In manufacturing, it is important to plan production good enough to handle the supply chain efficiently. This can be achieved by using Master Production Scheduling (MPS) and Material Requirements Planning (MRP). These two tools can easily change your manufacturing business completely. The MPS system and MRP systems help businesses use their resources well, avoid problems, and fulfil customer demand.
In this blog post, we will understand what is MPS, what is MRP and what is the difference between MPS and MRP.
What is an MRP system?
MRP, Material Requirement Planning, is a software that helps businesses plan all the materials needed to make products. MRP helps to understand how much materials businesses have in their inventory. It tells when a manufacturer needs to order more inventory, and how long it will take to get that. This helps business owners plan when to order more materials so that they always have enough to keep manufacturing products without any delays.
What is an MPS system?
MPS, Master Production Scheduling, is a system that informs a manufacturer which, how many, and when to make certain items. This plan is important because it brings together information from different parts of the business like sales and manufacturing teams. MPS helps the business make sure it manufactures enough of the products according to customer requirements. It also makes sure that resources are not wasted because of mismanagement.
Difference between MRP vs MPS
While both MRP and MPS are important for production planning, they serve different purposes. Together, they form a coordinated framework for easy production management. Here are the major differences between MRP and MPS:
| Criteria | MRP (Material Requirements Planning) | MPS (Master Production Scheduling) |
|---|---|---|
| Purpose | Focuses on material and production needs. | Provides an overall production plan. |
| Main Function | Helps to decide what materials are needed, when, and in what quantities | Sets production goals, including volume and timing |
| Timeline | Short-term focus, typically covering weeks to months ahead | Medium to long-term outlook, often months to a year or more |
| Output | Generates material requirement schedules, production orders, and inventory plans | Creates a timetable for production activities, including start and end dates for manufacturing tasks |
| Importance | Makes sure of the availability of materials needed for production, minimising shortages and overstock | Aligns production with demand forecasts, improve resource utilisation and meet customer needs |
Examples of MRP and MPS
Material Requirements Planning and Master Production Scheduling are important tools for manufacturing efficiently. For example, let's consider a bicycle. Here are examples of how they work:
Material Requirements Planning (MRP)
The role of Material Requirements Planning (MRP) is to make sure that all necessary materials and components are available for production when needed.
- MRP uses details from the Master Production Schedule (MPS) and historical data to calculate the quantity of materials required.
- It also calculates the timing for ordering these materials.
- This planning tool helps the business manage its resources effectively, allowing for the efficient planning of labour and materials.
- MRP supports the business in adjusting its production plans based on the MPS forecasts.
- This makes sure materials are available for the required production needs.
Master Production Scheduling (MPS)
On the other hand, the Master Production Scheduling (MPS) helps in understanding the quantity of finished products that need to be produced and the timing of this production.
- For the bicycle manufacturer, the MPS provides a detailed plan specifying how many bicycles of each type (mountain bikes, road bikes, hybrid bikes, etc.) should be produced in each week of the next few months.
- This will be based on sales forecasts and market demand trends. For example, if there is an expected high demand for bicycles in a particular season, the MPS will plan for an increase in production to meet this demand.
- This approach helps the business avoid overproduction and the creation of unnecessary inventory.
- This ultimately reduces inventory costs.
MRP vs MPS Considerations
When you use MRP (Material Requirements Planning) and MPS (Master Production Scheduling) in your small or medium-sized manufacturing business in India, here are a few simple tips to keep in mind:
- It's really important to have a good understanding of how much you'll sell. This helps you make the right amount of products and not have too much or too little.
- You don't want to have too much stock stored up(overstocking), but you also don't want to run out. Keeping the right amount of inventory and materials is important.
- MRP helps you have all the materials you need ready to go, based on how much you plan to make and sell. This way, you will always be ready for production.
- MPS is about planning to make products that your customers actually want to buy, matching your production with customer demand.
MRP and MPS should work like a team. When they do, you use your materials and resources efficiently and get your products manufactured on time.
How is Production Planning Different From a Master Production Schedule?
For business owners of SME manufacturing companies in India, production planning is your big-picture strategy. It helps in deciding what products your factory will make, how many, and when. This makes sure everything runs efficiently and matches your business goals.
On the other hand, the Master Production Schedule (MPS) gets into the details - it tells your team exactly what to produce, in what quantity, and by when. This is based on your current orders and market predictions. It turns your strategy into a detailed plan that meets customer demand while managing your resources efficiently.
How is Production Planning Different From Material Requirement Planning?
For Indian SME manufacturing company owners, understanding the difference between production planning and material requirements planning (MRP) is important.
- Production planning is your strategy roadmap, focusing on what to produce, the quantities, and the timeline. This makes sure your operations are aligned with business objectives.
- But, MRP, gets into details. It makes sure you have all the necessary materials ready for production, based on your production plan. It calculates the specific materials and quantities needed, managing inventory to meet production targets without surplus.
While production planning sets the stage, MRP makes sure you have the resources to manufacture effectively.
Dependent vs Independent Demand
| Aspect | Dependent Demand | Independent Demand |
|---|---|---|
| Definition | Dependent demand is the requirement for components and materials based on the bill of materials (BOM). | Independent demand is direct customer orders or forecasts. |
| Determination | It is based on analysing the composition of finished products and their corresponding BOMs. | It is based on the analysis of customer orders or market forecasts. |
| Planning tool | Material Requirements Planning (MRP) is used to calculate dependent demand. | Master Production Scheduling (MPS) is used to calculate independent demand. |
| Importance | MRP helps in managing resources easily for production. | MPS helps in planning when to make things to meet customer orders. |
Mastering Manufacturing Efficiency with TranZact
MRP and MPS systems are important for production planning in manufacturing. They work together to improve the operations of a manufacturing business. Both are important for using resources well, meeting customer needs, and running operations smoothly.
Using TranZact manufacturing businesses can manage both materials requirements and production management. They can plan what materials they need to make products and when they need them. It also helps in scheduling production tasks. It keeps track of inventory using barcode scanning and offers reports and analytics to make smart business decisions. TranZact helps manufacturers save time, reduce costs, and improve productivity in their operations.
FAQs
1. What is the difference between MRP and MPS?
MRP manages the details of materials and production, making sure everything needed is available at the right time. MPS sets the overall goals for production, like how much to make and when. While MRP focuses on specific tasks, like ordering materials, MPS looks at the bigger picture, coordinating all production activities to meet those goals.
2. What is MRP vs ERP?
MRP handles material planning and production scheduling and makes sure everything is in place for manufacturing. ERP (Enterprise Resource Planning) is a larger system that includes MRP but also manages other aspects like finances and human resources.
3. What is MPS in production planning?
MPS plans the production schedule, detailing what to produce and when to produce it. It considers factors like demand forecasts, resource availability, and production capacities.
4. What is MRP in production planning?
MRP makes sure that the necessary materials are available when needed for production. It generates schedules for material procurement and production orders based on demand forecasts and inventory levels.
5. How do MPS and MRP work together?
MPS sets the overall production goals and schedules, while MRP manages the detailed requirements for materials and production processes. Together, they check production activities, making sure that the right materials are available at the right time to meet production schedules.
6. What is the master schedule in manufacturing?
The master schedule provides the specific production tasks and timelines for manufacturing products. It includes details such as production quantities, start and end dates for production activities, and resource allocations.
7. What is the purpose of MPS?
MPS makes sure that production goals are met by coordinating manufacturing activities and optimising resource use. It aligns production schedules with demand forecasts, helping to balance customer needs, inventory levels, and production capacities.
8. What is the purpose of MRP?
The purpose of MRP is to make sure timely availability of materials needed for production. MRP helps prevent shortages, reduces excess inventory, and maintains smooth production processes. Its main goal is to improve material planning and execution to support easy manufacturing operations.
