BANIGO Rogers1
IKEGWURU MacKingsley2
1 Department of Marketing, Faculty of Administration and Management,
Rivers State University Nkpolu Oroworukwo, Port Harcourt, Nigeria
2 Department of Logistics and Supply Chain Management, Faculty of Administration and Management,
Rivers State University Nkpolu Oroworukwo, Port Harcourt, Nigeria
Abstract
Effective inventory management is crucial to maintaining competitiveness and achieve organizational success.
This paper evaluated the concept of material requirement planning (MRP) and assessed it import to and organizational performance metrics (inventory turnover, order fulfillment, cost savings, service level). Extensive literature review was done to sound the views of scholars on the meaning and nature of MRP, as well as its contribution to organizational performance. Based on the literature review, we observe that MRP has significant influence on organizational performance. This is because the studies assessed, all report that MRP informs higher stock turnover rates, increased profitability, enhanced service levels, customer satisfaction, among other outcomes. Thus, the study concluded that MRP is a viable inventory management practice that leads to improved organizational performance; and study recommends that firms, especially those in retailing, that are desirous of boosting their performance should invest in technology-based MRP system.
Keyword: Customer satisfaction, inventory turnover, material requirement planning, order fulfillment, organizational performance.