ERP Manufacturing Process Solutions Drive Intelligent Master Production Scheduling
In a previous post, Responsiveness, quality and control - why industrial manufacturers use abas ERP, we looked at some of the key features that make abas ERP so powerful for industrial manufacturers. Today's post will offer a closer look at Master Production Schedule (MPS), and explain more about how this aspect of the software facilitates manufacturers' end-to-end processes.
Industrial manufacturers are facing a fairly unusual situation. On one hand, they are dealing with incredible pressure to update their technologies and operational models to function with a higher degree of strategy and intelligence. On the other, the rise of smart manufacturing is also creating new revenue opportunities for organizations that are able to adapt to the current marketplace.
Using a master production schedule solution within the confines of a modern enterprise resource planning system can help manufacturers weather this period of change by enabling them take a much more strategic approach to aligning resources across operations.
The rise of smarter manufacturing
Traditionally, many organizations have implemented manufacturing strategies in which they forecast potential demand based on historical sales trends and schedule their supply purchases and production runs accordingly. In some cases, organizations may have become flexible to the point where they try to align their available supply of a good ready to ship to projected demand.
With smart manufacturing available in today's data-driven environments, businesses can collect data from across lines of business and know precisely how and when they produce assets. Internet of things devices can alert stakeholders when certain supply and equipment thresholds have been met, and an ERP manufacturing process solutions platform informs users of overarching operational trends, not to mention specific reports, that inform decision-making. With this information in hand, smart manufacturing in which IT and operations technology come together to drive efficiency.
How do modern manufacturers measure their success? Find out in our popular download, the KPI Playbook for Modern Manufacturing
Zion Market Research found that the smart manufacturing market is positioned to expand at a compound annual growth rate of approximately 15.4 percent for the period of 2017 to 2023. These potential gains are exciting, but the industry needs to deal with heated competition and shaky supply chains. The result is high operational costs and tight margins.
As these trends come together, a clear overarching theme stands out: There is a great deal of opportunity for manufacturers to embrace smart technologies and establish innovative processes, but companies must be incredibly careful to ensure the technology they invest in to achieve these goals delivers value to its full potential.
Organizations can't afford to invest heavily in technologies that create and manage data intelligently only to have that information fall to the wayside due to limited production planning capabilities.
Using MPS manufacturing in response to smart manufacturing
At its core, MPS manufacturing is an ERP manufacturing process in which you use the master production schedule to forecast your production schedule relative to the actual purchasing activity happening in your organization. Through this precise coordination, organizations give their sales teams the ability to identify production availability at a given time and generate accurate available-to-promise dates as they interact with customers.
Smart manufacturing strategies can take MPS tactics to another level by increasing the amount of data companies have at their disposal.
Here's how the strategy can work:
Data pertaining to the availability of raw materials is stored within the inventory management components of an ERP system, providing visibility into what is in stock at a given time.
Material requirements for different products are managed in the ERP setup, giving sales teams the insights they need to calculate the supply that will be needed for a customer order.
Vendor management systems provide visibility into delivery times and costs of getting goods from different sources to offer insights into expected supply chain timelines leading into an order.
Representatives interacting with clients can use reporting tools and raw data within the ERP setup to project production capacity at a given time and accurately estimate when necessary assets will be available for production.
With these details settled, users view existing production work orders on various lines to identify when capacity will be available.
From there, sales orders can be created with precise available-to-promise dates that account for raw material availability, existing inventory and the production schedule.
Once the sale is final, the ERP system can be used to coordinate work orders across departments and ensure stakeholders throughout the organization have the information needed to get the job done.
All of this coordination is possible because the MPS manufacturing strategy gives the business a central location where its production schedule can reside and be updated in real time. When MPS tactics are combined with the data availability of smart technologies, companies can enact lean manufacturing to a deeper degree than would have been possible in the past because they can minimize excess inventories of both raw materials and manufactured goods in place.
Gaining the end-to-end visibility needed for MPS manufacturing
Effective MPS manufacturing strategies hinge on end-to-end data visibility. With the abas ERP manufacturing process platform, a sales worker can get all the information needed to support precise scheduling within the sales order screen, but an accurate estimate depends on having relevant data across multiple lines of business. Beyond the issues mentioned earlier - access to raw materials, inventory levels and production capacity - organizations also need to understand shipping and fulfillment capabilities.
A sales order that forecasts production accurately but doesn't properly account for shipping variances can end up leading to a poor customer interaction. You may get the goods in on time and the assets produced on schedule, only to have those items sit in your warehouse as you look for a vendor who can ship them based on your timeline.
The problem with waiting for quartly sales reports is the inability to adjust to market shifts quickly enough
When you have IoT devices tracking operations and feeding information into your ERP system, you can project production accurately, allowing you to then enact just-in-time inventory management strategies in which you avoid storing excess materials in your warehouse. This can keep shrinkage under control and drive efficiency gains in both the warehouse and production lines. At the same time, ongoing reports on shipping capabilities let you forecast when you'll be able to get items out from your warehouse to customers, further strengthening the customer experience.
Historically, manufacturers have been limited to production runs built around quarterly or seasonal sales trends. Major reports clued leaders into sales patterns and decisions were made accordingly. The problem is that this is a highly inflexible model in which companies are not only limited in their ability to adjust to market shifts, but are also forced into fairly predictable, standardized production runs.
By combining smart manufacturing principles with MPS capabilities in an ERP solution, those flexibility barriers disappear. Sales teams can, therefore, provide stronger customer experiences at the point of sale and across the entire product delivery process. Furthermore, the more precise scheduling lets companies vary their production runs more freely and order raw materials in such a way that asset availability aligns with immediate production demands.
Interested in how abas ERP helps companies prepare for the future? Check out the abas 2018 Overview Brochure
MPS in abas ERP
The abas ERP manufacturing process system offers organizations the core functionality they need to establish MPS manufacturing capabilities with features like sales forecasting, inventory management and production. Many businesses also have unique workflows and demands, especially as custom manufacturing becomes more commonplace in a variety of market segments. We combine our powerful off-the-shelf ERP capabilities with simplified customization that ensures customers can take full advantage of smart manufacturing alongside MPS capabilities.
The manufacturing sector is going through a period of rapid and disruptive change, but the right technologies can help companies adapt to the rapidly shifting market and maximize the value of their resources.
Interested in learning more about abas ERP and MPS? Feel free to contact us at anytime, and you can also download our free whitepaper: Perfection in Production, for even more information about abas ERP!