What is ERP? What is MRP? Are they the same thing? These questions are often asked in the manufacturing and business world. It is easy to get confused when the letters are thrown around without explanation.
When you know the full MRP vs ERP meaning, you will better understand the MRP and ERP system. Read on to get a clear understanding of each system and why many businesses are choosing an integrated ERP system.
ERP vs MRP Basics
MRP stands for Material Requirements Planning software system. It was software designed for manufacturers to keep up with production and inventory. This would help them to maintain consistent production and not have to stop.
The ERP definition is Enterprise Resource Planning software system. It focuses on all aspects of the business from manufacturing and supply, to finances and staffing. It is multiple systems all resourcing the same data in a company.
MRP Focus
The MRP focuses on having the materials needed so products can be produced for customers. The software helps manufacturers balance inventory levels and finished product levels to meet demands.
It keeps up with the output needed to keep up with sales orders, purchases, and projections. It is often a stand-alone program that has a singular focus for the company.
ERP Focus
The ERP focus encompasses the manufacturing side but also accounts for the entire scope of the business. ERP utilizes accounting, customer connection, quality control, strategic planning, and supply chain among many other things.
The ERP keeps all of the business information together and allows all of the departments to access it. This helps every department to stay informed in real-time about how the business is accomplishing its goals.
ERPs provide real-time information for all departments within the company. They provide a common user interface for every application so each department can work together with ease.
The Menu vs A Meal
A way to understand what is ERP system vs an MRP system is to think of a restaurant. ERP is the entire menu and MRP is one meal on the menu. ERP systems include MRP applications, but they have a whole lot more.
They are often SaaS cloud-based systems like the IFS ERP Application that help all departments of a business stay focused. ERP systems are also more adaptive to work with existing systems you may already use in your business.
MRPs main focus is on the manufacturing side of the business. The ERP includes the manufacturing side but brings all of the other parts of the company together.
Your Need Determines Your Pick
The MRP vs ERP challenge comes down to two focuses. MRP is a narrow-focused program that just covers your manufacturing process. ERP is a fully integrated system connecting your whole business together.
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