Supply chains can be relatively complicated to manage, their complexity varying, dependent on the business's size and the type and number of items manufactured. Efficient supply chain management is crucial, since the network of interconnected businesses must liaise smoothly, the aim being to provide products and services to consumers in a cost-effective and professional manner. The main components of supply chain management are planning, developing, manufacturing and delivering the items or services.
Benefits of ERP to supply chain management
Even if there's just one weak link that leads to delays or other issues, this means a dissatisfied customer and potential loss of business. This is why there are benefits in using an enterprise resource planning (ERP) software system to deal with any supply chain, no matter how large or small.
The planning stage of supply chain management is essential, as a strategy must be developed that not only meet customers' needs, but also ensures the business venture is profitable. A major part of the planning process involves developing a set of metrics that will monitor the efficiency and quality of the supply chain.
Develop the supply chain
Developing the supply chain means building a strong relationship with the suppliers, identifying those who are reliable and planning the methods of payment, shipping and delivery, while also creating metrics that can monitor and improve these relationships and processes.
At the manufacturing stage, the product must be tested, packaged and its delivery scheduled. In terms of supply chain management, this is the most metric-intensive stage, as businesses must be able to measure the production output, the product's quality level and worker productivity.
In the manufacturing industry in particular, effective supply chain management ensures that the necessary raw materials arrive at the production sites on time. Production can grind to a halt, with assembly lines lying dormant and the workforce inactive, if the raw materials are consistently arriving late.
This can leave a company unable to fulfil orders on time, or being forced to obtain materials from another source at short notice, perhaps resulting in a lower profit margin.
Using an ERP system to boost the effectiveness of the supply chain can also provide cost-efficient order processing and purchasing systems, with strictly-monitored handling procedures lowering the supply chain costs and therefore boosting overall profitability.
Anticipate consumer demand
Effective supply chain software can help companies in every way by anticipating consumer demand more accurately, planning procurement and production, thus avoiding unnecessary purchasing of raw materials, eliminating manufacturing over-runs and preventing the extra expense of storing excess finished goods, or reducing prices to move products off the warehouse shelves more quickly. It can facilitate just-in-time stock models to eliminate the risk of having excess inventory. Effective ERP software also simplifies and accelerates the handling of defective goods, on both the buying and selling side of the business, by automating the claims process with distributors, suppliers and insurance companies. Reports can also be produced to track and analyse the performance of suppliers and distributors.
The majority of supply chain management software also includes add-on options that will enhance related activities, such as product lifecycle management, contract management, capital asset management and other procedures.
Software can empower companies to streamline manufacturing operations from start to finish, improving the supply chain network, minimising delays, enhancing collaboration and reducing costs.
Here at WinMan, we can provide supply chain specialists all the tools necessary to enhance your supply chain management through ERP software. For further information on how we can help improve business productivity with an all-in-one ERP system, please contact us today for a no-obligation chat with our knowledgeable customer advisors.