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Top 5 Inventory Mistakes and How to Avoid Them

Top 5 Inventory Mistakes and How to Avoid Them

Days before the solar eclipse of 2017 it became nearly impossible to purchase the special glasses needed to safely observe the event. People rushing from store to store in a frenzy trying to locate the last available pair of glasses, found the stores had just not planned well… they had nothing left. It got so bad that some stores reported customers coming to blows as they fought over the remaining items. To make matters worse, Amazon and Walmart had to let customers know that the glasses they purchased might not be safe. Some brands were not made to the proper specifications and could not be trusted. Walmart reported another problem… the stock they had ordered never arrived. That should not have happened at Walmart, a store known for its amazing supply chain. They manage over 11,000 stores in 27 countries, requiring a technological tour de force that rarely lets them down. Balancing supply and demand completely overwhelmed most retail and manufacturing entities. Somehow, their systems failed them. Inventory planning and management are among the most important tasks, as this event clearly demonstrated. When not managed well, the failure can be catastrophic. Rootstock recently conducted a webinar designed to identify 5 […]

The Internet of Things Comes to Manufacturing

What that means for you now, and in the years ahead When it comes to manufacturing, IoT developments can certainly impact what you make. The use of IoT-enabled devices – everything from cars to consumer appliances to healthcare equipment – is exploding. Actually, that might be an understatement. According to a Gartner Research report published in February, “8.4 billion connected things will be in use worldwide in 2017, up 31 percent from 2016, and will reach 20.4 billion by 2020. Total spending on endpoints and services will reach almost $2 trillion in 2017.” So, chances are pretty good that, sooner or later, the things you produce will have the ability to communicate with other things, and to share data. The application of IoT technology is spreading that quickly. But no matter what you manufacture, the Internet of Things is certainly going to change how you make it. In fact, that’s already happening. Walk around your own factory floor and you’ll see examples – large and small – of how IoT is transforming your processes, improving efficiencies, reducing downtime. That doesn’t mean your manufacturing facilities are going to run without human oversight next week or even next year. But even if […]

The Impact of the Cloud on Manufacturing

Today’s manufacturers need to be agile in order to respond quickly to dynamic markets and changing customer demands. They must implement streamlined and efficient workflows that increase the speed of deployment and provide scalability. Manufacturers know that when they become more agile, they become more competitive and successful. That’s why they have turned to the cloud. The cloud enables automation, and more automation not only makes a firm more nimble, it also leads to increased revenues through cost efficiency and new revenue streams. The cloud gives firms the ability to store large amounts of data and then access that data in real-time from anywhere, and this allows just-in-time business decisions and increased collaboration across the entire supply chain. Cloud-based ERP solutions give companies end-to-end visibility into their entire operations, resulting in greater flexibility and adaptability and ultimately, greater profits. In a 2016 survey by Inspirage, 73% of manufacturing companies responding considered it important or very important that cloud ERP software establish and scale collaboration to reduce risk and increase agility. By now, the benefits of the cloud should be old news: on-demand real-time access to data and resources, scalability, data storage, reduced costs and the ability to connect core manufacturing […]

Will US Manufacturing Growth Drive Technology Advances?

The US manufacturing sector has been enjoying some good news lately. Manufacturing in the United States grew for the sixth consecutive month in February, as reported by the Institute for Supply Management. During that same period, inventories contracted, which is proof that manufacturers know that to compete and grow, they need to be as flexible and efficient as possible. Cloud ERP is specifically designed to help manufacturers become more flexible and more efficient, and the ecosystems built around cloud ERP give these firms the end-to-end solutions they need to apply these principles to their entire organization. We believe that the continuing growth and contracting inventories will drive manufacturers to embrace cloud-based ERP ecosystems and the technology innovations that these ecosystems make possible. According to the most recent monthly executive survey from the Institute for Supply Management, the US manufacturing sector grew for the sixth consecutive month in February. The Purchasing Managers’ Index (PMI) was 57.7% for the month, a 1.7% increase over January and the highest total since August 2014. The PMI passed the 50% threshold for manufacturing growth back in September 2016. Indexes for new orders and production also increased for the sixth consecutive month in February. New orders […]

How to Sell New Cloud ERP Systems to CFOs

When hoping to move to a new manufacturing cloud ERP system, sooner or later, you will need to have a discussion with the Chief Financial Officer (CFO) or the person who acts as such for your company. The CFO’s job is not to join in on your enthusiasm over all the terrific benefits that you plan to achieve with your cloud-based ERP system. That’s not what CROs do. We need to understand that the CFO’s role, with us and everyone else, is to turn down many proposals to assure that the few most important can thrive. Thus, the CFO asks the right questions to provide the rest of the C-suite with the correct risk/reward insights so that they know when to approve a suggestion or not. Since there are only so many resources in an organization, the CFO needs to assure that they are allocated properly. What to Tell a CFO about Your Proposed ERP Manufacturing Software First of all, you need to explain that what you are now using to track the business no longer works. At any particular time, if someone asks you how much you have in inventory or if you are making money on that big […]

Quantitative and Qualitative Benefits on Implementing a New ERP System: Part 5

The Bottom Line To purchase a new software suite, vendors must show owners and upper management how the new investment will make money and provide a solid return on investment. Dino Farina, Proveris Scientific founder and CEO knew that his company was consistently overbuying parts and materials just to assure that it had enough in inventory to meet order demand for its nasal and aerosol testing instrumentation. His question was, with cloud manufacturing ERP, would Proveris be able to determine how many of its most popular machines could be built with the inventory on hand? “We were constantly trying to get the answers to such questions,” emphasizes Farina. “By the time we finally got the data, the answers were too late. With manufacturing Cloud ERP, we will now be able to not only find out how many units we can manufacture with the inventory on hand but whether we need more inventory, how much, how soon and at what cost. This will make our business more efficient by increasing our cash flow and improving our resource planning, while giving our customers faster deliveries on their orders.”

Quantitative and Qualitative Benefits on Implementing a New ERP System: Part 3

Both Continuous Software Enhancements and Customizations Must be Addressed Most small companies do not have the resources to develop and maintain all of the features their growing businesses demand. The old legacy softwaredoes not allow the customizations and integrations they need and they do not want to get caught into a future legacy problem. However, It makes little sense for an owner of a smaller business to invest in a new Cloud ERP if the new software won’t provide the answers needed that are so sorely wanted from the present elementary system. To spend more money to be in the same vacuum of information is simply a waste of money, even though it might interface with salesforce.com. Yes, there might be some improvements but not enough to force a solid payback on the new ERP. The same holds true for larger concerns. With the supply chain now being global, additional importance is placed on certain features of ERP, such as multi-plant inventory, planning and tracking offreight and other shipment logistics, plus having to track consigned inventory and sub-contract expenditures. Increased machine automation in some industries means that they require more analysis regarding the cost of materials versus the cost of […]

Quantitative and Qualitative Benefits on Implementing a New ERP System: Part 2

Qualitative Benefits of a Cloud ERP System Now, let’s focus on the qualitative approach to making the ERP case. The best examples I can give are the reasons our customers gave us for implementing our Cloud ERP solution. There were basically two main groups of customers and all used salesforce.com®. If the company was smaller and growing, they were previously using spread sheets or very simple ERP packages that they had outgrown. “We had been running all of our reports in Quickbooks,” reports Northeast Lantern Vice President Christopher Heal. “We then needed to take the various reports, export them into Excel and formulate a single new report just to find the information we needed. Nonetheless, we still didn’t track inventory or have a snapshot of our production flow. Manufacturing cloud ERP will now help us do that, which will mean our customers will be able to get product faster.” If the customer was larger, it had been using an on-premise ERP system that was no longer providing the help that they needed. A company with multiple divisions and differing ERP systems cannot obtain the global deployment and integrations of systems that it needs to be competitive. The cost/benefit analysis for […]

Quantitative and Qualitative Benefits on Implementing a New ERP System: Part 1

There have been a series of articles on this subject and the topic is covered in almost every software manufacturer’s PowerPoint presentation to a new prospect. There are many reasons, including growing revenues, creating business efficiencies, aligning the various departments of a company into a cohesive unit and so on. Lofty goals all. The truth is that every company has a unique set of circumstances and will require its own way to justify a major project. In general, a good approach is to look at the investment from both a quantitative and qualitative perspective. Let’s begin with the quantitative. The first thing most companies examine is how much inventory reduction they will obtain with an effective ERP system. Industry analysts generally agree that between a 20 to 30 percent reduction is achievable with improved management of raw material, parts, WIP and finished goods. Even if the incremental improvements are only 10 to 15 percent, this still results in significant savings. Forecasting and scheduling improvements resulting from an effective ERP system will have a positive impact on purchased materials and components. With the ability to provide firmer commitments with predictable lead times to the company’s vendors, purchasing departments can negotiate better […]