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what is manufacturing erp software

What is Manufacturing ERP Software? All You Need to Know

What is Manufacturing ERP Software?

Manufacturing ERP is an Enterprise Resource Planning (ERP) software solution with a laser focus on streamlining and automating activities related to manufacturing. A manufacturing ERP fulfills the specialised requirements of manufacturing companies to manage their day-to-day operations effectively.

Manufacturing ERP, or sometimes referred to as Manufacturing Resource Planning, automates scheduling, planning, and inventory management of raw materials and resources to manufacture complete items.

The need for a manufacturing ERP system

Manufacturing companies need a system to manage, automate, track, collaborate, and connect every step of the manufacturing process. Small and mid-sized manufacturers may be able to manage with an entry-level stand-alone system. Larger manufacturers with global operations need a robust, leading-edge manufacturing ERP with embedded artificial intelligence (AI), machine learning (ML), and analytics. Irrespective of the size of your manufacturing business, you will need a system to help you track, monitor, and manage the entire operations for competitive advantage.

Why is manufacturing ERP important?

Manufacturing ERPs are used by manufacturers to manage the various stages in the production process, from raw materials to finished products. The system offers a variety of benefits including the following:

  • Streamline production process
  • Enhance operational efficiency
  • Improved quality
  • Faster and higher delivery accuracy
  • Lower costs
  • Increase sales and profitability
  • Better customer satisfaction
  • Increase competitiveness

Features of Manufacturing ERP to look out for

#1 Materials Requirement Planning

Materials Requirement Planning (MRP) calculates the raw materials and components required to manufacture a product. It consists of tracking and identifying inventory of materials and components on hand and scheduling it for production process.

#2 Master Production Schedule

Manufacturing facilities can receive multiple orders simultaneously which need to be created, tracked and managed in the system. Orders can be assigned according to the workload and capacity of your manufacturing facility.

#3 Bill of Materials (BOM)

A Bill of Materials (BOM) is a list of all materials, components, and assemblies and their corresponding quantities required to build an end-product. A well-documented BOM is vital in quality control and inventory forecasting.

#4 Inventory Management

Track and monitor outgoing and incoming inventory of work-in-progress (WIP) and finished products. Inventory management is an important element in preventing overstocking or understocking. Both situations can lead to poor cash flow and loss of revenue. Real-time inventory tracking streamlines ordering and shipping. It also allows manufacturers to accept pre-orders and predict delivery time frames.

#5 Warehouse Management

The warehouse management feature controls and coordinates receiving, scanning and storage of all incoming and outgoing inventory. It also tracks the location of each inventory item within the warehouse for ease of picking, packing, and shipping. An effective warehouse management feature helps to optimise the use of space, improve inventory control, and streamline shipping and receiving.

#6 Routing

Routing is a roadmap of processes to be followed to assemble a finished product. Each process is handled by a work center internally or sub-contracted externally – all which can be tracked and managed within the manufacturing ERP solution.

#7 Traceability & Batch management

Some manufacturers need the traceability and batch management feature to fulfill regulatory and compliance requirements. It is good practice for all manufacturers to utilise this feature to enable you to trace and track a product. All manufactured products have lots and serial numbers to enable traceability when required.

The Difference Between a standard ERP and Manufacturing ERP

A standard ERP system is a generic solution with common features that suit most businesses. Most ERP software includes finance, sales, customer service, and basic inventory that is sufficient for most businesses but lacks full manufacturing features. A standard ERP system will need to be customised to meet the unique needs of manufacturers.

A manufacturing ERP system is custom-designed for the manufacturing industry and fulfills manufacturing-specific needs. Features like materials requirement planning, BOM, master production schedule and traceability are built-in. Manufacturing ERPs include finance, sales, and customer service for a seamless and integrated experience across all business functions.

Kickstart Your Manufacturing ERP Journey

If you are in search of the right-fit manufacturing ERP solution, we may be able to help you. Let us know your current manufacturing environment, the challenges you are facing, and the vision for your business growth and we may have a solution for you. We are a call away on 1300 440 444.

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