Category: Master Planning (MRP)

Dynamics 365 Finance and operations – Master Planning Overview

What is Master Planning ?

A grouping of business processes that includes the following activities:-

• Demand management, which includes the forecasting of sales, the planning of distribution, & the servicing of customer orders
• Sales & operations planning, which includes sales planning, production planning, inventory planning, backlog planning & resource planning
• Master scheduling, which includes the preparation of master production schedule & the capacity plan

Master Planning Flow Diagram

Types of Master Plans

• Static plan:- The static plan remains unchanged until the next time that you run the master planning task, and provides a stable basis for analysis and actions.

• Dynamic plan:- The dynamic plan will be updated by subsequent transactions, which can result in constant changes to planned orders, for ex. in case of Make to Order products.

  NOTE:- While creating a new Master Plan, you can specify whether to include:-

1. On-hand inventory
2. Inventory transactions
3. Sales Quotations
4. RFQ
5. Purchase Requisitions

One master plan versus Two master plans

• Use of one plan

Master Planning is run for the same plan (Static Plan) which uses information about demands and supplies and several master plan policies which are defined in Master Planning parameters.

• Use of two plans

Master Planning is run for the Static Plan, and the set of data is automatically copied to the dynamic master plan.

=> The static plan remains unchanged until the next time that you run the master planning task, and provides a stable basis for analysis and actions.

=> The dynamic plan will be updated by subsequent transactions, which can result in constant changes to planned orders.

Master Planning parameters

General Parameters

• Set default Static Master Plan, Dynamic Master Plan, Forecast Plan & Coverage Group.
• Copy Static Plan to Dynamic Plan

Planned Orders Parameters

• Set up to consider Vendor Trade Agreements based on Minimum Lead Time or Lowest Unit Price.

Standard Update Parameters

• Set up for Inventory Marking policy, Grouping of Planned Purchase Orders & Planned Transfer Orders
• Set up to consider Purchase Agreements for planned purchase orders

Coverage Group

• Coverage group handles how master planning views the item while running Master Planning.
• Parameters specified in a Coverage Group will determine how net requirements will be calculated for the item for the generation of planned supply orders to meet demands.
• If Coverage Group is not mapped with an Item in “Item coverage” form, system will use the default Coverage Group which is specified in the General Master Planning parameters.

Coverage Group Policies

Options (policies) available for Coverage Group:-

=> Period

=> Requirement

=> Min-Max

=> Manual

Period

When an item’s projected inventory reaches zero (or its minimum quantity), master planning calculations will suggest a planned order with a quantity that covers demands over the period size, which we are mentioning in “Coverage period” field.

This option is useful for “B” inventory class items.

Requirement

When an item’s projected inventory reaches zero (or its minimum quantity), master planning calculations will suggest a planned order and quantity that covers each individual demand.

This option is useful for “A” inventory class items.

Min-Max

When an item’s projected inventory falls below its minimum quantity, master planning calculations will suggest a planned order with a quantity that achieves the item’s maximum quantity.

This option is useful for “C” inventory class items.

Manual

Master planning calculations will not suggest planned orders, but it does calculate requirements to support manual planning efforts.

Role of Default Order Settings in MRP

In “Default order settings” form, we can specify the order type which system should create after running MRP. We can do this set up for different sites as well.

Here, we can mention minimum order quantity, maximum order quantity, standard order quantity & multiple order quantity which system will consider while creating a planned order after running MRP.

Role of Item Coverage in MRP

On “Item coverage” form, we can specify the settings for a specific item which will override the settings set in “Default order settings” form & the “Coverage code” mapped in the “Coverage group” for that item.

Approaches to Run Master Planning

• Regeneration– Delete existing planned orders, and generate new planned orders based on all known requirements.
  • For ALL Items:- Will automatically delete existing planned orders (and related planned capacity requirements) and generate new planned orders based on all known requirements.
    In case of 2 master plans, if we run Master Planning for Static Plan, then the resulting set of master plan data will be automatically copied to the Dynamics Plan.
  • For SELECTED items:- Will NOT automatically delete existing planned orders. Planned orders must be deleted before running the Master Planning.
    In case of 2 master plans, if we run Master Planning for Static Plan, then the resulting set of master plan data will NOT be automatically copied to the Dynamics Plan.
• Net change – This approach is applicable ONLY when we are running the Master Planning for Dynamic Plan. It will generate planned orders that cover only those requirements that were created or changed since the Master Planning task was last run. However, Action dates and Futures dates are updated for all requirements.
• Net change minimized – This approach is similar to “Net change” except Action dates and Future dates will ONLY be updated for new or changed requirements