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APPENDIX A

MRP VS. KANBAN

Although Kanban is an excellent execution tool, it is not intended as a planning tool. However, planning is where MRP-type systems excel. MRP systems work by taking a production forecast and turning it into a series of component forecasts. They do this by using bills-of-materials and routers, which break down each finished good into its basic components. MRP systems also use data on lead times and safety stocks to develop production schedules and raw material requirements. MRP systems excel at planning; however, they are data-intensive systems fraught with problems:

  • Forecast error
  • Labor intensive
  • Systems intensive ...

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