Seven features to look for in a job shop ERP
Job shops are characterized as manufacturers whose products have a high level of mix and relatively low volume. They make a wide variety of products for their customers and usually only a few of each. So what should you look for in a job shop ERP system?
1. Available machine time
New jobs often are unplanned. A wafer shows up at the door early in the morning and an hour later a buyer calls to ask if it can be diced right away. Is the equipment required for the job available or is it tied up with commitments already made for other customers or even jobs for this customer? No one wants to turn away work, so the capability of a good job shop ERP to help provide an answer in short order is key to a good job shop ERP.
2. Alternate routing
The tool needed for a job is already scheduled to run a different job. Can the new job be run with a different tool and still be profitable? What about the job already scheduled? The high mix of products requires flexibility to use alternate routings and the agility to quickly change the plan while keeping customer delivery and profitability in mind. A make to order ERP must be able to deliver this.
3. Document control
Jobs arrive to be done quickly. Most have drawings and other documents describing precisely what the customer expects. The finished work might look good but if the customer expected steel and it was made using stainless, it could have no value. A make-to-order ERP should contain an easily-accessible document sharing portal to prevent things like this from happening
4. Business intelligence
Are we always falling behind on the schedule for that mill? When was the last time customer X sent us work? We see a lot of work from customer Y but they always want the work back the same day. Are we charging enough? A job shop ERP should include the BI capability to answer these questions quickly and easily.
Job shops are in business to earn money for the owners and stakeholders. Each job should contribute and cost is an important result from ERP. The materials used plus employee and machine time and any subcontracted work all add to total job cost. ERP should keep those costs so that the contribution for any one job or category of work can be evaluated for profit.
6. Minimization of downtime
Most job shops have equipment and tools that are expensive. The shop wants to keep that equipment busy earning money. Job shop ERP can track exact utilization and the reasons for down time to help you streamline processes and maximize profit. If the time was spent setting up the next job or cleaning up from the last job, it might be unavoidable. If work was turned away while the equipment could have been available, that is not excusable.
6. Materials on hand
Job shop ERP transactions and inventory accuracy should mean you know that materials needed for a job are on hand and ready to use when the job starts. Mistakes can mean a job is pulled from production and a second setup might be required which can eliminate any expected return on a job.
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