Why all this focus on cloud-based ERP? Because the benefits and capabilities can help manufacturing organizations increase efficiencies and decrease costs. The current manufacturing market is perhaps one of the most competitive markets, with nearly all manufacturers moving toward lean or just-in-time manufacturing. And there’s a good reason for that. Cloud-based ERP can help manufacturing organizations grow and gain market share in the following ways.
One of the largest costs manufacturers struggle with is the cost of inventory. That is reflected in not only the cost of materials but also equipment, labor, shipping, and a myriad of other elements affecting manufacturing. ERP helps to reduce these costs by providing deep visibility into inventory, inventory components, and all of the facets of manufacturing. Furthermore, traceability reduces costs by helping organizations track an order from the smallest part (and track each of those parts) to the finalized, delivered product. These efficiencies invisibility and traceability are requirements to stay competitive in today’s markets.
Manufacturing changes at almost the same speed as technology. Inventory changes, demand changes, equipment changes, all manner of environmental changes, and even market changes can determine whether a manufacturer is able to produce exactly the product that is needed, in just the right quantity, at the right time. Cloud-based ERP provides transparency for all of those manufacturing elements, and it provides that clarity in real time. Need to know if your supplier is going to provide a part of the time? ERP enables a connection with the vendor that can alert you to any delay in order fulfillment. Organizations can even use real-time and historical data to accurately predict swing in demand to prevent over- or under-production issues.
Organizations with multiple manufacturing plants in various regions or even countries know the challenge of managing more than one plant or warehouse. Which location is handling a manufacturing job? Would another location be more suited to produce the product faster? Is there a backlog of completed product sitting in a warehouse somewhere that could be shipped rather than produced? All of these questions need to be asked and answered. Cloud-based ERP gives organizations the ability to connect multiple locations to a single ERP application that can provide real-time visibility between the locations.
There is no need to pick up the phone and hope you get the shop manager and pray that he’s right when he says he has all of the materials necessary to produce an order. Or to send an email and wait for a response that may or may not come about existing inventory stores in a warehouse on the other side of the world. Cloud-based ERP makes it possible to see inside all of those locations and examine their capabilities or capacities, with no delay. You can then route jobs in the most efficient way to provide the customer exactly what they need when they need it, as cost-effectively as possible.
Big data is one of the hottest topics in technology right now because there is much to gain from accessing all of the data that are available to an organization. Especially in manufacturing. Cloud-based ERP allows for that access from everything to equipment health and maintenance schedules to shop floor management, inventory, and production capabilities. With all of this information available, manufacturers are positioned to make better decisions that are designed to move them ahead of the competition.
The potential for growth in manufacturing exists. The question is how will you tap into that potential to move your organization forward? Cloud-based ERP can help you harness the possibilities and move you toward that 2–3 percent increase in market share.