Running MRP and Kanban on the same blank/part - Is this possible?

[Alan MDP]

I am creating a Kanban system for our high runner blanks which make 2 products. The demand for the products can be split into our 'Main' customer demand and 'Other' customer demand.

To allow me to remove the spikes from the blank demand, i was looking to retain using the MRP system for the blanks/parts for the 'Other' customer demand. However, for the 'Main' customer demand i was looking to use these blanks specifically for the Kanban system.

This inturn has implications whereby i will require a raw material holding area for 'Kanban material' and separate area for 'MRP material; and the same applies for tooling.

Has anyone had any experience of splitting a part/blank and running half on MRP and half on Kanban (the reality is that the majority of demand will be pulled in the Kanban and the 'Other' customer orders will be pushed though the system). I know these systems contradict each other; but i was wondering if there was any feasible way of running the two systems for a trial blank.

Regards,

Alan

 

[wmarhel]

Hi Alan,

First off, you will never totally eliminate MRP from the process if for no other reason that it also likely handles purchase orders, vendor information, and is tied into the accounting system. Of course, you could be using a secondary accounting system such as Quickbooks, in which case MRP might be rendered unnecessary.

According to the APICS' (Association for Operations Management) dictionary MRP is defined as (Key items in Italics):

Material Requirements Planning (MRP) : A set of techniques that uses bill of material data (BOM), inventory data, and the master production schedule to calculate requirements for materials. It makes recommendations to release replenishment orders for material. Further, because it is time-phased, it makes recommendations to reschedule open orders when due dates and need dates are not in phase. Time-phased MRP begins with the items listed on the MPS and determines (1) the quantity of all components and materials required to fabricate those items and (2) the date that the components and material are required. Time-phased MRP is accomplished by exploding the bill of material, adjusting for inventory quantities on hand or on order, and offsetting the net requirements by the appropriate lead times.
---------END DEFINITION-------------

MRP manages the entire BOM, so there is still likely to be a need there. Inventory data can be readily handled through the use of kanban and it is likely to more accurate. Inventory data can be addressed through MRP (inventory locations identified with MRP) or through kanban which should clearly identify where material is to come from and where it is supposed to go once completed.

Other aspects such as planning, forecasting are typically still done at a Macro level. In other words, at the product family level. As you move down into other layers, material requirements become dependant on the parent (top level part #) and so are calculated directly.

MRP is more of a scheduling/planning tool and it has a place. Kanban on the other hand is about execution. It is directing work to be performed, telling people where to get it from and where it is to be taken.

What you will likely do if your system is capable is to generate blanket purchase orders and utilize a barcode on your kanban (note that I didn't say card). When a kanban is consumed and parts are taken; the kanban is scanned and inventory can be transacted in the system from the blanket purchase order. There are also applications out there that will do electronic kanban, but I am not a fan of this until a certain level of maturity and comfort is reached with the process.

Ideally, a kanban will be scanned at two points in any process. First when a kanban is fulfilled so the materials can be placed in inventory and moved into the designated location. Second when the kanban is consumed, which also relieves inventory. An even better way if your cycle times are within short periods is to scan upon completion of the finished unit and backflush all the material consumed.

Can you run both at the same time, sure. Do you need to run both at the same time? Yes, to some degree. It all comes down to how you want the processes to be executed.

Wayne

 

[ab001]

why not call it a supermarket? a certain amount of blanks sit on a shelf
blanks are pulled for any job as required.
replenishment is done in standard size (your kanban - eg one bin or pallet)
use your MRP info to decide the right size.

 

[DanteCaspian]

The above comments are quite right.
In many environments a hybrid of visual and "grassroots" kanban and use of ERP, or MRP is possible. How and to what degree things are controlled often has to do with a particular product/product family, its frequency of the run and the volume of raw and WIP inventory.
The book, Made to Order Lean, may be useful to you or others, for practical examples of how and when to create hybrid systems... the principle is actually simple.