Master Production Scheduling (MPS): Optimizing Production Planning


In manufacturing, effective production planning is crucial for meeting customer demands while optimizing resources and minimizing costs. MPS plays a pivotal role in this process by providing a detailed schedule that aligns production activities with demand forecasts and inventory levels. Let’s delve into the intricacies of MPS and understand how it helps organizations streamline their manufacturing operations.

Definition of Master Production Scheduling (MPS):

Master Production Scheduling (MPS) is a production planning technique that involves creating a comprehensive schedule for manufacturing operations. It serves as the backbone of production planning by specifying what, how much, and when to produce, considering customer demand, available resources, and inventory levels.

Key Components of MPS:

  1. Demand Forecast: MPS begins with analyzing demand forecasts, which can be based on historical data, market trends, and customer orders. It provides insights into the expected demand for the products.

  2. Customer Orders: Customer orders play a significant role in shaping the MPS. By considering the specific orders received, the production schedule can be tailored to meet these demands and ensure timely delivery.

  3. Available Inventory: MPS takes into account the existing inventory levels of finished goods, sub-assemblies, and raw materials. It ensures that production plans are adjusted based on the inventory position to avoid overstocking or stockouts.

  4. Lead Time: The lead time required for procuring raw materials and producing finished goods is an essential consideration in MPS. It helps determine the appropriate timing for starting the production process to meet delivery deadlines.

  5. Production Capacity: MPS considers the available production capacity, including machinery, labor, and other resources. By aligning production activities with capacity constraints, MPS optimizes resource utilization and prevents bottlenecks.

  6. Production Sequencing: MPS establishes the sequence of production orders to ensure efficient use of resources and minimize changeovers or setup times. It helps in scheduling production runs and optimizing the flow of materials through the production process.

Benefits of MPS:

Implementing MPS brings numerous benefits to manufacturing organizations, including:

  1. Improved Customer Service: By aligning production with customer demand, MPS ensures on-time delivery, resulting in increased customer satisfaction and loyalty.

  2. Efficient Resource Utilization: MPS optimizes the use of resources such as labor, machinery, and materials, reducing waste and improving overall operational efficiency.

  3. Inventory Optimization: By synchronizing production with demand, MPS minimizes excess inventory and reduces holding costs, ultimately improving cash flow.

  4. Enhanced Production Planning: MPS provides a structured approach to production planning, enabling organizations to make informed decisions based on accurate data and realistic schedules.


A bakery receives customer orders for cupcakes and needs to create an MPS for the upcoming week.

Key Components:

  1. Demand Forecast: Weekly demand forecast: 500 cupcakes

  2. Customer Orders: Customer A: 150 cupcakes Customer B: 200 cupcakes Customer C: 100 cupcakes Customer D: 50 cupcakes

  3. Available Inventory: Finished Goods Inventory: 50 cupcakes

  4. Lead Time: Lead time for cupcake production: 1 day

  5. Production Capacity: Available production capacity per day: 200 cupcakes

MPS Calculation: 

Step 1: Determine the total production requirements: Customer orders: 150 + 200 + 100 + 50 = 500 cupcakes

Step 2: Consider available inventory and adjust production requirements: Inventory adjustment:

  • Finished Goods Inventory: 50 cupcakes
  • Adjusted production requirements: 500 – 50 = 450 cupcakes

Step 3: Calculate the number of production days needed: Number of days = Adjusted production requirements / Production capacity per day Number of days = 450 / 200 = 2.25 days (rounded up to 3 days)

Step 4: 

Create the daily production schedule: 

Day 1: Produce 200 cupcakes (to meet customer orders and replenish finished goods inventory) 

Day 2: Produce 200 cupcakes (to meet customer orders and replenish finished goods inventory) 

Day 3: Produce 50 cupcakes (to meet remaining customer orders)


Master Production Scheduling (MPS) is a crucial component of production planning that facilitates efficient manufacturing operations. By considering demand forecasts, customer orders, available inventory, lead times, and production capacity, MPS enables organizations to create a detailed schedule that optimizes resource utilization, minimizes costs, and ensures timely order fulfillment. Implementing MPS leads to improved customer service, better resource management, and streamlined production processes.

Remember, mastering the art of MPS empowers organizations to achieve operational excellence and stay competitive in today’s dynamic manufacturing landscape.