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MRP vs. ERP vs. PLM Software Usage in Electronics

erp vs mrp vs plm

OEMs, contract manufacturers, EMS companies, large enterprises, and engineering services and design firms make use of several pieces of software to do their jobs. Some of these software packages may include data management features that provide integration across multiple functional areas to enable enterprise-level execution, while others help track and manage design-level data for a product. These companies need to manage different portions of the product development and production process, and each needs specialized software to help them succeed.

Three important software platforms used by these various companies to manage development and production for a new product include:

  • Enterprise resource planning (ERP)
  • Manufacturing resource planning (MRP)
  • Product lifecycle management (PLM)

Product lines, process flow, components, and raw materials all flow through this set of applications. Ultimately, the path to market is guided through these applications, and growing companies will need to select at least one of these platforms to help them manage development and production.

MRP vs. ERP vs. PLM Usage

These three major enterprise management systems are used at multiple levels, ranging across design and production. While they are not the only systems companies use to manage production, they are among the group of important enterprise systems that directly relate to electronics design and production operations.

Manufacturing Resource Planning (MRP)

It is a production planning, scheduling, and inventory control system used to manage manufacturing processes. MRP software is designed to answer three fundamental questions: What is needed? How much is needed? And when is it needed?

Production Planning

Production runs can be scheduled and managed within the company’s available fabrication/assembly capacity.

Purchasing and Inventory Management

If connected to a stocking system, MRP can be used to monitor stock levels and automatically prepare orders for execution based on sales forecasts and upcoming production schedules.

Work Order Management

MRP systems are used to generate work orders, detailing what is to be produced, and the materials needed.

BOM Management

Users can manage BOMs for a part number/assembly number, including multiple variants and alternates for an assembly.

For manufacturers, MRP systems are used to primarily handle procurement and project management functions in a facility. This includes moving orders through each step of production, tracking parts and materials orders, and monitoring inventory across a facility. These systems may later pass data into a larger system that spans across enterprise operations, known as the ERP system.

Enterprise Resource Planning (ERP)

ERP software is a suite of integrated applications that are used to manage a company's supply chain, operations, reporting, and manufacturing activities. ERP systems also enable management or automation of administrative functions, such as finances and human resources. This is a more general type of system for operations management that is used across industries, not just by electronics manufacturers.

Supply Chain Management

Users can manage all aspects of a company’s supply chain, including visibility into procurement, inventory management, and logistics.

Customer Relationship Management

Users can manage and track customer interactions, sales, and account history in an ERP system.

Human Resources Management

Personnel can be managed, including tasks like payroll and performance review.

Project Management

Certain enterprise-level project management functions can be executed in an ERP system.

Product Lifecycle Management (PLM)

A PLM system is one of the very important platforms electronics companies need to track and manage their design data, component data, supply chain information, codebase for embedded systems, and much more. Anything related to production of an electronic device over its entire lifecycle can be performed in these systems.

PLM systems are very important for data management in larger companies with sizable product lines because they compile all information into a single location. By formalizing storage and tracking of design data into a single application, they eliminate the need for tribal knowledge and manual data tracking across different functional areas. PLM systems can also integrate with CAD systems and version control systems to help streamline the management of product data.

Centralized Product Data

PLM software can act as a single source of truth for all product-related data, including designs, specifications, and manufacturing data.


PLM systems function as a collaborative tool across teams by allowing all data related to a product to be stored in a centralized location.

Revision History

Revisions to a design can be tracked and rolled back with an integrated or external version control system.


The best PLM systems can integrate with supply chain data providers so that component data can be updated and obsolescence can be tracked.

Contract manufacturers and EMS companies do not need PLM systems to work with customer data. However, OEMs and even smaller engineering firms will use PLM systems to track lifecycles for their own products or on behalf of customers. As your company grows, it may be necessary to add a PLM system into your management structure to ensure your company can streamline processes around your product lines.

No matter what you need to procure and manufacture, make sure you first build and qualify your designs using the complete set of system analysis tools from Cadence. Only Cadence offers a comprehensive set of circuit, IC, and PCB design tools for any application and any level of complexity. Cadence PCB design products also integrate with a multiphysics field solver for thermal analysis, including verification of thermally sensitive chip and package designs.

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