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What is MRP-II (Material requirements planning)?

A material requirements planning (MRP) system is a computer based inventory information system which is used to plan and control raw material and component parts inventories.

 Pre-requisites for successful operation of MRP:

1. Strict adherence to the schedule : The successful operation of MRP system requires a strict adherence to the latest production and purchasing schedules. Workers must be educated to understand the importance of schedule adherence, and controls should be in place to ensure this adherence.
2. Accurate data base : Data accuracy is vital to the system. If a plan is based on inaccurate data it may be impossible to adhere to the schedule. For example, if the bill of materials file is not updated to reflect any changes in product composition it will be impossible to adhere to the schedule.

MRP II is the extension of MRP I

When the scope of MRP-1 is developed further which includes
1. Planning of raw material
2. planning of component & sub- assemblies
3. Compute the other resources e.g. machine or labour capacity
4. to create a full integrated plan for management

then it is known as Manufacturing resources planning ( MRP-II)

MRP II (also written MRP-2 ) adds the MRP schedule into a capacity planning system and then builds the information into a production schedule. It is also seen as a link between strategic planning and manufacturing control. The sequence of events is as follows :

A manufacturing, plan is developed based upon inputs from purchasing & production. Adjustments may be necessary to allow for production rates. Possible inventory levels in seasonal trades & the size of the workforce. The manufacturing plan leads into a detailed master production schedule which is akin to the original philosophy of MRP already outlined.

If correctly applied, MRPII provides a common data base for the different function units such as manufacturing, purchasing and finance within a firm.
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