Go lean or go gone: Enterprise Resource Planning--ERP--is part of the Lean strategy to boost bottom-line profits.In today's manufacturing environment where the difference between financial success and ruin is often measured in pennies per part, enterprises must operate their businesses with an eye toward becoming increasingly "lean and mean" and in control of their system.
This means bringing greater efficiencies into the job shop. Such gains in efficiency aren't easy to achieve in long-entrenched production methods, and are often the result of a complete overhaul of a total manufacturing environment or a nuanced approach to improvement in specific aspects.
In either case, the manufacturing system is analyzed an·a·lyze
tr.v. an·a·lyzed, an·a·lyz·ing, an·a·lyz·es
1. To examine methodically by separating into parts and studying their interrelations.
2. Chemistry To make a chemical analysis of.
3. for nonproductive non·pro·duc·tive
1. Not yielding or producing: nonproductive land.
2. Not engaged in the direct production of goods: nonproductive personnel.
n. functions--places where waste in the manufacturing process can be "Leaned" of inefficiencies. These nonproductive aspects are the focus of change in the system, and the central point where Enterprise Resource Planning--ERP--meets Lean objectives.
For example, Lean configurations in an ERP (Enterprise Resource Planning) An integrated information system that serves all departments within an enterprise. Evolving out of the manufacturing industry, ERP implies the use of packaged software rather than proprietary software written by or for one customer. operation realize greater efficiencies in areas such as setup See BIOS setup and install program. time, labor costs, and material handling.
In setup, the problem has been the time it takes an operator to setup and break-down job-specific machine tooling rigs.
With Lean principles in operation, resource planning Resource planning may refer to:
By doing so, the efficiencies gained through the use of ERP means minimizing direct labor costs. Using time-clock devices, such as GUIs, time spent on the clock and nonproductive time spent off the clock can be accounted for.
Time is a valuable resource of the enterprise, and with ERP, it is possible to monitor and reduce wasted indirect labor cost.
Traditional thought has been that wasted indirect labor time is an inevitable part of the manufacturing process. ERP disproves this. In a properly designed and implemented ERP operation, indirect labor is reduced and direct labor time recovered for the benefit of maximized production.
Simply, ERP software gives focus to the manufacturing operation, bringing clarity through a single-source of data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a . It is here, in the coordination of information, that shop floor efficiencies are found by the manufacturer. Shop floor and manufacturing software The following list of software modules are the manufacturing components of Baan's ERP (BaanERP) system, acquired by SSA Global in 2003 and subsequently by Infor at the end of 2006. It is listed here because it provides a comprehensive overview of the required software. See MES. bring together production and inventory data into one centralized cen·tral·ize
v. cen·tral·ized, cen·tral·iz·ing, cen·tral·iz·es
1. To draw into or toward a center; consolidate.
ERP software has the capability to forecast capacity high- and low-points, reduce bottlenecks, and improve on-time delivery. For the manufacturer competing in a global economy, it has an added benefit: consistent on-time delivery.
Because ERP operates in alliance with Lean pull-production principles, companies must maintain reduced material inventories to achieve just-in-time goals. In the lean ERP configuration--especially one using Lean cell production techniques--there is less material handling. When the job is started on the shop floor, production material flows through the plant rather than sitting idle for any significant time, reducing inventory cycles.
With the greater efficiencies found in Lean labor costs, setup times, and materials handling Materials handling
The loading, moving, and unloading of materials. The hundreds of different ways of handling materials are generally classified according to the type of equipment used. , a fully-implemented ERP program enhances productivity and provides a positive return on the ERP software investment.
The modern job shop must run Lean for positive returns on the efforts. For its part, an ERP software system that builds efficiencies into the production process is one that realizes the quickest payback Payback
The length of time it takes to recover the initial cost of a project, without regard to the time value of money. in terms of the bottom line for both the manufacturer and the customer.
Global Shop Solutions
Dusty Alexander is the president of Global Shop Solutions. With headquarters in The Woodlands, TX, it is the largest privately-held ERP software company in the U.S., according to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. the company. For more information, visit www.globalshopsolutions.com