MRP Data Analysis & System Implementation 5 — Questions and Answers
Question 1: Which scenario best illustrates the 'nervousness' problem in MRP systems?
- A system that takes too long to complete an MRP regeneration run
- Small changes in master schedule demand causing large, frequent changes to lower-level planned orders (Correct answer)
- A planner who overrides too many system-generated recommendations
- Inaccurate demand forecasts causing stockouts at the finished goods level
Correct answer: Small changes in master schedule demand causing large, frequent changes to lower-level planned orders
MRP nervousness occurs when minor demand fluctuations at higher BOM levels cascade into disproportionately large and frequent replanning of lower-level components.
Question 2: When implementing MRP across multiple manufacturing sites, what is the main advantage of using a centralized versus decentralized MRP approach?
- Centralized MRP eliminates the need for inter-site transfer orders
- Centralized MRP enables visibility and optimization of material flows across all sites (Correct answer)
- Decentralized MRP provides faster processing speeds per site
- Centralized MRP automatically balances workload between sites
Correct answer: Centralized MRP enables visibility and optimization of material flows across all sites
Centralized MRP gives planners a single view of inventory and demand across all sites, enabling better coordination of transfers, purchases, and production allocation.
Question 3: A planner uses MRP data to perform a 'where-used' inquiry for a component. What question does this analysis answer?
- Which suppliers can provide this component?
- In which parent assemblies or finished goods is this component used? (Correct answer)
- What is the total on-hand quantity of this component across all warehouses?
- When was this component last purchased?
Correct answer: In which parent assemblies or finished goods is this component used?
A where-used inquiry traverses the BOM upward to identify all parent items that consume the specified component, essential for evaluating the impact of shortages or changes.
Question 4: In MRP system implementation, what does 'go-live readiness' typically include verifying?
- That all employees have memorized MRP calculation formulas
- That data accuracy, user training, system configuration, and cutover procedures are all validated (Correct answer)
- That the ERP vendor has provided written performance guarantees
- That all existing inventory has been sold before the new system is activated
Correct answer: That data accuracy, user training, system configuration, and cutover procedures are all validated
Go-live readiness requires confirming that master data is accurate, users are trained, the system is correctly configured, and a tested cutover plan is in place.
Question 5: An analyst comparing two planning periods finds that MRP-generated purchase order values dropped 15% while customer service levels improved. What does this most likely indicate?
- Demand has declined significantly in the market
- MRP implementation improved planning accuracy, reducing excess purchases while meeting demand (Correct answer)
- The company switched to lower-cost suppliers
- Safety stock levels were increased to improve service levels
Correct answer: MRP implementation improved planning accuracy, reducing excess purchases while meeting demand
Simultaneous reduction in procurement spending and improvement in service levels indicates that better-timed, right-sized MRP orders replaced the previous over-purchasing caused by poor planning.
Question 6: Which MRP input data element directly controls when MRP will suggest releasing a planned order relative to its due date?
- Safety stock quantity
- Item lead time (Correct answer)
- Order quantity minimum
- Scrap factor percentage
Correct answer: Item lead time
MRP offsets the planned order release date backward from the requirement date by the item's lead time, so lead time directly controls the release timing.
Question 7: During post-implementation review of an MRP system, which finding would indicate that the system is being used as designed rather than as a 'data warehouse' with manual planning?
- Planners regularly print MRP reports and make decisions on paper
- The majority of planned orders are converted to actual orders without manual intervention (Correct answer)
- Users have created many spreadsheet workarounds alongside the system
- Exception messages are consistently ignored by planning staff
Correct answer: The majority of planned orders are converted to actual orders without manual intervention
High conversion rates of planned orders to actual orders without manual overrides indicate planners trust and use MRP output, reflecting proper system adoption.
MRP Data Analysis & System Implementation 5
Which scenario best illustrates the 'nervousness' problem in MRP systems?