Manufacturing ERP Software: Complete Solutions for Production Management

Introduction

Manufacturing ERP software provides integrated solutions to manage production, inventory, supply chain, and business processes for manufacturing companies. These systems track raw materials, work in progress, finished goods, quality metrics, orders, and more in one centralized database accessible across the organization. Manufacturing ERP improves production efficiency, cost controls, planning, and supply chain collaboration.

Background and History

Manufacturing companies have used ERP systems since the 1990s to integrate siloed business processes. Early ERP software focused heavily on financials and materials management. Over decades of advancement, manufacturing ERPs evolved into full-scale platforms with specialized capabilities to orchestrate complex shop floors, global supply chains, and product data.

Modern manufacturing ERP provides real-time visibility and management controls across inventory, bills of materials, scheduling, quality, manufacturing execution, and fulfillment. Leading solutions leverage the cloud, mobility, IoT, and advanced analytics to optimize production.

Key Capabilities

Core capabilities of manufacturing ERP platforms include:

CapabilityDescription
Production Planning and SchedulingOptimize facility workload and materials flow
Inventory ManagementTrack raw material, WIP, finished goods across warehouses
Manufacturing Execution SystemPaperless shop floor execution and quality management
Supply Chain ManagementProcure materials, manage suppliers and orders
Product Lifecycle ManagementEngineering, BOMs, change control, costing
Reporting and AnalyticsPersonalized dashboards with real-time visibility

Business Benefits

Key benefits manufacturing organizations realize from ERP software include:

  • Improved production efficiency via workflow automation
  • Reduced costs through waste and downtime minimization
  • Enhanced quality control for standards compliance
  • Better customer order fulfillment
  • Real-time inventory and operational visibility
  • Data-driven planning and continuous improvement

Evaluating Manufacturing ERP Solutions

Selecting a manufacturing ERP platform involves gathering requirements, assessing solutions, and choosing an implementation partner. Critical steps include:

StepDescription
Functionality Needs AssessmentMap core production processes to identify must-have ERP capabilities before comparing solutions
Solution ArchitecturesEvaluate potential ERP platforms for flexibility of deployment across on-premise, cloud computing, or hybrid options to determine the best IT footprint
Implementation PartnersChoosing an ERP consultant well-versed in manufacturing practices is instrumental for accelerating rollout and user adoption

Key Manufacturing ERP Modules

Manufacturing ERP solutions provide a modular suite spanning production execution, planning, inventory, quality, costing, maintenance, and more.

Production Planning and Scheduling

Production planning and scheduling organizes shop floor activities while optimizing material use and capacity. Key components include:

ModuleDescription
Master Production SchedulingCreates production plans aligning with business objectives for best throughput and on-time delivery
Material Requirements PlanningDetermines materials quantity and timing needed for scheduled production runs. Enables “just in time” purchasing
Capacity PlanningBalances workload across work centers and machines for optimal asset utilization. Considers multiple constraints
Shop Floor ControlOrchestrates and tracks floor execution, including production orders, workflows, machine assignments, labor, and work in progress moves

Manufacturing Execution System (MES)

The manufacturing execution system module oversees and optimizes production floor operations via:

FunctionDescription
Workflow AutomationConfigurable workflows standardize production processes for consistency while adapting to changing requirements
Quality ManagementInspections, alerts, corrective actions, and reporting ensure products meet specifications and comply with regulations
Overall Equipment EffectivenessMonitors machine availability, performance rates, and quality yield to maximize productive output

Inventory Management

Real-time visibility of on-hand inventory across the production lifecycle enables better material flow:

TypeDescription
Raw MaterialsTrack incoming stock, reconcile purchase orders, and allocate per production priorities
Work-In-ProcessFollows intermediate products across work centers to reduce excessive work in progress queues or bottlenecks
Finished GoodsManages warehouse finished product levels, stockroom picks, and shipment staging

Supply Chain Management

Streamlines the external supply network via:

FunctionDescription
ProcurementRaises purchase orders and schedules external material deliveries aligned to internal requirements
Supplier Relationship ManagementMaintains pricing contracts, part specifications, purchase agreements, quality history and other supplier details
Order FulfillmentOrchestrates order promising, allocation and delivery with supply availability and production scheduling

Product Lifecycle Management

Manages data, processes, and document controls across the product lifestyle:

FunctionDescription
Engineering Change ControlManages revisions of bills of materials while assessing downstream supply chain impact.
Bill of Materials ManagementCentral repository for product data including approved parts lists, specifications, and documentation.
Product CostingTracks costs of raw materials, labor, and overhead to determine manufactured item costs for quoting and profitability analysis.

Deploying Manufacturing ERP Software

Getting maximum value from a manufacturing ERP investment requires careful system configuration and rollout:

ConsiderationDescription
On-Premise versus Cloud DeploymentBalance IT infrastructure control versus cloud solutions providing higher scalability and faster updates when evaluating deployment models
Customization ConsiderationsLimit modifications to the ERP’s native functionality to ease the burden of testing and future upgrades
Change Management Best PracticesUser adoption ultimately determines project success. Planning communications, training, and support enable the cultural shift
Training ProgramsOperator training curriculum tailored to specific roles and processes accelerates user adoption of new integrated solutions

Measuring Manufacturing ERP Success

Key performance indicators to quantify manufacturing ERP impact include:

Metric TypeDescription
Operational MetricsBenchmark production output, quality, efficiency, and cycle times before and after launch to quantify tangible improvements
Financial Key Performance IndicatorsMeasure inventory turns, gross margins, and other financial ratios to determine ROI and profitability enhancement
User Adoption TrackingMonitor application usage frequency and self-service data access to gauge engagement levels by persona

Emerging Manufacturing ERP Innovations

Technology advances driving the next evolution of manufacturing ERP include:

TechnologyDescription
Internet of Things and Sensor IntegrationIncorporating data from connected machines, wearables, part identifiers and sensors onto the shop floor increases automation capabilities
Advanced Analytics and ReportingEmbedded manufacturing intelligence provides planning simulations, predictive alerts, and visibility into operational performance
Mobility and AccessibilityCloud and mobile enable real-time visibility and paperless workflows across the production environment via smart devices

Manufacturing ERP Industry Leaders

Top ERP vendors with significant manufacturing customer bases include:

Top Providers Overview

The market for manufacturing ERP software remains dominated by three mega-vendors with decades of sector experience:

ProviderDescription
SAPThe SAP S/4HANA ERP suite provides deep functionality across production, supply chain, and product lifecycle processes on a unified data platform.
OracleOracle ERP incorporates robust manufacturing resource planning capabilities natively integrated with financials and supply chain applications.
InforInfor builds industry-specific ERP solutions combining process manufacturing and discrete production strengths, with CloudSuite and SyteLine options.

Conclusion

Implementing manufacturing ERP enables orchestration of the production environment under operational and financial metrics-driven management. When selecting solutions, align capabilities to core needs and partner with implementation experts to mitigate rollout risks. Database centralization, workflow digitization, IoT integration, and advanced analytics will continue expanding these platforms’ potential. Ultimately, manufacturing ERP facilitates the highly automated, lean, and insight-led smart factory of the future.