We have already compared the features and benefits of ERP Vs. MRP software. We derived from that discussion that ERP vanquishes and replaces standalone manufacturing software with its unified software architecture.
ERP Software for Manufacturing attempts to integrate all departments and functions across the company into a single system that could serve specific departments’ needs simultaneously.
This article will navigate you through the deciding factors behind choosing ERP for the Manufacturing business.
Where does all the ERP magic begin?
Before the introduction of ERP software- if a customer order arrives, it is keyed and re-keyed to different departments’ software/computer systems. All that keying and lounging around various departments causes delays and lost orders.
For example, to know if the order is shipped or not, you will have to get into the warehouse department’s system, so ultimately, you will need to call the warehouse department while bearing customers’ frustration. All along, no one in the manufacturing company truly knows the status of a particular order.
If we unbox the manufacturing process before ERP software existed, finance did its job, the warehouse did its job, and if anything went wrong beyond the departments’ walls, no one ever knew who was at fault.
But with ERP, not anymore; rather than just doing the basic work, its features make users businesspeople. Every transaction/activity is kept on record, and everyone works according to the system.
Hence, with ERP software, the process becomes more efficient.
With ERP software, a manufacturer could find out-
- Is the customer going to pay on time?
- Will we be able to ship the order on time?
- Do we have low inventory levels?
Manufacturing ERP Software will test your company’s accountability, responsibility, and communication and help you change the way you have been doing business because business as usual isn’t enough in today’s digitized era.
Implementing ERP software could be the best investment, but make sure you do the research and spend adequate time understanding your business requirements. Most manufacturing companies hire a professional ERP consultant or agency in such cases.
Reasons to Choose ERP Software for a Manufacturing Company
People generally dislike change if it’s about how they do their jobs. So, the value of ERP software could be hard to pin down. If you are someone who wants to improve the ways your people take orders, produce goods, ship, or bill them, you will undoubtedly understand the value of the software.
Discrete Vs. Process Manufacturing: Which ERP software do I need?
Discrete manufacturers have greater requirements for managing components, reducing waste, and managing assets.
While the Process manufacturers have the requirement of correlating operations, raw materials changes, managing hazardous materials, and adhering to compliance.
Needless to say, both Discrete and Process manufacturing companies need to track resource management, stock units, lot sizes, material inputs, types of labeling and packaging, etc.
Referring to these common trails, be it a discrete or process manufacturer, choosing ERP software that shares common elements is recommended to help you align with the business processes.
Now, let’s understand how ERP runs the show in digitalized manufacturing era.
- Unify Financial Information
Does your project management team define success in a way that is different from your sales departments?
Finance has its numbers, the sales team has another version, and other departments may have their own version of how they have contributed to the organization’s revenue.
Having ERP Software for Manufacturing means establishing one version of numbers that the entire company can refer to and working towards it collectively.
Its excellent report features, including product profitability analysis, let you create and share the success metrics across multiple departments while ensuring everyone is on the same page.
- Improved Departmental Efficiency
Back-end functions are generally time-consuming; ERP can automate all the manual processes saving your users time to focus on other essential things.
For example, A robust ERP can schedule predetermined maintenance routines for your manufacturing machines to avoid the inconveniences of remembering maintenance schedules.
- Speed Up Manufacturing Process
What if your manager called you to put a product online tomorrow? Without ERP software, you wouldn’t have access to run an inquiry or check stock status quickly.
With a proper ERP system, as you have a conversation with your manager, you can quickly run an inquiry and check the status on the spot.
- Automatic Task Assignment
With Manufacturing ERP Software, as soon as a new order enters the system, the necessary component parts required to produce the item are allocated and assigned immediately.
- Data Accessibility
Where you took hours to pull out numbers manually, with ERP software, you can do it in a few taps and seconds if you want to compare your last year’s inventory levels to your current inventory.
ERP enables rich reporting features to help you customize reports and flag specific items to refer to later. Your manufacturing company will never see inventory levels dip with a proper system in place.
The Implementation of ERP Software for a Manufacturing Company
It’s evident for companies to find out the ways of doing business before picking an ERP package. The most common reason companies fail to achieve their goals is that the software doesn’t support their critical business processes.
Some manufacturers become restless upon not seeing improvements within fewer months of the implementation. Don’t expect your business to revolutionize immediately with ERP implementation.
In one of the cases mentioned in the research paper of Christopher Koch- The ABCs of ERP, a Meta Group study of 63 manufacturing companies found that it took 8-31 months to identify recognizable benefits after the new system was implemented.
Things to take care of before implementing ERP Software for Manufacturing Companies:
- What are the primary reasons behind implementing ERP?
- Is the ERP system both easily scalable and configurable?
- What are the key strengths and weaknesses of ERP software on your list?
- How to pick an ERP implementer?
Note: If you fall into the small business category, thinking about ERP implementation costs and specific processes becomes necessary.
We hope that you will be able to decide on implementing ERP Software for the Manufacturing company with all the information. With that said, you can also refer to our guide to choosing an ERP implementation partner.
If you don’t find answers to your specific questions, reach out to our certified ERP consultants.
