MRP

MRP 2

ERP
Introduction
General Electric and Rolls Royce developed the first computerized
Material Requirement Planning (MRP)System in the early 1950s. The
program was released in the 1960s for other manufacturers to use.

• The first generation of MRP systems, or MRP I, was designed to

recognize the relationships between raw materials, parts, assemblies,
and products.
• These make up the bill of materials (BOM) that is the foundation of
MRP. MRP focuses on determining the materials required in the
production process.
• It helps you get answers to questions such as: What items are necessary
for production? When are they required? How many are needed?
Functionality of MRP Benefits of MRP
• To maintain the minimum required • Optimized Inventory
stock
• Lower Costs
• To ensure raw materials are available
for production • Increased Productivity
• To ensure finished goods are ready for
on-time delivery
• To plan manufacturing activities,
delivery schedules, and purchasing
activities
Benefits of MRP 2 over MRP
1. Purchase Planning
2. Forecasting Demand
Difference between MRP and ERP
ERP is different from MRP and MRP II because it offers:

• Real-time visibility, insights, and collaboration

• Automation of manual processes across the organization
• A single and consolidated database
• A common user interface
• Modules that manage critical functions of an organization
• Integration across functions, departments, and data

ERP has everything you need in a single system. This eliminates IT hassles and
ensures a streamlined workflow.
 Summary
 Manufacturers need to be able to keep their supply
chain optimized. Efficient resource management
ensures low inventory costs and on-time deliveries. Not
having control over resources can hurt a business’s
reputation.

 MRP, MRP II, and ERP streamline manufacturing and

business operations in an organization. Technology,
globalization, and complexity have brought about new
functionality. Manufacturing software has evolved from
MRP to MRP II to ERP.

 ERP can reduce costs, increase profitability, improve

internal collaboration, and increase customer
satisfaction. It helps businesses manage critical
functions.