 8 Implementing E-Z-MRP - A Plan For Success

Overview
Implementing E-Z-MRP will most certainly involve more than one person in your company. Traditionally, almost every job is affected. Even if the responsibility for maintaining your E-Z-MRP database is the responsibility of a single clerk, everyone has to understand how E-Z-MRP will change their jobs and the operation of the company. Looking at Figure 1 Integrated Manufacturing and Accounting System, you can see all of the areas of the company that have input into the MRP equation. Your company may not be large enough to have formal departments in each of these areas. Nevertheless, the data that is under the control of these areas still has to flow smoothly to the E-Z-MRP system, and the outputs from the system need to flow smoothly back to these areas. This means that some new procedures will need to be developed and implemented. This can present problems in the daily operations of company employees, as they must undergo changes and adapt to new procedures that can disrupt their comfort zone. However, with a little planning and encouragement, it can go smoothly. If everyone involved knows what MRP is, what it does, and how it works, they come to understand how it will make their job easier. Then they will welcome the change, prepare for it, and work to make it succeed.

Steps to Implementation
The following is a general guideline for implementing your E-Z-MRP system: 1) Enter all parts assemblies, subassemblies, and components, including, if desired, costs and lead times. Confirm the accuracy of the data. 2) Enter Bills of Material and confirm accuracy. Accuracy of the bills, particularly the quantity per assembly, is of critical importance. Overstating the quantity per assembly will result in MRP telling you that you need more stuff than you really need. Understating the quantity per assembly will have even more serious consequences, resulting in MRP telling you that you dont need to buy as much stuff as you really need. This will cause shortages and stop production. 3) If desired, enter manufacturers cross-references. 4) Ensure that paperwork feedback loops are established and functioning so any changes to the parts or bills are accurately reflected in the Part Master and Bill of Materials tables.

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5) Take a physical inventory. Enter these beginning quantities on hand through the Material Planning Supply Side form. Be prepared at this point to maintain your perpetual inventory by recording all of the receipts into and issues from inventory. 6) Enter the outstanding sales orders and any forecasts for end items that you want, through the Material Planning Supply Side form. Be prepared to maintain this data by recording any shipments against existing sales orders, entering new sales orders as they are received, and any changes to the forecast items. 7) Enter current Purchase Orders, including any quantities received to date. Do not allow the system to automatically update the quantity on hand as you record these received items. The physical inventory counts already reflect the fact that these parts have been received and are already in stock. Be prepared to maintain this data by entering any new purchase orders and receiving parts against existing purchase orders as these events occur. 8) Enter planned and released Work Orders. Do not allow the system to automatically adjust inventory (auto-kit) when entering quantities released. The physical inventory counts already reflect the fact that these components have left inventory and are in Work-In-Process. Be prepared to maintain this data, entering new work orders as they are planned, releasing work orders in the system as they are actually released to the floor, and entering completions as they occur. 9) Run the Calculate program and then print the Make and Buy reports (Full or Net) to get an idea of where the company stands relative to Make and Buy decisions. Once Steps 1 through 4 above are completed, the Bill of Materials portion of your database will be established. Unlike the data that flows through the Material Planning portion of the system and is continuously changing, this data is more or less static. The data entered in steps 5 through 9 represents a snapshot of your business as of that point in time. Thus, this data is best collected and entered over a weekend, when there is little or no manufacturing activity. You must be prepared to begin maintaining this data first thing on Monday morning recording all receipts to and issues from inventory, entering new Sales Orders and recording shipments, opening and closing work orders, etc.

The Dry Run

Once everyone is satisfied that the manual support systems are ready and in place, you can test the new procedures by selecting a limited number of end items (items you actually sell to your customers) for a dry run of the system and your new procedures. Since you will already be maintaining live data during this simulation, it is probably best to make a copy of your production database and use it for this dry run. Create demands for these end items (either real or hypothetical forecasts and/or sales orders), and run through the entire MRP process. Run the MRP Calculation and produce and distribute the reports.

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Implementing E-Z-MRP - A Plan For Success

Then complete the exercise by simulating the passage of time, entering transactions to reflect the following: Receiving parts against purchase orders Releasing work orders Completing work orders Shipping the final product

Feed everyones responses to the first set of reports back into E-Z-MRP. Recalculate the MRP and generate and distribute a new set of reports. Repeat this process until all action items have been resolved. As a result of this exercise, everyone will become familiar with the new procedures, and you will have a chance to work out problems in a non-threatening environment. You will then be ready to begin regular use of E-Z-MRP.

Implementation Checklist
Bills of Material Accuracy confirmed by Document Control Accuracy of standard costs confirmed by Accounting Update mechanisms for Bills of Material in place

E-Z-MRP Implementation Inventory Responsible parties identified Paperwork procedures in place Receipts and Issues Receiving Kitting User education complete Inventory run parallel with existing system until satisfied with the accuracy of the new system and its manual support procedures E-Z-MRP up and running on your computer or network You, and everyone else who needs to, knows how to operate E-Z-MRP Data entry operators training complete E-Z-MRP database created User education complete

Purchasing Responsible parties identified Paperwork procedures in place

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User education complete Coordination with Production Control in place Lead times input and confirmed

Production Control Responsible parties identified Paperwork procedures in place User education complete Change procedures with Marketing/Forecasting agreed to Input and confirm accuracy of lead times

Marketing/Forecasting Responsible parties identified Paperwork procedures in place User education complete Ground rules for demand side changes agreed to and implemented

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Reports Appendix

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Report 1 Part Master

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Report 2 Bill of Materials

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Report 3 Summary Bill of Materials

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Report 4 Bill of Materials One Line Format

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Report 5 Where Used

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Report 6 Manufacturers Cross Reference

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Report 7 Comparative Bill of Materials

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Report 8 WDG-000 Summary Bill of Materials Quantity 250

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Report 9 Supply Side Report Page 1

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Report 9 Supply Side Report Page 2

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Report 10 Supply Side Report Due Date Sequence

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Report 11 Demand Side Report

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Report 12 Make Report Full Format

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Report 13 Make Report Net Only Format

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Report 14 Make Report Order Date Sequence

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Report 15 Buy Report Full Format Page 1

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Report 15 Buy Report Full Format Page 2

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Report 16 Buy Report Net Only Format

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Report 17 Buy Report Order Date Sequence

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Report 18 Kit List

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Report 19 Work-In-Process Page 1

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Report 19 Work-In-Process Page 2

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Report 20 Shortages

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Report 21 Audit Trail Report

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Report 22 Make Report Full Format

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Report 23 Make Report Full Format

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Report 24 Make Report Full Format

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Report 25 Buy Report Full Format

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Report 26 Buy Report Full Format

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Report 27 Supply Side Report Parts Only Format

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Report 28 Tag Edit Listing

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Report 29 Physical Inventory Report

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Report 30 Physical Inventory Exception Report

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Report 31 Audit Trail of Physical Inventory Transfers

Report 32 Purchase Order

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Report 33 Purchase Order Report

Report 34 Work Center Listing with Detail

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Reports Appendix

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Report 35 Routing Report

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Report 36 Work Order Traveler

Reports Appendix

Report 37 Work Center Loading Report Tabular Format

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Report 37 Work Center Loading Report Graphic Format

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Reports Appendix

Report 37 Work Center Loading Report Graphic Format

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Report 38 Cost Transfer Report

Reports Appendix

Technical Support and Seldom Used Bug Report Form

Technical support for E-Z-MRP is available from your E-Z-MRP dealer. If you have questions about the operation of your E-Z-MRP system, please contact your dealer. If your dealer is unable to answer your question, or if you purchased your system directly from Beach Access Software, please contact: Beach Access Software Phone: 858-259-4334 Fax: 858-259-4471 Email: bchacc@san.rr.com Although E-Z-MRP has been carefully tested, there still remains an astronomically remote possibility that you will encounter the dreaded program bug. If you do, a form will pop up with the words Run Time Error at the top. This form will have a message containing a Run Time Error Number and an Error Description. In the very unlikely event that you encounter a bug in the software, when you call or write, please let us know the following information: Your Name and Company Name Your Phone, Fax, and Email address Version of E-Z-MRP that you are running (see the opening screen for the version number) What form were you working in when the error occurred? What was the run time error number and description (very important)? What was the last thing you did just before the error occurred?

If you encounter a run-time error, it is very important that you close the program entirely and restart it.

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