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Manufacturing ERP: Everything Your Business Needs To Know
Manufacturing ERP: Everything Your Business Needs To Know
Oct 19, 2021Andy Pickard
Whether you’re a manufacturer looking to replace outdated software, switch to a new provider, or you’re just starting out on your ERP journey, selecting and implementing a broad-reaching system can feel like a high stakes commitment.
To help you tackle the challenge of investing in or upgrading your ERP software, we’ve created this guide to manufacturing ERP: what is it, when do you need it, what should it do, and when is it time to upgrade to a more advanced ERP solution? We’ve got the answers.
What Is ERP for Manufacturing?
Manufacturing enterprise resource planning (ERP) is a software solution designed to help manufacturers digitize and automate your business operations. So you can run your enterprise more efficiently, save time and money, and increase your accuracy and speed of production.
One of the major reasons that manufacturers invest in ERP technology is to leverage more data, to manage critical aspects of the manufacturing process, utilize resources effectively and make stronger strategic decisions.
There are many different types of manufacturing ERP solution available on the market – we’ll talk about this in greater depth in a moment. However, most ERP platforms include a core set of features that support front-office, back-office and shop floor operations, including:
Customer relationship management (CRM)
Supply chain management
Finance and accounting
Some ERP for manufacturing solutions will also include business intelligence (BI) reporting tools, to help you analyze performance and progress.
What Types of Manufacturing ERP Are Available?
There are three different types of ERP solution available to manufacturers.
1. Generic ERP Software, which can be used by companies in multiple sectors – not just manufacturing. These offer most of the features we mentioned above, but they’re not designed for manufacturing use. So while it may be tempting to choose generalist software if you’ve never had an ERP system before, you will miss out on valuable functionality if you choose to buy generic software. And if your business is using a general manufacturing ERP solution already but if it’s not delivering the specific functionality you need, then it’s time to upgrade to something more specific.
2. Broad Manufacturing ERP Systems that can be used in any sub-sector. These provide more value than generic ERP software because they include features built specifically for the needs of manufacturers. For example, tools for managing shop floor process changes, and machine maintenance scheduling capabilities.
As we mentioned, general manufacturing ERP delivers more value than a software designed to work in any industry. However, if you decide to go with a generic or broad ERP system, you could end up needing to bolt-on additional software or customize your platform to get the exact functionality you need – which makes deploying and running your ERP software more complex, and impacts ROI.
For true investment value, your business should be looking for ERP technology that delivers functions specifically for your sector. Speaking of which…
3. Industry-Specific Manufacturing ERP Solutions such as process manufacturing ERP, discrete manufacturing ERP, and food manufacturing ERP. These are the most popular choices for manufacturing organizations, as they provide you with specific features needed to run your business efficiently. For example:
Process manufacturing ERP software includes formula/recipe management modules, to calculate and scale ingredient quantities for batch manufacturing control. Process ERP systems also include lot traceability, to support accurate labelling, industry compliance and quality control processes, and help with product recalls.
Discrete or industrial manufacturing ERP software enables manufacturers to turn quotes and estimates into a bill of materials (BOM), to streamline the sales process and accurately match upcoming orders with component availability. For more information on these two categories, read our blog post: Discrete vs Process Manufacturing ERP Software: What’s The Difference?
Food ERP software includes complete traceability tools, quality assurance capabilities, built-in compliance and food safety functionalities and inventory management features that reduce perishable food wastage. It also facilitates automated real-time data capture to ensure the integrity and accuracy of your records. To learn more, watch our food and beverage ERP overview below or read our Ultimate Guide to Food ERP.
What Are the Benefits of Using Manufacturing ERP Software?
Investing in ERP software enables manufacturers to improve scheduling, increase output and scale-up quicker than if your company is reliant on manual processes or legacy technology. Other key benefits include:
Real-time, 360-degree data visibility – so every person in your business has access to accurate information and can use this data to make effective decisions. For food manufacturers in particular, this visibility enables end-to-end-traceability to fulfil both regulatory and consumer demands for transparency.
Intelligent scheduling capabilities – rather than just tackling jobs in chronological order, you can choose how to group them. For example, prioritizing high value customers to maintain satisfaction levels, or grouping like-for-like jobs to limit time lost changing machinery settings.
Accurate inventory management – with better scheduling and complete data integration, you can plan and manage inventory requirements in-line with work orders, to minimize outages, reduce overstocks and source materials from multiple suppliers.
Standardized working processes – if everyone is using the same manufacturing ERP software, your processes and procedures are consistent for every job. You can also use an ERP for manufacturing to incorporate essential health and safety checks, quality controlling, and industry compliance, to ensure a continually high standard of production.
Continual analysis and improvement – selecting a manufacturing ERP solution with built-in BI tools enables you to track the progress and profitability of every job. This way, you can understand the true value of clients and job types, focusing new business development on areas that yield the greatest profit.
What’s Better: On-Premise or Cloud Manufacturing ERP?
Once you’ve decided whether to invest in general manufacturing ERP software or an industry-specific ERP solution, there’s another important decision to make: your deployment option.
There are two types of software available to manufacturers: cloud based manufacturing ERP software and on-premise ERP.
With on-premise, ERP software is installed locally, so it will only be accessible via specific devices. Your chosen vendor will need to be on-site to deploy the system, and your technology may need upgrading or replacing to be compatible with the latest software packages.
Some manufacturers choose on-premise ERP solutions because business data is stored on-site, and the system uses an internal network connection that is accessible even if your internet connection isn’t working. However, the cost of maintaining and upgrading on-premise software can be significant, and if you experience a technical issue then you’ve got to wait until your software provider can get an engineer on-site to fix it. So there’s a greater risk that your business operations will be down for longer.
In contrast, cloud based manufacturing ERP software can be accessed on any device with a web connection; there’s no need for face-to-face contact. It’s quicker and easier to deploy than on-premise ERP because it can be done remotely—including any technical support you require post-implementation. Any bug fixes, customizations and upgrades can be carried out virtually as well, as your technology vendor is responsible for hosting and managing your ERP solution.
In addition to being simpler and more affordable, cloud manufacturing ERP offers greater value than on-premise software because it’s accessible to everyone in your organization – so your entire workforce is using the same real-time data and systems. And cloud ERP software is easily scalable as your company grows.
For more benefits, read our compelling case for cloud manufacturing ERP.
What are the best practices for a successful manufacturing ERP implementation?
We’ve talked about picking a solution for your industry and choosing the right deployment option for your business. But what else do you need to ensure a successful ERP implementation?
Your choice of manufacturing ERP software vendor is critical to project success. All too often, ERP fails to return on investment because manufacturers choose a technology provider that is either inexperienced, or who doesn’t have the specialist knowledge to set up their ERP solution for manufacturing organizations.
Look for an ERP software partner that has worked in manufacturing before, and who can prove this by sharing customer stories and testimonials with you. A vendor with industry experience will know the day-to-day challenges that manufacturers face, and they can show you how to solve them using ERP technology.
Next, make sure all your key internal stakeholders are on board with the project. Even with industry-specific manufacturing ERP software and an experienced vendor, your implementation will only work if your colleagues are willing to get involved and learn how to use the new system! Assembling an internal steering group can help to drive the project forward and deploy your ERP solution in a manner that drives rapid value for your organization.
Finally, set clear objectives for onboarding new ERP software with measurable KPIs against them. The best way to demonstrate the value of any new technology investment is to agree up-front what you want it to transform first, and to quantify what success looks like so you can demonstrate to senior leaders that you’ve hit your key targets.
What ERP Solutions for Manufacturing Does Aptean Offer?
As you may have realized already, Aptean’s in-depth knowledge of manufacturing ERP is based on many years developing enterprise resource planning software specially for the challenges of the manufacturing industry.
We offer a suite of industry-specific ERP solutions including process manufacturing software, industrial manufacturing software, food and beverage ERP and more. And we have extensive experience working with manufacturing organizations in a diverse range of sectors including automobiles, beverages, chemicals, cosmetics, electronics, fabricated metals manufacturing, food manufacturing and pharmaceuticals.
Combining our extensive industry experience and technical expertise, we deliver advanced solutions to help you conquer your most pressing challenges and ensure you continue to thrive as your industry evolves.
Are you Ready for What’s Next, Now®? Book a free consultation with our industry experts today or find out more about our industry solutions below.
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