Enterprise Resource Planning Effectiveness
Supply chains are more than just ordering parts and keeping up with inventory. A supply chain has to deal with the financials, planning and scheduling, and the management of the warehouse and the customers’ orders. New technology has helped companies and corporations with these things and one of them is the Enterprise Resource Planning (ERP) systems. “Enterprise resource planning (ERP) is business process management software that allows an organization to use a system of integrated applications to manage the business and automate many back office functions related to technology, services and human resources” (Beal, 2017). In this paper I will be discussing two key applications of an Enterprise Resource Planning (ERP) system. The key applications will be Inventory Control and Production Planning and Scheduling and how they are needed to support key supply chain business processes.
“Inventory control is the practice overseeing and controlling of the ordering, storage, overseeing and controlling of quantities of finished products for sale, and use of components that a company uses in the production of the items it sells” (What Is ‘Inventory Management, 2017). SYSPRO is an Enterprise Resource Planning (ERP) system that companies use for inventory control. SYSPRO is a software tool that can be added to the computer systems to control all aspects of the inventory system. “SYSPRO is a powerful tool that will provide any company or corporation with superior inventory control to be able to optimize stocking levels, free-up working capital, provide more effective customer servicing and benefit from improved profits” (“Inventory Management”, 2017). The use of this system allows the supply chain manager or employees to track the movement of materials throughout the warehouse as well as when things are ordered when they will arrive. This software will also help locate specific inventory in the warehouse down to the shelf that it was place upon as long as the information is inputted in the system correctly.
SYSPRO is sold in modules so that companies can get the module that they need instead of having to purchase them all and never use them all. Example being is that if my company only needs inventory control and finance then those are the only two modules I have to purchase. The software has extensive customization so that companies can have the product work the way they would like it to work. “The software can be deployed on premise or in the cloud. In addition, the mobile product offering, SYSPRO Espresso, provides you with access to your business information at any time, from your preferred mobile device, as easily as if you were in your office” (“Inventory Management”, 2017). The software also comes with system wide facilities that make sure that the system is fully secured from unauthorized access. The system allows you to set up the security for the operator of the system or by the role of the person that is using the system so that an employee’s cannot change data without the supervisor signing off on the change. SYSPRO software is also version independent so you are able to continue working will you update the system to a newer version. Having this software allows companies to keep up with every process involved in the inventory control saving them time and money and allowing them to operate smoother and better.
Production Planning and Scheduling
“Production planning, or production scheduling, is a term that covers all aspects of operations, from workforce activities to product delivery and is almost exclusively seen in manufacturing environments” (O’Farrell, 2017). Production planning and scheduling is key to a supply chain system because it helps an organization plan production with the optimum utilization of all the available resources. The production planning and scheduling module allows the company with process definition with inputs, outputs, by-products and overheads. “The primary inputs which tells the composition of a finished product; a master schedule, which tells how much finished product is desired and when; and an inventory record file, which tells how much inventory is on hand or on order” (“Inventory Management”, 2017). This is very important because no company wants to have too much product being produced or not enough to fill the order. If they have too much product they can run the risk of the product sitting in the warehouse and never being bought or they could not produce enough and they have to spend more money in wages or outsourcing the job to get the appropriate amount before the deadline. Outputs from the process include planned-order schedules, order releases, changes, performance-control reports, planning reports, and exception reports. The software allows the supply chain manager to input what they want done and the system will automatically generate job orders for productions. The system does all the work allowing managers and employees to do other tasks to get the job complete. Just like inventory control the system will run and operate correctly even when the system is being updated. This allows for no production lost and no extra expense. The system will automatically update itself and keep things running as smooth as possible.
No supply chain s flawless but they are making new technology to help keep things running better. With the Enterprise Resource Planning (ERP) system it is giving companies resources to keep cost and time down. To make sure that the ERP system is meeting the desired outcomes the ERP system needs to have metrics. When it comes to inventory, “manufacturers cycle time is one of the most important metrics as it measures how fast the business is responding to customer orders. Cycle time measures the length of time it takes to produce a good and deliver it to the customer from the moment the invoice is received” (Nguyen, 2016). When a customer has a faster cycle time this means that the customer is satisfied and the process is very effective. When it comes to production planning and scheduling another metric that is very important is schedule adherence. “Another relevant KPI is schedule adherence, which measures how effectively the ERP allows the company to maintain its production schedule. An effective ERP system should bring the scheduled and the actual number closer together” (Nguyen, 2016). So the ERP systems have been a very powerful tool for companies and corporations to use.
Beal, Vangie. (2017). ERP – enterprise resource planning. Retrieved from http://www.webopedia.com/TERM/E/ERP.html
Inventory Management. (2017). Retrieved from https://www.syspro.com/us/product/inventory/
Nguyen, H. (2016). 5 Metrics to measure success of your ERP project. Retrieved from http://blog.trginternational.com/5-metrics-to-measure-success-of-your-erp-project
O’Farrell, R. (2017). Production Planning & Scheduling. Retrieved from http://smallbusiness.chron.com/production-planning-scheduling-43174.html
What is ‘Inventory Management’? (2017). Retrieved from http://www.investopedia.com/terms/i/inventory-management.asp
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