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How to Use Your ERP Software to Solve Manufacturing Supply Chain Challenges

Supply chain challenges affecting manufacturers over the past several years are not going away soon. Some industries were upended so dramatically that it could take years to get back to pre-pandemic operations. It’s a systemic problem without easy solutions but used strategically, your ERP software can be a very effective instrument for navigating through supply chain turbulence.

3 Ways ERP Software Builds Supply Chain Resilience

1. Advanced Analytics

Business intelligence (BI) tools, coupled with data from your ERP software, can help you analyze situations and adapt more quickly with actionable insights. You’re already using ERP software data to manage production and inventory, but it might not provide the level of analysis you need for making insightful, strategic decisions.

Using BI tools to analyze performance—including Overall Equipment Effectiveness (OEE), run rates, scrap, yield, energy consumption, material consumption, and fill rates—can have a big impact on supply chain effectiveness.

For example, you can review data from truck utilization and dock capacity to help optimize how you move and receive products. With record fuel prices, uncovering gaps in these areas can be significant. BI tools can help you uncover how you can optimize your shipments and help you analyze OTIF (on-time-in-full) customer shipments to uncover inefficient areas.

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Advanced analytics also can help you analyze long-term, aggregated data to quickly and easily identify why certain product outcomes happened and perform “what-if” analysis with diagnostic tools. Using business analytics, you can evaluate inventory performance compared to your competitors and the industry overall, and identify historical patterns to model future purchase patterns and possible changes to make in your product mix.

2. One system for all

Nothing says ‘inefficient’ more than using multiple software systems when you can perform better with just one. This is especially true if you have systems that do not integrate with each other. Using supply chain management (SCM) software that’s integrated with your ERP software is essential—from shipping and receiving to support for multiple carriers and rate shopping. The benefits of a robust ERP software go well beyond SCM. You can connect all elements of your business, including finance, engineering, and HR. Using one system provides a single source of truth and makes it easier to train and onboard new employees.

Gaining the most via your SCM and ERP software includes a robust warehouse management system with serial tracking, supplier-managed inventory, and forecasting. Warehouse management tools that use handheld devices to scan inventory can improve transaction processing time, increase accuracy, and reduce errors.

Coupling your ERP with SCM tools also connects the dots between planning and scheduling, job management, and sales order management. For example, it allows your sales teams to see what is available to sell, or when customer jobs will be complete or might need additional information.

3. Anytime/anywhere access

Predictive analytics, real-time data, internet-connected machinery, and automation enable you to be proactive in identifying and solving potential supply chain issues. Leveraging familiar technology—like mobile devices—to access this data is an effective time-saver for warehouse and production functions. Access to this data permits a fast, easily understood, and up-to-date perspective on the state of your inventory management, so you can track performance against critical metrics and actual supplier lead times. You also can spot opportunities to rebalance stocks, helping to uncover the root causes of operational inefficiencies.

The need for any time/anywhere access to business-critical data became all too real during the pandemic. Real-time access to critical data enables key employees to make point-of-activity decisions, and you can address potential issues before they become problems. Not only can cloud-enabled ERP software help your employees reduce response times, but it also can help your customers serve themselves. With the cloud, you’re no longer limited to serving your customers in the traditional sense (i.e., being at your computer in an office). You can respond to customers on the fly—literally on an airplane—while the customer is on the golf course. You can provide pricing to users immediately while configuring products. Cloud-enabled ERP software allows customers to create, edit, and track orders and make payments. Not only does this save time for all parties, but it also allows customers to access data on their smartphones.

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Now Is the Time to Act

Many tools to mitigate supply chain challenges already are in your arsenal. The challenge is prioritizing their use and budgeting the time it takes to integrate data analysis in a meaningful way. Partnering with a technology provider that understands your industry and business challenges is essential to your success.