Let’s consider the two main types of business:-
- Distribution business – Generally what you “buy is what you sell”. Codes, part numbers all relate to one another. Wide choice of systems available including ERP,CRM, Inventory management …
- Manufacturing :-
- Repeat production orders with a degree of customisation. Once set up and running codes etc.. don’t change very often. Fits the current ERP manufacturing systems. Good choice of systems available.
- High variation from Order to Order. (80% of manufacturing business) Small to medium production runs, short lead-times, late decisions by the customer. Current ERP systems are not designed for these applications and it’s no surprise to see that “75% implementation failure rate” (Gartner).
Our Approach For Manufacturing.
If you have high variation from order to order we recommend the following business model. Split the business into two discrete operations. Distribution (distribution hub) and manufacturing. Using this model, you can utilise ‘best in class’ systems for distribution including the latest CRM, inventory management systems etc.. In the distribution hub you don’t have to worry about BOM (bills of materials) or manufacturing operations.
What we do ? We assist companies maximise their value streams.
Now how do we get all these systems to talk to each other? Great news is Industry 4.0 has arrived and basically it allows information to flow using API’s. (application interface). Put simply it is a method of securely sharing information between systems.
One of the many advantages of Industry 4.0 it allows any part of the system to go live and start providing benefits without the ‘big bang’ principle of full ERP. It also allows existing systems to be connected together.