Before we get into ERP modules for manufacturing planning, we must first define what manufacturing planning is. It's a production plan derived from a very detailed sales forecast; it balances the company resources with the current market demand. It is the cross-functional process of planning for a month or a quarter based on the market targets for production and sales and inventory levels. It is used for fulfilling basic business revenues and the goals of the market. It also helps create a framework for developing a master production schedule.
Production planning on the simplest terms is the most grassroots level of planning and estimating for any manufacturing and production firm. These can include, the production capacity of the unit, the quantity of raw materials required to complete the order, the process of production, checking if the plan is economic or not, the number of the labor force that would be needed, and the skills they would need to possess, estimating wastage and how to reduce it, and alternative methods of production if the wastage exceeds the estimates. All these questions and concepts are ideas that should arise during production planning to overcome any problems and to generate continuous and streamlined workflow.
An effective production plan has to consider all aspects of manufacturing order from scratch. It should also be able to forecast where and how things may go astray and how to navigate them without harming the production stream once it begins. Hence, the manufacturing plan is made and revised far ahead in time, even before the manufacturing properly begins. The entire process is then streamlined using an Enterprise Resource Planning (ERP) system.
For successfully creating a manufacturing plan, these are a few ERP modules that should be integrated:
• Operations and production management
This is the heart of the manufacturer. This controls the entire workflow of a manufacturing firm. It manages aspects such as, catering products for customers, making sure those products are ready and on schedule for delivery, financial management is also connected to be able to pay the suppliers and employees at the right time. In other words, the operations and production management is the backbone of the production planning.
• Inventory control
All manufacturers have to strictly maintain and use their inventory. An inventory is one of the greatest assets of a manufacturer and should be used optimally and efficiently. An ideal inventory is always moving until the product is completed; however, it is not always possible so the goal is to keep the inventory as mobile as possible. Inventories store products for future and current orders. If it is not controlled properly, the items in the inventory can become obsolete if the customer demand changes or if better products are available. This results in major losses, not only the good that is obsolete but also the cost of disposal is added.
• Purchasing and supply chain management
Manufacturing, at its core, is run by inventory and purchasing. This module will deal with sales orders and predicted demands. A schedule is then generated using the data and the supply chain manager is then alerted to increase or decrease certain productions. The same module can be then used to monitor the order until it is ready for shipment.
Manufacturers who outsource their production can also use this to maintain their inventory and know if a certain product is in stock or they need to purchase it. A lot of the times, components are consigned to a producer. Although it is physically moved, but stored on the producer's site and owned by the manufacturer. This module can help keep track of all the products and stock seamlessly.
• Sales and order management
Using this module, the customers can place orders on the products they need. Those orders become sales orders for the manufacturer. The ERP then signals the operations to schedule its production and order components needed to make the product. The module can also alert the sales management and inform them if there is a risk of the product being canceled as well, saving costs, and boosting efficiency. The ERP records all transactions and the same orders can be made repeatedly with just a click.
• Customer relationship management
Customer relationship management (CRM) provides the tools to ease communication between the manufacturer and the customer. This can be voice calls, emails, texts, or any other form of communication. The CRM records the time and dates the message was sent and if the message was also opened and read.
• Supplier relationship management (SRM)
This is a module that helps track requests for product quotations from suppliers and keeps a record of the quotes for the future. It also plays an important role in assuring the manufacturer's quality. The manufactures usually have to maintain a certain quality and certification. Those certifications are kept in check by the SRM and alert the manufacturers whenever updates are needed.
• Business intelligence
This is a key module for any manufacturer's planning. This module tracks every transaction made in any module. The time and date, the person making the transactions, all of these are recorded. These then make up the audit trail which is crucial for management.
The module can also run on different modules and configurations, adjusting to suit every other module. BI allows the users to use any data in the ERP and link it to any other module to share information, reports, and so on. The data can also be displayed in any graphical representation or charts. It can also help individual workers know about their next task, that too in confidence.
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