A Comparison of Strategies to Dampen Nervousness in MRP Systems

Abstract

This research examines the effectiveness of alternative strategies for dealing with the problem of order instability, or nervousness, which occurs in Material Requirements Planning systems. Nervousness can be particularly disruptive in multi-level production processes where a change in order size or timing at one level can result in changes at other levels. This study proposes and evaluates five different strategies for treating nervousness caused by the interaction of lot-sizing decisions and the planning horizon. Not evaluated here are the effects on order instability caused by demand uncertainty or supply and lead-time uncertainty. The five strategies examined are: (1) Freezing the schedule within the planning horizon, (2) Lot-for-Lot after stage 1, (3) Safety stocks, (4) Forecast beyond the planning horizon, and (5) Change cost procedure. A series of simulation experiments was conducted to test the effectiveness of the five strategies on schedule stability and system costs. The experiments were constructed to evaluate the impacts of various lot-sizing methods, the length of the planning horizon, setup and holding cost parameters and product assembly structure. The results indicate that when the source of nervousness is due to changes in decisions caused by a rolling planning horizon, safety stock and lot-for-lot approaches are not cost effective. Under most conditions, the strategies of incorporating a change cost to discourage schedule changes or freezing the schedule within the planning horizon appear to be dominant.inventory/production: operating characteristics, inventory/production: simulation, inventory/production: planning horizons

A Nervousness Regulator Framework for Dynamic Hybrid Control Architectures

“…In this case, the nervousness is defined by the difference between the planning and the real execution of operations. Subsequently, the term evolved to the instability derived from internal/external changes or perturbations that cause the system process to be treated as an exception [2,9]. However, the changes occurring on internal and external levels can be either great enhancement opportunities or extremely disruptive events for the system's behaviour [11].…”

Freezing the master production schedule under single resource constraint and demand uncertainty

“…Blackburn et al (1986Blackburn et al ( , 1987 investigated five different strategies for reducing MRP nervousness and found freezing the MPS to be among the most effective strategies. Sridharan et al (1987Sridharan et al ( , 1988 developed a method to measure schedule instability and studied the impact of MPS freezing upon inventory costs and schedule instability in single-level MPS systems under deterministic demand.…”

“…Several methods have been suggested to reduce schedule instability in MRP systems (Blackburn et al, 1986(Blackburn et al, , 1987. One frequently used method involves the freezing of the MPS.…”

Mathematical Programming Approaches for Stable Tactical and Operational Planning in Supply Chain and APS Context

“…The term stability is generally opposed to "nervousness" (Blackburn et al, 1986;Ho, 1989;Minifie, 1990). De Kok and Inderfurth (De Kok and Inderfurth, 1997) have defined the term as "a lack of stability in the material requirements planning".…”