Material requirements planning (MRP) refers to the technique of using a projected manufacturing production schedule to fire out what supplied materials you will need (bills of material), and when you will need them. MRP is a simple technique, but does not take into account any constraints on your resources, or deviations from the schedule, and hence, when used in isolation, can produce infeasible erp project charter solutions.
MRP II, or manufacturing resource planning, was created to alleviate some of MRP’s shortcomings. By tying in actual production data and resource constraints, or “closing the loop,” MRP II is able to produce feasible production plans to help stabilize and control manufacturing systems. Capacity planning tools typically perform a similar function: matching up production plans and schedules with available capacity to validate their feasibility. Most of the ERP systems include an MRP or MRP II module, or a capacity planning link. However, by focusing on production planning and control functions, these tools are not in and of themselves much help in analyzing systems to help improve them.