| bill of materials (BOM) | one of the three primary inputs of MRP; it lists the raw materials, parts, subassemblies, assemblies and assemblies needed to produce one unit of the product.
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| capacity requirements planning | the process of determining short term capacity requirements.
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| changes | revision of due dates or order quantities, or the cancellation of orders.
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| component | any ingredient of a product; this could include, for example, a raw material, subassembly, assembly or end item.
cumulative lead time; the sum of the lead times that sequential phases of a process require, from ordering of parts or raw materials to completion of final assembly.
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| dependent demand | demand for items that are subassemblies or components to be used in the production of finished goods.
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| enterprise resource planning (ERP) | an expanded effort to integrate standardized record keeping to permit information sharing among different areas of an organization.
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| exception reports | data on any major discrepancies encountered.
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| gross material requirements | total expected demand for an item or raw material in a time period.
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| independent demand | the demand for finished goods, or the demand for products or services which are not incorporated into other products or services.
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| inventory records file | one of the three primary inputs in MRP; it includes information on the status of each item by time period.
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| level | in a product-structure tree, a code that assigns a stage number of an assembly, showing how many stages there are between the component and the end item 0 for end item, 1 or first level, 2 for second level, etc.
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| load report | a department or work center report that compares known and expected future capacity requirements with projected capacity availability.
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| lot-for-lot ordering | MRP with planned-order releases and planned-order receipts matching net requirements exactly.
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| lot sizing | choosing a lot size for purchasing or production.
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| master schedule | one of the three primary inputs in MRP; it states which end item are to be produced, when these are needed, and in what quantities.
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| MRP (Material Requirements Planning) | a computer-based information system designed to handle ordering and scheduling of dependent demand components.
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| MRPII (Manufacturing Resource Planning) | not a replacement for MRP nor an improved version, it is an expanded approach to production resource planning, involving other areas of the firm, such as marketing and finance.
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| net-change system | MRP that is updated continuously, every transaction is posted by the computer, and the changes in available quantities and requirements are made in real time.
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| net material requirements | the actual amount needed in each time period; the difference between gross material requirements and the amount on hand.
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| order releases | authorization for the execution of planned orders.
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| part-period model | part-period refers to holding a part over a number of time periods. The model attempts to balance setup and holding costs.
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| pegging | the process of identifying the parent items that have generated a given set of material requirements for an item.
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| performance control reports | report on deviations from plans and include cost information.
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| planned-order receipt | quantity expected to be received by the beginning of the period in which it is shown.
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| planned-order release | the planned amount to order in each time period.
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| planned orders | a schedule indicating the amount and timing of future orders.
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| planning reports | data useful for assessing future material requirements.
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| primary reports | reports prepared based on standard MRP parameters, such as planned-order schedules, order releases, and changes to planned orders.
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| product-structure tree | visual depiction of the requirements in a bill of materials, where all components are listed by levels.
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| projected on hand | the expected amount of inventory that will be on hand at the beginning of each period.
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| regenerative system | MRP that is updated at regular intervals of time.
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| scheduled receipts | open orders scheduled to arrive by the beginning of a time period.
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| time bucket | a unit of time (e.g.. a week), for purposes of measuring the duration of an MRP operation, such as receiving or releasing an order, or the lead time.
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| time fences | A series of time intervals in which restrictions are placed on changes to the master schedule. The nearest time fence is the most restrictive.
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