Quietly snoozing at my desk the other day I was woken up and asked to explain why a planned production order was creating requirement into the past. It turned out that what was wrong was a mismatch between the lead time calculated for the route on the planned production order and the item coverage’s Production lead time. Now I’ve created a few posts about master planning in general and the item’s safety stock represented as the item coverage record’s minimum quantity – and I’ve frequently laboured the point that as well as addressing the Minimum quantity you also have to think about the setting of the ‘Fulfil minimum’ parameter:
But I confess that up until today I’d never really put a huge amount of thought into where the system’s getting the ‘Procurement time’ from. When dealing with Production items I just pretty much mindlessly trotted out the explanation that, within the item’s Capacity time fence, the system uses the item’s active route to determine the production lead time of a planned production order. But hang on a minute – this is item safety stock. We haven’t got a planned production order (yet) and we don’t know the quantity of that production order until we run our Net requirements calculation – so really the system just has to use another method, and it’s staring us in the face: the Lead time tab on the Item coverage record:
As you can see here, if activated by the appropriate Checkbox, you can set the item/warehouse Purchase, Production or Transfer lead time.
If you don’t over-ride the lead time on the item coverage record you’re going to use the Site specific ‘Inventory’ default:
And that’s getting its default from the Item’s Default order settings:
So the scenario that I discovered went like this. The item safety stock had been setup at 2,000 with a 5 day Production lead time, and Production capacity was about 400 per day – so the planners assumed that they’d be able to cover normal safety stock demands without any problems. But unfortunately the settings on the production route were wrong, and a planned production order for 2,000 was calculating a lead time of around 4 weeks. In the master plan setup they were not using the Futures date as the requirement date for planned production orders (although they had that set on for planned purchase orders) and so the system generated a planned production order with a requirement date equal to the item coverage production lead time (5 working days):
But the demand on the components (the Derived requirements) were calculated based on the production lead time based on the active route and for the required quantity:
Moral: keep your wits about you when setting master planning parameters and make sure that your settings are consistent and realistic.