Requirements Planning System For Replenishment Planning

1284 Words6 Pages
A common system for replenishment planning used in major companies, including Electrolux, is a material requirement planning (MRP) system. Making wrong replenishment decisions leads to expensive inventories (Danilovic & Vasilievic, 2014). Because of the uncertainty in demand and supply, a need for optimizing inventory control procedures exists. The goal of the manufacturer is to devise production and supply procedures that minimize the average holding cost and stock-out cost. A supply chain management challenge is to control the capital cost of raw material by keeping stock levels down while simultaneously providing a high level of customer service. These often conflicting objectives require a customizable material requirement…show more content…
Eliminating the inefficiencies created by the lack of defined procedures for returning excess inventory from the assembly lines to the raw materials warehouse is the objective of Electrolux. Establishing a written procedure and implementing it through consistent employee training will eliminate waste and reduce costs, while improving operations at the Memphis factory. For manned manufacturing systems, work process design pertains to designing efficient manufacturing processes (Ham & Park, 2014). Efficient workflow is important to the performance of a system, as the absence can create bottlenecks and performance to decline. Potential exists for bottlenecks and performance decline on the Electrolux assembly lines as excess material clutters the area, making it difficult for employees to perform the tasks assigned, within the designated time allotted. An analysis of workstation functions can assist in determining when excess materials should be relieved from the assembly line and who should perform this function. The assembly line workstation should include a materials disposition process at the end of each day, or during the change-over time to the next model variant. Kaizen is the Japanese term meaning continuous improvement, derived from two concepts: Kai, meaning change, and Zen, meaning to improve (Sanchez & Blanco, 2014). Credit is given to Masaaki Imai, who is considered to be the father of continuous improvement. The principles
Open Document