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Material Requirements Planning

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MRP

Also called: material requirements planning system

Definition

The push-based planning system that explodes requirements through the bill of materials from forecast and schedule and issues build schedules to each operation; MRP pushes to plan while kanban replenishes to actual consumption, so the two are triggered in opposite ways.

In detail

The courseware does not call for scrapping MRP but for moving it back a layer: long lead-time purchasing, capacity planning and financial reporting still rely on it, while short-cycle replenishment goes to kanban, and who decides what at which layer must be made explicit. The usual failure is running both with unclear rules — kanban replenishing to consumption while MRP still orders to forecast, leaving inventory at both ends. During conversion the MRP lead-time and lot-size parameters must be changed first, or the system keeps generating signals that contradict the kanban.

Example in practice

A plant keeps high-value A parts in MRP for long lead-time purchasing and converts B and C parts to two-bin kanban. In the first month the MRP suggested orders are left untouched and the store receives the same part twice, after which the team flags those part numbers as planned outside the system.