Material Requirement Planning (MRP) - Basics

MRP is a computer technique, which is decades old but still spreading in manufacturing due to the falling price of computers. Nowadays MRP is embedded in a larger system called ERP.

In repetitive industries MRP has been superseded by JIT, because the works and purchase order generation capabilities of MRP are not required. (JIT organises a continuous flow of incoming materials so the discrete orders of MRP aren't needed.) Whereas in the past ERP systems tended to be built around MRP, these same ERP systems now contain JIT capabilities.

In non-repetitive industries MRP is still a valuable technique, especially in Defence or Pharmaceuticals where lot control is critical.

MRP in its basic form does have one fundamental flaw, and that is the long lead times used. MRP applies standard lead times in determining the timing of material release and manufacturing operations. Now, much disruptive behaviour is normal to the shop floor, such as down time, queuing, shortages and so on. In consequence the lead times must be long enough to give spare time for these eventualities, especially to allow for the inevitable queuing of jobs at each operation. The result is

However, it is hard to see how manufacturing can be conducted without some form of MRP. Schedules still have to be created and material ordered. What is needed is more sophistication. For example, the latest MRP systems have combined the basic form of MRP with the principles of Finite Capacity Scheduling to overcome this problem.