If your business involves manufacturing, then you know that making products requires a deep level of attention to detail. Generating a single item might take a dozen or more components, all of which need to be sourced, stored, and routed according to a master schedule...which itself is frequently in flux. On any given day, a single, disrupted step in a long process can choke off all of production and devour your profits. The products you're creating may be dependable and durable, but their creation can be quite fragile without the necessary preparation and product strategy. Our fourth installment focuses on things to think about as you organize your business manufacturing software that is intelligent enough to think several steps ahead and help your assembly line avoid mistakes.
- What type of manufacturing will you be doing?
No two processes will be alike, so let what you're making and your exact manufacturing procedures drive the system requirements. If you concentrate on discrete manufacturing (i.e. individual components assembled into a product that can be easily counted, like an automobile), you probably want your software to support functions like work center capacity planning, granular inventory management, routing, and detailed tracking of the product as it flows through the process. If process manufacturing (i.e. materials combined or blended into a bulk product, like soft drinks) is your thing, your business systems should emphasize unit of measure conversions, component bills based on percentage, decimal precision, and the ability to rework/adjust batches.
- What tracking requirements are enforced by your industry?
Some industries, like medical devices and food production, have stringent rules requiring manufacturers to trace raw materials and components all the way through to finished products and, sometimes, the end customers who own them. If you participate in an industry like these, your business software needs the ability to quickly and precisely reveal all the products on all the shelves that contain components identified as defective or dangerous. As such, the software you select should have robust lot or serial identification capabilities that give you clear, accurate visibility into the manufacturing and distribution history of all your products.
- What are your production planning requirements?
Are you building snowboards? Then your products need to be ready for purchase in late fall or early winter...whenever winter is where people will be wanting to hit the slopes. Surfboards? Then get those offerings ready for May in California and October in Melbourne. Are you making clarinets? If so, your planning challenges may be geographic as well as seasonal. Planning requirements are always as unique as the demand that drives them. In order to produce just the right amount of inventory for the customers who want it, you'll need to decide how and when you will build stock. Whether you forecast or build to order, your software will need to adapt to the particular nuances and exceptions that come with moving product to market without delay.
- What are your component planning requirements?
Knowing when finished goods need to land on shelves is one thing. Making sure all the parts and pieces upstream are ready to accomplish that goal in time is quite a different challenge. For many operations, using a min/max system to manage component inventory to correct levels will be sufficient. More complex manufacturing may require a material requirements planning (MRP) system, which uses future production plans to provide precise material control. Though it may be tempting to jump right into software that has all the bells and whistles of MRP, be honest about your needs. While min/max isn't as sophisticated or able to anticipate as far down the road, it’s easier to set up and requires less time to manage.
- What costs do you want to track as your products get made?
Of course, the cost of almost any finished product doesn't just come from the components that form it. It also comes from the work that went into assembling or creating it. If labor is a significant portion of your product's cost, you'll need to determine how that value gets added to its final price tag. Perhaps you are always looking to improve task efficiency and want to track changes at a detailed level in relation to production. Then you may want to use a time-clock system that integrates to job production. More predictable set-ups may want to skip all that tracking - which is labor-intensive in its own way - and just allocate labor after the fact. Look for manufacturing software that has the integration points you need to value your products according to their true worth.