3 trends set to change manufacturing ERP in 2016

In this article I have jotted down several trends which I believe will be influential in the development and usage of manufacturing ERP in 2016. Rather than retrieving my swami turban and crystal ball from the cabinet, I have based this discussion on my experiences this year and recent research.

1. Broader user demographics

Workforce demographics are changing as migration to North America and Europe increases. In a recent report by the OECD (Organisation for Economic Co-operation and Development), legal permanent migration in 2014 was reported at 4.3 million, a 6% increase from 2013. This increase has seen European migration reach the heights seen in North America (approximately one million a year). Aside from the obvious political and humanitarian pressure this creates, it also has an impact on the demographics of workers on the shop floor.

Recommended Reading: Manufacturing ERP Guide - Ensure successful manufacturing ERP selection and implementation

With this change in shop floor demographics, comes a change in requirements for our manufacturing ERP system in 2016. Until now, multi-language systems were a nice-to-have in many businesses, with the focus being on local populations and their requirements. 2016 will see an expansion of language capabilities in systems looking to expand their user base. Alongside this, greater focus will need to be applied to training programs for our systems due to the influx of workers from traditional manufacturing backgrounds with limited systems experience.

2. Social mechanics applied to our systems

I recently listened to a presentation by Rob Sinfield, Director of Product Marketing at Epicor, where he talked about subscribing to a sales order in order to track changes and progress from placement of the order through delivery. Any user whose role was linked to that sales order could use the same mechanics we see on social platforms to follow the order or client of interest within the system.

Another social mechanism which is being increasingly sought after in manufacturing ERP is the ability to collaborate on projects, schedules and orders. Where we have alerts from ERP in the form of system-generated emails today, we will soon be able to carry on entire conversations about what caused the alert and what is being done to correct the immediate situation and prevent future occurrences.

3. Support for manufacturing as a service

Manufacturers will expand the use of subscription-based sales, according to Kevin Roberts of FinancialForce. King Gillette started a business with low-cost razor handles knowing that customers would continue buying blades to fit those handles. The next evolution will be for manufacturers to sell a subscription for their products and components. Sales orders driving manufacturing ERP systems in 2016 may need monthly releases. Revenue recognition will need new rules, as orders will remain open across multiple fiscal years. The hockey-stick curve often seen where products are all shipped at the end of periods will flatten as those consumables are shipped throughout the month.

System change will continue to occur into next year, as it always does. ERP will continue to be a tool used by manufacturers to meet their customers’ requirements, but how we get to this point may be on the verge of radical changes.

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Tom Miller

About the author…

Tom completed implementations of Epicor, SAP, QAD, and Micro MRP. He works as a logistics and supply chain manager and he always looks for processes to improve. He lives near San Francisco Bay in California and can be found on the water in his kayak or on the road riding his motorcycle. Contact Tom at customerteam@erpfocus.com.

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Tom Miller

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