Materials Market Analysis
Introduction
Materials planning or MRP (in English, material requirements planning) is a planning and management system, usually associated with production planning software and an inventory control system.
Its purpose is to have the required materials at the right time to meet customer demands. The MRP, based on scheduled production, suggests a list of purchase orders to suppliers.
In more detail, it tries to simultaneously meet three objectives:
History
In World War II, the US government used specialized programs to control the logistics or organization of its units in battle. These technological solutions are known as the first materials requirement planning systems (MRP Systems).
By the end of the 1950s, MRP systems began to be used in productive sectors, especially in the United States of America. These systems allowed them to keep track of various activities, such as inventory control, billing, payment, and payroll administration.
In parallel, the evolution of computers favored the growth of these systems in terms of the number of companies that opted for them. Of course, these computers were very rudimentary, but they had the capacity to store and retrieve data that made it easier to process transactions.
In the 1960s and 1970s they evolved to help companies reduce inventory levels, which reduced company expenses as they only purchased when necessary.
The main objective of these systems is to control the production process in companies whose activity takes place in a manufacturing environment. Production in this environment involves a complex process, with multiple intermediate stages, in which industrial processes take place that transform the materials used, component assemblies are carried out to obtain higher level units that in turn can be components of others, until the completion of the final product, ready to be delivered to external clients. The complexity of this process is variable, depending on the type of products being manufactured.
The basic systems to plan and control these processes address the problem of organizing the flow of materials in the company to efficiently achieve production objectives, all of them consisting of the same stages:
MRP is not a sophisticated method, but, on the contrary, it is a simple technique, which comes from practice and which, thanks to the computer, works and makes classical techniques obsolete with regard to the processing of dependent demand items. Its appearance in academic programs is very recent. Its great growing popularity is not only due to its successes, but also to the advertising work carried out by the A.P.I.C.S. (American Production and Inventory Society), which has dedicated considerable effort to its expansion and knowledge, led by professionals such as J. Orlicky, O. Wight, G. Plossl and W. Goddard.