Since the mid-90s, ERP applications have become increasingly popular. This is especially true in the complexity of the manufacturing sector, with no surprise. Manufacturing Industries have so many business processes. The more people involved in a process, the more margin for error – and so optimization is also needed.
ERPs help smoothen workflows across the business through one fully integrated application. During those periods (the 90s) industries invested millions of money for ERP software. Given its reputation for being a high-cost implementation software back then, resulted in SMEs locked out by high upfront costs and slow ROIs.
Thanks to open-source and yet cloud-based options driving down prices, this is no longer the case. As of today, manufacturing businesses are benefiting from ERP software.
Even with the lower upfront costs that SaaS, as well as Open-Source options, offer, you’ll still need to know if this is right for your business before you invest. Do the benefits align with your business goals? How exactly would an ERP impact your day-to-day operations?
Let’s take a look at why manufacturing Industries are turning to ERPs for greater efficiency and boost to their competitive advantage.
Streamlining processes, reducing cost.
One of the main drivers to deploy enterprise resource planning applications is cost reduction. This makes inventory management a key ERP module. Through automating reordering and calculating material usage, it is now possible to keep minimal stocks. The need to hold large stocks is now rendered obsolete. This has streamlined manufacturing costs.
Automation and integration have often streamlined costs further. The better ERP systems reduce costs and human resources management modules are available. In some instances, the system manages aspects such as staff training, annual leave, and sick leave etc.
Payroll management is a feature of the HR module allowing for tighter business integration and visibility. Using automation the system ensures necessary HR functions perform on schedule. This ensures the business stays on track.
Day to day running of the plant..
Another advantage of ERP is that it allows managers to run their industry/plant with a view to maximizing workflow. Should one aspect of the production run into problems, the system will flag this. Alert managers can now change the workflow schedule. This minimizes disruption and helps to ensure production adheres to deadlines. This level of management, again, streamlines costs and maximizes production.
Keeping the bottom line healthy.
With the capability to reschedule workflow as needed, positive impacts happen. Production is often increased as the production line never stops.
Actionable business intelligence makes for better decision making and prevents issues from becoming problems. The wheels stay on the track. All this results in a healthier balance sheet. In today's competitive world this makes a real difference to company performance.
Supply chain visibility.
Given the importance of supply chains, having full visibility of your supply chain is mission critical. Should your supply chain fail, production stops, and your plant effectively closes down? This is often catastrophic for a manufacturing business.
Good ERP systems allow you to see every aspect of the supply chain, allowing you to make decisions in real time. This avoids costly delays and keeps everything running as it should be.
You may need to order raw materials or components from your vendors, should one let you down.
You can schedule workflow around deliveries maintaining your productivity.
You can monitor costs and price fluctuations using alternative vendors if necessary.
Good ERP systems can run daily reports showing the status of orders and supply.
You can analyze every aspect of supply chain spend giving full accounting visibility.
Mission critical inventory can be set to reorder automatically. These aspects are handled using the material resource planning module (MRP).
ERP offers you full management control of your supply chain. Like other aspects of day to day management, correct system configuration ensures that a management hierarchy system is in place. This ensures that the right people make the right decisions.
Can you afford not to have this kind of visibility for your manufacturing business?
ERP strategic advantages.
With a 360 degree view of operations[By means of analysis reports capabilities of an ERP], developing more robust strategies becomes possible. You’ll find this new perspective leads to better-informed decisions. Consider these advantages:
You can identify bottlenecks in the supply chain and production processes.
You can identify problematic areas of workflow and address them.
With a 360 degree view, it is easier to configure the whole plant for maximum productivity.
With the HR module in place, you can organize teams to compensate for sickness and absence. It becomes possible to maximize the productivity of your industry.
You will have far greater operational insight.
- Having the big picture broken down by your ERP system gives you a unique perspective on the business. This allows you to make the necessary decisions to optimize workflow and processes.
- Once you have this operational insight you can apply this across the business. This is advantageous if you open a new plant. You can fast track and skip the learning process to optimize all plants faster and at a more favourable cost.
For a manufacturing company to compete it has to be able to maximize productivity and workflow. It cannot afford to waste money and time. Management needs a grip on plant operations, costs, and be able to reconfigure operations to achieve business goals.
Good supply chain management is crucial to success. Full control and visibility are, therefore, mission critical.
As businesses are a sum of many parts of operations, having a system that is usable throughout the business by various departments, makes for good practice and allows senior executives to see the big picture of the whole business.
Singo Africa Limited operating from Tanzania provides a fully integrated ERP system by name of Odoo that connects together every aspect of your business. Learn more about us or schedule a personalized demo here for your business. We are here to help you grow your business exponentially with a beautiful and powerful yet easy to use software solution.
Tanzania ya viwanda inawezekana, viwanda vyetu, uchumi wetu - JPM, Viwanda hivi vikiwa na Mifumo mizuri ya technologia itasaidia katika utunzaji wa taarifa na kuwa na mwongozo mzuri wa kupambanua ukuwaji wa viwanda,