What are the Challenges of the Manufacturing Industry: How Can ERP Help Address Them?

The advent of Enterprise Resource Planning (ERP) system in the manufacturing industry has transformed a significant proportion of companies from their core. This intense growth has been possible because of the ERP’s capacity to bring lucrative opportunities and address various manufacturing industry-related issues. 

Earlier, manufacturing software was explicitly designed to support larger companies. But now, you can get your hands on various ERP systems suitable for manufacturing organizations of all sizes. 

This article discusses the challenges the manufacturing industry commonly faces and how ERP can help address them.

1. Integration of Operations and Locations

If your manufacturing organization has multiple units and plants located across different areas, it can result in poor information flow, data silos, and lack of coordination. Furthermore, it can make it difficult for manufacturers to implement basic procedures. 

Solution

ERP can help overcome this problem by integrating planning, inventory, procurement, production, supply chain, finance, and sales across multiple units or locations. 

Additionally, with this system, you can collect data from several business verticals, departments, and locations, giving you a 360-degree visibility of your business. Integrating operations and locations via ERP software makes it easier to implement policies, guidelines, and rules to streamline workflow across different manufacturing units. 

2. Inventory Control

Any manufacturing company, small or big, needs optimal inventory levels to keep production ongoing. But you can’t maintain an optimal inventory level without having complete visibility of the stocks. In addition, having manufacturing units at multiple locations can lead to overstocking or understocking, directly impacting production and cost. 

Solution

An ERP software designed for the manufacturing industry offers an inventory management and control module. This module helps manage and control inventory levels across multiple manufacturing units. 

Such ERP systems help manufacturers generate a wider inventory management report to gain insights about inventory levels in the organization. You can use these insights to maintain optimal inventory levels. For instance, if the report states inventory overstocking or stockout, you can immediately act accordingly. 

3. Data Collection Errors

The accuracy of your business decisions and the growth of your manufacturing company are directly linked to how fast you collect, study, and interpret data. Opting for a manual approach can make decision-making time-consuming, resulting in expensive delays. 

Solution

High-end Manufacturing ERP Software automatically collects accurate data from varied sources. No matter how many departments or applications your manufacturing company has, ERP will present you with data in a centralized location, making it easier for decision-makers to access and study the data. Additionally, with data management tools, manufacturers can eliminate data fragments and silos, leading to informed decision-making. Make sure to learn more on this.

4. Low Employee Productivity

Inefficient and unproductive employees can negatively impact the functioning of manufacturing organizations. It often happens when your employees focus more on back reconciliation, follow-up approvals, and regulations than the main tasks.

Solution

ERP’s easy and quick reporting feature saves your employees a significant amount of time. Sending approvals via e-mails allows employees to cut down on processing time, and ERP alerts and notification systems can improve coordination and productivity among different teams. 

The time your employees save with automation and digitization can be used to establish strong customer relationships, leading to business growth. 

5. Optimum Resource Allocation

Manufacturing companies find it challenging to optimally allocate resources across multiple units and plants without an integrated system. Inefficient resource allocation increases production costs. In addition, relying on manual paperwork can lead to loss of information and duplicity.

Solution

An ERP system automatically records necessary information related to machinery, equipment, plant, and other resources across multiple manufacturing units. Moreover, this cutting-edge system sends regular alerts or notifications for inspection, servicing, and maintenance work, ensuring that all machinery and plants function well and yield maximum results. 

Poor Planning and Scheduling

Detailed planning of each vital element in the manufacturing unit is the primary responsibility of manufacturers to align production schedules and deliveries. However, it’s not possible without accessing accurate inventory data. 

Solution

ERP system provides manufacturers with updated data that can be used to correctly plan workflows and schedule the batches to meet market demands and use materials optimally.

Bottom Line 

Powerful ERP software is the ultimate solution to overcome all the challenges discussed and streamline your business processes. With this robust system, manufacturers can implement effective procedures and policies to overcome several manufacturing industry-related issues. Therefore, consider implementing a customized ERP system suitable for meeting your business needs and achieving the best results. 

Eresource ERP is a leading web-based ERP software company. We offer customized ERP software for manufacturing, construction, process manufacturing, fleet management, trading and distribution industries.