The significance of an ERP in the Manufacturing Industry

A healthy economy requires a productive and competitive manufacturing sector.

The benefits of local manufacturing extend beyond the (significant) economic gains. A thriving Australian manufacturing industry also boosts our national development and resilience.

Manufacturing and other related industries currently support millions of jobs across Australia. However, external pressures have built over the past few years. Between geopolitical tensions, post-covid labour & supply chain issues, scarcity of raw materials and rising cost of capital, the sector is struggling.

The Federal Government has pledged $1b AUD to promote advanced manufacturing in Australia. This fund would provide capital for manufacturers to expand their operations, enhance processes, take advantage of new technologies and utilise research and development (R&D) to innovate and introduce new or enhanced products in the market. This is part of a broader strategy to create new capabilities and opportunities in transport, defence, agriculture, food processing, medical science, renewables, and low emission technology sectors.

The investment fund offers welcome relief to manufacturing organisations in Australia. But how can manufacturing organisations overcome industry-wide challenges - and make the most of the new opportunities? One of the better options is to have a robust and stable Enterprise Resource Planning (ERP) system.

How ERP software could help a manufacturing company

An industry leading ERP can help a manufacturing organisation in a variety of ways. This extends beyond managing regular business activities to also help streamline complex processes. It gives the management a consistent view across the business and arms them with the required tools for reporting and business intelligence to drive the business towards growth and advancement.

Some of the things an ERP will help with includes:

  • Day-to-day business activities such as:The significance of an ERP in the Manufacturing Industry
    • Multi-Entity Management
    • Accounting
    • Procurement
    • Project management
    • Sales
    • Supply chain operation
  • Complex business processes including:
    • Inventory management
    • Manufacturing
    • Production planning and MRP
    • Logistics
    • Risk management
    • Payroll
    • Human capital management
    • Warehouse Management

Selecting the right ERP solution for your manufacturing business

Every business is different, and every ERP solution is unique. With a multitude of ERP products available in the market, selecting the right one is both important and difficult. In addition, the process of adopting an ERP must be managed carefully to ensure the best outcomes. The system needs to be widely accepted across departments and seamlessly integrate with any existing systems already in use at the organisation. The good news is that an experienced ERP partner can ease this transition to deliver the right outcomes.

A great example of this can be found in the following case study. RSM Australia helped Harvestaire refine their manufacturing processes through Oracle NetSuite. Harvestaire is primarily an aftermarket parts business, servicing combine harvesters and tractors nationally with all the manufacturing done within Australia. As a global NetSuite consulting partner, RSM facilitated the deployment of NetSuite SuiteCommerce as the core ERP at Harvestaire. The ERP solution now manages Harvestaire’s finance and operations, procurement, sales, web store and manufacturing processes.

Harvestaire has seen multiple benefits from using a global ERP like NetSuite some of which are summarised below:

  • Single source of truth – Consolidation of fragmented systems and spreadsheets into a single system with a 360-degree view of the business. Now all the data comes from a single and trustworthy source enabling real time reporting across the business. This has also minimised duplication of effort in data entry.The significance of an ERP in the Manufacturing Industry
  • End-to-end view – the entire manufacturing process is now on NetSuite ensuring the users have better control and management can plan and forecast accurately.
  • Inventory control – Ability to define minimum stock levels and re-order points has led to better visibility and control over inventory and stock valuations, and reduced stock outages.
  • Efficiencies in Procurement – The procurement process has become more efficient as a result of enhancements in inventory control with stock arriving in time for the anticipated breakdowns during the harvest season. Also, with a pre-defined Delegation of Authority the system ensures Purchase Orders are raised for the right items, with the right quantities and quoting the agreed rates with the suppliers.
  • Planning, Budgeting & Forecasting – Harvestaire has been able to plan ahead due to access to high quality data related to inventory, sales and procurement. Budgeting and Forecasting is now more accurate and management reports provide a true and relevant picture of the business.

Overall, the business has grown multi-fold which has given its stakeholders unmatched confidence in NetSuite’s abilities and significantly improved the efficiency of the day-to-day operational users. This has been achieved without the need to add additional staff because the system is able to automate processes.

A cloud based and modular ERP like Oracle NetSuite can effectively meet the ever-growing and complex needs of small, medium or even large manufacturing operations. RSM has globally partnered with Oracle NetSuite to offer and deploy solutions using NetSuite’s expansive capabilities including but not limited to the Manufacturing sector.

It is impossible to ignore the impact of an ERP in the modern business world. Businesses can align different teams, improve workflows across the organisation and enhance collaboration – leading the organisation towards a common goal and realising the vision of the founders and stakeholders.

For more information

To start a conversation about NetSuite and find out how RSM can assist you, please contact us here or reach out to your local RSM office

Article source: Manufacturers Monthly