Process manufacturing businesses can gather value from powerful tools like an ERP system just like any other organization. And like other organizations, how they use those tools determines the value gained. But the majority of businesses are discrete manufacturers and so the majority of ERP systems cater to the larger market. The issue lies in the fact that process manufacturing ERP requirements can differ greatly from their discrete counterparts.
It is time to make your ERP selection. You and the other stakeholders have reached agreement on the critical requirements that must be covered by the selection. You have a prioritized list of other wishes for the ERP. Some of these are requirements for certain disciplines and others are desires people hope to accomplish with the ERP. You have also agreed on the value of the requirements for the company as a whole. Finally, your finance department were included in the selection group. They were, weren’t they?
1. Manufacturing Communication
Many process manufacturers use fully or semi-automated flows so the ERP must communicate more with machines than another business where communication is with people. The process manufacturing ERP might tell a PLC to start an operation electronically instead of providing a dispatch list. The SPC feeding information back to the ERP is more likely to be a sensor reading temperature rather than a technician completing a chart. An ERP designed for process manufacturers should already have these capabilities but each business must understand their own communication needs and ensure the selected ERP meets the requirements.
Some areas are important to a degree for discrete manufacturers, but are of life and death importance to a process manufacturer. Shelf life to one means the glue could no longer be sticky and to another, the product itself could cause serious injury to a patient. A bag of fasteners will have lot control but how often will a rivet be defective? But when someone becomes ill from eating spinach with e-coli we need to know quickly where the spinach came from, where it was processed, and who else might have bought that batch of product.
3.Process Manufacturing Compliance
Regulatory reporting and requirements are particularly important in many process industries. Those requirements continue to evolve and become even more restrictive. HACCP is a recent addition for food and drug manufacturers. What compliance requirements does your business have for a process manufacturing ERP system.
When preparing your set of requirements for your ERP, be careful not to make those requirements too strict. You could eliminate some ERP providers unintentionally. Write down your set of requirements. Ask all your discipline leaders to write their own lists. Have a conversation and reach consensus on your business’ true requirements. Then prioritize into “must have”, “really should have”, and “would like to have” requirements. Now you can rate prospective ERP providers compared to your needs. Don’t eliminate a system just because it isn’t specifically for process manufacturers. Many general purpose ERPs have excellent capabilities for your industry. At the same time, use caution to read behind the advertising and know that a process manufacturing ERP system that claims to be specifically for your industry truly meets your requirements.
You have probably looked at the marketing-heavy websites from some ERP vendors and maybe even done a little research into the selection process by now. An easy distinction between manufacturing ERP systems is whether they are for process or discrete businesses, or both. You can quickly de-select those for discrete only. But remember that many can manage both kinds of business well, so don’t limit the search to only those that advertise process manufacturing.
4.Making the Final Choice
Now try to narrow the search to those that serve your particular market. Cosmetics and chemicals are both process manufacturers but their needs don’t completely overlap. Invite a couple to present their products and let them know your requirement priorities. Question seriously if they seem to gloss over areas you think important. Talk with your peers too. What ERP did they select? Why? What problems did they find with the system or with the providers and their services?
Now is the time to think about whether you require an ERP on-premise or whether a cloud system might work well for you. There are ERP systems in both arenas that likely can meet your needs. Cloud systems require a lot less up front investment which is good but you are still essentially renting the system.
Arrange for demonstrations of the actual systems – not just marketing presentations. Make sure you see that your requirements can be met to your satisfaction. You might even visit a live site to see if the user interface is as good as advertised in the eyes of real users. Whatever medium you use to view the ERP, be sure your whole team gets to see their requirements met. If production is completely satisfied but quality is not, keep looking.
Finally, you make your choice. You have run the numbers and the return on your investment in the new tools is right. Your implementation team is ready and you have the beginnings of a testing plan and timeline. The probabilities are with you. But success is not yet certain. Do your best, but be prepared to start over if necessary. Do not implement the wrong ERP just to save yourself embarrassment.