History of MRP

1913 to today · 13 chapters · 21 dated events · 19 sources

The short answer

MRP took shape in the early 1960s. Joseph Orlicky worked on it at J.I. Case, and Black & Decker is usually cited as the first company to run it, in 1964. IBM published PICS in 1968 and COPICS in 1972. Orlicky’s book came out in 1975 and the method spread through APICS. Oliver Wight’s MRP II added capacity and money around 1980, and ERP absorbed MRP after 1990. It still runs inside most ERP systems today.

Material requirements planning (MRP): A planning method, usually run by software, that works backward from what must ship and when. It explodes the bill of materials, subtracts stock on hand and on order, and offsets each part by its lead time to say what to make or buy, and when.

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The story

Today· Your shop

Where it starts

Every shop that builds things asks the same two questions. What do we need, and when do we need it? Order too early and your cash sits on a shelf. Order too late and a job waits on one missing part. For more than 60 years, software has tried to answer those questions. This is the story of that software, called MRP, and of the clipboard that still sits beside it.
1913· Economic order quantity

How many at once?

The first answer was a formula. In 1913, an engineer named Ford Whitman Harris published a short article called How Many Parts to Make at Once. Every setup costs money, so you want big batches. Every part on the shelf ties up cash, so you want small ones. Harris found the batch size where the two costs balance. It became known as the economic order quantity, and it is still taught today.
1913 to 1960· Reorder points

Order when it runs low

For the next 50 years, most shops ran inventory on reorder points. Watch each part. When stock falls to a set level, order more. That works for bolts and paint, where use is steady. It fails for parts that go into an assembly, because they get used in lumps, on the day the assembly is built. In 1957, 27 production and inventory managers met in Cleveland and founded APICS to work on problems like this one.
1961· Racine, Wisconsin

The parts list

The key was the bill of materials. Every product breaks into parts, and every part may break into more parts. In October 1961, Gene Thomas of IBM and Joseph Orlicky of the J.I. Case tractor company worked out a program to store those parts lists on a computer and explode them, level by level. IBM called it BOMP, the Bill of Material Processor. Some histories date its release to 1965.
1964· Material requirements planning

What do we need, and when?

Now the question could be answered for every part at once. Start with what you have promised to ship, and when. Explode the bill of materials. Subtract what is on the shelf and what is already on order. Offset each part by its lead time. In 1964, Black & Decker ran this on an IBM 1401. Some say Orlicky’s work at J.I. Case came first. Who was first is still argued.
1966 to 1972· PICS and COPICS

IBM packages it

IBM saw a product. In 1968 it published PICS, the Production Information and Control System, a plan for running production on its mainframes. COPICS followed in March 1972, in several volumes. The early runs were slow. A full regeneration replanned every part from scratch and could run for hours. Net change replanned only the parts a change touched, so the plan could be updated more often.
1970s· APICS

The MRP Crusade

In the 1970s, MRP became a movement. Orlicky, George Plossl and Oliver Wight, known together as POW, taught it across the country through APICS. Orlicky’s book came out in 1975. That year, about 700 companies ran MRP. By 1981, about 8,000 did. A later textbook, Factory Physics, called this period the MRP Crusade. Every run depended on an accurate parts list and an accurate count of the shelf.
Around 1980· MRP II

Closing the loop

MRP assumed every machine had unlimited time. It would plan a week of work for a lathe that only had a day free. The fix was to check the plan against capacity, and to feed what really happened on the floor back into the next run. Oliver Wight called the whole loop, with purchasing and the money included, manufacturing resource planning, or MRP II. His book came out in 1981. Some sources date it to 1983.
1953 to 1983· Toyota and kanban

Pull from the floor

While American plants pushed work out on a computer plan, Toyota pulled it. In 1953, the machine shop at its main plant began using cards, called kanban. When a box of parts is used up, its card goes back upstream, and only then is more made. Taiichi Ohno developed the system. In 1983, APICS launched its Zero Inventories Crusade, and just in time became the counterpoint to MRP.
1984· Theory of constraints

The bottleneck

In 1984, Eliyahu Goldratt and Jeff Cox published The Goal, a novel about a plant manager trying to save his plant. Its point was simple. A plant can only ship as fast as its slowest step. Work released faster than the bottleneck can take it just piles up in front of it. So plan around the bottleneck, and let everything else follow. MRP had planned every work center as if each one mattered equally.
1988 to 2000· ERP and APS

A schedule that fits

In 1990, Gartner gave the next step a name, enterprise resource planning. MRP became one module inside a larger system, next to the ledger, sales and purchasing. Meanwhile, i2 Technologies, founded in 1988 by Sanjiv Sidhu and Ken Sharma, sold planning software that respected each machine’s real capacity. The category was called advanced planning and scheduling, or APS. It usually ran beside the ERP, as a separate system.
2011· Demand driven MRP

Buffers

In 2011, Carol Ptak and Chad Smith revised Orlicky’s book and added demand driven MRP. It mixes the old logic with ideas from lean and the theory of constraints. You hold stock buffers at a few chosen points, sized in zones called red, yellow and green. When a buffer drops into yellow, you order. Everything else is planned from real orders. Some sources date the method to 2010.
Today· Your shop

The plan and the clipboard

Today, MRP still runs inside most ERP systems, often overnight, with logic Orlicky would recognize. And in many shops, someone still walks the floor with an expedite list. The math was never the hard part. A plan is only as good as the parts list, the lead times, the count on the shelf and the promise in the quote. When those live in one place, the plan can be trusted, from quote to invoice.

Key dates

Where reputable sources disagree on a date or on who was first, the row says how.

Year	Thread	What happened
1913	Inventory rules	How Many Parts to Make at Once. Ford Whitman Harris publishes the economic order quantity in Factory, The Magazine of Management, February 1913. It balances setup cost against the cost of holding stock. Source
1953	Lean & pull	Kanban in Toyota’s machine shop. Toyota applies pull logic in the machine shop of its main plant. A card on each box of parts signals when to make more. Taiichi Ohno develops the system. Source
1957	Inventory rules	APICS is founded. 27 production and inventory control managers in Cleveland, Ohio form the American Production and Inventory Control Society. It renames itself ASCM in 2018. Source
1961	MRP	BOMP at J.I. Case. Gene Thomas of IBM and Joseph Orlicky of J.I. Case work out the Bill of Material Processor in October 1961, in Racine, Wisconsin. Sources differ: An interview-based history dates BOMP to October 1961 at J.I. Case. Wikipedia dates IBM’s BOMP to 1965, with DOS on the System/360. Source
1962	MRP	Orlicky joins IBM. Orlicky leaves J.I. Case for IBM, where he meets Oliver Wight. His Case process is described as one of the earliest automated net change MRP runs. Source
1964	MRP	Black & Decker runs MRP. Usually cited as the first MRP implementation, with Dick Alban as project leader, on an IBM 1401. Sources differ: Some histories credit J.I. Case (1961 to 1962) with the first MRP system, others Black & Decker (1964). Some vendor histories put Black & Decker in the late 1960s. Source
1966	MRP	PICS RPS. Gene Thomas recalls IBM’s PICS RPS of 1966 as the first packaged and marketed MRP system. Sources differ: Single source: an interview with Gene Thomas. Source
1967	Inventory rules	Plossl and Wight’s textbook. George Plossl and Oliver Wight publish Production and Inventory Control: Principles and Techniques. Source
1968	MRP	IBM publishes PICS. The Production Information and Control System: IBM’s plan for running production planning on the mainframe. Source
1969	MRP II & ERP	Oliver Wight starts his firm. Wight founds his education and consulting company. It goes on to lead the move from MRP to MRP II. Source
1972	MRP	IBM COPICS. Communications Oriented PICS, first edition March 1972, published in several volumes. Source
1975	MRP	Orlicky’s book; 700 companies. Material Requirements Planning is published. About 700 companies run MRP that year. Source
1980	MRP II & ERP	MRP II. Closed-loop MRP grows into manufacturing resource planning: materials, capacity, the shop floor and the money in one plan. Sources differ: Wikipedia’s MRP article dates MRP II to 1983; its MRP II article places the shift around 1980. Wight’s book carries a 1981 copyright. Source
1981	MRP	About 8,000 companies. MRP has grown from about 700 companies in 1975 to about 8,000. Source
1981	MRP II & ERP	Wight’s MRP II book. MRP II: Unlocking America’s Productivity Potential, Oliver Wight Limited Publications. Source
1983	Lean & pull	Zero Inventories Crusade. APICS launches its Zero Inventories Crusade in January 1983, carrying just in time ideas to American plants. Source
1984	Scheduling	The Goal. Eliyahu Goldratt and Jeff Cox publish a novel about a plant manager. It introduces the theory of constraints: find the bottleneck and plan around it. Source
1988	Scheduling	i2 Technologies. Sanjiv Sidhu and Ken Sharma found i2 in Dallas after leaving Texas Instruments. Its planning software works to the real capacity of each resource. Source
1990	MRP II & ERP	Gartner names ERP. Enterprise resource planning, described as the next generation of MRP II. MRP becomes one module in a larger system. Source
1996	MRP	Factory Physics. Wallace Hopp and Mark Spearman publish Factory Physics. Its history chapter on the MRP years is titled The MRP Crusade. Source
2011	Lean & pull	Demand driven MRP. Carol Ptak and Chad Smith revise Orlicky’s book and set out DDMRP: stock buffers at chosen points, sized by zone, replenished on actual demand. Sources differ: Most sources give 2011. Some say Ptak and Smith conceived the method around 2010. Source

Questions

Who invented MRP?

Joseph Orlicky is usually credited. He worked out bill of materials processing at the J.I. Case tractor company in the early 1960s with Gene Thomas of IBM, then joined IBM and wrote the book Material Requirements Planning, published in 1975.

Which company ran MRP first?

Black & Decker in 1964 is the usual answer. Some histories credit earlier work at J.I. Case, and who was first is still argued.

What is the difference between MRP and MRP II?

MRP plans materials: what to buy or make, and when. MRP II, named by Oliver Wight around 1980, adds capacity checks, feedback from the shop floor, purchasing and the money, in one closed loop.

How is MRP different from kanban?

MRP pushes work out from a computer plan. Kanban, used at Toyota from 1953, pulls work: a card goes back upstream only when parts are used, and only then are more made.

What is DDMRP?

Demand driven MRP, introduced by Carol Ptak and Chad Smith in 2011. It holds stock buffers at a few chosen points, sized in red, yellow and green zones, and plans everything else from real orders.

Sources

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The short answer

Watch the film

The story

Where it starts

How many at once?

Order when it runs low

The parts list

What do we need, and when?

IBM packages it

The MRP Crusade

Closing the loop

Pull from the floor

The bottleneck

A schedule that fits

Buffers

The plan and the clipboard