6 ways ERP can help manufacturing processes post-COVID

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COVID changed the world. Uncertainty persists, with many countries heading back into forms of lockdown. Our lives and the economy will look very different once the world finally reopens, affecting the way we work, our core business processes, and day-to-day activities.

Since the ’60s, businesses have used Enterprise Resource Planning (ERP) to align their business processes – from running accounting to procurement, to handling human resources, to managing regulations and compliance.

ERP is a way to bring data together – unlocking efficiencies to improve collaboration, increase teamwork, and build significant profits. ERP is called the nervous system in the digital body, connecting legacy systems to provide more value, for longer.

To draw critical insight, ERP is the clearest point of entry for new technologies like the Internet of Things (IoT), which adds new datasets to a manufacturing.

What does COVID mean for ERP, and can ERP be at the heart of agile working for post-coronavirus manufacturers?

As we explain below, there are six ways ERP can make a massive contribution to the resilience and reinvention of your post-coronavirus operation.

ERP creates flexible supply chains

Flexible supply chains help manage challenges like these by using external data to improve demand and supply forecasting. Businesses should also consider expanding and broadening their supplier ecosystem. For many businesses, the time to build a digital supply chain and become a smart, Industry 4.0 manufacturer is now.

With the cloud, you can take advantage of real-time visibility, which is a real asset when it comes to managing supply chains. This helps businesses understand weather patterns (which may be affected more severely by climate change) and reasons for supplier issues and delays. You can feed into real-time decision making. And of course, supply chains benefit from increased efficiencies and less reliance on manual processes.

Traceability leads to supply chain resilience

If supply networks are one half of supply chain resilience, traceability is the other. In the food and beverage industry, for instance, COVID pushed manufacturers to adopt technology that proves their food products are safe. It has also accelerated interest in digital technologies as it is more difficult to perform traditional offline third-party food auditing and verification.

With many consumers now eating at home rather than at restaurants, there’s an increased demand on manufacturers to provide safe food products directly to customers. In general, despite the trend towards onshoring, few sectors will honestly be able to say that, in increasingly variable supply chains, they can trace every component of a product without digital assistance.

As ideas like independence of food supply and food miles become political hot topics (as well as consumer priorities), process manufacturers, in particular, will need ERP to keep provenance and traceability reporting under control.

ERP and social distancing at work

COVID has put remote working at the forefront of business processes and planning, with businesses not traditionally associated with remote working, such as manufacturing companies, being forced to put remote working and the relevant collaborative technology in place.

Next-generation cloud ERP is at the center of workplace reinvention, allowing much of the work that previously had to be done on-site to now be performed remotely. ERP gives remote staff access to the information they need, no matter where they are. It allows workers not on the factory floor to operate remotely, with all the information they need to make decisions in real-time.

On the floor, it frees up workers to operate flexibly – and therefore distanced – using handheld scanners to process materials. ERP allows different manufacturing departments to communicate because they are using one version of the truth, increasing productivity, collaboration, and allowing the real-time use of data.

As the backbone of an emerging IoT environment, ERP can also marshal sensors to spot production problems before they become shutdown issues, and also reduce the need for on-site personnel by triaging those problems early enough (often fast enough to resolve without a service call).

Lean manufacturing leads the way to operational efficiencies

Manufacturers around the world must work in a world which has thoroughly changed due to coronavirus. Businesses that were inefficient and unproductive before due to a lack of modern technology will struggle – post-coronavirus they will struggle even more.

Nobody argues that we are now in a cost-cutting era. Businesses are focusing on core activities and trimming the fat from operations to secure as long a financial runway as possible.

For manufacturers, the playbook has been written over many years. Lean processes reduce waste and minimize cost across the operation. If you’re looking to optimize inventory holdings, transport and distribution costs, raw materials pricing and usage, plus the time and motion involved in production processes, or to obtain the data which will trim cost out of any number of other elements of manufacturing, ERP should be your starting point.

Automation speeds up the delivery of goods to consumers

Post-COVID, increased visibility to make fast and more data-led decisions will be essential. Through automation available in modern ERP, you can use real-time reporting and analytical dashboards to continuously review your financial data, without lengthy time spent auditing and preparing the information. As we stand on the brink of significant advances in automation and its affordability, ERP is the backbone of deployment.

The integration of ERP and tax becomes more critical

Many businesses have had to rely on government support during lockdowns. As we move towards a more interventionist era, where tax and governmental regimes increasingly impact on business, ERP will become ever more critical for CFOs.

Source: Sage

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