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Tackle Manufacturing Operational Challenges and Complexity (P.2)

Posted by Thai Pham on

In the last post, we discussed about the 2 key factors to overcome operational challenges from shared ideas of top manufacturing executives in GatePoint’s survey 2013, which focus on taking advantage of new revenue opportunities and improving production processes using ERP solution. In this post, we will continue to share top executives’ viewpoint on how to make the best use of not only ERP, but other general business applications, as well as how to flexibly combine organisational processes with information system to bring out the best results.

3. Utilise ERP across the Enterprise

As ERP is designed to use across the enterprise, however, 59% interviewed executives said they get most benefits from the system in finance and accounting, and only one-third thinks that ERP is important in every aspect in organisation. Moreover, demand forecasting and inventory management are the most potential for improvement in the manufacturing process, with 49% and 44% executives agreed respectively.

According to Kinder, senior director of industry & solutions, Infor, the manufacturing world is rapidly changing and manufacturers need to have great flexibility to adapt and respond quickly to the environment, with the help of technology that supports in-depth functional manufacturing area such as supply chain management (SCM), product lifecycle management (PLM) and enterprise asset management (EAM). These applications should incorporate business intelligence and performance management process altogether strategically and flexibly to provide the best results.

4. Finding harmony among diverse applications

15% organisations in the survey has more than one ERP system in use. This often results from merge & acquisition activities, where a business is using an ERP system that is different from the company making the acquisition. Or it may also because of separate decisions to select a more modern ERP system than the being-used one.

The story above is similar to one in Vietnam, where businesses are more likely to implement separate application for certain organisational function such as financial management, performance management, human resource management… which can cause problems when gathering relevant information to make strategic decisions.

5 Ways to Aid Manufacturing Operational Challenges

Commenting about this problem, Mr. Humphlett, Marketing Director at Infor, stated that the ability to connect all diverse application is “crucial” to provide the board with insights into the business to navigate the organisation.

5. Coming to grip with complexity

There are 29% of polled respondents forecast an increase in the complexity of their operations, and 87% addressing conquering manufacturing complexity as a key challenge to overcome. Moreover, the greatest areas in where complexity grows most are the business processes, with 39% of respondents, followed by 32% by organisational complexity. Supply chain complexity, IT/market complexity, product complexity and operational complexity continues to complete the list in descending order, surprisingly.

Complexity make the management process more difficult, thus bringing critical decisions may be delayed and cause great impact to the organisation. As a result, manufacturers need an ERP system that helps them to deal with change, while continue to adapt to the organisational changes when the company grows and help them manage the complex supply chain.

Conclusion

Apart from growing revenues, cutting costs, and keeping the information system up-to-date, it is extremely important for manufacturers to coming to grip with the changes in business and technology. Each step in the manufacturing process can have great impact to profitability. Top manufacturing executives understand how optimising production process is important to the organisation, therefore, gaining visibility and being efficiency is very crucial for them to achieve their business goals.

You can see more detailed analysis of GatePoint’s survey of top manufacturing executives in our full report: “5 key factors in optimising complex manufacturing businesses”.

overcome operational challenges

Topics: Enterprise Resource Planning ERP

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