What Causes MRP to Go Wrong And What Can We Do About It?

Scheduling the replenishment of stock using MRP is not always straightforward. As Dynamics consultants, it’s not unusual for customers to come to us expressing their confusion. The purpose of this blog is to look at two of the most common issues which cause problems and discuss how Business Central can handle them.

The issues we will cover

  • Out of date or generally inaccurate planning parameters on the Item Card
  • Overly convoluted Planning or Requisition Worksheets, caused by multiple small changes to planning Line suggestions
  • MRP suggests changes which cannot be acted upon. For example, where some vendors are not in a position to adjust quantities or amend dates to an existing Purchase Order. Similarly, where the shop floor cannot easily accommodate changes to the existing Production & Assembly Orders

How does Business Central deal with this?

Business Central has a variety of tools to tackle all of the above. The outcome of getting your MRP process established is gaining full control over one of the most functionally-rich areas of the Manufacturing module. Getting it resolved early will save you bundles of time and countless future headaches generating planning spreadsheets manually.

Maintaining MRP parameters with RapidStart

The planning parameters are an essential part of running MRP. Their accuracy is paramount to producing suggestions that are realistic and helpful. If you have to manually amend planning Lines each time you run MRP, then you’re losing the benefit of having those calculations run in the background! Keeping tabs on all items’ planning parameters, especially when there are thousands, can be a mammoth task. But keeping the Planning and Requisition Worksheet recommendations logical and accurate is crucial.

The effectiveness of the MRP process is directly related to the accuracy of the planning parameters on each item. It can be an onerous task to maintain item planning parameters, especially when it has to be done on an Item by Item basis. When you have a couple of thousand items in the system, you can imagine how arduous this can be! On many occasions it’s neglected, massively impairing the effectiveness of the Planning and Requisition Worksheet recommendations.

In Business Central, this issue can be largely improved. I say ‘improved’ and not ‘removed’ as users will still be required to enter the planning details for items. But using RapidStart, the MRP planning parameters can be exported to Excel and easily edited. This spreadsheet can then be imported back into Business Central.

Using Dampeners to reduce the number of MRP recommendations

Business Central has planning parameters, in the ‘Planning’ tab on the Item Card designed to reduce the number of proposals in the Planning Worksheet. This tab is only visible for items of type: ‘Inventory’ or ‘Service’.

A Dampener Period allows users to specify a number of days added on to the Delivery Date whereby if demand changes, the Planning Worksheet suggestion won’t change. Without a Dampener Period in place, users put themselves at risk of having lots of unnecessary, small, suggested replenishment changes.

Imagine a customer asks for an item to be sold to them and we are buying this item beforehand to meet the demand. Where the customer decides they’d prefer that item arrive a day later than previously stated, do we want the system to change the suggested purchase date by a day? Probably not. As a minimum it will cause unnecessary hassle and, for all we know, the vendor might not accept the change to the Purchase Order date because they might not have the necessary stock ready by then. They might have based their replenishment on the previous requirement, which can’t be matched now.

It might be that the item in question is large and it can’t be kept long, perhaps due to limited warehouse space or spoilage. In instances like that, not having a Dampener Period might be appropriate. But in the majority of cases, this amendment of the Purchase Order date is unnecessary, so a Dampener Period is useful. The effective setting of these dampener parameters can dramatically reduce the number of proposed MRP lines, making the process much more manageable.

For those looking to see step-by-step examples of utilising both a Dampener Period and Quantity, click here.

Prevent MRP from adjusting existing orders

There may be a time where you don’t want MRP to amend planning Lines for existing Purchase, Production or Assembly Order quantities or dates. For example, where vendors are not in a flexible position to adjust their own shipments. It might be that the vendor has short lead times. Granted you know this is the case, you won’t want your Purchase Order amended. The same goes for manufactured items. The shop floor might be unable to easily accommodate changes to existing Production or Assembly orders. This could be because you use a batch style of manufacturing. The solution is Planning Flexibility.

Planning Flexibility

To handle these situations, you need to specify that MRP doesn’t change the Line once it has been created. This can be achieved by setting the Planning Flexibility field on the Line of a Purchase, Production or Assembly Order. This is similar to the aforementioned Dampener Period and Quantity fields. However, this field isn’t limited by the Dampener values you enter in the Planning tab on the Item Card, it’s done on a Line-by-Line basis on the relevant order. Note that to see the field, you may have to use Personalise to add the field to the Line on your view of the page:

When you click the dropdown for the field, you are presented with two fields: ‘None’ and ‘Unlimited’. ‘None’ means that MRP can’t suggest changes for this Line. ‘Unlimited’ is the opposite. MRP can therefore suggest changes to the Line based on planning parameters.

An example of Planning Flexibility

Let’s say we have a Sales Order for 10 chairs. We replenish these using Purchase Orders. If we run MRP and click ‘Carry Out Action Message’, a Purchase Order is created. If we set the Planning Flexibility field to ‘Unlimited’, we can change the dates on the Sales Order and if we click ‘Calculate Regenerative Plan’, the Planning Line will change, suggesting changes to the Purchase Order. This will of course be dependant on the parameters we set against the Item in the Planning tab. However, if we have Planning Flexibility set to ‘None’ when the Purchase Order is created, regardless of any date or quantity changes we make, that Purchase Order will remain the same.

This image illustrates Planning Flexibility set to ‘Unlimited’. As you can see the Sales Order quantity has changed to 100. The dates have changed too, hence the Action Message entry on the left-hand side.

Where we have Planning Flexibility set to ‘None’, it doesn’t mean that the increase in demand will be ignored. It just means the original Purchase Order made from the Carry Out Action Message functionality won’t be amended; creation of an additional Purchase Order will be suggested on top of it.

This image illustrates Planning Flexibility set to ‘None’. No amendments are suggested for the existing Purchase Order but as demand from the Sales Order has risen from 10 to 100, MRP suggests creating an additonal Purchase Order.

It’s worth mentioning, all Lines by default will have their Planning Flexibility set to ‘Unlimited’. Consequently, each time you wish to amend this, you will have to change it manually.

Closing remarks

As always, thanks very much for taking the time to read this. If you would like to get in touch with us and speak about any planning issues or otherwise, click here.