MRP (Materials Requirements Planning)

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The traditional methods of inventory management, which are appropriate when the demand for goods is independent, that is, subject to market conditions and not related to other items, are inadequate in other circumstances, particularly when the demand for items dependent, ie is not directly subject to market conditions but is also related to other items of a higher degree of complexity.

If in addition the demand is discrete and discontinuous, classical techniques working with values that represent continuity in the application, are largely ineffective, often bringing with it both the appearance of breaks as the maintenance of unnecessarily high average stocks.

The MRP (Material Requirements Planning), arise from the need to solve the problems presented in the context of irregular demand, discreet and dependable. Since MRP is based on the fact that the demand for each item is independent, except for those with an external demand, and that the needs of each article and the time that must be satisfied they can be calculated from independent demands and structure of products, with the additional information processing deadlines and provisioning.

While the MRP system develops inventory management functions, is much more than an inventory management technique, as developed among others the functions of production scheduling, order planning and priorities, providing information to other areas of production. The primary goal is to have the necessary stock just when it will be used. The emphasis should be put more on when to call in the quantum, which makes it necessary programming technique for managing inventory the same, the basic objective is not only to monitor stock levels as in the classical management, but to ensure its availability in the desired amount at the time and place.

Until the advent of computers in the sixties not open the doors to the MRP (Requirement Planning Material), a simple technique that comes from practice and that, thanks to the computer, it works and renders obsolete the traditional techniques as regards the treatment of dependent demand items. MRP systems follow a hierarchical approach and technique are born as a computerized inventory management and manufacturing planning of production, capable of generating the Plan Materials from a master production schedule (PMP).

The system is based on the explosion of material needs. This process is the concrete translation of purchase orders and production for each of the products involved in the production process of external demands for end products:

The basic scheme of MRP is as follows:

List of Materials File

Master Production

Inventory Record File



Materials Plan

Secondary Reports

Inventory transaction data

Ticketsthe system are:

  • Master Production: quantities and deadlines that must be available to produce the final product with an indication of the expected dates of delivery. This program should be validated to ensure its feasibility.
  • Bill of Materials (BOM: BILL OF MATERIALS): the structure of production and assembly of the article in question. Used allows the tree to build every one of the items that appear in the master production plan. Indicates which components make up each unit and to calculate, for each part of the necessary components to make it.
  • Inventory log file: collects information and data on the different items (delivery times, stock available at warehouse, scheduled receipts and stocks ,...) necessary for the production process.

The outputs of the system are:

Plan of materials containing the quantities of each of the items to be purchased or manufactured by the company, for each of the periods is the planning horizon. Includes the production plan and procurement plan


Can be defined as the MRP planning system manufacturing components, through a set of logically related procedures, reflects a master production schedule in real needs of constituents, including dates and amounts.

The system characteristics can be summarized as follows:

  • Guidance products. At the beginning of their needs, plans the necessary components.
  • Prospective system, as the planning is based on the future needs of the products.
  • Make a time offset needs items in terms of delivery times, establishing the dates of issue and delivery of orders. On this issue, we should remember that the MRP system takes the TS (time of supply) as a fixed datum, so it is important that it be minimized before being accepted as such.
  • Does not take into account the capacity needs, so that the plan does not ensure order is viable.
  • It is an integrated database, to be used by different areas of the company.

The MRP, in its original form, was not without problems. First, the importance of the accuracy of the MTP (Master Production Plan) to achieve correct results with the MRP resulted in the addition of a Master module Production Programming the software packages. Moreover, the programming was done without considering the possible capacity constraints and the possible difficulties arising from the implementation of plans of materials in the workshops. Because it began to be used in parallel Capacity Planning techniques at different levels (eg Bills Resource Capacity and Capacity Requirements Planning Profils). Which improved the results, but lacked real integration and use of a common database. Similarly develop management skills workshops (Shop Floor Control) to control the priorities and determine the ranking of different jobs in the production unidadesde.

Closed loop MRP.

After 15 years of experience in MRP (1975), was the integration of MRP systems originating with techniques for Capacity Planning and Management Workshop, leading to closed-loop MRP Systems (BC)which perform in an integrated and coordinated the activities mentioned, also allowing feedback from the level of execution to planning.

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Schematic of Closed Loop MRP.

The system starts from an aggregate production plan developed outside the system, which will become a PMP by the Master Scheduling module latter will be the starting point for planning medium-term capacity through technical rough (Rough- Cut). If the resulting plan is feasible, the master program will serve as input to the MRP module. Ordering plans MRP providers will go to purchasing management, while the workshop will order from Capacity Planning (CRP). If the short-term plan is viable deducted from CRP, the orders will become part of the management workshops, which will monitor system operations and program priorities. The situation in the workshops and plans to serve short-term capacity to the system's ability to control, usually using the Analysis Input / Output.

The characteristics of closed-loop MRP can be summarized as follows:

  • Is prospective.
  • Includes Master Production Scheduling, the materials requirements planning, capacity planning short and medium term, the Control and Management Capacity Building Workshop.
  • Try an integrated manner all aspects of the beholder, as the database and the system are unique to all areas of the company.
  • It works in real time, using on-line terminals, although some will occur in batch processes.
  • Has simulation capabilities, so that to determine what would happen if certain changes occur in the circumstances of departure.
  • Acts as the top down, because the process must begin in the Aggregate Production Plan.

The closed-loop MRP systems represented a major step towards the integration of business management, but there was still a gap between management-Inventory-Free Production and other areas of business areas, mainly Accounting and Finance also a vital missing link in connection with the Strategic Plan.

EXERCISES MRP: Tickets required for the calculations in trouble for a period "i".

a) Gross requirements, NB.

Amounts needed component in the respective periods.

Master Plan (independent demand) and the internally generated top-level items to yours (application dependent).

b) outstanding Orders, PP. Tickets materials provided for previous programs.

c) Requirements net NN.

NN i = Max (O, NB i + SS - (PP i + E i-1)) NN> 0.

d) Receipt of orders expected, RP.

RP i ? i NN. Needs corrected according to type of batch.

e) Release of orders, LP. When net requirements so indicate will occur LP.

f) Stocks in storage, EX.

EX i = (E i-1 + PP i + RP i) i-NB

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