Difference Between MRP vs ERP Systems: Which is best?

The floor management, inventory, operations and planning is a critical element in maintaining the smooth running of a manufacturing business. As production and supply chains develop to meet the bigger global needs, firms can automate processes and take smart data-driven decision-making in real time data and software systems. ERP (Enterprise Resource Planning) and MRP are two regularly adopted software solutions (material requirements planning). Learn the basics of these systems through Rootstock training. This article will discuss the differences between these two systems and which one would be best for your company. 

Key differences between the two systems

ERP systems integrate all parts of a complicated puzzle that constitutes a production enterprise. Data from one part of the company can inform decisions performed elsewhere appropriately. An ERP system gives you control over the entire process, from raw material supply to delivery logistics. A MRP module is a key component of ERP systems, although the solution is not the only focus.

However, MRP is a mainly utilized method for the management of production and purchasing sectors for efficiency gains by the production and operations teams. It enables the production plant to meet client requirements while meeting inventory KPIs and economic buying. MRP is an autonomous software product, therefore the data is not linked to its databases while other departments can access the data. While the import and export of essential data is generally possible in order to integrate MRP systems into other applications, a comprehensive integration into ERP is developed.

The ERP system in depth

An ERP system is a modular software package that consolidates the information you need to operate your company and offers tools to optimally operate in all fields. Therefore the customer journey through your company is entirely transparent and offers you real-time prices and status updates to manage your company efficiently, as well as automated, real-time updates to your consumers.

ERP systems exceed MRP. ERP will include CRM (customer relationship management), SCM (supply chain management), estimation/quotation, product configuration (including bill of materials – BoM), project and providing inventory management, scheduling, shop floor data collection (SFDC), purchasing and other modules.

Comprehensive control 

ERP is a genuinely complete system spanning all aspects of company and an essential instrument for the efficient deployment of expanding and more complex enterprises. It is more expensive than MRP, however, but has a broader reach and can assist achieve inventory reductions and efficiency benefits, which means it pays several times for itself.

one poor component of the system is that too much IT can overwhelm it. Smaller companies should be prepared and work to the advanced management systems – many of which will never require extremely high IT standards.

The MRP system in depth 

The MRP system enables total control and effective inventory management, ongoing work, OEE, acquisition and production.

MRP concentrates primarily on the production cells of a company and is meant for users from those departments. For the management of its production planning, a manufacturing company would utilize an MRP to anticipate and order materials in the correct volume to reach the proper date. It can also be integrated with the databases of suppliers using APIs to manage the supply chain.

The right sized system 

The core of competing management is a well-sorting, right-sized MRP. It permits controlled, transparent, and better ordering and prevents exaggeration, better inventory management and the provision of working capital for meaningful deployment in productive activities. For owners and managers, this is a fantastic release of pressure. 

In addition, an MRP system provides considerably more information and better insight on shop flooring and work costs. Activity is logged using workstation touch screens. OEE technology collects machine fail-time data that can be refined by unproductive and scrap-level data. On the system, the personnel who require them are able to obtain product drawings, photographs and training data. Orders for purchases and invoices can be automatically raised, matched and monitored.

Which one is best for you? 

An ERP system provides you with the capabilities to achieve total control across the complete process, if your aim is supply chain management. Most ERP systems today on the market are modular, so that you may choose which areas (departmental workflows) you want to integrate and which modules. Moreover, the system can be implemented while dealing with Access, when primary modules are acquired and merged, because some companies simply need not each module.

MRP is a smart solution for those companies with customer orientation software already in place such as customer estimations, sales processing and debtor management, but which do not have supplier, inventories or production control. Also, if you don’t have the cash for the complete (or partial) ERP system, but production control is vital to your firm, MRP may be the correct option to you.