Word is beginning to spread through the grapevine that the economic recovery is on its way. While most of us don’t expect to be living large again in the near future, there are positive signs. Many companies report small increases in orders. Many planners also report increases in orders on the horizon, which is inspiring hope in many people and businesses.
Your company however is currently in bunker mode. To service the downturn you have reduced head count and curtailed hours. This has lead to a backlog in daily tasks and a stressed out workforce. While increases will be welcome, are you ready to handle it? Installing ERP software may be just what you need. ERP software can allow you to automate and integrate tasks, increasing efficiency without increasing, or with a minimal increase in the workforce.
Without ERP, ramping back up out of the recession leads to choices. Where do you increase workforce and why? Orders will have a ripple effect in the organization. Customer service will notice the up tick first, but an increase here may only serve to overload other areas. Purchasing is also important as it is critical to get materials on hand. If you managed properly through the downturn, your inventory is probably short, and needs properly timed replenishment. This ripple leads throughout the organization. The question again is where to start.
Ramping up is also a matter of cash timing. A standard order may have four to six weeks lead time to delivery. Payment for the order may take sixty to ninety days after delivery. This means that money to pay for personnel hired to handle the increase may take three to four months to collect. That’s a big burden for companies that may already be running on empty.
Installing ERP manufacturing software is just what can handle the situation. While the cost is somewhat significant, the preparation it will put in place is priceless. Most companies that install ERP systems in good times see reduced personnel requirements. Installing at a time with reduced personnel will then allow ramp up without adding personnel.
In purchasing for instance, increased orders may require an additional purchasing agent, or at lease clerical help for the existing purchasing agent. An ERP system will eliminate a lot of paper based busywork tasks, allowing an increase with existing personnel.
The same will hold true for project mangers and schedulers. In the current state of affairs, project managers and schedulers will have enough resources to plan and schedule the shop and support functions to handle increased orders. ERP software on the other hand will employ software based solutions to enable the same planning and scheduling with the existing resources.
The use of ERP software coming from a downturn may actually yield better results that if installed during good times. While management may be reluctant to shed surplus labor resources caused by installing ERP systems, they will readily avoid hiring new resources if the tools are available to enable this.
Many may think hard times are not good times for ERP and manufacturing software solutions. In reality, the time has never been more right.
Author Resource:
Samuel Daggle writes articles for the manufacturing and construction industries that focus on providing advice about selecting manufacturing software. To learn more or to read reviews of specific software packages, visit http://www.ctsguides.com/manufacturing.asp
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