In a manufacturing facility, it is essential that you ensure that materials and resources are fulfilled within the time frame requested. This can be a complex task as potential issues such as a supplier’s factory going down or transportation vehicles breaking down can arise.
Material Requirements Planning (MRP) is a vital component to any manufacturer’s supply chain to efficiently develop a plan and manage materials within production.
What is MRP?
Material Requirements Planning (MRP) pertains to the methodology of planning the production of goods by translating master schedule requirements for end items into time-phased requirements for sub-assemblies, components, and raw materials.
The master schedule specifies the quantity and need date of an item while the Material Requirement Plan specifies the quantities and timing of raw materials and components required to achieve the master schedule.
The goal of MRP is to answer the following questions:
- What is needed?
- How much is needed?
- When is it needed?
Utilizing a Material Requirements Planning software makes it much easier for planners to order and organize the materials that are required for production. Through MRP, the need for manual materials planning is eliminated and the system is able to successfully carry out an adequate strategy.
MRP has become a vital component in allowing manufacturers to keep up with a consistently growing demand. Before implementing a software with MRP capabilities, it is important to understand the features that will be most beneficial for manufacturers.
Features of MRP That are a Must for Manufacturers
The 3 features of MRP that are a must for manufacturers include the following:
- Demand Forecasting - Demand planning and forecasting is a substantial component pertaining to MRP as the process uses actual or forecasted demand to determine the type and quantities of materials required for production. Accurately predicting demand is key to eliminate potential inventory issues such as producing too much or too little items within the required time frame. This will allow you to minimize your inventory holding costs and and fulfill orders on time.
- Purchase Planning - The core of MRP pertains to planning which is the procurement and sourcing of raw materials that are needed to supply the incoming demand. One of MRP’s primary goals is giving your purchasing department a better view of what is needed to complete a job, whether it has been ordered or is being forecasted. A clear list of materials that are needed along with the required quantities will ensure that you will have enough materials on hand. Purchase planning is an essential component in planning and scheduling and manufacturers should look into MRP software with this capability.
- Production Scheduling - Once the materials and available inventory have been determined and purchases have been made, you must schedule your production. This step involves looking at production times, and required resources and the labor you need to complete your production orders. A production scheduling software that can develop a finite schedule will play a key role in determining production times and lead times to ensure that you can purchase your materials and get them on time for production.
Implementing an MRP system can be extremely beneficial for production facilities. However, software implementations can be a complex endeavor and may fall short of expectations in some areas.
A software that can fill the gaps where most MRP softwares lack is PlanetTogether’s Advanced Planning and Scheduling (APS) Software. PlanetTogether is able to automatically generate work orders or purchase orders based on actual or forecasted demand signals to create the most advantageous production schedule for your facility. Its concurrent material and capacity planning with production scheduling ensures that you have all of the materials you need and a production schedule that is realistic and feasible.
We feed [PlanetTogether] the facts we know, and it automatically proposes an optimized schedule that allows us to meet those dates. It’s something we tried, but could never do manually.
DICK MARX, MATERIALS MANAGER, KNAPHEIDE TRUCK EQUIPMENT
Some of the common benefits of using PlanetTogether's MRP are (1) the simplicity of a "single-click" process than plans materials and resources in a cohesive system, (2) the speed of the MRP process performed by PlanetTogether, and (3) the plan that results from planning material and capacity together, rather than creating an infinite capacity material plan in an ERP system and then planning finite capacity in PlanetTogether.
Advanced Planning and Scheduling (APS) Software Benefits
Advanced Planning and Scheduling Softwares have become a must for modern-day manufacturing operations as customer demand for increased product assortment, fast delivery, and downward cost pressures become prevalent. These systems help planners save time while providing greater agility in updating ever-changing priorities, production schedules, and inventory plans. APS Systems can be quickly integrated with an ERP/MRP software to fill the gaps where these systems lack planning and scheduling flexibility, accuracy, and efficiency.
With PlanetTogether APS you can:
- Create optimized schedules that balance production efficiency and delivery performance
- Maximize throughput on bottleneck resources to increase revenue
- Synchronize supply with demand to reduce inventories
- Provide company-wide visibility to resource capacity
- Enable scenario data-driven decision making
The implementation of an Advanced Planning and Scheduling (APS) Software will take your manufacturing operations to the next level of production efficiency by taking advantage of the operational data you already possess in your ERP system. APS is a step in the right direction of efficiency and lean manufacturing production enhancement. Try out a free trial or demo!