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CHAPTER 22 Blueprint for the Future: Demand-Driven MRP Logic 387

owing to the shortcomings listed earlier, this leads many manufacturing personnel with-
in companies to think that they should ignore MRP. In fact, a frequent milestone for a lean
or DBR implementation is that the computer planning system has been eliminated or
effectively marginalized.
On the other hand, from a planning and purchasing perspective, companies must
have a way to see, plan, synchronize, and manage the availability of all materials, compo-
nents, and end items effectively. This is especially true for critical and/or long-lead-time
manufactured and purchased parts. With today’s increasingly complex planning scenar-
ios (discussed earlier), it leads planning personnel to insist on using MRP. A common reac-
tion to an expressed desire to ignore or turn off MRP leads to a fairly common reaction by
planning personnel: “You think it’s bad now? Wait ‘till we turn it off—we will be flying
completely blind.” The person who made the suggestion immediately loses credibility
with the planning side of the organization, which view the suggestion as one based on
oversimplification driven by a lack of fundamental understanding of materials planning.
However, both the opposing perspectives are correct. This is why the conflict is so
pervasive and chronic. The more complex the manufacturing environment, the more
acute this conflict tends to be. The inability to reconcile the dilemma in those environ-
ments effectively leads to the ineffective MRP compromises categorized earlier and also
will relegate lean, DBR, and Six-Sigma implementations to lip service. This completely
squanders their potential and the time, effort, and money already put into them.
The business requirements that are driving both sides of the dilemma must be
achieved without the conventional inaccuracy, inconsistency, and massive additional
efforts and waste associated with the current set of compromises. If companies want to
be agile, there is no other way.

DEMAND-DRIVEN MRP INTRODUCTION
MRP, as noted earlier in this book, has some very valuable core attributes in today’s more
complex planning and supply scenarios (e.g., bill of material visibility, netting capability,
and maintenance of sales order/work order connection between demand allocations and
open supply). In other words, critical aspects of it are still relevant—perhaps even more
relevant than in the past four decades. The key is to keep those attributes but eliminate
MRP’s critical shortcomings while integrating the pull-based replenishment tactics and
visibility behind today’s demand-driven concepts into one system in a dynamic and
highly visible format. The solution is called demand-driven MRP (DDMRP).
DDMRP builds from the still relevant foundations of Orlicky’s MRP. It takes advan-
tage of advances in technology over the past 60 years, as well as incorporating innovative
new logic with regard to the lead-time compression required to achieve and sustain a com-
petitive advantage in the demand-driven world. In addition to these innovations, DDMRP
leverages the complete toolbox, including core MRP and distribution requirements plan-
ning (DRP) logic, theory of constraints (TOC), and lean principles. Figure 22-2 illustrates
this fusion. A list of new terms is available in Appendix C at the end of this book.