E9.1 Item Branch Planning Code (MPST) - What is the difference between 1, 2, & 3?

richchipper

Well Known Member
We are a manufacturing company that uses multi-branch DRP for planning purposes. I've never been sure what the difference between planning codes 1, 2 & 3 (Planned by MPS or DRP / Planned by MRP / Planned MRP with Forecast). It doesn't seem like it's making a change to the calculations, but a user just asked me the question and I can't seem to find the answer in the usual places. Thanks in advance.
 
The MPS and DRP items should go with planning code = 1, and MRP items go with 2. Forget about 3 which I know is the definition brought from World and I don't see the necessity in E1.
When you run R3483 with generation types 1 for MPS/DRP, and then R3483 again for generation type 5. You will have different MRP results if the DS = planning code 1 and 2, or the planning code = 2 only.
 
We use 0, 2, 3, 4 and a custom code 6.
I'm not a planner but I know they use 3 in combination with a Order Policy code of 4 (Period of Supply vs Lot for Lot).
 

0 = Reorder point​

If an item has an order policy code of zero then the MRP/MPS/DRP system will not plan this item. Component demand will only show up in the MRP system when active work orders (WOs) exist for the parent item that have parts lists attached.
Refer to E1: 43: Overview of The Purchase Order Generator (P43011) Document 625474.1.

1 = Lot-for-lot or as required​

If an item has an Order Policy Code of one (1), then the system will create messages for either WOs or POs (purchase orders), for the exact amount needed - no more, no less. However, if this Order Policy Code is used in conjunction with the Item Branch Quantities (P41026), users may specify quantities like minimum and maximum reorder quantities, multiple order quantities, etc. (See the Item Branch Quantities section below for more information/clarification).

2 = Fixed order quantity (FOQ)​

If an item has an Order Policy Code of two (2), the system will create messages for either WOs or POs based on the value entered in the Value Order Policy (OPV) in the P41026 Plant Manufacturing Data. This value (OPV) is in the primary unit of measure, and becomes the Fixed Order Quantity (FOQ). If demand exceeds the FOQ, then the system will create another Order Message for the FOQ.

Use FOQ for planning items like resistors that are purchased by the reel (2500 per reel), printed circuit boards (ex. 8/pallet), or items that have a quantity restriction on a machine, or other production limitation.

example: Demand for period 1 is 25
FOQ = 10
Three (3) different Order messages for a quantity of 10 each will be created.

3 = Economic Order Quantity (EOQ)​

If an item has an Order Policy Code of three (3), then the system will create messages for POs (EOQ is valid for purchased items only) based on the following formula:

EOQ = Division of [2(POCS)/(INCS)] * [(SQ01+SQ02+ ...SQ12)/(CSTA)]

POCS = Cost to issue a purchase order from the value entered in the Branch Plant Constants. (P41024)

SQ01 through SQ12 = Monthly sales, in units, calculated form data contained in the Item History File (F4115). These fields are added together in to get the annual sales.

CSTA
= Average Cost of the item, from the Cost Ledger File (F4105) field UNCS.

INCS = Cost of carrying inventory form the value entered in the Branch Plant Constants (P41001).

The behavior of EOQ is as follows:

1. If EOQ > demand, then an order message for EOQ will be created.
i.e. EOQ = 87
Demand = 50

An order message for 87 will be created.

2. If EOQ < demand, then an order message for demand will be created.
i.e. EOQ = 87
Demand = 100

An order message for 100 will be created.

4 = Periods of Supply​

Using an Order Policy Code of four (4) will create generate messages for work orders or purchase orders based on the value entered in the Value Order Policy field. The number of days in the Value Order Policy is based on the Shop Floor Calendar (P00071) for manufactured items and calendar days for purchased items, and is the number of additional days after a unsatisfied demand is encountered that MRP Order messages will be created for. Other industry terms: Message consolidation, or consolidated messages.

example: Weekly demand from forecast, sales and workorders is not consistent. Item is inexpensive to purchase, like small hardware, and carrying costs low. May have safety stock to cover scrap or loss.
Value Order Policy = 180 days (around 6 months)
MRP will plan one order message (+PLO on Time Series) for 6 months of supply. This order policy code was designed to be used with high-use/low cost items for which the user is not concerned about carrying excess inventory.

5 = Rate scheduled item​

If an item has a Order Policy Code of five (5) then the system will generate messages based on existing rates and rate generation rules. This order policy code is for parent rate-scheduled items only - components of rate items should not use this policy code. Order policy code five is also used in conjunction with the Value Order Policy field. The value entered in the Value Order Policy code with rate scheduled items behaves much like a safety stock - if the ending available is below or above this number then the MRP system will create "increase rate to" or "decrease rate to" messages for the rate scheduled item.

For more information see E1: 31: Rates: Set-Up and Overview of Repetitive Manufacturing Document 625969.1.
 

0 = Reorder point​

If an item has an order policy code of zero then the MRP/MPS/DRP system will not plan this item. Component demand will only show up in the MRP system when active work orders (WOs) exist for the parent item that have parts lists attached.
Refer to E1: 43: Overview of The Purchase Order Generator (P43011) Document 625474.1.

1 = Lot-for-lot or as required​

If an item has an Order Policy Code of one (1), then the system will create messages for either WOs or POs (purchase orders), for the exact amount needed - no more, no less. However, if this Order Policy Code is used in conjunction with the Item Branch Quantities (P41026), users may specify quantities like minimum and maximum reorder quantities, multiple order quantities, etc. (See the Item Branch Quantities section below for more information/clarification).

2 = Fixed order quantity (FOQ)​

If an item has an Order Policy Code of two (2), the system will create messages for either WOs or POs based on the value entered in the Value Order Policy (OPV) in the P41026 Plant Manufacturing Data. This value (OPV) is in the primary unit of measure, and becomes the Fixed Order Quantity (FOQ). If demand exceeds the FOQ, then the system will create another Order Message for the FOQ.

Use FOQ for planning items like resistors that are purchased by the reel (2500 per reel), printed circuit boards (ex. 8/pallet), or items that have a quantity restriction on a machine, or other production limitation.



3 = Economic Order Quantity (EOQ)​

If an item has an Order Policy Code of three (3), then the system will create messages for POs (EOQ is valid for purchased items only) based on the following formula:

EOQ = Division of [2(POCS)/(INCS)] * [(SQ01+SQ02+ ...SQ12)/(CSTA)]

POCS = Cost to issue a purchase order from the value entered in the Branch Plant Constants. (P41024)

SQ01 through SQ12 = Monthly sales, in units, calculated form data contained in the Item History File (F4115). These fields are added together in to get the annual sales.

CSTA = Average Cost of the item, from the Cost Ledger File (F4105) field UNCS.

INCS = Cost of carrying inventory form the value entered in the Branch Plant Constants (P41001).

The behavior of EOQ is as follows:

1. If EOQ > demand, then an order message for EOQ will be created.
i.e. EOQ = 87
Demand = 50

An order message for 87 will be created.

2. If EOQ < demand, then an order message for demand will be created.
i.e. EOQ = 87
Demand = 100

An order message for 100 will be created.

4 = Periods of Supply​

Using an Order Policy Code of four (4) will create generate messages for work orders or purchase orders based on the value entered in the Value Order Policy field. The number of days in the Value Order Policy is based on the Shop Floor Calendar (P00071) for manufactured items and calendar days for purchased items, and is the number of additional days after a unsatisfied demand is encountered that MRP Order messages will be created for. Other industry terms: Message consolidation, or consolidated messages.



5 = Rate scheduled item​

If an item has a Order Policy Code of five (5) then the system will generate messages based on existing rates and rate generation rules. This order policy code is for parent rate-scheduled items only - components of rate items should not use this policy code. Order policy code five is also used in conjunction with the Value Order Policy field. The value entered in the Value Order Policy code with rate scheduled items behaves much like a safety stock - if the ending available is below or above this number then the MRP system will create "increase rate to" or "decrease rate to" messages for the rate scheduled item.

For more information see E1: 31: Rates: Set-Up and Overview of Repetitive Manufacturing Document 625969.1.
The origianl question is about the planning codes, and here with your explanation is on Order Policy Codes?
 
The origianl question is about the planning codes, and here with your explanation is on Order Policy Codes?
Wow you are correct. Completely pasted the wrong thing.

Valid values are:
0: Not Planned by MPS, MRP, or DRP
1: Planned by MPS or DRP
2: Planned by MRP
3: Planned by MRP with Forecast
4: Planned by MPS, Parent in Planning Bill
5: Planned by MPS, Component in Planning Bill

Planning Code Detail​

0: Not Planned by MPS, MRP, or DRP.
Recommended for inexpensive items that are planned using reorder point (Purchase Order Generator) instead of MRP.

1: Planned by MPS or DRP.
The logic is similar for planning code values 1, 2, and 3. Planning code value "1" is widely set for MPS-controlled saleable end items.
For example, a manufacturing company can firm up its Master Production Schedule using the processing option with generation type "1 - Single Level MPS/DRP". Set the data selection for just the master scheduled item with the planning code value "1". Using the frozen MPS generation for the entire planning horizon, planners can then generate MRP to plan demand for the components by using processing option with generation type "5". The above logic is hard coded to work correctly only when using the Planning Code value "1" set for the MPS item.

2: Planned by MRP
Used when an item is to be planned by MRP along with its components. Bills of Material are set up and MRP is run with all components included in the data selection. The program will "explode" the component demand. The parent and the component can both have this planning code value. Both the independent demand and the dependent demand are considered for planning.
This is a standard value and used widely for normal MRP generation. The MPST field has a data dictionary default value of "2". Therefore, every newly created item will have this value, unless the user decides to change it.

3: Planned by MRP with Forecast
Planners use planning code "3" to differentiate those MRP-controlled component items that are also sold as end items, and therefore might have forecasted requirements. The logic for this planning code value works the same as planning code value "2". The value has been retained in EnterpriseOne to support the migration of customers from World software to EnterpriseOne.

4: Planned by MPS, Parent in Planning Bill.
The purpose for planning bills is to generate forecasts for saleable end items. Planning bills are commonly used in a manufacturing environment where the saleable end items have a large number of features and/or options. The forecasts for these saleable end items are based on percentages of the features and options offered that you expect to sell.
Planning bills consist of groups of pseudo items that reflect how an item is sold. They are entered into the system in a Bill of Material format, and represent the variety of possible options and features that might be included as a saleable end item.
Example: The Planning Bill identifies the percentages of each type of product expected to sell. The system can calculate the total requirements for each type of bike by exploding the Planning Bill. For more information, see Note 627246.1 E1: 34: Planning Bills in the MPS/DRP system.
The parent item on planning bill should be set up with a planning code value of "4". If there are multiple sub-assemblies, they too should be set to planning code "4".

5: Planned by MPS, Component in Planning Bill.
Components of planning bills should be set up with a planning code value of "5". Refer to the example of the planning bill stated above. The components of the bike should have the planning code value "5" for the forecast to be created utilizing type of feature and percentage setup in the parent item BOM.
 
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