The implementation of an enterprise resource planning (ERP) system is not mandatory. Companies can decide for themselves whether or not to invest in such software. However, businesses have been using such systems since the 1960s, when the term ERP had not even been introduced yet. In addition, such solutions originally came from the manufacturing industry.
Manufacturing companies are complex, even if they produce simple goods because they involve many more processes than other enterprises, such as retail companies. For this reason, leading manufacturers have already implemented ERP software and successfully optimized their operations in the ways described in this article.

To Enhance Supply Chain Management

Supply chain management is at the heart of any manufacturing business, no matter how small. Unfortunately, having an optimal supply chain in place is not enough, as the market and geopolitical situation in the world is constantly changing. In most cases, companies tend to benefit from flexible management models that allow them to adapt their supply chains to the changing world.

Advanced ERP systems such as Microsoft Dynamics 365 Finance and Supply Chain Management facilitate this task by providing companies with a centralized view of all data involved in the supply chain and comprehensive analytics functionality.

With an ERP system, a manufacturing company can optimize every element of the supply chain, from more accurate demand forecasting and procurement planning to complex warehouse and logistics management.

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To Improve the Quality of Goods

The quality of goods is the most important factor determining customer satisfaction. While many companies struggle to improve the quality of their goods because this process usually leads to increased costs, implementing an ERP system can solve this problem without any extra investment.

First of all, it simplifies production planning and scheduling, which means that goods will be ready on time. Of course, timely delivery is of utmost importance to most customers and business partners.

Secondly, an ERP system can be a useful tool for routine quality control. Such software can provide companies with solutions for tracking production defects, analyzing quality data, and managing nonconformances.

These features can improve overall production quality, increase customer satisfaction and facilitate regulatory compliance. In addition, improved quality control also helps minimize scrap and rework, which can save manufacturers a lot of money.

To Make Financial Management More Effective

Accounting and financial management are essential to any business, but performing them usually involves countless repetitive tasks that are prone to human error.

The financial management part of a modern ERP system is usually designed to streamline this part of the work through automation. This allows many tasks to be performed without human supervision. On the one hand, this reduces the costs associated with human labor. On the other hand, it also boosts the quality of tasks by reducing the number of errors.

While accounting functionality is quite popular among various ERP solutions, some suites, such as Microsoft Dynamics 365 Finance and Supply Chain Management, offer even more advanced features to their users. One of these is artificial intelligence, which can be used to create detailed financial forecasts that go beyond the capabilities of standard accounting software based on statistical calculations.

Maintenance of the Production Floor

Microsoft Dynamics 365 FSCM is also a good example of a powerful tool for production maintenance. This ERP system is also equipped with The Internet of Things, which can help manufacturers track their assets, including production equipment. This is a reliable way to detect and fix problems with machinery before it is too late and there is downtime in production.