Most companies understand ERP as a transactional repository and an accounting system, but they overlook the rest of the benefits ERP brings to manufacturing. The reality is that ERP systems can keep your shop floor running smoothly.
- Increase operational efficiency
- Increase throughput
- More predictable delivery schedules
Read on to learn the five ways ERP can help deliver these benefits.
1. Presents timely information to the people who need it
When people on your shop floor need to know which job to work on next or the correct sequence of steps in a routing, they should turn to ERP. The ERP system provides dispatch lists that are always up-to-date, so your team always works on the correct priorities. Because the shop order routing is easily accessible, operators and material handlers know where the materials should go next, so you never have to worry about materials delivered to the wrong work center and becoming lost.
2. Eliminates manual production processing and planning
ERP calculates and recalculates production schedules based on real-world status information, so dispatch lists and production schedules are always up-to-date. These eliminate the time-consuming, costly and error-prone manual schedule planning that many manufacturers suffer with, and replaces it with schedules that consistently and correctly reflect real-world status.
Planners can manipulate the schedule or create new shop orders right from their desktops, so changes in priorities are immediately reflected in the shop schedules. This eliminates telephone tag, time wasted hunting down the shop supervisors and misinterpretations of verbal instructions. The result is a more efficient and effective schedule and increased factory throughput.
3. Real-time status visibility
ERP systems can display the current status of any shop order at any time, enabling rapid and accurate updates when customers are looking for delivery information. In addition, the real-time status visibility supports accurate, fact-based decisions and enables more effective scheduling and accurate planning.
By identifying possible production bottlenecks, your company can take quick action that helps to improve factory output, increase on time shipments and reduce WIP inventory.
4. Identify bottlenecks and smooth production plans
Instant visibility to shop floor status helps to identify bottlenecks while there is still time to take action. Your company can decide to eliminate the bottleneck by outsourcing or selecting alternate routings for orders. You can make these decisions either up front, as you create the initial plan, or during the production process when unplanned events, missing tooling or equipment breakdowns mean that the schedule cannot proceed as originally planned.
When bottlenecks or capacity constraints are known up front, your company can make changes to alleviate the problem. As a result of utilizing ERP to smooth production plans before work orders begin to pile up at work centers, you'll enjoy shorter lead times, higher output, reduced inventory and higher customer satisfaction due to on time deliveries.
5. Provides a centralized information repository
ERP systems store all the information necessary for effective planning, scheduling operational activities and status updates. Since all the information is shared and accessible across your organization, everyone can work better together and collaborate more on the best options for your company as a whole. In addition, the shared central data source eliminates the need for spreadsheets and manual side systems that people use when they have limited or no access to the formal information system. This more collaborative environment leads to fewer errors, lower costs and more efficient operations.
Companies benefit in so many ways from their ERP system and its comprehensive storehouse of operational information that it makes sense to ensure that your company’s ERP system is widely available to employees on the shop floor and beyond.
