When we think of manufacturing, we may imagine big factories, assembly lines or fast-moving, automated processes. This is the world of big company manufacturing, however. Not all manufacturers are like that. Small-to-midsized (SMB) firms are often engaged in more flexible, custom manufacturing. This creates a different set of needs for manufacturing management software, prompting the question, “What is the best software for SMB manufacturers?” Acumatica, which offers specialized Enterprise Resource Management (ERP) software for manufacturers, has published a useful whitepaper on this topic. We will explore the subject here.
First, What Kind of Manufacturer Are You?
There is no “best” manufacturing software for two reasons. For one thing, manufacturing software is always adapted for your unique business. It’s better to talk about manufacturing software suites that can be customized for your needs. Also, manufacturers vary significantly in the kind of operations they run.
Figure 1 – Different kinds of manufacturers, as categorized by their relative levels of variety and volume – which also correlate to speed and flexibility
The best manufacturing software for SMBs will vary according to a company’s manufacturing operation. The chart shown in Figure 1, which is taken from the Association for Supply Chain Management (www.ascm.org), offers a great way to categorize different kinds of manufacturing business. It plots manufacturers according to the relative levels of variety and volume, which also correlate to speed and flexibility.
A project shop is one with low volume and speed but a high degree of variety and flexibility. A company that makes custom equipment falls into this category. A job shop moves a little faster, but has less variety. Job shops usually sets of similar products, known as “jobs” for individual clients. A batch operations business is sort of like a job shop, but it has less variety and flexibility, but higher volumes and faster speeds. A mass, or continuous manufacturing operation is high speed and high volume, but with low variety, e.g. makers of soda cans or mass-production auto parts.
Matching Software with Manufacturing Category
In our experience working with manufacturers, software selection and configuration flows from a detailed, nuanced analysis of the company’s operations. In this context, operations span the full gamut of the business, not just the shop floor. The analysis should include a close look at the sales process and how the company supports customers after orders have been placed. All of these have a bearing on how manufacturing software is set up. And, the end results will vary based on the type of manufacturing that’s being done:
- A project shop will likely need manufacturing software that’s configured for in-depth project management and project accounting capabilities. This may mean integrating software modules for manufacturing management, supply chain and project accounting. A software suite that doesn’t offer this should not be considered for a project shop. Depending on the complexity of the project, the software may need sophisticated supplier management and scheduling, e.g. if components are expensive and manufactured abroad.
- A job shop needs similar functionality to a project shop, but, in our experience, usually also requires more customer relationship management and logistics features. Delivery of finished jobs may be time sensitive, split into multiple sub-orders and so forth.
- A batch operations business tends to need strong supply chain management capabilities. They’re moving quickly and cannot afford to run out of manufacturing inputs, nor do they want to hold inventory longer than they need to.
- A mass, or continuous manufacturing operation needs good supply chain management and logistics support in its manufacturing software. These companies also may need effective financial management, particularly if they’re running at lower margins. They’re often managing money as much as they are inputs and end products.
Getting Manufacturing Software right for the SMB
The challenge with getting manufacturing software right for an SMB is to provide the feature depth they need without overwhelming them with the complexity of an enterprise ERP system. After all, a large manufacturing enterprise might have more IT admins on staff than an SMB has employees. The SMB manufacturing software package has to be scoped right for the customer in question.
Acumatica Cloud ERP is a good option for SMB manufacturers in most cases. It can adapt to the needs of the four kinds of manufacturers. It’s also flexible enough to meet the specific requirements of a given firm—while offering ease of implementation and management that suits the operations of a smaller firm. To learn more about how we can help you with SMB manufacturing software, contact us today.
Additional Manufacturing Resources
5 Things Manufacturers Need in ERP
