An overview of MRP

MRP is a computer-based information system designed to handle ordering and scheduling of dependent-demand inventories (eg raw materials, component parts, and subassemblies). A production plan for a specified number of finished products is translated into requirements for component parts and raw materials working backward form the due date, using lead times and other information to determine when and how much to order. Hence, requirements for end items generate requirements for lower-level components, which are broken …

…must balance work loads across departments and make decisions about scheduling work, and plant forepersons, who are responsible for issuing work orders and maintaining production schedules, also rely heavily on MRP outputs. Other users include customer service representatives, who must be able to supply customers with projected delivery dates, purchasing managers, and inventory managers. The benefits of MRP depend in large measure on the use of a computer to maintain up-to-date information on material requirements.