Comparing MRP, Excel planning spreadsheets and APS

Many ERP systems claim to have integrated planning capabilities. In the vast majority of cases, they provide only the most basic functionality that doesn't meet the needs of your planners.

Result: Your production planners run the planning process from some Excel spreadsheet(s)... Sounds familiar?

The explanation is simple: the core of an ERP system is transaction processing, i.e. tracking all activities of a company in the areas sales, inventory, accounting, manufacturing, purchasing, etc. A planning process is by nature a flexible decision support and analysis process, which doesn't mix well with the structured and organized workflows of an ERP system.

 

MRP / MRP II / MPS
of your ERP system
Excel planning spreadsheet Advanced Planning and Scheduling tools, such as frePPLe
Integrated with company’s ERP data. Manual data maintenance.
Ask your planner how much time he/she spends copy-pasting data and preparing the plan...
Manual data maintenance or integrated with company’s ERP system.
Designed for execution and accounting of transactions. Ad hoc planning process.
Mailing Excel spreadsheets back and forth is not effective in creating an effective planning process.
Designed to support planning processes.
A single set of numbers is being shared across all involved departments.
Unconstrained explosion of material and capacity requirements.
If capacity constrained planning is available, it is primitive and/or based on manual iterative planning runs.
Formula's and macros for unconstrained or constrained planning. Automated finite capacity planning and scheduling.
The interaction of lead time, material and capacity constraints is recognized by the system, resulting in much higher plan quality.
Fixed lead time per product. Fixed lead time or formulas. Dynamic lead time considering all material and capacity constraints.
The delivery date for an order dynamically depends on the availability of material, resource availability and order priority.
Automated process. Manual plan creation.
Yes, you can create some macro's but there are limits to the size and complexity you can handle in this way.
Automated process, followed by manual interaction with the proposed plan.
No evaluation of alternates. Formulas and macros for alternate selection. Intelligent alternate selection based on cost and priority.
No what-if capabilities. Copy your Excel spreadsheet to create a what-if simulation. Advanced what-if capabilities and scenario planning.

 

In summary:

  • Basic requirements can be met from your ERP system.
  • A slightly more complex environment will quickly require some planning spreadsheet(s) to support your planning process.
  • Beyond a certain size and complexity, a spreadsheet-based planning process will no longer be sufficient, and proper system support for the planning process becomes a must.

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