Industries, manufacturing models, and company sizes that benefit most from using ERP Software
ERP software will offer a high rate of return for any company that implements it, regardless of their manufacturing model or industry. Have you noticed companies in your industry that seem to have noticeably streamlined processes, are able to get orders out faster, consistently satisfy their customers, and generally excel against the competition? Their secret is likely their ERP implementation.
It doesn’t matter what manufacturing model or models your organization has employed. The right ERP software will scale to fit different manufacturing models and different size companies, enabling you to grow and succeed as your needs change over time.
For those of you still thinking, “but my manufacturing company is too small to use ERP. We don’t need it yet...”
What size company benefits the most from ERP?
Larger, more complex operations certainly have the most to gain from (and probably can not function without) having an ERP system in place. But it’s not just about the size or complexity of your organization right now, it’s where you want/expect your organization to be in the future that determines your need for ERP and the benefits you stand to gain by implementing ERP.
A lot of smaller manufacturing companies don’t think ERP is a reasonable option based on their size, but if your company plans to grow, ERP is a necessity. Your manufacturing company might be fine without ERP now… but don’t expect to grow without proactively adjusting your business processes to scale. Companies that are used to managing production and material planning manually can’t realistically expect to continue to operate that way as they expand their product line or build their customer base. Any manufacturing company expecting demand to increase will need to ramp up their processes for much larger scale production, and thus serve to benefit the most by being proactive and implementing ERP before they are “hurting for it.”
Which industries and manufacturing models will benefit most from ERP?
The ability to customize the components of an ERP solution based on an organization’s specific needs is what enables a wide range of industries and manufacturing models to benefit from ERP. The more complex your operation, the more benefits you serve to gain through the implementation of an ERP solution. But regardless of whether you operate in a low volume/high complexity environment, or high volume/low complexity environment, the right ERP software will give you the visibility you need to create leaner operations, manage complex supply chains, and streamline your business processes to get products to market faster.
In addition to the need for visibility, SCM and lean operations, many manufacturers across different industries must also maintain compliance.
For example, the medical device manufacturing industry, electronics manufacturing industry, and food and beverage manufacturing industries all face different issues when it comes to compliance but all of these industries can manage compliance with ERP. Regardless of whether your manufacturing company is trying to achieve ISO 9000 certification, FDA compliance or simply meet Current Good Manufacturing Practices (CGMPs), or the depth and extent of your product line is driving the need for better quality control and more efficient systems to track records on quality issues -- the need to remain compliant exists. Whether quality and compliance management is required by your industry or is just a strategy implemented by your company to ensure customer satisfaction and continuous improvement, you need the right compliance management software to get the most out of your quality control program. ERP offers benefits to the full range of industries and manufacturing environments.
Other examples of industries that stand to benefit largely by implementing ERP:
Aerospace
ERP software designed to facilitate government contract forms and reporting is making the aerospace industry more efficient. Integration with CAD software and real-time sharing of information from engineering with the shop floor and cost accounting keeps projects moving forward according to schedule.
ERP’s central data source integrates information from every piece of the process to reduce administrative labor costs, tighten inventory control and improve cost accounting accuracy.
Flexibility and quality control are high on the top of priorities for electrical device manufacturers. The high-tech world of electrical devices operates in a state of continual evolution and change. There is no time for searching for information or the latest schematic; it needs to be immediately available to everyone connected with the project. ERP software fulfills the needs of this fast-paced industry. All processes are trimmed lean, so that both production and administration can operate at maximum efficiency.
Regardless of your place in the manufacturing industry, accurate capacity forecasting and tight controls from the shop floor to the front office are what make a manufacturer profitable. ERP software provides all levels of management with the tools they need to improve their piece of the process. From sales representatives to the worker on the line, everyone in the organization experiences the benefits of ERP efficiency. It doesn’t just improve the bottom line; it improves the whole work environment, providing a positive attitude that expects and generates success.
Certificate of compliance and “cradle to grave” tracking of parts are just two of administrative complexities that are a part of manufacturing for the medical industry. Having these details automatically updated throughout your system with one entry is one of the benefits of employing comprehensive ERP software in this industry.
Medical manufacturers using ERP software demonstrate their commitment to the high standard of control expected in this tightly regulated industry.
Time can be wasted simply directing workers to their appropriate tasks in the machine building industry. With the detailed scheduling system available through comprehensive ERP software systems, everyone knows where each project is on the schedule and where they fit into the sequence. The automated time tracking records labor hours for each individual and each part of the process they are involved in. ERP software is trimming labor hours and increasing profits for the machine building industry.
Regulated Industries
Compliance with government regulations requires specific and detailed reporting. ERP software reduces the administrative aspect of government contracting. No special spreadsheets for tracking and reporting government required data. Superior ERP software eliminates the need for redundant entries and outside tracking and reporting for government jobs. ERP software makes it easier to:
- Meet DCAA compliance requirements for Aerospace, Department of Defense and other agencies
- Manage all CSCSC categories for the organization
- Maintain multiple level budgets, original and current
- Generate government required reports
Bottom line, any manufacturer that would like to improve efficiency can benefit from ERP’s ability to help streamline and manage processes. And if you’re thinking your company is too small to benefit from ERP or you can’t afford an ERP system, that’s simply not the case. If you choose the right vendor, ERP is an affordable solution with a lot to offer, even for a small business.
