Every manufacturing company is different, not just from the products they provide but the way they go about achieving that final product. An automotive manufacturer surely doesn’t go about creating their product in the same way a rubber and plastics manufacturer does.
So how does ERP serve all of these different manufacturing models? Process manufacturers, be it the food and beverage industry or working with chemicals, do not undergo the same manufacturing method as a discrete manufacturer in either automotive or electronics. Depending on the ERP software you choose, the system should be able to fit in to your necessary manufacturing methods.
These manufacturing models are the ones benefiting most from an ERP solution:
One of the most common manufacturing models, make-to-stock benefits most from ERP in inventory management and accurate forecasting. Manufacturers following a make-to-stock model need to have an accurate advanced planning and scheduling module to ensure they’re meeting demands. ERP software can offer make-to-stock manufacturers lot and serial number tracking, multi-location inventory control, purchase and receiving applications, purchase history, MRP, advanced planning and scheduling and automated purchasing.
This manufacturing model is fast paced and needs a lot of organization. Instead of planning ahead for expected demand, make-to-order manufacturers are along for the ride once orders start to flow in. However, it doesn’t have to feel like orders are out of control. Real-time data in ERP software makes make-to-order manufacturing easier. The benefits ERP software bring to the model include shop floor control, data collection, real-time job costing, order tracking, order driven scheduling and cost estimating.
Some manufacturers offer a few different products, and they don’t all undergo the same process of manufacturing. For these mixed mode manufacturers, flexibility is key. An ERP software that provides a wide array of options and is customizable will benefit these manufacturers the most. ERP software can simplify the mixed mode process with real-time job costing and scheduling, work in progress reports, “what-if” scheduling, work order schedules and automated purchasing.
This mode can be tricky. Every purchase order is different, keeping you on your toes. Engineered-to-order manufacturers need an ERP system that is as customizable as the products they’re selling. The most benefits engineered-to-order manufacturers can get from ERP software include an ability to integrate with computer-aided design programs, real-time updates of inventory and purchasing for each project, real-time costs, project management including mid-project adjustments and job costing.
This is a unique mode for manufacturers. Only a few industries are touched by this mode of manufacturing, including food and beverage, the health industry and aerospace and defense. Government regulations require specifics and detailed reporting. Manufacturers needing to meet government regulations need an ERP system that can track batch and lot numbers, compliance reporting, weight costing and pricing, quality control and human capital management.
Using an ERP system that works with your manufacturing mode is crucial. The good news is most ERP systems are customizable, allowing you to decide what areas of manufacturing are most important to your business. Speaking with a consultant can help to make the right decision when trying to pair an ERP system with your mode of manufacturing.