Demand Driven MRP: assessment of a new approach to materials management

Abstract

Demand driven material requirements planning or DDMRP is a recent and promising material management method that has been developed and implemented in the practitioner world. Essentially, DDMRP represents a rethinking of the basic MRP logic. By incorporating elements drawn from Lean Systems and the Theory of Constraints and by introducing new features such as dynamic buffers, DDMRP modifies the basic MRP logic so that it is better able to satisfy customer demands in an increasingly demanding, turbulent and dynamic environment. Claims have been made by firms that DDMRP represents a superior planning approach. In this paper, we introduce and explore DDMRP. In addition, we evaluate its effectiveness relative to two other widely accepted approaches – MRP II and Kanban/Lean production – through a series of structured computer simulation experiments. The results strongly indicate that DDMRP does represent a superior approach – one that warrants further academic study.

Keywords:

• Demand Driven MRP
• variability management
• MRP
• Lean
• Kanban

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Notes

1. Product: “Any good or service produced for sale, barter, or internal use.” (APICS dictionary, 15th edition, 2016).