Assembly manufacturing has been fast integrating into engineering production. Although many benefits such as fast and efficient production of parts have emerged from assembly manufacturing, a major challenge that is inherent in assembly manufacturing is inventory control. Fortunately, Material Requirement Planning has emerged as an important tool that has especially helped to tackle the problem of inventory control in manufacturing. Using the MRP approach, it is now possible to determine and plan for all the materials that are required for the production of finished components beforehand. To Increase efficiency, save on costs, and update their systems to advanced and better technologies, a host of companies in the United Arab Emirates have been incorporating MRP into their systems. In setting up a framework of Material Requirement Planning into their systems, Companies in the UAE have encountered a number of challenges. For UAE enterprises to be able to move into efficient and effective manufacturing, they need to overcome deterring challenges while implementing MRP systems.
How MRP Systems Work in the UAE
Like any other place where an MRP system has been installed, the development of what is commonly known as a Master Planning Schedule (MPS) forms the first step in the implementation of an MRP in the UAE (Harhen 15). In summary, a Master Planning Schedule is intended to give a projection of all the components that are required to manufacture parts and, also provide a projection of forecasts and demands (Harhen 15). In developing a MPS, companies in the UAE normally consider periods within which the MPS is developed (time buckets) (Harhen 16). Time bucket periods commonly range from a daily basis to a weekly basis. Another important parameter that is normally considered during the development of an MPS is how far one can project and plan into the future through a MPS (Planning horizon) (Harhen 16). For a project manager to project a time horizon, he/she needs to have beforehand knowledge on demands from customers; moreover, he/she needs to come up with a time period that is necessary for a manufacturing process to be completed (Lead time) (Harhen 16). In essence, a MPS forms a kind of a loop that moves from one level of production to another until all the required information on all the materials and components that are required to finish a manufacturing process is completed. Such information is very important for the purpose of requesting materials from suppliers and also for supplying required items to a given customer on time. At one level of production are parts, followed by sub-assemblies and so on until a complete assembled unit is obtained.
In an MPS loop, an important stage is the explosion stage. Here, a tool known as a Bill of Material (BOM) is utilized (Harhen 17). Essentially, a BOM provides important information on the number and type of parts that are needed for the production of every item that is required for the manufacture of a complete assembly (Harhen 17). The number and type of every part that is needed for the production of parts and sub-assembles are thus known with the aid of a BOM. Normally, a complete assembly is exploded into sub-assemblies in various levels until the final parts that are needed to come up with the complete assembly are known (Harhen 17).
The levels that have been described above determine the number of loops that are run in a MPS to obtain information on all the numbers and types of parts that are needed for a final product to be manufactured. Once an explosion has been done (In a particular loop), the next thing that is done in an MPS system is what is commonly referred to as Netting (Harhen 17). Here, available parts (materials) from available stock are deducted from the number of materials (parts) that have been determined as necessary to develop a component at a given explosion stage (Huntington 40).
The final stage that is normally implemented in an MPS loop is what is commonly referred to as offsetting. Here, one calculates the period of time that is needed for the production of an item (under the conditions of a given manufacturing setup); also, one determines when manufacturing must begin so that a required item is available on time (Harhen 18). In order to determine time offsets, one needs to have information on the time that would elapse before a needed component to complete an item is available from a supplier; besides, one needs to also know the time that it would take the manufacturing facility to avail the required part (In Internal supply cases) (Huntington 48). As I had stated, once the offsetting stage is completed in an MPS system, one moves to the next level in the loop (By repeating all the stages in an MPS system at that level) until the number and parts of all the components that are needed for the production of a finished assembly is known (Huntington 61).
Challenges that are met when Implementing an MRP in the Local UAE
A number of challenges have been encountered by companies that operate in the UAE while implementing an MRP system. Considering that many MRP systems that operate in the UAE are relatively young, common challenges that are present during the early stages of an MRP implementation process are felt here (UAE). Among the common challenges that have been encountered by enterprises while implementing MRP systems include difficulties in selecting an ideal software and hardware system for an MRP system (Howard 127). It is always difficult to determine a system that will embed well into an enterprise with fruitful benefits. With limited knowledge in MRP systems at the onset, many company managers have been compelled to seek advice from an array of professionals and outsourcing companies (Howard 127). This direction of outsourcing information can even lead to confusion due to a host of conflicting information that can be presented to the concerned enterprise (Huntington 48).
According to their design, MRP systems must be fed with high-quality data that is highly accurate in order to operate effectively. Many enterprises that operate in the UAE have systems of measurement that cannot provide the type of data that is required for an MRP system. Once such an enterprise adopts an MRP system, the result is inaccurate outputs such as wrong lead times (Howard 130). Without the aid of experts and the cooperation of project managers, resolving the problem of inaccurate data may prove impossible to solve (Harhen 21). The problem of inaccurate data is one of the non-projected difficulties that are encountered when implementing an MRP (Huntington 48).
Another challenge that is commonly encountered by companies in the UAE while implementing an MRP system is the challenge of restructuring and re-designing their enterprises in a way that will fruitfully accommodate an MRP system (Howard 134). For example, the aspect of responsibility on the part of employees that have a role of entering data into an MRP is raised (Howard 134). Making a small mistake here can be catastrophic. Hence, an enterprise may be forced to evaluate the managerial ladder and structure. As it can be expected, an MRP will automatically alter many aspects of an enterprise; hence, a need to restructure. Restructuring an enterprise is hardly an easy task; thus, presenting a challenge to a company that is adopting an MRP system (Huntington 51).
When an MRP system is incorporated into a company, requirements from company employees shift considerably. Company employees are not required to continue operating in the same way that they were operating before an MRP system was adapted (Howard 142). It is a well-known thing that many human beings are averse to changes. The challenge of accommodating and adopting the necessary changes that are required in the behavior of employees (for an MRP system to work) has been common in UAE enterprises. Such a scenario is even exacerbated by the fact that an MRP system is bound to present problems during its initial stage of implementation. Many employees will therefore complain that the system is non-beneficial; hence, withdrawing their important support for the system (Howard 146). Some employees may even work to sabotage the MRP system.
And of course, the difficulty of obtaining competent professionals to help in the running of MRP systems has remained a great challenge to many manufacturing companies that have opted for MRP systems in the UAE (Harhen 23). There might be a need to import expensive manpower from developed nations to help in running an MRP system (Howard 149). Such a move is especially true considering that the difficulty of tailoring an MRP system so that it can embed into the technical system of a company is always present. Although a UAE enterprise with an MRP system can opt to outsource professional services, locally designed solutions (which are hardly available in the UAE) should always be prioritized
In an endeavor to embed updated technologies in manufacturing that have brought a range of benefits to users in other parts of the world, a number of enterprises in the UAE have adopted MRP systems. Considering their complex nature, it is only possible to accrue benefits from MRP systems when the systems galvanize with core aspects of an enterprise. Issues on technical and behavioral compatibility of an enterprise system with an MRP system are some of the important issues that an MRP project manager needs to consider. Such issues have presented an array of challenges to UAE enterprises that have been toiling to implement MRP systems. Considering that most of the UAE enterprises that have been adopting MRP systems are still in the stages of infancy, a number of challenges that have been encountered in the direction of Implementing MRP systems have been enormous. However, with no known alternative to an efficient system of inventory management, it can only be hoped that many enterprises in the UAE would move in a direction of Implementing MRP systems successfully.
Harhen, John. “Material Requirements Planning (MRP)” University of Cambridge press. 2002. Web.
Howard, Frank. “Challenges in MRP for Small and Medium Companies” Scribble Press. 2008. Web.
Huntington, Evans. “Challenges when Implementing MRP for the First Time” Scribble press. 2010 Web.