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Home / ERP Blog 06.14.18 / Technology Evaluation / ERP in Complex Manufacturing – Key Considerations for Success
06.14.18

ERP in Complex Manufacturing – Key Considerations for Success

ERP in Complex Manufacturing – Key Considerations for SuccessWhen it comes to ERP in complex manufacturing, a few definitions are in order.

We look at complex manufacturing as companies that manufacture highly engineered products with longer product cycle times and multiple levels of subassemblies in their bills of material.

These organizations design, engineer and manufacture “discrete” products to order. This approach is distinct from “batch manufacturing.”  With complex manufacturing, the company needs to track manufacturing history down to each serialized product unit. In contrast, batch production manufacturers track production per work center, day, batch or lot.

Some of the complex discrete manufacturers we have worked with serve vertical industries such as aerospace and defense, specialized industrial equipment, electronics and other areas. They’re challenged by complex configurations and systems. As an example, one piece of equipment can have from 500 to over 1,000,000 components and require 200 to 500 steps to assemble.

Complex equipment manufacturing companies tend to be low-volume businesses with a large product mix.

What are the Rules for Selecting an ERP in Complex Manufacturing?

Find out by downloading our “Evaluating an ERP system” White Paper.

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Complex Processes

Ultra’s team of independent ERP consultants has seen that in complex manufacturing, it is necessary to manage complex diverse product configuration, long product lifecycle, along with increased market pressure for shorter time to market for new products and stricter regulatory compliance oversight.

Some of the more significant challenges faced by these manufacturers are in the areas of:

  • Tracking operations over long cycle times, low volume, make-to-order or engineer-to-order
  • Complex product development involving multiple Bills of Material (BOM)
  • Complex process routing sequences with decision points and loops
  • High flow of engineering changes affecting work-in-process
  • Production is not repetitive, and mechanics must be alerted for changes

Requirements for ERP in Complex Manufacturing

When considering ERP in Complex Manufacturing, it’s best to start with a look at the most pressing challenges.  That’s a good way to approach setting ERP selection criteria.  In fact, Complex Manufacturing, by definition, comes with some challenging issues and needs.

  • Engineered products often require a high number of BOM’s supporting various iterations of similar products
  • Industry requirements demand extensive product documentation that must be maintained based on contracts and regulatory controls.
  • Compliance and enhancements drive extensive engineering change and product revision control requirements.
  • Diverse markets cause complex supply chain and supplier certifications and quality Requirements
  • Production resource constraints and organization often requires multi-facility/cross-facility manufacturing i.e. Sub-Assemblies supplied from alternate plants
  • Customer service requirements include warranty and after-market parts management based on contract and regulatory controls
  • Long production cycles demand complex scheduling and constraint management

ERP in Complex Manufacturing – Next Steps

I’ll be touching on additional issues impacting ERP in complex manufacturing in the second part of this blog series.

Forward-looking complex manufacturers are now evaluating how enterprise systems can be used to drive true business process transformation.

Contact Ultra to consider your strategies in the face of a complex manufacturing environment.

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Categories: Technology Evaluation Tags: Complex Manufacturing, Distribution ERP, ERP Assessment, erp best practices

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About Martin Davis

Martin Davis

Marty Davis has 30+ years of business experience helping both mid-sized and large manufacturing and distribution companies optimize their operations and business processes. Marty has guided hundreds of companies through improving their profitability and efficiency through technology. He has also assisted organizations in promoting innovation through more effectively utilizing people, processes and technology. His extensive background in working with IBM and Oracle has provided him with a vast knowledge of many industries and process areas. Marty began his career in Wholesale Distribution working extensively in distribution and logistics, as well as sales and operations. Marty’s real world experience offers valuable and practical insight into the effective implementation and management of technology.

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