DEMAND-DRIVEN MRP IN IFS APPLICATIONS 10: ALL YOU NEED TO KNOW!

Apr 17, 2019

Are you a modern manufacturing company that needs to rely on a robust ERP system to manage a challenging business environment? If you’re the CEO or CIO of such a manufacturing organization, you may be wary of a number of issues that you may face. Material and spare part shortages can disrupt the flow of your work. Monitoring and maintaining inventory performance, service levels, lead times, reduction of waste and related expenses, etc. are all issues you have to deal with on a regular basis.  

If you still rely on excel sheets, access-based mini-systems, error-prone manual cut-and-paste jobs, or even hand-written whiteboards, you might soon find yourself hitting a glass ceiling. IFS, the global applications company, understands that and has worked very hard to integrate the latest and best demand driven material requirements planning (DDMRP) methodologies into their latest instalment of IFS - IFS Applications 10. Dynamic business environments today have seen product life-cycles grow shorter, a growth in more individualized products and reducing lead times. Demand-driven MRP proves to be an effective solution in such conditions, and can lead to a 40% reduction in inventory, or an 80% reduction in lead times, according to IFS website. This has led IFS to create IFS Applications 10 which is now compliant with the Demand Driven Institute

Why use demand driven material requirements planning (DDMRP)?

As the world has become more and more ‘digital’, customer patience and customer tolerance have reduced significantly. Everyone expects services as they want it, where they want it, and how they want it. Pricing fluctuates much more now based on demand and supply. Enterprise planning systems need to adapt with these changes in customer behavior and must modify their master scheduling accordingly to get forecasts right. The software must also be able to account for the bullwhip effect. IFS have devised IFS 10 in such a way that it can do all of these things. Let’s see how.

How does IFS Applications 10 help demand driven material requirements planning (DDMRP)?

IFS Applications 10 uses decoupling points buffers. This implies the quantity of inventory that will provide a ‘reliable’ availability to customers. They also allow aggregation of demand orders and help build a stable supply signal to the supply chain much like wave breakers in a marina.

IFS Applications 10 shows unprotected lead time for demand-driven MRP. The unprotected lead time refers to the longest accumulative time of the production chain. Unprotected lead time is a highly theoretical unit because it thinks there are no parts available. But, if you buffer some parts and make them always available, the unprotected lead time unit can just be calculated as the time from the buffered components to the finished product. By bringing the buffers up the process, you can build shorter unprotected lead times and gain a competitive advantage for your company.

IFS Applications for manufacturing uses strategic stock buffers, that must never be netted to zero. These strategic buffers decouple material requirements planning (MRP) from demand-supply positions and create resupply orders as a function of buffer positions.

The 5 IFS DEMAND-DRIVEN MRP STEPS

Step 1). Define your strategic inventory position, ie. tell IFS which parts to buffer.

Step 2). Create buffer profile and levels.

Step 3). Build dynamic adjustments.

Step 4). Finalize demand-driven planning.

Step 5). Sustain visible and collaborative execution to manage supply orders.

The IFS Applications buffer system is color coded. Green is viewed as ‘okay’, yellow equals replenish and red refers to some problem on its way. You can consider your average daily use of units when planning these buffer levels to manage your operations better with IFS for manufacturing.

Ready to reap the benefits of demand driven MRP with your upgraded IFS Applications? Learn about how you can upgrade IFS with ProV.

ProV is a multiple award-winning partner for IFS ERP and IFS FSM. ProV’s competitive IFS Applications pricing and best-in-class services for IFS implementations, IFS software support, and IFS customizations help simplify you achieving the most from your software investment.  Take our FREE Consultation today to get started! 

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Topics: IFS Applications, ifs upgrades, ifs financials, ifs applications 10, IFS ERP, WHy upgrade ifs