MRP II and S&OP: How are they connected?

S&OP is a structured planning process, with the main objective to balance the market demands and the organization’s resources and the supply of materials and services. The S&OP get initial alignment from the Business Plan (2 to 5 years horizon) and the Functions strategies in the organization (1 to 3 years), to produce a full plan with a scope on 3 to 18 months.

Typically, a discussion about S&OP is focused on organizations that make and distribute products. However, the principles and process are just as applicable to businesses that import products, contract out their operations or sell logistics services.

S&OP can be the planning tool used throughout a supply chain – it is as applicable in planning a loading terminal for commodity materials or a shipping container park as it is for planning a product based business.

Having set this, now the S&OP plan have to be translated for the execution, and is here where the MRPII support on it.

A Master Plan Schedule (MPS) is prepared with a horizon of 1 to 6 months, according to the outcomes from the S&OP process, reviewing Capacity Plans (CRP) and the Distribution Planning (DRP). And with this MPS requirements, a full MRP II is prepare with all details for the execution, giving the guidelines for the execution schedules (scheduling) for each week of operation.