The document discusses material requirements planning (MRP), including that it was developed in 1964 by Joseph Orlicky and first used by Black & Decker in 1964. MRP is an inventory management system suited to manufacturing industries that provides computerized inventory control, production planning, management information, and manufacturing control. The document outlines the concepts of independent demand and dependent demand in MRP and notes some objectives, inputs, applications to services, and limitations of the traditional MRP system and later MRP II and ERP systems.

1. By: Mukesh Lal Karn
Purbanchal University School Of Management
MBA 2nd Semester(Spring)
Roll no. -2

2. MRP
 In 1964, Joseph Orlicky developed MRP
 Black & Decker in 1964 used MRP
 MRP is an Inventory Management System
 Suits to manufacturing industries
 Computerized Inventory Control
 Production Planning System
 Management Information System
 Manufacturing Control System
William J. Stevenson, ”Operations Management”, Tata McGraw Hill

3. Fundamental Concepts of MRP
 Independent demand:
 Demand for the product is not directly related to
demand for other items.
 Is the demand for finished product.
 It needs to be forecasted.
 Dependent demand:
 Demand for the product is directly related to demand
for other product.
 Is the demand derived from finished product.
 Components required for finished product.
William J. Stevenson, ”Operations Management”, Tata McGraw Hill

4. Inputs of MRP
William J. Stevenson, ”Operations Management”, Tata McGraw Hill

5. Objectives of MRP
 Inventory reduction
 Reduction in production and delivery lead times
 Realistic commitments
William J. Stevenson, ”Operations Management”, Tata McGraw Hill

6. MRP in Services
 Restaurants
 Hospitals
 Hotels
William J. Stevenson, ”Operations Management”, Tata McGraw Hill

7. Limitation of MRP
 Capacity Planning
Result
 MRP II (In 1980s)
Limitation of MRP II
 Lacks sharing among different departments
Result
 Enterprise Resource Planning(ERP)

8. Any Queries??