Analysis of standard ordering policies within the framework of MRP theory

Abstract

A number of different standard ordering policies are presented within the methodology of Material Requirements Planning (MRP), such as Lot-For-Lot (L4L), Fixed Order Quantity (FOQ), Fixed Period Requirements (FPR), etc. In MRP theory the time development of the production-inventory system is determined by a set of fundamental equations for available inventory, total inventory and backlogs using Input–Output Analysis for capturing the Bill of Materials and Laplace transforms for describing the advanced timing requirements. This paper aims at formally introducing standard ordering policies into the fundamental equations of MRP Theory in order to analyse the possibility to obtain closed-form expressions for the time development of the system, when such rules are applied.

Keywords:

• Material Requirements Planning
• Ordering policy
• Lot-For-Lot
• Fixed Order Quantity
• Fixed Period Requirements
• Laplace transform
• Input–output analysis