What is the difference between ERP and MRP/MRPII?

Business systems in the manufacturing industry have evolved in functionality over the years. The early systems were called MRP (Material Requirements Planning) systems because there was an innovative module called MRP within it, which calculated purchase and works order requirements based on predicted or actual demand for products. MRPII (Manufacturing Resource Planning) was the next generation of integrated manufacturing systems which used more sophisticated, iterative planning cycles to take account of factory capacity as well as the materials requirements. MRP II systems were eventually replaced with ERP (Enterprise Resource Planning) systems which added more applications and catered for industries beyond manufacturing. Today all integrated business solutions including those for the manufacturing sector are described as ERP systems.

Enterprise Resource Planning (ERP)

Multi-currency Multi-company Multi-measurement unit Database Server Backend Real-time Reporting System Records last modified tracking VB.Net as the development tools Privilege to view or modify records Multiple user simultaneous access Can support MYSQL as the database English/ Traditional / Simplified Chinese Support

Achiever's ERP solution helps you handle operational and administrative tasks more efficiently. It reduces your workload and allows you to evaluate your business to keep costs down to a minimum. Its multi-function platform also streamlines the management of orders, quotation, invoice, inventory, accounting as well as resource allocation. Convenience and Time Saving : The system allows users to generate bills and orders with the least time and efforts, as well as shipment schedules. With few clicks of your mouse, you can quickly generate bills and orders with high accuracy. It avoids you from making mistakes due to repetitive entries. Ease of Use With a point-and-click interface, it makes the system user-friendly, simple and straightforward to use. You will be able to operate it without experiencing any difficulties. Effectively Selling Your Goods We truly understand that establishing a favorable brand image is a critical ingredient for business success. Therefore, our Marketing Tool equips you with a sharp weapon in promoting your company. The system can create tailor-made catalogues and CD-ROMs for your target clients reflecting their needs and wants, so as to sell your goods effectively Strengthening Internal Communication Two-way communication makes an important difference of driving the success of any business. Our unique Task function strengthens the internal communication between management and employees. Enhancing Business Securities Adequate security and data protection are major concerns for most enterprises. Our system allows you to specify the approval procedures. Authority level can be pre-defined by the management to prevent any unwanted access. It keeps all of your confidential information secure.

System Features of ERP

Auto Bill Management The data entry process is simple and straightforward. With few clicks of your mouse, you can quickly generate orders, quotations or invoices. Consolidate items in previous quotations, invoices and sales orders to form a new bill. Integrated with Accounting and Inventory Module, it auto updates the account statement and inventory status after bill posted. Monitor the bill status in real time.

Intelligence Purchase Generate the best combination of suppliers or vendors to form new purchase order automatically.

Internal Task Management Users can assign the tasks, request for the approval and post of particular bills. It facilitates effective division of labour. The work schedule of every user acts as individual task reminder and deadline alert. The senders can track the read time and task completion time; while the receivers can respond to the message directly.

Marketing Tools Upload and save the product pictures in database. Download the product information from database directly to create tailor-made catalogues and CD-ROMs for your target clients.

Advanced Security Setting Prevent any unwanted access by setting pre-defined authority level. All confidential documents cannot be released without the approval from management.

Electronic Document All bills, transaction histories and customers, products and vendors information are stored in centralized database automatically. Export the documents to PDF, Word, Excel and Text format. A pre-built e-mail function enables you to send the documents via email directly Compatible with the latest trend of e-business.

Auto Conversion Support the conversion between different languages (English/ Traditional Chinese/ Simplified Chinese). The multi-currencies function allows you to set the exchange rates and convert dollars to corresponding notes automatically, which is helpful to explore china and foreign markets.

Support the conversion between different measurement units and sub units

Manufacturing Resource Planning (MRP) Material Inventory Material Management Supplier Management Production Scheduling Supplier Purchase History Production line management Multiple level & version BOM Unlimited process for Job Order Safety quantity for each materials Auto generate PO for each job order Forward & backward (JIT) Scheduling Production line shift Management on man-power & operation hours

Material Requirement Planning (MRPI)

The factories always encounter some usual problems such as inadequate or over abundant supply of manufacturing materials, and the delay of job orders. Stocking up too many raw materials may lead to insufficient flowing capital while lacking in them may cause production delay and tremendous loss. As a result of this, Achiever offers your company a comprehensive solution. With the help of MRP I, you can precalculate the estimated quantity of materials needed before production starts, and perform the prior orders to ensure sufficient stock.

System Features
Automatic Material Ordering Calculate the exact amount of raw materials required for each product and each bill automatically. Recommend the best order quantity from relevant suppliers and vendors Material Inventory Management Monitor and record the stock level and inventory flow of every warehouse. Accurately allocate the raw materials to manage the production capacity well. Adjust the material inventory in real time.

Manufacturing Resource Planning (MRPII)

MRP II system helps in estimating the human resources needed for each production line. Thus, it avoids exceeding production capacity and redistributes resources for emergency use.

System Features
Automatic Production Scheduling Automatically formulate the entire production schedule of factories. Effectively estimate the entire production cycle. Production Line Management Effectively arrange the working tasks for each employee. Redistribute employees for emergency use. Effectively allocate company resources to complete the production as scheduled, so as to minimize the production cost.

Manufacturing resource planning

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Manufacturing Resource Planning (or MRP2) - Around 1980, over-frequent changes in sales forecasts, entailing continual readjustments in production, as well as the unsuitability of the parameters fixed by the system, led MRP (Material Requirement Planning) to evolve into a new concept : Manufacturing Resource Planning (e.g. MRP 2)[1] Manufacturing resource planning (MRP II) is defined as a method for the effective planning of all resources of a manufacturing company. Ideally, it addresses operational planning in units, financial planning, and has a simulation capability to answer "what-if" questions and extension of closed-loop MRP.

This is not exclusively a software function, but a marriage of people skills, dedication to database accuracy, and computer resources. It is a total company management concept for using human resources more productively.

Contents

1 Key functions and features 2 Industry specifics 3 MRP and MRPII: History and evolution 4 MRP and MRPII: General concepts 5 Manufacturing Management Software 6 Benefits 7 Criticism 8 References 9 See also [edit] Key functions and features

MRP II is not a proprietary software system and can thus take many forms. It is almost impossible to visualize an MRP II system that does not use a computer, but an MRP II system can be based on either purchased licensed or in-house software.

Almost every MRP II system is modular in construction. Characteristic basic modules in an MRP II system are:

Master production schedule (MPS) Item master data (technical data) Bill of materials (BOM) (technical data) Production resources data (manufacturing technical data) Inventories and orders (inventory control) Purchasing management Material requirements planning (MRP) Shop floor control (SFC) Capacity planning or capacity requirements planning (CRP) Standard costing (cost control) Cost reporting / management (cost control) together with auxiliary systems such as:

Business planning Lot traceability Contract management Tool management. Engineering change control Configuration management Shop floor data collection Sales analysis and forecasting Finite capacity scheduling (FCS) and related systems such as:

General ledger Accounts payable (purchase ledger) Accounts receivable (sales ledger) Sales order management (Distribution requirements planning) (DRP) Automated warehouse management Project management Technical records Estimating Computer-aided design/computer-aided manufacturing (CAD/CAM) CAPP The MRP II system integrates these modules together so that they use common data and freely exchange information, in a model of how a manufacturing enterprise should and can operate. The MRP II approach is therefore very different from the point solution approach, where i ndividual systems are deployed to help a company plan, control or manage a specific activity. MRP II is by definition fully integrated or at least fully interfaced.

[edit] Industry specifics

MRP II systems have been implemented in most manufacturing industries. Some industries need specialised functions e.g. lot traceability in regulated manufacturing such as pharmaceuticals or food. Other industries can afford to disregard facilities required by others e.g. the tableware industry has few starting materials mainly clay and does not need complex materials planning. Capacity planning is the key to success in this as in many industries, and it is in those that MRP II is less appropriate.

[edit] MRP and MRPII: History and evolution

Material requirements planning (MRP) and manufacturing resource planning (MRPII) are predecessors of enterprise resource planning (ERP), a business information integration system. The development of these manufacturing coordination and integration methods and tools made todays ERP systems possible. Both MRP and MRPII are still widely used, independently and as modules of more comprehensive ERP systems, but the original vision of integrated information systems as we know them today began with the development of MRP and MRPII in manufacturing.

MRP ( and MRPII ) evolved from the earliest commercial database management package developed by Gene Thomas at IBM in the 1960s. The original structure was called BOMP ( bill-of-materials processor ), which evolved in the next generation into a more generalized tool called DBOMP (Database Organization and Maintenance Program). These were run on mainframes, such as IBM/360.

The vision for MRP and MRPII was to centralize and integrate business information in a way that would facilitate decision making for production line managers and increase the efficiency of the production line overall. In the 1980s, manufacturers developed systems for calculating the resource requirements of a production run based on sales forecasts. In order to calculate the raw materials needed to produce products and to schedule the purchase of those materials along with the machine and labor time needed, production managers recognized that they would need to use computer and software technology to manage the information. Originally, manufacturing operations built custom software programs that ran on mainframes.

Material requirements planning (MRP) was an early iteration of the integrated information systems vision. MRP information systems helped managers determine the quantity and timing of raw materials purchases. Information systems that would assist managers with other parts of the manufacturing process, MRPII, followed. While MRP was primarily concerned with materials, MRPII was concerned with the integration of all aspects of the manufacturing process, including materials, finance and human relations.

Like todays ERP systems, MRPII was designed to integrate a lot of information by way of a centralized database. However, the hardware, software, and relational database technology of the 1980s was not advanced enough to provide the speed and capacity to run these systems in real-time,[2] and the cost of these systems was prohibitive for most businesses. Nonetheless, the vision had been established, and shifts in the underlying business processes along with rapid advances in technology led to the more affordable enterprise and application integration systems that big businesses and many medium and smaller businesses use today (Monk and Wagner).

[edit] MRP and MRPII: General concepts

Material requirements planning (MRP) and manufacturing resource planning (MRPII) are both incremental information integration business process strategies that are implemented using hardware and modular software applications linked to a central database that stores and delivers business data and information.

MRP is concerned primarily with manufacturing materials while MRPII is concerned with the coordination of the entire manufacturing production, including materials, finance, and human relations. The goal of MRPII is to provide consistent data to all players in the manufacturing process as the product moves through the production line.

Paper-based information systems and non-integrated computer systems that provide paper or disk outputs result in many information errors, including missing data, redundant data, numerical errors that result from being incorrectly keyed into the system, incorrect calculations based on numerical errors, and bad decisions based on incorrect or

old data. In addition, some data is unreliable in non-integrated systems because the same data is categorized differently in the individual databases used by different functional areas.

MRPII systems begin with MRP, material requirements planning. MRP allows for the input of sales forecasts from sales and marketing. These forecasts determine the raw materials demand. MRP and MRPII systems draw on a master production schedule, the breakdown of specific plans for each product on a line. While MRP allows for the coordination of raw materials purchasing, MRPII facilitates the development of a detailed production schedule that accounts for machine and labor capacity, scheduling the production runs according to the arrival of materials. An MRPII output is a final labor and machine schedule. Data about the cost of production, including machine time, labor time and materials used, as well as final production numbers, is provided from the MRPII system to accounting and finance (Monk and Wagner).

[edit] Manufacturing Management Software

For the companies that want to integrate their other departments with their manufacturing management, ERP software are necessary.

[edit] Benefits

MRP II systems can provide:

Better control of inventories Improved scheduling Productive relationships with suppliers For design / engineering:

Improved design control Better quality and quality control For financial and costing:

Reduced working capital for inventory Improved cash flow through quicker deliveries Accurate inventory records

[edit] Criticism

Authors like Pochet and Wolsey [3] argue that MRP and MRP II, as well as the planning modules in current APS and ERP systems, are actually sets of heuristics. Better production plans could be obtained by optimization over more powerful mathematical programming models, usually integer programming models. While they acknowledge that the use of heuristics, like those prescribed by MRP and MRP II, were necessary in the past due to lack of computational power to solve complex optimization models, this is mitigated to some extent by recent improvements in computers. However it should be noted that manufacturing scheduling is intrinsically a very large problem, and it is easy to show for even a relatively simple example that it is not possible to guarantee optimal outputs with any algorithm. [4]

[edit] References

^ Waldner, Jean-Baptiste (1992). CIM: Principles of Computer Integrated Manufacturing [1]. Chichester: John Wiley & Sons Ltd. pp. p47. ISBN 0-471-93450-X. ^ Shum, Paul (2003). Knowledge and Innovation Culture as Determinants of Financial Performance in New Product Development. Australia: The International Journal of Knowledge, Culture and Change Management. ^ Wolsey, Laurence (2006). Production Planning by Mixed Integer Programming. Springer. ISBN 978-0-387-299594. ^ http://www.mjc2.com/production-scheduling-complexity.htm Why is manufacturing scheduling hard? Monk, E. and Wagner, B., Concepts in Enterprise Resource Planning, 2nd Edition, 2006, Editor, Mac Mendelsohn, Canada: Thomson Course Technology. [edit] See also

CONWIP C-VARWIP Document automation for Supply Chain and Logistics Enterprise resource planning (ERP) Just-in-time (business) kanban Manufacturing Material requirements planning (MRP) Scheduling (production processes) Supply chain management

Distribution resource planning Warehouse management system Warehouse control system Retrieved from "http://en.wikipedia.org/w/index.php?title=Manufacturing_resource_planning&oldid=518002876" Categories: Manufacturing Enterprise resource planning terminology Navigation menu

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