Simulating the Impact of Forecast Related Overbooking and Underbooking Behavior on MRP Planning and a Reorder Point System

Research output: Contribution to conferencePaperpeer-review

Abstract

Production Planning and its parameterization is critical to fulfil customer demands and to successfully react
on changes in high volatile markets. Therefore, demand updates should be considered to improve
production planning. In this paper the performance of two production planning methods MRP (Material
Requirements Planning) and RPS (Reorder Point System) are compared in a multi-item single stage system
where customer orders are updated in a rolling horizon manner. Applying a simulation study, we investigate
the performance of MRP and RPS for biased and unbiased forecast information and discuss the difference
in the optimal planning parameters. The study shows that for a production system with underbooking and
low demand uncertainty, RPS method is superior, in all other scenarios MRP outperforms RPS. For
overbooking scenarios, the results show that MRP leads to overall cost improvements ranging from 8 to 30
%.
Translated title of the contributionSimulation der Auswirkungen von vorhersagebedingtem Überbuchungs- und Unterbuchungsverhalten auf die MRP-Planung und ein Nachbestellpunktsystem
Original languageEnglish
Publication statusPublished - 2023

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