What is Manufacturing ERP Software?

What is Manufacturing ERP - Definition and Benefits

Manufacturing enterprise resource planning (ERP) software helps manufacturers increase production efficiency by providing the end-to-end visibility needed to keep improving their processes. Identifying and eliminating waste, cutting non-value-added processes, and removing the roadblocks to revenue growth are a few of the many benefits that manufacturing ERP software provides.

Defining Manufacturing ERP Software in Greater Detail

Unlike many other ERP solutions, manufacturing ERP software is purpose-built to serve the shop floor’s needs and improve manufacturing processes. The end-to-end system has manufacturing execution system (MES) and ERP capabilities integrated together at its core, along with additional application modules, all running on the same database to provide a 360-degree view of the manufacturing business. The other modules typically include accounting and finance, quality management system (QMS), warehouse management system (WMS), and supply chain management (SCM), among others.

Having integrated MES functionality is essential for manufacturing ERP software to deliver value. When evaluating a solution, check to ensure that it supports core MES features, such as planning and scheduling, production reporting, inventory management, quality management, and a comprehensive shop floor control system that includes real-time production and process monitoring.

By combining real-time data captured from machines on the shop floor and process monitoring data captured plant-wide in a historian database, manufacturers gain greater visibility and control over production costs, machine yield rates, supplier performance, and product and process quality. Real-time production monitoring captures data to the machine level, counting production cycles, measuring scrap, monitoring to ensure that all production steps are executed, measuring production times, and predicting completion times. Real-time process monitoring records process parameters during production that often include machine temperatures, pressures, weights and measures, and event durations

Examples of How Manufacturing ERP Software is Used

Knowing in real-time how decisions on the shop floor will affect costs, margins, pricing, and profitability is essential to growing a manufacturing business. Manufacturing ERP software is most valuable when it helps to drive decisions on the shop floor that preserve margins and profits. Following are three common examples of how manufacturing ERP software is being used successfully today to optimize manufacturing operations.

 

  1. Understand how production scheduling decisions impact financial performance and customer satisfaction. A core feature of MES software is finite scheduling, which is often used to define the best possible production schedule given labor and materials constraints, machine availability, and customer delivery dates. When manufacturing ERP software has MES, ERP, accounting, and finance functionality integrated with master planning and scheduling and customer relationship management (CRM), it can define within seconds the optimal production schedule to preserve margins while meeting customer delivery dates.
  2. Improve supplier quality, machine yields, and delivery performance in real-time. The real-time production monitoring system integrated into manufacturing ERP software makes it possible to identify and track supplier quality levels, machinery yields, and delivery performance by machine and order. As a result, manufacturers can gain insights into quality, yield rates, shop floor productivity, and delivery performance that would otherwise be unavailable. Because manufacturing ERP software shares data across all modules in real-time, including order management, the insights obtained are actionable—for example, identifying the roadblocks that need to be removed to improve supplier quality, machinery yields, and delivery.
  3. Strengthen inventory control and management through insights into each decision’s cost and profit implications. Managing inventory levels across a warehouse or entire supply network is essential to any production operation and motivates many manufacturers to first adopt manufacturing ERP software. The inventory control and management module within a manufacturing ERP system support reorder point calculations and configurable alerts based on replenishment points and product order levels. Minimum features include order quantity, lead demand, stock cover, and accuracy analytics.

Conclusion

Manufacturing ERP software is purpose-built for the shop floor first, integrating MES and ERP to create the core of a unified system platform. By running the core MES and ERP functionality—along with accounting and finance, QMS, WMS, SCM, and other modules—on the same database with real-time production and process monitoring data, manufacturers can immediately know how decisions on the shop floor impact their bottom line.

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