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7 Ways ERP System Solves Biggest Manufacturing Problems

 ERP-solves-manufacturing-problems

If you are in a manufacturing business and not using an ERP system, there are a plethora of operational challenges that you may come across on a daily basis. You are still stuck in the age of manual data entry, which eats up a major chunk of your time and guess what, it isn’t foolproof either. You still don’t get accurate reports in real-time and end up wasting a lot of time validating reports from multiple platforms. Then there are quality and traceability issues, inaccuracies in scheduling, lack of planning, issues managing the costs as well shrinking profits etc., that mar your business. An ERP can definitely fix these as well as all of your other manufacturing problems. Want to know how? Take a look at the seven major problems your manufacturing business faces and how ERP can fix them:

Problem #1: Error in Data Collection

The world’s most valuable resource is no longer oil, but data. How quickly your business grows depends on how fast you can have access to its data. But if you’re still storing data manually, you are light years behind your competition. The reason is simple, manual data entry takes time and can be inaccurate too because to err is human. But these errors and time delays can be costly for your business. So what is the fix?

Get an ERP, which gives you immediate access to key data like, your finances, sales forecasts, inventory levels and a holistic view of your business operations in general, at any given time. It also empowers your staff with the information they need to do their jobs more effectively, thus improving the overall health of your business.

Problem #2: Inaccurate Reports

In order to grow, your business needs accurate reports in real-time. But if you are still using outdated modules to receive reports and queries, you may be wasting your time unnecessarily validating reports and verifying data. These long delays prove to be the bottlenecks holding your business back. So, how do you change this?

An ERP software can help make reporting easier for you. With enhanced reporting capabilities, your business will be more equipped to respond to complex data requests. Your staff will be able to run their own reports without relying on help from IT, thus saving them of precious time which they can devote to other projects.

Problem #3: Quality Issues

For any manufacturing business, delivering quality products has to be the topmost priority. But if you still rely on outdated methods to ensure quality, there is a strong possibility you are compromising on the quality by erring in batching, expiration dates, lot recall, etc. The need of the hour is to automate your quality processes and achieve more control over the complete supply chain.

The need of the hour is an ERP, which helps you with real-time and end-to-end tracking of your inventory, right when it enters into the walls of your premise to time it leaves your last wall. Monitoring of inventory characteristics, stability testing, tracking expiration data, plus identifying quarantine resource is all that an ERP does for you. Thus improving your operational efficiency and giving you greater control over your business. Besides, it also helps you meet the regulatory and safety norms while keeping you ready for audits and away from hefty fines.

Problem #4: Lack of Planning/Inaccurate Scheduling

Efficient planning and scheduling is the key to the success of your manufacturing business. And for efficient planning, data is the tool. We discussed above that how not having access to vital data can affect your business. So, if you are not using an ERP, you don’t have access to accurate data to plan your business operations, your production schedules, your inbounds, deliveries, etc. You have no visibility into sales forecasting and inventory levels too. Lack of planning will hamper your scheduling, as you will have to spend lots of time preparing the schedules for the shop floor activities.

That’s precisely why you need an ERP so that you can have access to key data such as sales forecasts, current inventory levels, procurements expected, ATPs, PAB, etc. which can help you with planning and efficient scheduling. Modern-day ERPs come loaded with the Material Requirement Planning (MRP) and Master Production Scheduling (MPS) functionalities, which provide material and production planning suggestions based on the demand and supply. This ensures that batches are efficiently scheduled to meet the current and future requirements and material are optimally available to keep the production going without halts or shortages.

Problem #5: Managing costs/Shrinking Profit Margins

Almost every business faces this stiff ask about keeping a lid on the rising costs. Managing the operational cost is hence of extreme importance, as the profit margins are directly related to it. But with ever-rising costs of raw materials, fuels, utility, etc., the profit margins of your manufacturing business are constantly shrinking. How do you keep the costs under check and increase the profit margins in such scenario?

You need an ERP, which provides you with vital information that helps in reducing operational as well as administrative cost of your business. It also helps you monitor and control operational losses, fully utilize your resources and keep the wastage at bay. It keenly inspects your processes instantly identifying the deviations as and when they happen thereby minimizing the chances of re-work or scrap.

Problem #6: Meeting Customer Requirements and Expectations

Innovation keeps you going in today’s dynamic scenario. The demand for health and environment-friendly products is increasing. Growing consumer awareness, use of latest technology, greener substitutes, time-saving and contemporary products need to be innovated and delivered on the shelf before the competitor to stay ahead of the curve.

Moreover, storing critical information of scores of customers and maintaining it manually is virtually impossible. Using the outdated methods, you cannot manage your customer records and leverage that information in your business’ interest to the fullest. In such a scenario, a huge gap between your customers’ requirements/expectations and your service is bound to happen. How to bridge that gap?

An ERP comes with the R&D module that performs complex calculations speedily, accurately and to precision thereby aiding innovation. Its customer relationship module enables you to store and analyse critical customer data. Based on it, you can analyse customers’ buying behaviour, keep a track of his purchase history, patterns and plan accordingly. The module also enables two-way communication, as your customer too can track their order status and give product feedback, which in turn allows you to incorporate the changes the customer desires and offer improved service. To win the customer over and encourage repeated buying, you can also implement various types of discounts and loyalty schemes.

Problem #7: Complying with Regulatory Norms

Complying with the regulatory norms is not just a choice, but a necessity to survive in the market and stay competitive. But if you are following compliance manually or through spreadsheets, you are making an already complex process all the more difficult. Such an approach increases the chances of hefty fines on your organization, product recalls, and worse, even tainted brand image and license cancellations. So, what is the remedy?

Get an ERP, and it will take care of all the regulatory compliances and safety reporting. Its advanced functionalities like Lot Traceability, Quality Control, Data Security, Electronic Signatures, Compliance Reports and Labels, Audit Trail, etc. ensure that your regulatory reporting requirements are not just met, but exceeded.

Conclusion:

These are just a few major ones. Manufacturers face numerous problems in their day-to-day operations that need a check-up and fixing too. ERP systems not just fix the aforementioned issues of your manufacturing business, but also help you deal with your everyday operational issues, streamline your business processes and gain a competitive advantage. True that it comes at a cost, but consider it as your investment and start reaping its benefits. Pay for an ERP implementation or pay the price of not implementing it, the choice is yours!

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Author

Sanjay Panjwani

I am Managing Director at BatchMaster Software India Pvt. Ltd., a leading vendor of ERP solutions in all the 7 continents. With over 30 years of presence in the ERP market & 1500+ customers situated all over the globe, BatchMaster is a mature organization of 200 plus employees.

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