Manufacturing industry ERP overlaps with MES systems.
In most cases, ERP fundamentally focuses on the needs of a company’s financial administration. Financial planning determines methods, practices and the level of accuracy of handling items: the emphasis is on recording what already happened and, finally, that the rows end up in invoicing and accounting.
Recording past events, however, does not meet the information needs of production planning. The sights of production planning in manufacturing industries are set on the future. They have to be prepared for future orders, production situations that follow forecasts and anticipating the effects of changes.
So does ERP serve the needs of production, and how well? A good, simple practical metric to assess the level of usage for a system is whether production planning needs to use complementary systems. Often this complement is simply an Excel spreadsheet, with which production planning tries to manage its processes better. In addition, separate systems similar to spreadsheets are used, as well as applications built, for example, on an Access database.
Manufacturing operations management (MOM) provides a glance into the future
When designing enterprise resource planning, the ultimate aim should be that the ERP system in itself gives a window into the future. The effects of the current situation and any occurring changes should be visualised from the jungle of numbers. Immediate feedback after changes in plans is also important.
The ERP needs of production planning can be very detailed, especially when the feasibility of plans needs to be evaluated. Variables include sufficient product inventory, threat of deficiencies, resource utilisation rates, what materials are needed, what amounts and when. All this information should be collected into one display if it is meant to help the planner.
Why couldn’t an ERP system reach into the traditional realm of MES (Manufacturing Execution Systems)? A consolidated MOM solution has significant benefits over a number of separate systems. The most important things are information transfer and timeliness: when something is published in the system, the information should instantly be available also to production and the buyer.
Situation snapshots and quality management
The information requirements in production management are different from those of financial management. The essential point is the formation of a situation snapshot through production progress and time usage.
Another essential point is quality management. The requirements for product and production monitoring are constantly becoming stricter. There must be a way to record quality information—such as a variety of measurement results or quality monitoring data during the production process—directly into the ERP system, making separate measurement logs unnecessary. This makes all information that is needed for management easily available for everybody.
Electronic logging at source is particularly important in industries like the foodstuffs industry where the origin and traceability of raw materials are critical information. Collecting the data afterwards is difficult, if not impossible. Sustainable development requires that monitoring covers the entire global production chain.
Information on production progress is important for production planning. It gives a real-time view on whether promises can be kept. Up-to-date information additionally serves many other functions of a company, especially in companies operating in multiple locations and internationally, who cannot base their information flows on constant personal contact.
A special system for production planning as an alternative
An ERP system fulfilling the needs of financial administration, production planning and production may be an impossibility for many companies, for various reasons. Then it just must be accepted that a basic system focusing on financial administration is complemented by another system specialising in production planning and management.
Roima’s Manufacturing operations management solution can serve as a special system in the areas of production planning and management. We have paid special attention to making the solution work as a control centre of all operational functions, helping see the future earlier and provide more accurate information to help operational planning and execution.
Olli Kanerva
