What are ERP and MRP?

by David Dunning ; Updated September 26, 2017

Materials Requirement Planning and Enterprise Resource Planning are both planning tools for businesses. MRP is geared toward manufacturing operations, while ERP attempts to centralize the data and processes of an organization, typically via a single computer system.

MRP

MRP, developed in the 1970s, involves determining which components and how many are needed to complete a product. Any available stock is subtracted, and lead times for the supply of components and the completion of finished products are estimated.

ERP

ERP was seen as the successor to MRP and developed the planning process beyond purely manufacturing functions. It analyzes every activity in the supply chain, including the acquisition of products and services online, in an effort to achieve efficient production, profitability and customer satisfaction.

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Differences between MRP and ERP

ERP is essentially MRP with some additional features, typically Human Resource Planning, salaries and document control. Similar to MRP, it needs to involve everyone in an organization, not just IT staff, to be successful.

About the Author

A full-time writer since 2006, David Dunning is a professional freelancer specializing in creative non-fiction. His work has appeared in "Golf Monthly," "Celtic Heritage," "Best of British" and numerous other magazines, as well as in the book "Defining Moments in History." Dunning has a Master of Science in computer science from the University of Kent.

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