"MRP Works Great If…."


I was reminded of a quote I had saved from an APICS article that I saw in 2003. I thought the quote was funny, somewhat unintentionally so. The article was titled “Push and Pull: Getting MRP and lean to work together”.

The quote:

“MRP advocates continually complain that IF:

  • Employees posted all inventory transactions correctly,
  • Reported all labor, and
  • Maintained each work center capacity;
  • If manufacturing followed schedules exactly,
  • If the company created accurate forecasts for the next six months…

The system would work perfectly.”

Ah, MRP advocates. So the problem is with the users of your system? Those pesky users who just won't use your glorious, all knowing system properly.

The problem isn't the fact that all of those above assumptions are unrealistic? The problem isn't that maintaining the system creates all sorts of non value added work that distracts employees from taking care of real customers?

Now I'll agree that MRP has a role and a place even in a lean company. But, that role should be limited to forecasting and sharing information with long lead time suppliers. If you're lean, you shouldn't have to rely on MRP to do detailed capacity planning and scheduling, so the need for all of those above assumptions to be true goes away. What are your experiences trying to debunk the MRP myth or in moving away from MRP to lean?

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Mark Graban is an internationally-recognized consultant, author, and professional speaker who has worked in healthcare, manufacturing, and startups. His latest book is Measures of Success: React Less, Lead Better, Improve More. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. He also published the anthology Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also a Senior Advisor to the technology company KaiNexus.

  1. TigerDude says

    “MRP advocates continually complain that IF: No – MRP Whiners talk like this. Leaders respond.

    Employees posted all inventory transactions correctly – take away manual transactions via bar code scanning

    Reported all labor – no an mrp problem. COGS will wash out at the end of the month – you know what you spent.

    Maintained each work center capacity – No excuse for not doing this.

    If manufacturing followed schedules exactly – Again, no excuse – enforce MPS compliance.

    If the company created accurate forecasts for the next six months… not required for mrp – that’s what inventory is for.

    Whiners whine. Leaders solve.

  2. Mark Graban says

    >manufacturing followed schedules >exactly – Again, no excuse – enforce
    >MPS compliance.

    So you tell the machines to not break down? How do you enforce perfect MPS compliance?

  3. Mark Graban says

    >Leaders solve.

    Really, I’d say leaders teach other people to solve.

  4. TigerDude says

    So you tell the machines to not break down? How do you enforce perfect MPS compliance?

    It doesn’t have to be perfect. rates are an average production. Obviously its easier if the operation is more reliable, but if it’s not reliable, you hold inventory as a buffer (& start working on TPM!).

  5. Mark Graban says

    TigerDude — thanks for your comments and for visiting the blog. I hope you’ll come back and participate some more.

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