Running a manufacturing business is quite complicated. It involves managing several moving parts such as taking in customer orders, ordering raw materials, tracking inventory, scheduling production, monitoring shipment, and many more. Since the US manufacturing industry is forecasted to boom further, you can expect the volume of work and the competition to get even crazier.
Good thing there’s enterprise resource planning (ERP)! ERP software consolidates all areas of the manufacturing process into a single database so that all business functions have systems that talk to one another and share data. Business processes now become connected from end to end. So if a new sales order comes in, the software will automatically update the database to inform purchasing, finance, inventory, and shipping to buy additional raw materials. And now that modern ERP systems, also known as cloud-based ERP systems, are delivered via the software-as-a-service (SaaS) model, even small manufacturers can afford these without having to invest in expensive hardware.
Here are three ways that modern ERP can give manufacturers a competitive advantage:
#1. Better decision making
Modern ERP gives you a full picture of what’s happening in your business as it happens to help manufacturers make accurate, data-based decisions with the following features:
- Real-time, in-depth analytics
- User-friendly interface
- Zoom in and out of data
- Role-based access to the cloud ERP
- Easily accessed through a desktop, a laptop, or any smart device
- Integrated workflow
- Predictive analysis
You can easily drag and drop components for customized reports and dashboards. With just a click of a button, data can be processed into tables, charts, and graphs to provide actionable insights.
Because of the web-based nature of modern ERP, suppliers and distributors can even actively participate so that manufacturers gain a dashboard view of the entire supply chain.
The system can flag potential problems before they happen.
Given all these, manufacturers can now better strategize and plan forward to optimize operations, enhance productivity, and adapt to changing market demands.
#2. Increased automation of processes
Manually inputted spreadsheets used to go hand in hand with ERP, but modern ERP uses the internet to connect to technologies, such as robots and internet of things (IoT) sensors, which now enable automatic capturing and processing of real-time data for seamless integration to proactively determine company needs.
Robots build on ERP’s strength of automating routine processes and integrating transactions between different departments, but these machines also allow for the removal of human intervention required for data entry and regular follow-ups with other departments. For example, automation in the past allowed for automatic reordering if a stock reaches a certain level, but it required an employee to manually input changes in the inventory level. Robots, on the other hand, monitor the inventory level 24/7 to provide real-time data and automatically send notifications to all business functions through the ERP system.
IoT sensors also feed modern ERP systems with real-time data. They can be used to constantly measure acceleration, pressure, water, proximity, gas, temperature, smoke, motion, and other factors that can be gauged remotely. These data are automatically recorded in the system, sending prompts to concerned departments.
With the incorporation of robots and IoT technologies within modern ERP systems, employees can shift from performing repetitive and routine tasks to handling more productive activities that greater contribute to achieving the company’s goals. It also reduces human error and unintentional duplication of entry, leading to time savings and lower operational costs.
#3. Reduced costs
Modern ERP’s ability to streamline and automate business processes enables a reduction in administrative and operating costs while increasing efficiency. Since it also enhances worker productivity, manufacturers can minimize labor-related expenses such as costly disruptions and delays.
Manufacturers can also benefit from lower warehousing, handling, and transporting expenses and reduction in excess and damaged stock since modern ERP systems allow you to track inventory more closely and accurately plan production. With improved forecasting, you can avoid last-minute purchases.
Red Key Solutions can ensure a smooth ERP implementation for your manufacturing business. Contact us today so your business can start reaping the benefits of modern ERP.