Today, most small and mid-size businesses invest in ERP or shop management solutions to streamline business processes in the quote-to-cash cycle.
Greater efficiency can be gained through integrations.
Oftentimes the tipping point for implementing a custom manufacturing software solution is when the owner or key manager experiences the pain of managing the same data in multiple systems. Running a job shop using an accounting system such as QuickBooks™ plus a myriad of Microsoft Excel™ spreadsheets to manage all aspects of the manufacturing operation erodes productivity and profits. At some point, the shop owner realizes the lost productivity of managing all of this data in disparate systems
Benefits of an single, integrated shop floor management system
- Quickly generate job cost estimates and quotes
- Easily manage orders and schedule the shop floor
- Collect real time labor and material movement transactions
- Comlete, real-time visibility into purchasing and shipping
- Everything ties into the same financial package
When the job shop software or ERP solution is completely integrated, studies consistently show that the shop will increase efficiency allowing key shop personnel to focus on real problem-solving tasks and in the end increase company profitability by reducing expenses and allowing the company to even take on more orders.
However, this is often where most businesses will stop when in reality this should only be the beginning.
Today, ERP software is often architected to extend the reach of the solution beyond the quote to cash function it was originally implemented for into other areas of the business. For example, for shops that are primarily custom, make-to-order manufacturers or heavy engineer-to-order environments, the need to have a sophisticated design software package such as Solidworks™ is imperative to assist in the construction of complex, bills of material (BOM). Often the output from such design software solutions is handed over to the estimators who then have to re-key the data into the ERP solution to generate quotations to the customer. This re-keying of the same data already managed in the design software solution may take a single estimator anywhere from several hours to several days to re-enter into the ERP solution to generate a final quotation to the customer. This process of re-entering the data from the design package to the shop floor solution decreases efficiency and the speed at which quotes can be generated and is error-prone.
Technology to reduce or eliminate duplicate data entry.
Through the use of standard application programming interfaces or APIs, two disparate software applications can now seamlessly “talk” to each other. For example, let’s take the estimator who has received the printed bill of material (BOM) from the engineer, instead of painstakingly re-keying the data, he is now able to open up the integration program where he:
- Points to the location of the completed design file on the company network and easily displays the data from the BOM, and then reviews any of the data before sending it to the ERP solution to create a quote, job or part master.
- If new part numbers exist that are NOT currently in the ERP solution, the user can make a choice to have the system automatically create them in the material master file or to treat them as one-off miscellaneous items unique to this BOM structure.
- In addition, the integration program can also “trap for errors” such as missing data elements that are required by the ERP solution such as quantities, etc.
The same business function that used to take hours or days can now literally be reduced to seconds or minutes with safeguards against incorrect data caused by manual input.
The same could hold true during the manufacturing process as well for tooling. In many shops, machinists or fabricators walk up to a tool dispensing machine to issue tools that are required when running specific jobs.
- Often the cost of this tooling never finds its way back into the ERP solution to most accurately reflect the total cost of the job. With the same type of standard API used to integrate the design or engineering solution to quotes, the same type of solution can be used to enable the tool crib to “talk” directly to the ERP system.
- When the employee scans or select the tool and then scans the job traveler, the tool crib program can allocate the tool to the job and subsequently update job cost appropriately.
For most customer manufacturing shops, it is all about time and cost savings.
Investigating ways to further streamline your business processes, reducing the chance of human error, and putting your staff to work solving real business issues should be the goal of every business owner. If you haven’t talked to your ERP vendor in recent years regarding options they have for integrating to your other business systems, do so today. If you are just in the process of selecting an ERP solution, talk to your prospective suppliers about the ability and architecture of their solutions to enable your shop to extend the benefits to other parts of your company. This one discussion could help your company realize benefits that you may not have realized even existed.