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By: Anju A.P

7 Major Benefits of ERP for the Manufacturing Industry

Enterprise Resource Planning (ERP) software software is not only confined to an  enterprise-sized or large scale companies but also to the small and medium enterprises around us. Almost all businesses, regardless of its size and complexities, can get benefited from an ERP software meeting its functions. Unlike other,  an ERP has very crucial role to play in manufacturing companies. 

Manufacturing is considered to be the backbone of the economy in business and an ERP acts as a prime tool for gathering all transaction information from every corner of the business and translating it into financial data and other insights.

Due to stiff competition and rise in demand of customers, every industry faces several challenges in meeting their goals. With the help of ERP software, they can achieve the complete, latest, end to end service of business application. An ERP system comes in integrated platform encompassing every function within a manufacturing or other departments, streamlining every business operations of all departments of an organization.

To know precisely how a Manufacturing ERP can help the manufacturers, firstly we need to understand the challenges faced by the manufacturing industry. The following are challenges faced by any manufacturing industry:- 

- Operating Costs 
- Traceability and standardization 
- Gap in manufacturing skills
- Production development
- Environmental consideration 
- Process efficiency 
- Product quality 

Now let's see how an ERP in Manufacturing Industry works for its betterment.

1. Real-time access to information
To be a successful manufacturing industry/business, it is important that we get the real-time access to all business information. With the ERP implementation in manufacturing, it helps the manufacturers to access the business information in one click. An ERP for manufacturing helps the top management officials to monitor all key business information real-time and transform them into business growth. An ERP in manufacturing enables 24x7 accesses to business information and business intelligence irrespective of the geographical location of the user, making them efficient to make a timely decision.

2. Improves communication
A manufacturing ERP software acts as a gateway for the manufacturers to share production-related data not only with internal employees, but also with the external public including all the associated vendors, suppliers, and distributors. With an ERP one can improve communication and coordination within the manufacturing business. A manufacturing ERP gives real-time information and useful insights the activities  carried across inventory, supply chain, and external market. A demand from one system to another is informed in real time streamlining the fulfillment processes. 
 
3. Make accounting easier
With an integrated ERP software, manufacturers can bring in all of the financials in one database, making the work of accounting staff easier and less chaotic. Unlike the earlier, the user should not have to spend any time in reconciling data manually or cross-posting the information.  ERP allows for the accounting department to become a truly strategic part of the business by increasing productivity with improved accuracy and new insights into every aspect of your business.

4. Improved Inventory Management and tracking
An ERP sufficiently provides control over inventory components, precise demand-planning, streamlined production scheduling, and strong coordination of distribution channels, enabling the companies to track on-time delivery of products. Especially if they’re involved in mass production, manufacturers will have a large amount of inventory coming in and going into production. With the help of ERP, manufacturers will be able to track all of this inventory, along with their characteristics, numbers, locations, etc. 

Many ERP systems automate serial and lot tracking and traceability, as well as swift product recall processes, saving the company time and money. Especially in food manufacturing industry, it comes as blessing as products is perishable in nature. The facilities like a lot, serial numbers, FIFO helps in tracking the expiry dated products, thereby efficiently moves the stock from inventory in real time without any loss of resource.

A manufacturing ERP can also maximize cash flow by stocking the minimum amount of inventory to satisfy the maximum number of customers. ERP will enable you with effective tools to control inventory costs, helping you to analyze trends and changes in demand, avoid stock-outs, and to decrease excess inventory.
 
5. Better production control
A manufacturing ERP improves the production schedule. Production scheduling focuses on fulfilling customer orders on time. An ERP comes with master production schedule (MPS) representing the products the company plans to produce in specific configurations, quantities, and dates. It helps in sales forecast and sale orders. Once the number of sales order and requirements are charted, with Material requirement planning (MRP) we can execute those sales orders.

MRP comes with bill of material data, inventory data, and the MPS to calculate the required amounts of materials and thereby create purchase orders and shop orders help in maintaining a transparent workflow within the manufacturing department.  Thus an ERP system delivers data thereby providing useful insights. All the reports, KPIs, and forecasting features make the manufacturing process worth in decision making and reliable. 

6. Streamlining and Automation of Business
A complete ERP software for manufacturing can definitely streamline the business processes and drive automation for manufacturing organizations. With an ERP in manufacturing, the user can easily monitor the production status in real time, without any dependence on the external public. One can easily monitor the production progress and also update the purchasing and finance departments upon the requirements of additional raw materials. This improves the productivity and customer commitments in the industry. 

An ERP also automates business processes by placing them into a useful format that is standardized and common for the whole organization. By automation, the company can also reduce its dependency on manual entries. With automation facility one can accelerate the production process also minimize the errors within. 

7. Improved customer satisfaction
accurate production planning, robust inventory management, streamlined process scheduling, and coordination among the distribution channels, an ERP facilitates the manufacturers with improved on-time product delivery and performance metric. The on-time delivering of keeps the customer satisfaction to the supreme. An ERP also inspects quality checks for purchased materials before production, in the middle of manufacturing stages, or as final inspections. On account of any problems, the quality check systems in manufacturing ERP helps narrow down the issue, thereby improving the product quality and customer satisfaction. 
 
A good manufacturing ERP software connects all of these processes from start to finish. It unites all the different departments involved, helping them work together in a more optimal manner. Thus, it increases efficiency, streamlines their work, and reduces error.

In short, An ERP thus can rule out many challenges in the manufacturing department. It can work as a single application software taking care of all real-time management of 

- Financials
- Product planning
- Materials and parts purchasing
- Inventory control
- Distribution and logistics
- Production scheduling
- Capacity utilization
- Order tracking
- Customer relations/satisfaction
- Equipment and assets
- Procurement
- Projects

Let's have a quick glance once again how ERP in manufacturing works:

- A manufacturing ERP gets you with greater visibility and control
- A manufacturing ERP bring out both finite and infinite planning capabilities to develop the schedule. 
- A manufacturing ERP transforms supply chain to achieve production plan with the sales plan, finance,
   and customers.
- A manufacturing ERP minimizes the manufacturing cost and also increases resource utilization
- A manufacturing ERP cuts down the production cost and improves time delivery
- A manufacturing ERP helps in both managing and monitoring work at office floors. 
- A manufacturing ERP improves productivity and operational excellence. 
- A manufacturing ERP helps to know the total time taken for producing an order
- A manufacturing ERP acts as an important key performance indicator.
- A manufacturing ERP empower a global workforce and streamline processes across multiple locations
- A manufacturing ERP grows your business with detailed forecasts based on real sales data plus a
   master schedule to plan material requirements

Cybrosys Technologies is an official partner for Odoo ERP located in India. Odoo is an open source ERP system which is suitable for a small to medium organization. We offer excellent ERP system for your manufacturing industry that supports a wide variety of manufacturing process such as material control, delivery, production, planning and so on. To know more or avail our service kindly drop your message to info@cybrosys.com.




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