MRP (material requirements planning)
MRP is the calculation of what has to be bought or produced, and by when, to deliver the plan. It explodes bills of materials against orders, subtracts stock on hand and deliveries in transit, and shifts what is missing back in time by the lead time or the production time.
The inputs are the production plan or confirmed orders, the bills of materials, stock on hand, open purchase orders, lead times and commercial constraints: minimum order quantity, pack multiples, safety stock. The output is a list of proposed purchase orders and production orders with the dates they have to be released.
The abbreviation gets confused with MRP II and with ERP. MRP calculates material, MRP II adds production capacity and work-centre loading, and ERP covers the whole company including sales and accounting. In Polish systems the module is usually called material requirements (zapotrzebowanie materiałowe).
MRP is exactly as good as the data it runs on. Stock posted late, an out-of-date BOM and a lead time entered once when the item was created produce a list the buyer will not approve, so ordering goes back to the spreadsheet. The calculation proposes; a person decides.
The signal that this concerns your company is material arriving too late for one order while months of cover sit on another item number, and purchase orders being raised from the buyer's memory.