ERP For Me

June 14, 2009
Industry-specific manufacturers need industry-specific ERP systems.

The art of manufacturing is not straightforward. Manufacturers live in a complex world that generates as many unique and varied operational requirements as there are products manufactured.

Because of their complex nature, manufacturing environments of all types -- from discrete to repetitive to process, whether built-to-order or built-to-stock -- can benefit from the right enterprise resource planning (ERP) system. ERP provides the necessary infrastructure, visibility and control needed to manage intricate day-to-day operations, and delivers benefits such as: automation of manual processes; improved inventory control and scheduling; better decision-making; improved customer service; and much more. However, while there are hundreds of ERP systems on the market, some are better-suited for the needs of industry-specific manufacturers.

In a recent study titled "ERP Plus in Process Industries," the Boston-based IT research firm Aberdeen Group notes that manufacturers need special features that can extend core ERP functionality to support necessities such as industry quality standards, rigorous compliance requirements and strict traceability. Best-of-breed ERP solutions, which are designed to serve any enterprise -- manufacturing or otherwise -- may be too broad-reaching and disparate to satisfy these requirements. On the other hand, ERP solutions that combine true real-time manufacturing, accounting and supply chain management into one database within the context and language of specific manufacturing industries can deliver a true advantage.

For example, within the automotive and medical industries -- where quality is critical -- the procedures to assure quality standards essentially are the same. Yet there are subtle variances in format and language between the two industries that an ERP system must understand if it is to best serve the needs of each manufacturing type. In addition, knowing immediately at order entry that there is a potential quality issue on a part can help prevent potential product delivery problems.

Another example can be found in injection molding. Family tooling can be cumbersome in systems not specifically capable of handling a single bill of material (BOM) that is used to make two or more varied parts. This complexity becomes even more unwieldy when scheduling, rejecting and reporting inventory comes into play. An ERP system that offers multi-level bills of manufacture that are specific for use with tool-and-die-based plastics manufacturing can better streamline this process and alleviate stress. Furthermore, industry-specific ERP can help in extrusion operations where production can vary from facility to facility or even from part to part. An industry-specific BOM should allow various formats such as extrusion by length or extrusion by weight. Best-of-breed ERP cannot always provide this level of detailed support out of the box from one system.

State-of-the-art, single-source ERP solutions that are preconfigured and designed for industry-specific manufacturers deliver the advantage of interoperability, speed and cost savings in addition to standard ERP benefits, and all in one package. Industry-specific manufacturers should look for solutions that are designed to address the latest manufacturing issues and industry requirements, such as ISO standards, TS standards and FDA requirements.

As Aberdeen suggests, manufacturers need more from their ERP. A single-source solution that intuitively understands the details of manufacturers' specific industries is the best choice to ensure they stay lean, agile and competitive.

Glenn Nowak is vice president of IQMS, a Paso Robles, Calif.-based provider of business and plant management ERP software and services.

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