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Do You Know the MRP Cost?

04 May 2012

Enterprise resource planning (ERP) began as manufacturing resource planning. Materials planning played a big role because you had to ensure that you had all of the supply chain covered before production could take place. Project management played an important role here, because costs had to be ascertained. The project manager has to work with a number of people in order to put all of the pieces together and determine the MRP cost. These contacts are both internal as well as external and include suppliers, distributors, warehousing, accounting, and procurement. Sourcing materials includes working with partners to establish the best deals in securing the supply chain. The project manager also works closely with the accounting department to determine costs and set a budget. Project management also works on an enterprise platform to administer materials management and expedite the process. Integrated application modules link him/her to to all of the necessary contact points, and the same platform is automated so that the process is carried out swiftly.

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Do You Know the MRP Cost?  

A project manager’s application modules includes links to human resources, and maintenance, as well. Personnel has to be scheduled and time frames set. The manufacturing shop floor has to be set up in advance and all production equipment checked out and properly serviced. The supply also requires that those materials that are needed at a specific time, are addressed with just-in-time deliveries. Application modules for this and cost calculations are included on the project manager's enterprise platform so that costs are monitored and tracked every step of the way. The accounting department maintains a general ledger  and works closely with project management to keep costs in-check at every level of the production schedule. Working on an enterprise platform makes it much easier to link with others both inside and outside of the business, and helps to ensure that all are working from the same script. This makes for less mistakes and communication breakdowns.

Just as the MRP cost is tracked, so must contacts with the customers involved, be. They need to be kept advised of the production schedule and how it is progressing. The enterprise system can supply information and data on a real-time basis and this means that project management is always working with updated information and can keep customers advised of what is taking place at any given moment. That same information can be shared, collaborated on and communicated to others within and without the enterprise on a real-time basis, as well. The enterprise platform also makes it easy to do reports, make analysis and provide business intelligence to management, upon request. This can be accomplished with the associated set of tools that come with a materials resource planning platform.

Materials planning requires working with a checklist that covers every phase of production. This includes labor, equipment. Parts, deliveries, customer relationship management, etc. Working on an materials planning platform that provides ERP application modules for all of these things and more, means that any project is more effectively managed.

Tracking the MRP cost needn’t be confusing. And working with enterprise software proves that it shouldn’t be.


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