In Multi–mode Project Scheduling with Resource Constrained (MPSRCP), activities are sequenced under resource limitation. In this thesis, an extension of the problem is considered. Multi-project multi-mode resource constrained scheduling problem with material ordering is studied. Bonus and penalty are taken into account in solving the considered problem as it is the case in many different industries. A literature review is presented and various solution methods for solving the considered and similar problems are studied. A new mathematical model is proposed considering a multi-project version of the problem. A new decomposition based heuristic to solve the problem is developed in this thesis. The approach is to use three separated mathematical models for each part of the problem. The developed heuristic is examined using various example problems with different features and randomly generated data. It can generate close-to-optimal solutions for all tested example problems with much reduced computational time when off-shelf optimization software was used. The developed math model and heuristic method are applied to a larger size case study based on a practical system in a manufacturing company in northern Ontario.