Manufacturing is a complex process, no matter the size of your operations. Maintaining shop floor control, allocating resources and managing finances are all tasks that need to be completed daily to keep a plant running. As your plant grows, so do these responsibilities, making it harder to manage operations using basic tools such as spreadsheets. That’s why it’s important to adopt the right manufacturing software system before things get out of hand. However, to accomplish that, you first need to determine your unique manufacturing requirements.
We’ve analyzed common manufacturing ERP functions and aspects and compiled them into this requirements checklist. You can use this guide as a template for deciding what your business needs from its next software system.
Top Manufacturing Software Requirements and Features
In this list, we’ll go over the basic features that many companies look for in a manufacturing ERP software solution and drill down further to the functionality associated with the various components. Some of these manufacturing requirements may be more or less relevant to your company depending on factors such as your industry, the size of your business and where you conduct sales. Be sure to make a list of the manufacturing software features and associated functions that are most relevant to your needs when creating your list of software requirements.
Manufacturing software historically has focused on the business functions that support production, such as accounting. But today’s solutions allow the same control and planning over your shop floor as they do with financial management. With this high degree of functionality, it’s no wonder why production management is often a top priority for organizations searching for a new or updated system.
This feature contains tools to manage planning, scheduling, quotes, estimations and capacity planning. Additionally, this module can provide visibility into your shop floor and includes time tracking and labor management. Tying in your production management with the system that manages all other aspects of your manufacturing operations allows for more efficient management overall.
Landed Cost Tracking
Planning and Scheduling
Projects and Contracts
Quotations and Estimating
Shop Floor Control
Statistical Process Controls (SPC)
PLC Machine Integration
Labor and Time Tracking
Manufacturing Accounting and Financial Management
After managing your production processes, controlling the accounting behind them should be one of the highest priorities on your manufacturing requirements list. Basic systems offer tools to manage accounts payable, accounts receivable, billing and invoicing. Tax management solutions are sometimes standard, but it’s not uncommon for vendors to rely on a third-party application for tax preparation. Bank reconciliation is also available to ensure your records match.
More advanced solutions may also offer budgeting and forecasting tools to help your business get a better idea of the road ahead. You may also wish to shop for a system that can handle accrual-based accounting, so you can better understand your company’s profitability.
Financial management tools work hand-in-hand with accounting, but provide more visibility and insight to help sustain and maintain operations rather than only offering cut-and-dry tools. For instance, activity-based costing features allow users to understand exactly where and how resources are used within a company. The data that comes from activity-based costing can then be used to bolster your budgeting and forecasting tools through clear visualization of the cost of each manufacturing process. Financial management allows users to generate payroll and analytical reports as well.
Billing and Invoicing
Budgeting and Forecasting
Payroll and Analytics
Supply Chain Management
Supply chain management functionality facilitates communication and streamlines efforts among manufacturers, their suppliers and their customers. First, self-service portals allow users to securely manage quotes, POs and inventory levels. SCM tools also enable users to forecast demand and estimate production volumes. These functions can manage bids and allow customers to configure a product online.
Inspection of Goods
Order to Cash
Request For Proposal (RFP)
Transportation and Logistics
Transportation tools within manufacturing software help manage fleets and optimize inventory levels. GPS is a common tool offered by vendors and included in manufacturing requirements because of its up-to-the-minute visibility of company vehicles and drivers. Additionally, solutions can provide users with data on mileage and send directions to drivers for the most successful and economically efficient transportation of goods.
Furthermore, these tools predict the optimal levels of raw materials needed on hand by leveraging historical demand. This data typically comes from sales records and other consumption stats. Overall, logistics secure an efficient and accurate transport of the goods needed for production.
Managing your assets is one of the critical manufacturing requirements to consider in your solution. It’s important to know where your assets are and what condition they’re in so you can keep producing at full capacity. Top-rated solutions should manage your assets through their entire lifecycle, including scheduled and preventative maintenance. Many systems also help companies monitor and reduce energy costs.
For more advanced asset management, you should look for a system that can manage parent/child relationships between assets, perform valuations and provide depreciation calculations.
Capital Project Management
Manufacturing project management assists companies in tracking business operations and resources on a long-term basis. Many systems are built on Agile project methodology. This allows users to break down tasks into iterations to ensure quality and increased input from multiple factions.
Gantt charts are a common tool used along with Agile principles to quickly convey project schedules to users. Gantt charts are also useful when users need to know the context and relationship between multiple project timelines. This enables your company to more efficiently spend its resources across all projects.
These tools help track your inventory, manage requests and dispatch materials for production. Like many typical inventory management solutions, manufacturing systems also take advantage of barcode technology for quick and simple tracking of your materials. A manufacturing solution also provides a comprehensive list of all of the materials you have available.
Moreover, some systems enable users to integrate data from purchasing, manufacturing, sales and accounting to assist in planning operations. These tools allow users to anticipate and plan for future raw material needs to minimize scheduling issues.
Bill of Materials
Job Tracking System
Material Requirements Planning
To ensure your product gets to your customers on time and with as few errors as possible, you need order management functionality on your list of manufacturing requirements. Order management provides tools that help from the time an order enters your system to the time your product is delivered. Many programs have automated much of this process to reduce human error wherever possible. Automation also streamlines your order fulfillment, as it reduces the amount of labor necessary to get a product to the customer.
Additionally, this type of software enables users to easily track customer orders and quotes. Users can see invoices sent out to customers as well as billing information that’s already been received. Tracking orders gives users a better understanding of the delivery timeline and the issues that may occur and cause delays. This is an especially important tool to have, as 84 percent of consumers trust online reviews as much as they trust a friend. In today’s online world, customer satisfaction needs to be a top priority.
As mentioned in the section above, the internet’s presence in today’s supply chain is impossible to ignore. With massive players like Amazon offering products online to customers that can be shipped right to their door, it’s advisable that your company does the same. Maintaining an e-commerce presence also provides more channels through which your business can generate revenue.
Manufacturing software suites typically offer an online shopping cart feature to enhance user experience. E-commerce tools should also provide a way to customize prices and the design of the interface. Providing an enjoyable shopping experience for your customers is essential.
However, even most top-rated systems don’t carry all these functions. Typically, a manufacturing software solution relies on third-party applications or simply does not support this functionality at all. If you’re looking for an inbuilt e-commerce platform from your manufacturing system, you’ll need to look closely and specifically for it.
There are two main deployment strategies for manufacturing software: on-premise and cloud-based. One of the biggest benefits of cloud deployment is that it gives users real-time visibility. Being able to see what’s going on in your plant in real time is highly valuable. Cloud-based products come with numerous other benefits, like scalability, relatively low-cost implementation and increased mobility.
Typically, buyers choose on-premise because they believe it to be more secure. While implementing a system on your own servers provides you with more control, it doesn’t necessarily mean more security. Today’s cloud-based systems are very secure and can be harder for hackers to exploit because they cannot test their attacks on a private server. But the needs of every company are different, and only you know what’s truly needed.
Questions to Ask While Gathering Manufacturing Requirements
In addition to the manufacturing features that a software solution can offer, you should also think about aspects not directly tied to the system itself. Consider your company’s circumstances as well as those of your prospective vendors. By looking at the whole picture, the process of requirements gathering for manufacturing ERP can be more fruitful and yield better recommendations of vendors to pursue.
What’s My Budget?
This seems like an obvious question, but once you start to look at systems that have all the manufacturing features you want and more, it can be easy to part with your original financial restraints. However, it’s important to keep in mind how much you’re willing to spend and to stay vigilant about ROI.
While very large manufacturing software systems do a great job of supporting major operations, you don’t want to end up with a multitude of features that go unused. If you decide to spend more than you originally anticipated, make sure all the extra manufacturing ERP features driving up the cost are necessary.
Does This Vendor Have Experience in My Industry?
Most of the top players in manufacturing software make products that are flexible and can be utilized in several industries. However, you still want to make sure your system is specifically recommended for your business sector or that your vendor has experience working with companies like yours. It’s helpful to look for case studies with data and statistics so you can find out how well a certain vendor performed in the past. You might also consider reaching out to a current customer of the vendor to see how their deployment went and what aspects they’re happy with and which they’re not thrilled about.
How Stable Will This Vendor Be?
This question goes hand-in-hand with vendor experience. Software vendors are more than the company you buy your system from. You should consider them a business partner, especially if you operate on an enterprise level. It’s recommended that you do some research on the vendor’s business practices and see if they’re willing to invest in your system and software category, or if they’ll be quick to sell to a larger software company. You’ll also want to make sure that the company is secure and growing so you don’t end up purchasing a solution from an organization that could go out of business in a couple of years.
Now that you have an idea of what your company’s manufacturing requirements should entail, it’s time to start comparing vendors. We recommend using our in-depth comparison report, which lists all the highest-regarded manufacturing vendors. In the report, our analyst team ranked and scored each product based on how well it meets top manufacturing ERP requirements. Click the link to see which vendors meet your most important production requirements.
If you’re not ready to look at vendors just yet, we also provide a customizable requirements template. Use it to gather all the requirements your business needs, then invite stakeholders to edit as necessary.
What did you think of our list of manufacturing requirements and software features? Are there any that we missed? Feel free to leave us a message in the comments below!