MRP vs MRP II vs ERP vs APS: The Alphabet Soup Explained

Two hundred castings arrived Monday, on time. By Friday, machining had finished 140 of them, and 60 castings sat on pallets next to the machine while 60 pumps went out late. The material plan was flawless. Nobody asked whether the machine could keep up.

That question is the whole difference in MRP vs MRP II. MRP (material requirements planning) calculates which materials you need, how many, and when. MRP II (manufacturing resource planning) wraps MRP in a closed loop: it checks the plan against capacity, feeds back what actually happened, and connects production planning with sales and finance. ERP and APS came later and answer other questions.

A short history of the acronyms

MRP, 1960s–1970s. Joseph Orlicky, working with IBM, showed that component demand can be calculated from what you plan to build and the bill of materials, and computers could finally do that arithmetic overnight. His 1975 book made the method a standard, and practitioners such as Oliver Wight and George Plossl spread it across American industry. The detailed logic is in MRP explained.

Closed-loop MRP, 1970s. Plants soon found that MRP plans as if capacity were infinite. Closed-loop MRP added capacity checks and shop-floor feedback.

MRP II, late 1970s–1980s. Oliver Wight popularized manufacturing resource planning, which kept the same letters and became MRP II. The idea: one plan for the whole company, from sales plan and master schedule through capacity and materials to the money.

ERP, around 1990. Gartner is widely credited with coining enterprise resource planning around 1990. ERP extended MRP II beyond the factory: accounting, HR, sales, distribution, in one database.

APS, 1990s. Advanced planning and scheduling tools schedule with finite capacity: every operation on a real machine, with a real calendar. APS answers the question MRP never asked: can this machine do this job, at this hour?

The 60 idle castings, worked through

The plan was 200 pumps this week. Each casting needs 0.5 hours on the machining center, which has 70 hours available.

What MRP did. 200 pumps × 1 casting = 200 castings. Stock was zero, lead time two weeks, so MRP ordered 200 two weeks ago. They arrived on time.

What capacity allowed. 70 hours ÷ 0.5 hours per casting = 140 castings. Demand on the machine: 200 × 0.5 = 100 hours. Short by 100 − 70 = 30 hours, which is 60 castings.

What MRP II would have done. A capacity check on the master schedule would have shown the machining center at 100 of 70 hours before the castings were ordered. The planner then chooses: 140 pumps this week and 60 next week (if next week has 30 free hours), a Saturday shift, or a subcontractor. MRP orders castings to match, so the 60 arrive when the machine can use them. That check is rough-cut capacity planning.

The MRP-only version cost more than 60 castings of cash on the floor. It cost 60 late pumps and a week of expediting, decided by default.

An everyday analogy

MRP is a caterer who orders food for 200 wedding guests with perfect timing. Nobody told the caterer the hall seats 140. MRP II is the wedding planner who checks the hall, the budget and the guest list before calling the caterer.

Myth: "Each generation replaced the one before"

It is easy to read the history as a line of upgrades. In fact, each layer wraps the previous one:

• MRP II contains MRP. It adds the capacity check and the feedback loop around it.
• ERP contains MRP II. It adds the rest of the business around it.
• APS usually sits next to ERP, taking its orders and returning a finite schedule.

So a modern ERP still runs 1960s MRP logic every night, often with the same infinite-capacity assumption. That is one reason ERP dates and shop-floor reality disagree, as covered in why ERP thinks every order takes 10 days.

Which one do you need?

Take your last ten late orders and find what went wrong first:

• Material was missing. Improve MRP inputs: BOMs, stock accuracy, lead times.
• Material was there, the machine was not. You need the MRP II capacity check.
• Capacity was fine in total, but the sequence failed. You need finite scheduling, the APS part.

Most plants find all three, which is why the path usually goes in stages, as laid out in manufacturing planning software.

How it looks in factory.online

In factory.online, MRP and capacity run on the same plan. The 200-pump manufacturing order explodes into a 200-casting requirement, and RCCP shows the machining center at 100 of 70 hours for that week. In a planning scenario the planner splits the order into 140 and 60, sees next week's load, and MRP moves the casting requirement to match. The finite schedule then places the 140 castings hour by hour.

If your castings arrive on time and your pumps still leave late, bring the order to a demo.