Tips for Choosing ERP Software
You are the operator of a small to medium size repackaging-re-branding company. Your business has some maternity and you have systems in place and working. A business analysis reveals that your firm is facing some growth stagnation for the immediate future, so you begin to look for ways to optimize what you have. Software immediately comes to mind, as you currently use computers in your operation, but not necessarily in a cohesive and coordinated way.
When you begin to look around at various software options, you notice some recurring buzz word-abbreviations; MRP, MRP II, and others. Those seem ok for manufacturing, but your firm out sources the product, then repackages and re-brands for individual customers, so it might not be optimal.
Lets begin with MRP, or Material Resource Planning. As the name implies, the function of manufacturing software is to enable the business to have the materials on hand in a timely and efficient manner. This type of software can also be handy for a small to medium size company because the Bill of Material, the basic building block of MRP software, can also serve as a shop router.
The same could apply for the repackaging operation. In this case the bill of material would consist of the item or items themselves, the packaging, the quantity per packaging unit and the printing of the packaging, internally or externally. This would be in with all the other usual particulars, PO number, due date, customer/vendor information.
Just like a manufacturing schedule, your manufacturing ERP software would let you know how many to buy, the date to have it in plant and resources needed. The only difference is that you don’t actually make anything.
As with most manufacturing software, major weakness of MRP software is still that it did not function well or often at all for capacity planning. The capacity of the system would be handled by a buyer/scheduler, working with the packaging floor management. This does however work well with some companies, so even though MRP software is not an all encompassing solution it may just work for you.
Moving on, there is MRP II software, which came from basic MRP as an answer to the question of how to use MRP software to make other business decisions. These decisions included how to not only ensure materials were available on time, but how to capture manufacturing costs, how to account for the materials, and how to manage payment of materials. MRP II software was thus not materials focused software solution, but a big picture solution that piece by piece brought in the entire organization.
MRP II software could also be aptly used in the packaging operation environment as well as the manufacturing environment. The added functions of MRP II software over MRP software would be the ability for the system to do capacity planning, enabling the firm to give better due dates and provide top notch customer service.
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