Blog

What is Demand-Driven Material Requirements Planning?

Posted by [email protected] on Dec. 15, 2020  /  Subscribe 0

Professional supply chain managers understand the importance of demand-driven material requirements planning, or DDMRP. It's what they do for a living, and there's no one more important in a manufacturing or production environment than the supply chain manager. Factories and manufacturing plants need the raw materials they turn into saleable products, and the only way they get those basic materials is via DDMRP and supply chain management. The planning, acquisition, inventorying, production, and final shipping of finished goods depends entirely on supply chain managers' skills and abilities, but what exactly is demand-driven material requirements planning?

Critical Care on an Industrial Scale

Nothing is more important than having what you need, where you need it, when it's needed—which is why we need DDMRP professionals. Demand-driven MRP is a multi-echelon supply chain planning process that identifies all needed components to complete the production process, including production materials and supplies. Budgets, schedules, promotions, and other essential business functions depend on the diligent execution of DDMRP methodology. The importance of proper DDMRP cannot be understated when it comes to the profitable operations of a manufacturing entity of any size.

Work Smarter, Not Harder

Supply chain management starts with multi-level applications that identify and monitor purchase cycles, which provide an adequate lead time for production materials to be available. Transportation, delivery, inspection, and inventorying of incoming materials is one part of the process that covers everything from vendor identification to ordering and tracking shipments into and out of the factory. Coordinating and controlling the flow of materials requires sophisticated software and education. The materials requirements planning DDMRP supports require training and education in the latest protocols and applications.

Get Dialed-In—Fast

Demand-driven materials requirements planning is the updated and upgraded version of Manufacturer Resource Planning (MRP), which came about over four decades ago. At the time, MRP and Enterprise Resource Planning (ERP) software was revolutionary and brought supply chain management into the modern era. Standardizing language, processes, and terminology globally improved supply chain driven material requirements planning. There were, however, still deficiencies that these software programs did not address, issues like shorter lead times that supported Just-in-Time manufacturing protocols. Today's applications take the maelstrom of data and information involved in supply chain management and make it usable.

Go Your Own Way

Education, training, and certifications in supply chain management, including a variety of disciplines within DDMRP, are currently available. Those areas of study include:

• Demand-Driven Planner Professional (DDPP) Certification - Learning how to strategically "de-couple" traditional acquisition models to reduce lead times and inventory levels.
• Certification in Production and Inventory Management (CPIM) - Mastering processes and inventory for better financial results and lower operational costs.
• Certified Supply Chain Professional (CSCP) - Teaches the entire supply chain protocol from one end to the other.
• Certified in Logistics, Transportation, and Distribution (CLTD) - Learning the processes of identifying, moving, and delivering materials globally, regionally, and locally.

All of the courses are designed to provide a complete educational foundation for the subject while introducing you to the other vital aspects of DDMRP. Certifications serve to provide awareness of professional skills and capabilities and offer a platform for continuing education and professional training on an on-going basis. 

A New World, Evolving Daily

The days where ordering off a Bill of Materials list have morphed into time spent monitoring, communicating, and adjusting schedules via computer. Sophisticated applications enable professional supply chain managers to oversee every aspect of their efforts in real-time. E-commerce and DDMRP software allow better access, acquisition, and management of materials than ever before. Global networks provide more opportunities for supply chain managers to achieve their goals more readily while maintaining the level of control and quality needed for successful production operations.

Get a Better Feel for the Situation

When the first attempts at MRP were undertaken in the 1950s and 1960s, the need was for a uniform approach to manufacturing processes based upon a detailed Bill of Materials breakdown. At the time, it served its purpose, but over time, it became less and less workable. Nuances in shipping, changes in supply networks, the advent of computers and the internet, along with many other changes, demanded a tool that was more intuitive and allowed for greater customization as the circumstances required. Demand-driven materials requirements planning works with a higher degree of flexibility while maintaining a better awareness of changing conditions and faster responsiveness when conditions require adaptability.

Take Your Knowledge of Demand Planning to the Next Level With DDPP Certification

As the world continues to evolve, it is crucial to keep up with the changes throughout our industry—because all other industries depend on it. Demands-driven materials requirements planning is the future of supply chain management, and APICS offers courses for the Demand-Driven Planner Professional Certification exam to help you keep up with ever-evolving industry trends. 

At APICS, our mission is to continue the advancement of end-to-end supply chain management through a body of knowledge, innovative research, and methods to create value for customers, Members, and organizations alike. For more information on operations and supply chain management or the certifications and exam preparation courses we offer to help prepare you for success in these roles, visit our Certifications and Credentials Page today!

Return to list