MATERIAL REQUIREMENTS

PLANNING MRP MEANING:

A COMPREHENSIVE GUIDE
ADMINISTRACIÓN DE OPERACIONES II
INTEGRANTES
01 Villanueva Ferrer Paula Camila

02 Tenorio Castro Lizbeth Sarahi

03 Flores Arroyos Fatima Maria

04 Santiago Avitu Marlon Jair

05 Torres Barbosa Cristofer

06 Guerrero Aleman Edgar Ricardo

 1. INTRODUCTION TO MRP
MRP, or Material Requirements Planning, is a software-based integrated inventory and supply management
system designed for businesses. It is used to plan manufacturing, procurement, and delivery schedules for
components, materials, and finished products, based on customer demand.

The main objective of MRP is to ensure that materials and components are available when needed in the
production process, that manufacturing takes place on schedule, and that finished goods are delivered to
customers in a timely manner. This is achieved through demand estimation, inventory management,
production planning, and scheduling.

In essence, MRP helps businesses answer three crucial questions:

What is needed (raw materials, components, and sub-assemblies)?
How much is needed (quantities of each item)?
When is it needed (timing of delivery and production)?

By providing answers to these questions, MRP enables businesses to optimize their production inventory
management, streamline their supply chain, and improve overall operational efficiency.
 2. HISTORY OF MRP
MRP, or Material Requirements Planning, is a software-based integrated inventory and supply
management system designed for businesses. It is used to plan manufacturing, procurement, and
delivery schedules for components, materials, and finished products, based on customer demand.
MRP systems have their roots in the manufacturing industry, with the earliest computer-based
inventory management systems developed in the 1940s and 1950s. The concept of MRP was
formalized in the 1960s by Joseph Orlicky, an IBM engineer inspired by the Toyota Production
System. The adoption of MRP systems grew throughout the 1970s and 1980s, leading to the
development of more sophisticated MRP II (Manufacturing Resource Planning) systems, which
incorporated additional business functions like marketing, finance, and human resources.

Over time, MRP II systems evolved into Enterprise Resource Planning (ERP) systems, which
expanded the scope of MRP to encompass various aspects of a business, such as accounting,
customer relationship management, and supply chain management.
 3. MRP VS. MRP II AND ERP

It is essential to distinguish between MRP, MRP II, and ERP systems, as each serves a different
purpose in managing a business's resources.

MRP Systems
MRP systems primarily focus on material requirements planning, production planning, and inventory
control. These systems help businesses determine the optimal amount of raw materials, components,
and sub-assemblies needed for production. MRP systems also aid in scheduling production and
managing finished goods inventory levels.

MRP II Systems
MRP II (Manufacturing Resource Planning) systems build upon the functionalities of MRP systems by
incorporating additional business functions, such as marketing, finance, accounting, and human
resources. MRP II systems provide a more holistic approach to resource planning, allowing businesses
to manage not just their production processes but their entire operation.
 3. MRP VS. MRP II AND ERP

MRP Systems
Enterprise Resource Planning (ERP) systems are an extension of MRP II systems,
designed to manage resources across an entire organization. ERP systems include
advanced functionality in areas like financial management, customer relationship
management, sales order management, and more. These systems integrate various
business functions into a single, centralized database, streamlining tasks and processes
across the organization.
 4. IMPORTANCE OF MRP FOR RETAILERS
Material Requirements Planning is crucial for retailers, whether they produce their products
or source finished inventory from manufacturers. MRP systems ensure that manufacturers
and businesses maintain adequate inventory levels to meet customer demand while
minimizing inventory holding costs.

By providing visibility into production inventory levels and demand, MRP systems help
businesses optimize their supply chain, improve production efficiency, and increase
customer satisfaction. MRP is essential for retailers in managing their inventory, meeting
customer demands, and ensuring timely delivery of products.
 5. KEY FEATURES OF MRP SYSTEMS
While the specific requirements of an MRP system may vary depending on a business's
unique needs, several essential features should be included in every MRP system:
Demand Estimation
An MRP system must be able to estimate customer demand and calculate the required
material quantities based on the bill of materials (BOM) and production plans.
Inventory Management
An effective MRP system must provide real-time visibility into inventory levels and facilitate
the efficient movement of materials throughout the supply chain.
Production Planning
An MRP system should support the planning and scheduling of production processes, taking
into account factors like equipment, labor, and material availability.
Scheduling Production
A good MRP system must be able to generate accurate production schedules, taking into
account lead times, material availability, and production capacity.
 5. KEY FEATURES OF MRP SYSTEMS

Scheduling Production
A good MRP system must be able to generate accurate production schedules, taking
into account lead times, material availability, and production capacity.
Monitoring and Reporting
An MRP system should offer comprehensive monitoring and reporting capabilities,
allowing businesses to track progress, identify bottlenecks, and make data-driven
decisions to optimize their operations.