The Algorithm Blog

Material Requirements Planning: Can it Help Me?

Material Requirements Planning (MRP) can be a daunting concept to discuss for implementation at your company.  Many companies have software that has the capabilities to facilitate MRP but the users simply don’t have the knowledge on how to set it up properly.  The larger MRP challenge beyond the lack of setup knowledge is how to actually utilize the information the system provides to support “make” and “buy” decisions.

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What is Production Planning Software?

What is Production Planning Software?

Actually, a better starting point for a discussion of production planning is simply to ask, what does your company use to plan and schedule production? Does your company plan production on spreadsheets? When a customer requests expedited delivery on an order, does your planner head to the whiteboard and begin erasing jobs to free up capacity? Can your planners see at a glance that alternative workcenters are available to alleviate a bottleneck in production? At peak season do your production planners remind you of a juggler straining to keep all the orders in the air while adding one more?

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Where to Start with Creating a Successful Production Plan

Any organization that makes a product has to create a plan for what to make, when to make it, how much to make, where to make it, and what is required to make it (resources and materials). The challenge is what tools to use to get the best plan possible and, once you have a plan, how to schedule the production. 

The business dictionary defines production planning as, "The administrative process that takes place within a manufacturing business and which involves making sure that sufficient raw materials, staff and other necessary items are procured and ready to create finished products according to the schedule specified. A typical large manufacturing business engaging in production planning will aim to maximize profitability while maintaining a satisfied consumer base."

The objectives of a good production planning process can be broken down by the following:

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