Manufacturing cloud ERP

Photo credit: Adobe © Sikov

Manufacturing cloud enterprise resource planning (ERP) software gives aerospace & defense (A&D) manufacturers complete visibility into the entire project life cycle in real time, from estimating and engineering through planning, scheduling, capacity impact on the shop floor, production, and shipment ? with comprehensive project cost and performance tracking

Since the A&D industry must comply with regulations from AS9100 to the Truth in Negotiations Act (TINA), A&D cloud ERP must satisfy all regulations while enabling engineering, sales, operations, procurement, materials, planning, production, project management, and the finance department to efficiently manage the supply chain.

Many A&D organizations are trying to garner revenue by providing service and repair. The selected system must be robust enough to support the stringent manufacturing requirements and have the functionality to support reverse logistics to provide their repair facilities with software which allows them to work a disassembly operation.

Customization – curse or cure?

One hidden cost of implementing an ERP system is tailoring it to drive staff efficiency and provide the best customer service. Cloud ERP solution users must recognize customization is necessary for user adoption of the software. No single ERP package, cloud or on-premises, will provide out-of-the-box, 100% of the functionality all require.

Avoid the hardened customization development methods of legacy ERPs using unsupported, non-upgradeable code. Ensure the ERP system leverages low-code capabilities tailorable at scale.

Recognizing significant differences and benefits to open systems on a public cloud, information technology (IT) management can make informed decisions on which cloud ERP solution provides a quicker payback and higher return on investment, especially considering customization can be controlled by the customer rather than the software provider.

7 selection tips

One ERP software package can’t address all manufacturing and distribution operations, so consider ecosystems offering more than one type of ERP software.

1. Consider a true, next generation cloud-based ERP system.
2. Make sure the ERP software interfaces with other system software.
3. Make sure your ERP matches your business requirements.
4. Be sure you can easily tailor it with low code/no code capabilities of the cloud platform.
5. Verify the software can be easily kept up to date.
6. Get references.
7. Take time to do a deep dive (day in the life) demonstration.

When selecting a cloud ERP solution, it’s not enough for the ERP to be only on the cloud, because most cloud ERP software solutions are created from an accounting or customer relations viewpoint, not a complex manufacturing viewpoint. A&D manufacturers need a robust manufacturing cloud ERP to:

• Gain better visibility on project schedules, costs
• Compare actual costs vs. budget by project in real time
• Capture complete serial, lot traceability through the entire product life cycle
• Provide as maintained vs. as built vs. as designed view for the entire bill of materials (BOM)
• View the project impact of capacity on the shop floor
• Run material requirements planning on a project basis

Special modules remove complexities

A few cloud ERP software suites provide the cloud benefits A&D organizations need, but they can’t offer the full set of functions and ERP benefits, such as visibility into the entire project life cycle in real time.

Industry focused A&D manufacturing ERP lets companies efficiently manage all aspects of their logistics and supply chain. Complete traceability for inventory items by lot and serial number satisfies the most rigorous industry requirements. Planning, costing, and inventory tracking is implemented on an item-project/contract basis.

Manufacturing cloud ERP engineering change control capabilities provide easier integration to industry standard product lifecycle management (PLM) systems and ensure engineering changes are implemented, enabling multiple divisions to centralize or decentralize purchasing and engineering. Among the key modules:

Manufacturing cost control manages costing throughout the manufacturing process, helping manufacturers identify and manage cost elements while eliminating inefficiencies. Users can define cost elements for purchased material, subcontracted material, labor and machine, and material burden. A&D companies can track costs in real time against an estimate to determine overall project profitability and for estimating future projects.

The scheduling module should schedule operation steps (sequential or concurrent) for work orders by work center. Drag-and-drop scheduling and capacity planning can provide immediate identification to fix shortages and overloads, and allows viewing day-to-day work center capacity planning by labor or machine hours on a single graphical display. Users can create and manage schedules for all firmed, released, and in-process work orders. Level loads can be achieved by dragging work order operations from one day to another.

A shop floor control module lets users streamline production and material flow with their suppliers and in their factories, creating powerful routing masters that capture as-planned routing details. They can explode BOMs to display assemblies broken down to individual components and parts.

A lot control and serial tracking module produces comprehensive audit trail inquiries. Users can register lot numbers through purchasing receipts, inventory, shop floor control, and sales orders and assign serial numbers to track inventories all the way to sales order fulfillment – or view full-level traceability trees and comprehensive device history records.

A material requirements planning (MRP) module’s capabilities benefit A&D firms that manage their business by contracts or projects. With the manufacturing cloud ERP modules, all departments of an A&D company can have complete visibility of all aspects of their operation and the infrastructure to communicate easily and respond to events quickly.

A work order management module can streamline the entire work order process, including release, picking material, booking, quantity recording, receipt, backflushing, and costing. This module should create tear-down work orders that, instead of using component inventory, supplies component inventory.

Photo credit: Adobe © kras99

Benefits of manufacturing cloud ERP

Complete project life cycle tracking and control. Plan, track, and cost by project using project control, connecting sales, inventory control, shop floor control, MRP, purchasing, and manufacturing cost control. Allocate materials to projects using standard or average costs, and associate inventory items, sales, work orders, purchase requisitions, and purchase orders with a project. Project workbench gives real-time access to all A&D project data, including a snapshot cost comparison of actual to budget, project inventory, purchase order requisitions and orders, manufacturing work orders, forecasts, sales orders, and all transactions associated with the project.

Accurate bids and estimates. Manage pricing and quotes efficiently and with complete visibility using configure-price-quote (CPQ). Provide accurate, immediate estimates for different products and customer channels or tailor it to specific business requirements.

Integrated scheduling, planning, and inventory control. Scheduling and capacity planning in manufacturing cloud ERP software for A&D manufacturing allows balancing production with material supply using a simple drag-and-drop scheduler. Level loads by dragging work order operations from one day to another.

Use inventory control to track inventory locations, costs, and quantities. Plan and set policies such as lead time, MRP parameters, and replenishment planning (RP).

Powerful engineering management tools. Production engineering manages components, sub-assemblies, BOMs, routings, and engineering changes no matter how complex. Revision control maintains status and effectivity dates, manages additional BOM and routing revisions, and generates work order demand by revision. Engineering change control (ECC) manages and tracks component and operation changes through authorizations and approvals.

Control and reporting

Today’s sophisticated manufacturers and customers demand more personalization for products and customer service. Focused manufacturing cloud ERP helps them know everything they can about their plant operations and customers. Choose carefully and demand a cloud ERP that allows you, the user, to personalize the solution to your exact requirements. A full-function cloud ERP and the ability to personalize it can provide continuous, top-notch service to all stakeholders.

Rootstock Software

About the author: David Stephans is president of Rootstock Software. He can be reached at dstephans@rootstock.com.