Production planning decides which products to make, in what quantity and by what date, with the machines, people and materials available. It starts from customer demand and goes down, level by level, to the sequence of operations at each shop-floor workstation.
The levels of planning
- Sales and operations planning (S&OP): over one to three years depending on the company, it sets volumes by product family and aligns sales, production, purchasing and finance on a single, feasible and shared plan, usually reviewed every month.
- Master production schedule (MPS): over a few weeks to a few months, it sets out the quantities to produce for each finished product, from forecasts and firm orders. It is updated every week.
- Material requirements planning (MRP): it turns the MPS into component and material requirements through the bill of materials, net of stock and open orders. It generates production orders and purchase orders.
- Scheduling: over the coming days and weeks, it decides in which order production orders run on each machine or workstation. It is the last step of planning.
Each level is more detailed and shorter-term than the one above. A gap left unresolved at the top is paid for at the bottom: an over-optimistic S&OP becomes an overloaded shop floor.
MRP and MRP II
MRP (material requirements planning) appeared in the 1960s. MRP II (manufacturing resource planning) extended it in the late 1970s: it no longer calculates only materials, but also the resources that transform them, machines and labour. This is the logic found today in the production modules of ERP systems. It works on a push basis: production is driven by forecasts, before the customer orders.
Infinite or finite capacity
- At infinite capacity, the calculation assumes a workstation can absorb any load. It says what should be done, without checking that it is possible. This is the default setting of most MRP systems.
- At finite capacity, the calculation takes into account what each machine and each team can actually produce. It moves what does not fit and gives realistic dates.
Planning at infinite capacity and then levelling the load by hand in a spreadsheet is still common. This is exactly what finite-capacity scheduling tools and APS replace.
Push, pull and DDMRP
- Push produces according to the plan, from forecasts. It suits long lead times and complex products, but builds stock when the forecast is wrong.
- Pull produces only what the next step consumes. Kanban, which came from Toyota in the late 1950s, is its best-known tool: a card or signal triggers replenishment of a workstation. Just-in-time extends this logic to the whole plant. Kanban replaces neither forecasting nor the medium-term plan: it runs the short term.
- DDMRP (demand driven MRP) combines both. It places stock buffers at a few chosen points in the bill of materials and the chain, called decoupling points, and triggers production according to the actual consumption of these buffers. It borrows from MRP, DRP, lean and the theory of constraints.
Planning and scheduling software
- The ERP and its production module: MPS, requirements planning, production and purchase orders. For many SMEs, it is the first planning tool.
- Scheduling software: builds the shop-floor schedule at finite capacity, often as a Gantt chart that the planner adjusts.
- APS (advanced planning and scheduling): optimises materials and capacities together, from the MPS down to scheduling, and compares scenarios.
- The MES: reports actual shop-floor progress, which makes replanning possible. See our MES guide.
Large APS vendors do not publish their prices. For small businesses, some online production ERPs do: MRPeasy, for example, shows plans from 39 to 125 euros per user per month from France, depending on the level of features (vendor page, checked on 04/11/2026).
What manufacturers said at Tech for Industry Show
At Tech for Industry Show 2026, at Paris Expo Porte de Versailles:
- Forvia has made planning and scheduling one of its three AI workstreams: making forecasts more reliable, simplifying the configuration of complex scheduling tools so they can be rerun more often, and eventually centralising the function outside the plants. Read the article
- Safran organises its plants into production archetypes, including job shops whose scheduling is optimised by algorithms. Read the article
- SKF Magnetic Mechatronics is preparing a distributed MRP between its sites: a requirement raised in France or Canada would automatically become an order in Morocco and trigger production. Read the article
- No Chain Technologies and Argon & Co pointed out that before optimising under capacity constraints, the constraints themselves should be removed: a machine overloaded for two weeks, a badly placed maintenance slot. Read the article
The SKF Magnetic Mechatronics interview is available as a replay: Unify the IT system, equip the teams, prepare the factory of tomorrow.
How to improve planning
- Make master data reliable: bills of materials, routings, cycle times, supplier lead times, real capacities. A plan calculated on wrong routings is wrong.
- Hold a monthly S&OP with management, sales, production and purchasing at the table.
- Freeze the short horizon: stop changing the plan for the next few days except in emergencies, so the shop floor can produce.
- Plan bottleneck workstations at finite capacity, at least those.
- Measure schedule adherence: share of orders completed on the planned date, delays, causes.
- Choose the tool after the process: an APS does not fix a plan nobody follows.
2027 exhibitors equipping production planning
To meet at Tech for Industry Show 2027 (in alphabetical order):
- 4CAD Group: integration of ERP, MES and PLM solutions, including real-time production management;
- Elisa Industriq: S&OP, planning, scheduling and MES.
Frequently asked questions
What is the difference between planning and scheduling?
Planning decides what to produce and in what quantity over a period; scheduling decides in which order orders run on each workstation, day by day.
What is an MPS?
The master production schedule: the timetable of quantities to produce for each finished product, over a few weeks to a few months.
What is the difference between MRP and MRP II?
MRP calculates material and component requirements; MRP II adds production resources, machines and labour.
Do you need an APS?
When load often exceeds capacity, when products share bottlenecks or when the schedule is redone every day in a spreadsheet, a finite-capacity tool gives realistic dates. Otherwise, the ERP's production module may be enough.
Does DDMRP replace MRP?
It transforms it: it keeps requirements planning but drives it by the actual consumption of stock buffers placed at chosen points.
