Key Difference between MRP and MPS for Material Planning
Purpose: understanding about difference between MRP and MPS. This question we often get from business / peoples because there are few key differences between MRP & MPS.
MRP: The planned and the exact requirement quantities trigger the net requirements calculation. The requirement elements of this calculation include sales orders, planned independent requirements, material reservations, dependent requirements received from BOM explosion, and so on. The net requirements calculation can give the exact requirements for each day.
MPS: The master plan of these materials greatly influences the entire production process: The planning of the dependent parts depends on the planning result of the finished products and main assemblies, even if the finished products represent a small share of all the materials to be planned.
|Material Resource Planning (MRP)||Master Production Schedule (MPS)|
|MRP Plans materials / items those have dependent demand elements||MPS Plans materials / items those have only direct demand elements
or independent demand elements
|During MRP Run, demand is flows down level elements because need to produce an item||During MPS, demand is flows direct from customer requirements
or forecasted requirements
|MRP can be executed at FG/ SFG or multi-level also||MPS can be executed at FG level or first level only|
|MRP recommended / Can be execute on daily to expedite items required to produce as per plan||MPS recommended run on weekly based on orders and forecast for that period / week|
· Calculates net requirements for all the requirement quantities that are to be planned.
· Calculates the quantity recorded in the procurement proposal according to the lot-sizing procedure
· Procurement proposal: Materials procured externally, the delivery and release dates are determined, and for materials produced in-house, the production dates are calculated.
· Materials produced in-house; the dependent requirements of the components are determined during the BOM explosion.
· Additional requirements (unplanned goods issues, excess consumption of components in production, and so on) can be covered by using the materials forecast
· Total planning run for master schedule items or single item planning for master schedule items
· Creates dependent requirements for the BOM level directly below the planning level
· Once the master plan has been finely tuned for the master schedule items, you start the total planning run for all dependent parts.
|Usage: In every industry for material planning||Usage: Mostly for FG products planning at Pharma, Automobiles, Chemicals, Food Industries.|
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Thanks for the blog.
I have one query what will happen if we use MPS for FG material and PD for SFG and Raw material. Then down level material will get planned or not?
When we will execute MPS it will just raise demand at SFG level.
When we will execute MRP at SFG through that we can plan down-level material according to mrp settings.