ERP Automation Tips for Your Supply Chain

ERP Automation is our constant effort to reduce the amount of human work and replace it with controlled ERP system processes.

Our supply chain includes the business we get our materials from as well as their suppliers and all the transportation and buffering links along the path. Our business is part of our customers’ supply chains too. How far back to go depends on our particular needs. Does food chain start with the farmer? Or, does it start with the farmer’s seed supplier?

What can we hope for from supply chain ERP automation? We could improve our visibility in the whole supply chain. We could reliably predict when our delivery will arrive and plan what we will do next. Reliable deliveries are important to a retailer who has to have baseball bats in the store before Little League season begins. It is important for a manufacturer too who places an order for a component with a 15 week lead time. All the other materials needed will be ordered to arrive at the same time. They will reserve plant capacity or even hire additional people to work with the 15-week component.

The Lean Supply Chain

Imagine an ERP system where real and anticipated demand flows unhindered all the way to the first link of the supply chain. Real demand is a purchase order but is not necessarily a piece of paper. Anticipated demand might be a planned order signaling potential demand to allow planning along the supply chain but not execution. That flow of information could be through many businesses, each with their own ERP system all communicating with each other.

Information back for the delivery can also be automatic. We could calculate the optimum delivery path for this one order and reserve a container, a ship, a rail car instantly and automatically. As the order moves we have electronic invoicing and electronic payments automatically created.

We could move to a closed loop system where we and all the others in our supply chain team are managing exceptions and no longer simply handling transactions. KPI's at every stage of the supply chain could be shown in real time. Data can be collected automatically along the chain which is used to continuously revise the optimal path and strengthen all the links of the chain. We can search for waste anywhere along the supply chain and reduce that leading toward a true lean supply chain.