ERP or MRP: What’s the Difference?

There are a lot of software systems designed to help fabricators and machine shops boost productivity, automate tasks, eliminate redundancy, and streamline efficiency. And some of these systems seem to overlap in terms of areas they address.  

Enterprise Resource Planning (ERP) and Manufacturing Resource Planning (MRP) are two such examples. While similar in many ways, these systems are unique in their focus, intended user-base, and what they deliver to the user. 

So, the question is: What’s the difference between ERP and MRP?

MRP Software

Specific to manufacturing, MRP systems streamline related manufacturing processes. This helps to identify inefficiencies in a supply chain and provide data that can be analyzed to implement better solutions. 

MRP systems create detailed production schedules and coordinate component materials with machine and labor availability.  MRP helps with such processes such as shop floor control, capacity and demand management, and sales and predictions.

ERP Software

ERP systems were created to help to plan and automate a variety of business functions across the extended enterprise. Because of this, ERP crosses over into such functions as accounting, sales, manufacturing, supply chain, customer management, quality, processes, planning, human resources, and so on.

ERP systems help to integrate management, staff, and equipment into a single system to assist with a business’s operations. Today’s ERP systems boost production, productivity by providing on-demand access to real-time data. 

History

Created to allow manufacturers to manage materials and costs, MRP systems date back to the 1960s. These systems evolved over the decades to meet additional needs like master scheduling, rough-cut capacity planning, capacity requirements planning, sales and operations planning, and other concepts. The software allowed for accurate forecasting and resulted in cost-savings. 

ERP systems came along some 30 years later to answer industry’s the call for a system that went beyond materials and manufacturing needs. It’s important to note that ERP systems don’t replace MRP systems. Their intent is to expand the scope and offer solutions to companies requiring a broader range of applications.

 

 

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