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The company you are employed with has asked for your help in solving an inventory problem. Many of the company’s dependent demand inventory items are cluttering their facilities. Several of these items are coming in weeks before they are actually needed. The quantity ordered for many of these items are excessive as well. This is causing a significant increase in Work in Process inventory on hand during the production period. The additional costs associated with carrying excess inventory and the additional clutter is a concern to management. Management would like to look in the possibility of using MRP to help them handle the ordering and scheduling of their dependent demand inventory. Bill Wiggins, the Vice President of Operations, has asked you to research MRP and to present your findings to management in a written report. Specifically, management would like to know what MRP is, and how it could help solve the company’s inventory problem. Also, management is concerned about the costs of implementing such a system. Much of this information can be found in your textbook. However, you must use the Internet to get additional information such as costs.
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consider the following data.inventory itemaverage demand annualsigma std. dev. of demand during lead timeitem unit
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