Comparing Ddmrp and Mrp Using Simulation

Demand Driven Material Requirements Planning (DDMRP) is a production planning and control approach designed for fast response to customer requirements in varying and volatile demand and supply markets. DDMRP is an extension of MRP approach that explores the principles of Lean and Theory of Constraints philosophies of production to reduce manufacturing response time and make good use of manufacturing resources. It achieves this by promoting flow, through selective, reduced and continuously adjusted inventory levels, towards synchronization of manufacturing and supply with customer market demand. On-ly few studies compared the performance of both approaches. However, in these studies the relationship between inventory and service levels has not been fully addressed. Therefore, this research is a contribution for a better understanding of this relationship by evaluating and comparing, the performance of these two approaches in a multi-product multi-stage production system. Results of discrete-event simulation show that DDMRP clearly outperforms MRP concerning the levels of work-in-process and finished-goods-inventory that are required to achieve a given service level.