I’ve been working with MRP systems for a long time. A long, long time.
Long enough that when I say things like AVL or talk about APICS certification, some people stare at me like I’m describing cave paintings. But the fundamentals of MRP haven’t changed — and the companies that get the most value out of it all tend to follow the same basic principles.
Before we get into the mechanics, let me set expectations.
My goal here isn’t just to answer questions about MRP. It’s to raise a few new ones. Ideally you’ll read some of this and think:
“Yeah, yeah, I know that.”
…and then hit a few moments where you go,
“Wait — I didn’t know that.”
Those are the good parts.
First, a Quick Reality Check About MRP
MRP only really tells you three things:
- What you need
- How much you need
- When you need it
That’s it.
If your system is doing those three things well, you’re in good shape.
If it isn’t, the problem is almost never the math.
MRP is basically a big, very fast calculator. It’s really good at remembering things and really good at math. What it’s notgood at is questioning the data you give it.
It will believe you completely.
Which brings us to the most important rule of MRP.
Garbage In, Garbage Out (Yes, Really)
I once visited a company that told me our MRP system didn’t work.
“Your MRP is a piece of junk,” they said.
“It doesn’t tell us the truth.”
After spending a day with them, I realized the system wasn’t the problem.
Everyone in the company had quietly added their own buffers:
- Sales set every order to ship immediately so theirs would get priority.
- Purchasing inflated lead times so they wouldn’t get blamed if something was late.
- Production added their own cushions in the schedule.
The result?
Everything was urgent.
Everything was late.
And the MRP output was completely useless.
Not because the math was wrong — because the inputs were.
The Three Things That Must Be Accurate
If you want MRP to work, three things have to be right.
According to the old APICS guidance (which I still like), the critical data elements are:
- Inventory accuracy
- Bills of material
- Lead times
Inventory and BOMs need to be nearly perfect. If those are wrong, parts will either appear when they shouldn’t — or worse, not appear when you actually need them.
Lead times matter too, but they’re a little more forgiving. If they’re off, the system will still show the demand — just not always on the right date.
But if your inventory or BOMs are wrong, the system may not show the requirement at all.
Another Surprise: MRP Doesn’t Actually Do Anything
This is something that surprises people.
MRP doesn’t automatically create purchase orders.
It doesn’t schedule jobs.
It doesn’t call your suppliers.
And honestly, you probably don’t want it to.
What it does is calculate the plan and show you what should happen.
That’s why buyers and planners still matter. Humans can look at the plan and say things like:
- “If I combine these orders I get a better price.”
- “That supplier ships on Tuesdays — I should move this.”
- “This order isn’t really urgent.”
MRP gives you the information. People still make the decisions.
The Best Way to Improve Your MRP
Here’s something I tell customers all the time:
Run MRP even if your data isn’t perfect.
You won’t break anything.
Instead, you’ll get a report that tells a story — and that story will highlight exactly where your data needs improvement.
For example:
- If MRP says you need to buy something you already have, your inventory is wrong.
- If it doesn’t show a requirement you know exists, your BOM is wrong.
- If everything shows up too early or too late, your lead times are wrong.
Each run helps you fix a little more data.
Over time, the plan gets cleaner.
Eventually you reach the point where people say:
“Yeah — we live and die by the MRP.”
That’s the goal.
One Last Thought
MRP works best when people treat it as a system for learning, not just a report for purchasing.
Run it regularly.
Question the output.
Fix the underlying data.
Do that consistently and something interesting happens:
The system starts telling the truth.
And when your MRP tells the truth, planning gets a whole lot easier.