This guest post looks at issues manufacturers can run into with ERP selection.
Every discrete manufacturer has a unique set of systems and specifications, and even though they may face equally individual challenges, one thing they typically have in common is the need for control and visibility across their enterprises.
A critical segment of a discrete manufacturer’s processes is supply chain management (SCM), which entails the control of materials, data, and finances as they move from each part of the supply chain:
The primary objective of SCM is to minimize inventory, which is typically costly to hold. To accomplish this, manufacturers must reduce variability in demand, supplier, and production lead times, and manufacturing lot sizes, to name a few considerations.
Planning and documenting each step of the manufacturing process is essential for estimating jobs accurately, as well as generating reports to track the process plan for each product. Subassemblies require a list of raw materials and components, along with their quantities, called the bill of materials. Monitoring and managing the workload of each operator and each piece of equipment is critical, as is transparency into each supplier’s systems.
So how can companies not only address all of these needs, but also do so efficiently, effectively, and accurately, with minimal stress and error?
Many discrete manufacturers are turning to Enterprise Resource Planning (ERP) systems to help them automate and sustain all of their administrative and operational processes. This type of integrated solution can prevent a multitude of organizational and operational issues because one system is consistently managing the entire organization in real-time.
Discrete manufacturing ERP software enhances the efficiency of supply chain management by integrating each supplier’s inventory, order status, updated pricing, order entry, and payments. The right ERP system can completely revolutionize your discrete manufacturing enterprise. Here’s how.
1. Real-time inventory
Accurate supply chain data and feedback from work-in-process is crucial for delivering the inventory data your business needs. With real-time inventory reports from your ERP system, you can have confidence in your purchasing lead times and production time estimates.
The right ERP system will also help to avoid surplus inventory by alerting you as soon as inventory conditions change. Disruptions in supply and shifting customer demands require an ERP system that is agile enough to adjust to these constant changes and make you aware as soon as possible.
2. Time-saving machine-to-ERP communication
So much time is wasted by workers on the shop floor when they must move from their work area to a terminal and manually input the number of units completed. Today’s production machinery can track those completed units and transfer the data—accurately and in real-time—right to the ERP system.
3. Better management of equipment
Manufacturers can set up their ERP systems to inform users which tool is required for various operations, and they can make sure it’s in the right place at the right time. They will know when any instrument or machine must be recalibrated, serviced, repaired, or replaced by tracking and reporting on its usage.
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4. Process specifications directly from engineering documents
The time-consuming task of manually typing specifications from the product engineer’s documents to the ERP system can be eliminated when those specs are automatically read by the ERP software directly from the documents. Not only is there a significant time saving, but there is less chance of error than when they are transferred manually.
5. Real-time production schedule updates
The best ERP systems have the flexibility to update production schedules in real-time based on current burdens along the production chain. Maybe overtime will need to be scheduled. Or perhaps rescheduling one order might affect another order’s delivery date. Whatever the issue is, your ERP system can handle it.
6. Lead times are generated automatically
Eliminate the possibility of missed due dates by automating the establishment of lead times. ERP systems can analyze available materials, labor capacity, and machine availability to provide anticipated lead times to product development.
7. Quality feedback and compliance
Your ERP system should help to ensure that all compliance requirements are met. Manufacturers can be sure that their routing and assembly instructions are followed because of the tracking and reporting that happens on all processes. The quality control function of the ERP should provide feedback, automatically identify potential problems, and report it to the appropriate user.
If any products are certified, the discrete manufacturing ERP software can supply compliance reports for the certification authority. It can also make sure the certification’s conditions are met.
8. ERP software can assist the make-or-buy process
ERPs can apply job estimating to subassemblies to determine whether components should be made or bought. Some systems can also factor in the time to build or buy, along with what it will cost.
As part of the make-or-buy process, each sub-assembly can be assigned a bill of materials, which informs these make/buy decisions by providing up-to-date market prices for material and labor for each product. Companies can guarantee the accuracy of the BOM by having them produced directly from the orders.
The benefits of ERP are continuously growing. This list of ways that ERP can revolutionize discrete manufacturing is by no means exhaustive. ERP selection and implementation could be the most significant step forward a manufacturing enterprise could take in 2020. It’s one of the surest ways for any manufacturing firm to stay ahead of the competition.
With the right manufacturing ERP system in place, you can transform your business into an efficient, productive, outcome-driven powerhouse that is positioned for the future. To learn more about ERP benefits and how to choose the right ERP for your business, check out the new e-guide from Decision Resources, Inc., “Choosing and Implementing an ERP System for Discrete Manufacturing,” available online for free.
ABOUT THE GUEST AUTHOR
Sam DeBone has proudly led Decision Resources, Inc.’s sales and marketing team since 1989. Sam has more than three decades of experience in the software industry and more than 25 years of experience with SyteLine and CloudSuite Industrial software solutions. He is actively involved not only with projects for new customers, but also in working to ensure that DRI’s existing customers continuously receive the advice and support they need concerning upgrades, new products, and consulting services. Sam enjoys working closely with DRI’s customers and is deeply committed to the company philosophy that there is nothing more important than DRI’s relationship with our customers