Material Requirements Planning (MRP) Material requirement planning

A MRP system — the software implementing the algorithm regulated by MRP methodology and creating results of material aspect of production on the basis of input data.

History and development of MRP systems

During a pre-computer era all tasks of control of availability of materials and component parts were executed by personnel of the enterprise manually. Cards of an inventory control in which information on receipt and consumption of material was specified were for this purpose applied. Such system worked slowly, often glitched as a result of the inevitable errors and inaccuracies caused by a human factor. Its uses resulted the periods during which production stood idle due to the lack of material. At some enterprises of a card of an inventory control are applied to this day.

From the beginning of universal automation in the sixties of the last century programmers found application for computing systems in enterprise planning (in particular, production processes). The method developed by them received the name MRP and purchased wide circulation around the world. Orientation to future requirements and neglect data on consumption in the past became the main difference of new methodology from the manual system preceding it. Actually, with the advent of MRP systems orders for replenishment of warehouses began to form as required and in the necessary amount.

In the late seventies the last century of a possibility of MRP systems were expanded for the realization account of the idea of reproduction of a closed loop. In particular, the following functions were added:

• control of compliance of quantity of the made products to quantity of the used products;
• drawing up regular reports on delays of orders, amounts and dynamics of sales and suppliers.

Further improvement of a system caused conversion of the MRP system with a closed loop in expanded modification which was called afterwards by MRP II (Manufactory Resource Planning). This system was created for effective planning of all (including, financial and personnel) resources of manufacturing enterprise.

Production scheduling systems develop constantly, trying to be in time behind all innovations of production process.

Principle of functioning of MRP systems

Basic information items of a MRP system

The schedule system of material requirements calculates the purchase plan of necessary components and the production schedule on the basis of the specification of a product, the forecasted demand and technology nuances of production. A MRP system can also independently calculate completion dates and the production schedule.

The cycle of work of a MRP system consists of the next stages:

• determination of the optimal diagram of production for the planned period on the basis of the analysis of the adopted program of production;
• material accounting, not included in the production program, but present at orders;
• calculation of complete need for each material according to structure of an end product;
• calculation of true need for each material and drawing up orders for material;
• entering of amendments into the created orders for the purpose of prevention of untimely deliveries.

As a result a system issues the plan of orders with operational changes and a number of office reports. A classical MRP system issues the following results at the exit:

• Plan of Orders. It defines what amount of each material should be ordered during each considered time frame during planning term. The plan of orders is the management for further work with suppliers and, in particular, defines the production program for domestic production of component parts, in the presence of like that.
• Changes to the plan of orders. They are modifications to earlier planned orders. A number of orders can be cancelled, changed or delayed and also are postponed for other period.

In principle, a MRP system can supply the user and other additional results which are represented in a report form. Can be the most demonstrative:

• Report on forecasts. Information for the analysis and long-term planning.
• Executive report. Indicator of correctness of accomplishment of all transactions. Whether here the user can correctly trace all instructions were followed whether was failure in system operation.
• Report on delays. Data on the most problem orders, time of execution of certain functions and the other moments which can affect further efficiency.

Planning of office capacities

In a MRP system it is possible to select such component as a subsystem of production capacity planning (Capacity Requirements Planning, CRP). The CRP module is used for the purpose of verification of the trial program of production created on the basis of demand forecasts on products, on a possibility of its implementation by means of available production resources.

If the program of production maintains a cycle of operation of the CRP module, then it begins interaction with a MRP system, otherwise amendments are introduced in the program, and it is exposed to repeated testing by means of a subsystem of production capacity planning.

See Also

• CRP
• ERP
• MRP II

Links

• Material Requirements Planning
• MRP и MRP II
• Bases of the systems of the class MRP-MRPII
• Materials requirement planning of MRP
• What is MRP and MRP II