Several attributes contribute to a smooth production flow of a firm. However, these factors are dependent on several independent resources.
These have to be carefully aligned and utilized so that it streamlines the overall production flow. In such situations, Manufacturing Resource Planning is used.
Overview of MRP I and MRP II
It is an integral part of an information system that is used by businesses. The goal behind its advent is to fix the short comes or constraints of Material Requirement Planning (MRP I).
Material Requirements Planning (MRP I) is one of the leading software-based integrated information systems that boosts the overall performance of a business.
Material Requirement Planning is an integrated information system that relies on a sales forecast-based system useful in scheduling raw material deliveries and quantities.
Aside from all these managerial uses, Material Requirement Planning has been extensively used to precisely predict the amount of human capital, machinery, and IT Infrastructure required to achieve a sales target.
To fulfill the burning requirement of the manufacturing companies, Manufacturing Resource Planning has incorporated the integration of additional data, such as employees and financial needs.
The integrated information system of MRP II concentrates, accumulates, and processes the information so that the third party can leverage this information for scheduling, design engineering, inventory management, and cost control in manufacturing.
Enterprise Resource Planning(ERP), a procedure-oriented methodology in which a manufacturer smartly manages all the critical aspects of his business.Both Material Resource Planning and Manufacturing Resource Planning are the predecessors of
Many large organizations have already developed too much software to assist companies in properly implementing Enterprise Resource Planning (ERP).
Definition of Manufacturing Resource Planning
Manufacturing Resource Planning is a computer-based integrated information system that can devise the most precise and accurate production schedule by leveraging the real-time data to create a harmony between the arrival of raw material components with the machine and labor availability.
It is often a helpful and most relevant tool to enhance the core functionality of the Enterprise Resource Planning (ERP) system.
The goal behind the advent of Manufacturing Resource Planning is to the extent the capability of Material Resource planning.
By the end of the 1980s, manufacturers and business owners started realizing that they needed a specific kind of software that could be easily incorporated into their accounting system and prophesy the amount of inventory required to accomplish a particular task.
MRP II is software that can effectively address all the requirements of manufacturers. For the sake of maintaining backward compatibility, it contains all the critical features of MRP I.
Real Word Examples
As of 20, the following vendors are well-known providers of the MRP II software.
- S2K Enterprise
- Oracle Netsuite Manufacturing Edition
Importance of Manufacture Resource Planning Software
Automated software of MRP II allows the user to,
- Acquire valuable details about the right time of ordering.
- How much quantity of raw material he needs to order from the suppliers.
- Generate orders for raw material input. The periodic arrangement of all the orders.
All of these are crucial to address the ever-growing demands of customers and the whole manufacturing process.
Automated software for Manufacturing Resource Planning regularly calculates the requirement of raw materials, and all the calculations performed by the MRP II are entirely based on the order forecasts.
Additionally, this automated software for Manufacturing Resource planning also changes to offset the potential issues that may arise in the future.
This attribute of MRP II makes it way more effective and accurate than the traditional management system.
Few Critical Aspects
Now I’ll be listing the critical aspects of manufacturing resource planning categorically.
MRP II gleaned valuable feedback from the production floor and stored this information more robustly and systematically.
To ensure the regular up-gradation of the next run, MRP II integrates the stored information to all schedule levels.
Inventory management control includes a scheduling capability that strongly emphasizes the significant resources, such as plant, machinery, and raw materials, which are incredibly crucial in producing finishing goods.
MRP II generates the most precise and accurate data that can assist an individual in gaining firm control over the manufacturing process
Software Extension Capabilities
Aside from the inventory and recovery control, different other programs are also incorporated into the MRP II.
Some of these programs are specifically designed to make the scheduling process way more helpful than ever before.
MRP II also comes with the in-built option for sale ordering processing. Stock recording and cost management accounting all lie in the realm of Manufacturing Resource Planning.
All of the above attributes are embedded in the company’s primary database system.
MRP has in-built advanced planning capabilities that include:
- Minimize the Panning activities
- Automated computerize ordering of raw material for the production of finishing goods
- Hard and soft allocation
Optimizing the Labor Requirement
For example, automated software for Manufacturing Resource Planning precisely calculates the amount of labor required to meet daily, weekly, or monthly labor schedules.
MRP II smartly manages the labor based on qualification and the relevant skill sets.
MRP II is useful when the initial data entered must be correct and accurate.
It is evident from the past track record that the companies that develop and deploy an automated software system for Manufacturing Resource Planning strongly recommend their users to enter only the correct and accurate data. That helps in utilizing the full potential of MRP II.
Benefits of Manufacturing Resource Planning
These are the potential benefits,
- Undoubtedly, MRP is an innovative and highly competitive tool that has completely revolutionized the traditional stock control and management method.
- A fully automated software for Manufacturing Resource Planning framed an effective and the most consistent production schedule, allowing any company to smartly manage its operating expenses by reducing the money, time, and human capital.
- Planning with the aid of automated software MRP II makes a company way more efficient than ever before. Thus, in simple words, we can say that MRP II acts as a helpful tool for profit optimization as it reduces unnecessary expenses.
- Data gleaned through MRP allows the companies to frame an effective strategy for the future and to prophesy how their overall strategy can affect the overall profitability of the business.
- The automated system of MRP provides a piece of more robust and detailed information that any company can easily leverage to accomplish its core functions, such as planning, effective decision making, and production.
Difference between MRP I and MRP II
How is MRP II different from MRP I?
MRP II is an advanced version of MRP I. MRP II is much ultra-modern software that provides the best vision into all areas, stages of production. MRP II includes the functionalities of MRP I along with some additional functionalities. MRP I is the plan for the materials requirements, and MRP II is the plan for resource requirements.
The most prominent manufacturing business model that benefits from the Manufacturing Resource Planning Integrated information system involves many assembly lines.
Small and medium scale businesses or SMEs can also leverage MRP II to enhance their overall production capacity and revenue.