Making MRP Work

Vendors must address long-standing problems with capacity planning, lot sizes and lead-times

By Gregory W. Diehl & Aaron J. Armstrong

Materials requirements planning (MRP 1), developed in the 1960s and 1970s, offered an important breakthrough for shop floor managers by linking production plans for finished goods with the supply of the component parts required to achieve those plans. The idea was to ensure that enough of the correct components were on hand to build assemblies, such as cars, before the parts were needed. Recognizing that labor and machines were key requirements, manufacturing resource planning (MRP 2) extended the idea of production requirements to include the number of labor-hours and machine-hours needed at each work center in a plant. However, as is so often the case, providing insight and structure to address one set of issues often reveals deeper and more complex challenges that managers must address.