Page 50 - MetalForming September 2016

The Challenges of Modern Material
Requirements Planning
The right MRP system can deliver improved utilization of facilities and resources, better inventory planning and scheduling, faster response to market demand and changes, increased customer satisfaction, and, ultimately, increased profits...if potential pitfalls are addressed.
BY SCOTT JESSUP
Material requirements planning (MRP) came onto the manu- facturing scene six decades ago in response to the introduction of lean production by Toyota. Essentially a computerized production-planning and inventory-control system, MRP integrates data from a variety of sources including inventory, production sched- uling and bills of materials to calculate the most efficient and effective pur- chasing and shipping schedules for parts, components and subassemblies required to manufacture a product.
MRP 101
Over the years, as manufacturers have become increasingly dependent upon software-based business and operational processes, some have confused the func- tionality and roles of MRP and ERP (enterprise resource planning). It’s easy to see why. There are, in fact, two MRPs: material requirements planning as dis- cussed in this article, and its offshoot, manufacturing resource planning (often referred to as MRP II), which broadened the scope of software-system use in manufacturing beyond material require- ments planning into other aspects of
Scott Jessup is a senior-level consultant for Visual Business Solutions, Inc., Roscoe, IL; 330/929-0600, www.visual- business.net.
the manufacturing process. As a second generation of MRP, MRP II is a closed- loop system that uses production plan- ning to drive the master schedule, which in turn drives the material plan that provides the capacity-plan input. At the end of a production cycle, feedback informs a reiterative process that further tweaks the manufacturing operation to wring even more efficiencies out of it and help further reduce waste.
MRPIIeventuallyevolvedintoERP, which added business processes such as customer-relationship manage- ment, accounting and data manage- ment to the mix. For some manufac- turing businesses looking to simplify their IT infrastructure with a single process-management platform, it might be okay to roll MRP functionality (in both its forms) into an ERP system. However, there are some risks involved, especially if the user’s manufacturing processes and material-handling needs are fairly complex and if the ERP system in use is not rooted in manufacturing.
Regardless of the confusion between MRPandERP,MRPplaysanessential role in manufacturing, enabling the production process to proceed smooth- ly and efficiently. As an inventory-man- agement system, MRP not only helps production managers plan and sched- ule raw-material purchases, it also helps reduce waste by minimizing both raw
48 MetalForming/September 2016
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