Master Production Schedule - How An MPS Works

How An MPS Works

By using several variables as inputs the MPS will generate a set of outputs used for decision making. Inputs may include forecast demand, production costs, inventory costs, customer orders, inventory levels, supply, lot size, production lead time, and capacity. Inputs may be automatically generated by an ERP system that links a sales department with a production department. For instance, when the sales department records a sale, the forecast demand may be automatically shifted to meet the new demand. Inputs may also be inputted manually from forecasts that have also been calculated manually. Outputs may include amounts to be produced, staffing levels, quantity available to promise, and projected available balance. Outputs may be used to create a Material Requirements Planning (MRP) schedule.

A master production schedule may be necessary for organizations to synchronize their operations and become more efficient. An effective MPS ultimately will:

• Give production, planning, purchasing, and management the information to plan and control manufacturing
• Tie overall business planning and forecasting to detail operations
• Enable marketing to make legitimate delivery commitments to warehouses and customers
• Increase the efficiency and accuracy of a company's manufacturing

MPS issues:

• Width of the time bucket
• Planning horizon
• Rolling plan
• Time fencing
• Schedule freezing