Master Production Scheduling (MPS) is a crucial tool in supply chain management. It specifies the quantity and timing of end items produced, bridging the gap between aggregate planning and detailed scheduling while coordinating production, sales, and inventory management.

MPS development involves gathering input data, determining time buckets, and calculating requirements. The process considers capacity constraints, inventory costs, and customer service levels. Impact analysis of MPS changes helps managers understand the effects of demand or capacity fluctuations on production schedules.

Understanding Master Production Scheduling

Role of master production scheduling

• Master Production Scheduling (MPS) specifies quantity and timing of end items produced over several weeks to months
• Bridges gap between aggregate planning and detailed scheduling serves as basis for material requirements planning (MRP)
• Coordinates production, sales, and inventory management balances supply and demand
• Provides basis for capacity planning guides lower-level production and purchasing activities

Inputs and outputs of MPS

• Inputs: demand forecasts (customer orders, sales projections), production capacity, inventory levels, aggregate production plan, product structure (bill of materials)
• Outputs: planned production quantities for each end item, production schedule by time periods (weekly), available-to-promise (ATP) quantities, projected available balance (PAB)

Developing and Analyzing the Master Production Schedule

Development of production schedules

1. Gather input data (forecasts, orders, inventory levels)
2. Determine time buckets (weekly)
3. Calculate gross requirements
4. Adjust for inventory on hand and scheduled receipts
5. Calculate net requirements
6. Determine lot sizes and lead times
7. Schedule production quantities

• Consider capacity constraints, inventory holding costs, setup costs, customer service levels
• Implement time fences demand time fence, planning time fence, production time fence

Impact analysis of MPS changes

• Demand increase may require overtime, subcontracting, or backorders
• Demand decrease may lead to excess inventory or idle capacity
• Capacity increase creates opportunity to reduce backlogs or increase production
• Capacity decrease may require rescheduling or prioritizing orders
• Analyze using rough-cut capacity planning, what-if scenarios, ATP analysis
• Measure performance with schedule adherence, inventory turnover, customer service level, capacity utilization