Integral Logistics Management — Operations Management and Supply Chain Management Within and Across Companies

7.8.1 Exercise: Adaptive Techniques for Product Families

Intended learning outcomes: Disclose a better understanding of the adaptive technique, by calculating the number of variants in the master production schedule.



Figure 7.2.2.2 showed an example of the variant master schedule. The example revealed that, in practice, this technique would not be applied for that case, because the number of variants turns out to be too high. How­ever, the present exercise is aimed to aid better understanding of the technique, and it is thus useful for all cases where the number of variants is significantly smaller than the total demand quantity for the product family.

Suppose that the demand of the product family P for January was 200 instead of 100. Again, suppose an equal option percentage — with a deviation of 20% — of the variants of the demand at the product family P level. What would have been the total number of variants V1 + V2+ … + V100 in the master production schedule for January?

Solution: 300. In fact, for 100 variants, an equal option percentage would result in 2 units per variant. If a deviation of 20% has to be considered for each variant, an additional (safety) demand of 0.4 units must be added. Because no fraction of a unit can be ordered, this value has to be rounded up to the next integer value, which is 1. Therefore, for each variant, 3 units will be in the MPS for January, or 300 in total.

For the month of March, where the demand of the product family was 150, can you explain why two units have to be considered in the MPS for each variant?

Solution: An equal option percentage would result in 1.5 units. The deviation of 20% can be included in the calculation before we round up to the next integer value. Thus, the deviation, that is, 20% of 1.5, equals 0.3, resulting in a total of 1.8 units per variant. This value is rounded up to the next integer, or 2 units.

For April, where the demand of the product family was 120, can you explain why only one unit has been considered in the MPS for each variant?

Solution: An equal option percentage would be 1.2 units. The deviation, that is, 20% of 1.2, equals 0.24, resulting in a total of 1.44 units per variant. As the units were rounded up by 0.8 in January and 0.2 in March, the 0.44 units in April are covered in any case. Therefore, it is sufficient to have only 1 unit in the MPS for April.




Course section 7.8: Subsections and their intended learning outcomes