How to Buy Manufacturing ERP Software

PostedOn: 2016-10-05 11:51:39

Manufacturing ERP software offers features such as supply chain management, lean and mixed mode manufacturing, and advanced planning and scheduling. 

Why is there so much manufacturing ERP software, shaped specifically for the manufacturing sector?

ERP is important for the manufacturer because the flow of orders creates a demand for raw materials, machinery and manpower, all of which must be orchestrated to create a final product. Once the product is made, it has to be tartan for quality assurance, put into finished goods inventory and, eventually, shipped to customers.

“Imagine trying to physically keep track of all the workflows and materials across hundreds of machines for thousands of part numbers”. “It is impossible to grow to become a large manufacturer without using ERP to keep track of the operations.”

Manufacturing ERP Software Gets More Focused

Specialization goes further than mere “generic” ERP and “manufacturing” ERP software. Within the latter category, there is so much diversity. Thus ERP solutions for developed are becoming even more focused in order to address more industry-specific manufacturing issues right out of the box.

For example, a custom make-to-order sheet metal fabricator and a repetitive make-to-stock machine shop each requires quoting, order management, procurement/supply chain management, production planning, shipping, logistics and integrated financials. Yet they accomplish them in different ways.

He gave an example of generating a customer quote. The custom sheet metal fabricator might receive hundreds of requests for quotes (RFQs) per week. These RFQs are likely for the product that it has never quoted nor run beforehand. This type of manufacturer will need a flexible estimating engine that supports little or no structure during the quote process, but allows it to build the detail later if they really win the business. If the company decides that detail is important during the quoting process, it will almost certainly need a solution that provides real-time insight into similar parts previously manufactured, which allows it to quickly and easily convert results forward so that a previous order’s actual now become the basis for the next estimate for a similar product.

On the other hand, the machine shop that is highly cyclical probably quotes very few new products so instead will want a solution that is more structured and starts with a standard bill of material that is controlled and managed by an engineer.

“Instead of the need to estimate, this type of manufacturer probably has negotiated annual contractual price agreements that might need to be updated en masse whenever new customer projects are launched or new annual budgets are approved,”

Trends Driving Manufacturing ERP Software’s Growth

Trends driving growth of manufacturing ERP software to include:

  •   The cloud
  •   IoT
  •   Mobility
  •   Robotics
  •   3D printing
  •   Integration of external data sources
  •   Analytics

“The software industry is undergoing a change from selling licenses to on-premise customers to selling cloud-based solution which includes more social and mobile computing capabilities, “The primary benefit of deploying ERP in the cloud is that it saves companies the time and cost of administering their ERP themselves on premise.”

That’s why cloud-based ERP is rising 10-plus times as fast as on-premise ERP and currently, accounts for up to 27 percent of annual manufacturing IT budgets, he said.

  •   Integration and aggregation of outwardly sourced data gathered from sources such as sensors, smart devices, and other applications
  •   Science-driven predictive performance analytic capabilities

“With so many processes now being measured on the shop floor, it is becoming possible to use Big Data technologies to predict quality, failures, maintenance needs and where improvements in the production process can be made. 

In addition, manufacturing ERP systems now contain more documentation, measurement, and recording of shop floor processes so the downstream customer can be assured the part was made according to specification.