What every COO wants his CEO to know about ERP

Categories: ERP
December 12, 2017

An ERP solution integrates manufacturing and back-office functions to maximize efficiency.

Operations officers are constantly looking to improve efficiency, reduce waste, and maximize resources on the production floor and in the warehouse. With so many moving parts, conflicting priorities, and ever-changing variables, keeping track of the different factors that could allow for improvement can be challenging.

As discussed in the recent article What every CEO needs to know about ERP, enterprise resource planning in operations management is one way to leverage technology to drive better efficiencies, reduced costs, and better workflows. Enterprise resource planning (ERP) platforms integrate operational and manufacturing functions with those from back-office areas such as finance, accounting, sales, marketing, and customer service.

This integration is often an obvious opportunity to those in the operational side of the business. Convincing senior leadership can sometimes be a problem. Here, then, is what every COO wants his CEO to know about ERP.

Automation tools are essential in today’s competitive manufacturing marketplace. Companies need software tools that help differentiate and provide those gains in efficiency and innovation that result in more market share and more revenue.

Operation managers often need software solutions like an ERP system to:

  • Develop accurate forecasts
  • Crease better reporting tools to measure productivity
  • Have a single, unified source for business intelligence and data
  • See a real-time view of operations without a delay in retrieving, converting, and displaying relevant information
  • Track inventory accurately in real time
  • Reduce operational costs

With an ERP solution, operational managers can quickly solve problems and find process improvements that save time and money.

How does ERP for COO help maintain efficiency make the case to the leading decision-makers? By detailing some of the advantages of such systems, including:

  • Material Handling and Documentation. Managing the massive amounts of paperwork related to transactions related to parts and product can be massively time-consuming. Similarly, managing inventory to know at a glance where there are potential logjams or deficiencies that could slow production is critical. With an ERP solution, operational managers can, in real time, know the sources and destinations of products and parts, identify what is in inventory, and interact with colleagues in the warehouse and finance to make sure there’s less paper and more integration.
  • Costing Analysis. In the effort to reduce operational costs, every penny matters. But tracking that information from a high-level perspective can be difficult. Changes in outside vendors, prices, and relative impact on operational costs, is far more effective when you can easily pull up sales data, communicate with procurement and finance colleagues while looking at the same information, and devise solutions that reduce expenses.
  • Employee Management. Employee management is complex, from scheduling to employee reviews, and from training to payroll. With an ERP system, HR, operations managers, payroll, and training teams can share data seamlessly, review dashboards, control costs, and create better experiences for employees that are coordinated across the enterprise.
  • Floor Communication. Communicating on the shop floor is never easy. Floor managers and operational leadership often need to look at the same data simultaneously to make the right decisions, pivot accordingly, or find inefficiencies. With an ERP software platform that allows staff to input and review data on mobile devices at the same time from different locations, company leaders can be ready to identify and solve problems and shift plans to maximize resources and talent.
  • Data Entry Demands. Data is at the core of an efficient, modern manufacturing company. There are many different points of data entry within such companies. Sales teams must enter orders and details, customer service teams need to record incidents and responses, finance staffs need to enter in invoices, design teams need to build products and solutions. Now imagine if that data has to be entered twice into multiple systems. It’s an incredible waste of resources. With ERP, data can be easily shared across departments, converted, and displayed accordingly. Data entry and conversion personnel and time can be spent elsewhere.
  • Process Analysis. Most good operations managers know there’s always room for process improvement that will drive efficiency and cost savings. ERP solutions allow companies to see processes that can be improved. They also can eliminate steps and accelerate decision-making in existing processes. For example, if a raw material is unavailable, it may stall production. With an ERP, you can identify other sources for the same or comparable materials, order them, allocate warehouse space, and notify accounts payable with a few keystrokes, keeping operations moving.

At NexTec, we help companies find great solutions for their ERP needs. Our teams of consultants work closely to understand a manufacturer’s needs and recommend the right ERP solution that improves operations. To learn more about how NexTec can drive efficiencies and productivity within your organization, download the NexTec Corporate Brochure.