There are multiple reasons for requiring traceability of a manufactured product, and there are multiple degrees of sophistication in the ease with which different traceability software solutions approach the subject, especially within the context of ERP. Therefore, understanding your traceability needs is essential in choosing the right ERP package.
Create a Matrix of Needs
The simplest way to define your needs is to create a four square matrix, with the x-axis being “frequency” and the “y-axis” being “potential liability”. Thus, anything in the upper half – greater than average liability – would argue for robust manufacturing traceability as a fundamental requirement. Examples of high liability might be food and beverage processing, pharmaceutical distribution, or even automobiles. When a problem occurs, potential financial liability is high. Anything in the right half of the matrix – greater frequency of need – would indicate a need for strong ease of use characteristics, since the last thing you would want is a cumbersome approach in which you have to switch back and forth between multiple screens and transcribe information into an offline system in order to assemble a total traceability picture. If traceability software is difficult to use, people tend to be incomplete in researching traceability in the first place.
If you are in the lower left square – low liability and low frequency – you will probably choose your ERP software based on other criteria, and be satisfied with whatever traceability features are available. If you are in the upper right hand corner – high liability and high frequency – manufacturing traceability is one of the top two or three features that make or break the deal.
See Traceability Software in Action
You also need to be kind, but relentless, in understanding fully how traceability works in an ERP package. If traceability is important to you, never depend on the canned demo to form your opinion. The demo will appeal to your desire for the world to be a tidy place by showing how easily a one-to-one relationship between a parent and child can be researched. In reality, the world is a messy place, and your daily problem is going back three levels in the bill of materials and determining everything that a component part touched – in a one-to- many relationship - over a given time period. This is very complicated to set up as a demo, so your best path to certainty is to ask for a reference visit with another customer, to see what traceability looks like in a live traceability software system. Be sure to examine traceability in both directions: (a) what were all of the raw (and intermediate) material lots that made this finished sku? and (b) how many different finished skus did this raw material lot ultimately go into?
Do not discard the possibility that your situation may require third party bolt-on traceability software in order to achieve your objectives. This brings along its own cost and maintenance baggage, but may be preferable to an awkward ERP solution.
Featured white papers
ERP Software Pricing Guide
Get the latest pricing information on over 80 popular ERP systems, and learn how to budget for your ERP project in our free guideDownload
60-Step ERP Selection Checklist
Get the comprehensive checklist for your ERP selection projectDownload
ERP Implementation: 9 steps to success
The 9 proven steps you should follow when implementing ERPDownload
ERP and product traceability
Learn about product traceability, how it works, and why we use it.
Why a food specific ERP system is a must-have
Key features and requirements food companies should consider when searching for an ERP
Cannabusiness ERP: 4 features to support cannabis production
With market growth predicted to hit $21 billion by 2021, cannabusiness ERP is on the march.