In: Operations Management
1. Give your perspective on the difference between the ERP / MRP II concept or lean manufacturing and Processor-oriented.
and Give a simple example to explain the differences between the two concepts.
This discussion will point out the difference between MRP 2 and ERP systems.
The MRP 2 system consist of a suite of software which takes care of production scheduling, demand forecasting and some additional tasks related to accounting and sales & marketing.
The ERP system is a software tool which encompasses all the functions of MRP 2 and includes other functionalities of supply chain management, human resource management as well as customer relationship management.
These systems are not mutually exclusive and many organizations continue to use MRP 2 systems in conjunction with the enterprise wide ERP systems as well.
In simple terms, a material scheduling Excel based programme which is used for scheduling orders and recording receipts and inventory is an example of MRP 2 system. Clearly this is more specialised in its functionality and is also restrictive. On the other hand, an enterprise wide SAP implementation can handle business processes of procurement, distribution, manufacturing as well as customer management. It has got multiple modules to look after each functions and is highly diverse in its functionality and has got greater coverage than a MRP 2 system.