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MES and ERP Integration – A Perfect Pair

As smart manufacturing has developed a strong presence within the industry as of late, two systems, Enterprise Resource Planning (ERP) system and the Manufacturing Execution System (MES) have gained prominence and overlap in some functionality. Still, they have distinct purposes.

Discover the core differences between ERP and MES in our helpful  guide

ERP systems contain information regarding inventory and customer demand, while MES controls how to build it. Integrating the two increases operational efficiency and enables organizations to become more flexible and competitive amidst today’s changing market demands. Real-time information exchange between the business and production layers can help increase overall equipment efficiency (OEE), reduce cycle times, and provide management with increased visibility for data-driven decision-making.

Intraratio has successfully integrated with ERP systems such as SAP, Oracle, and Intuit. Our integrations include some of the more modern web-based ERP systems like Acumatica. Within many manufacturing environments, both can work with one another to provide maximum efficiency, proven ROI, and increased productivity, getting your products to market faster, with lower costs and higher quality.

Here are five ways integrating ERP with MES can help streamline your manufacturing process:

Demand Forecast Accuracy

Underestimating demand refers to running out of products when customer demand is at its highest. This reduces a company’s revenues while potentially damaging customer relationships. Insufficient inventory is essential for revenue as delays in delivery schedules can harm a company’s reliability.

When a company overestimates demand, companies have to invest upfront in a surplus of extra inventory. This causes the need for a quick production turnaround time to move product, which is often unable to be met. Excess inventory, whether raw materials, work-in-progress or finished goods—holds up revenue for the business that can be allocated to other areas such as staff, upgraded production software, etc.

Inventory typically occupies between 25% and 40% of total assets, and the uncertainty of demand is often the most significant influence on remaining stock. Integrating ERP and MES data provides accurate demand forecasts allowing companies to reduce inventories by avoiding overproduction.

Real-time Production Adjustments

ERP systems track demand changes that can feed into manufacturing schedules to verify quantities of products manufactured and are closely aligned with demand for leaner and more proactive manufacturing. Much of the current machinery located on the shop-floor is now connected to the local area network (LAN)and includes embedded sensors and control mechanisms.

This network connectivity paired with wireless sensors (WSAN) provides control and real-time feedback for in-progress production adjustments on the production floor.

The utilization of barcode labels and RFID tags have traditionally been used to help connect partners and move goods from a logistics & supply chain management perspective across organizational boundaries. These extremely low-cost technologies should be utilized on the factory floor to track work-in-progress materials, enable parts requirements, route equipment, handle and manage the use of assets, and track availability. Barcode labels and RFID tags, coupled to the right tracking software, can provide plant operators with insights that enable them to process raw materials through to completion efficiently. When paired with other material data, they allow a complete data-centric view of the factory, which leads to higher confidence and more committed value from your customers.

Change Orders Seamlessly
Improved system integration supports more efficient processing of change orders. Product changes requested by customers need to be transferred to production systems as soon as possible to avoid delays in fulfilling orders. New manufacturing processes will affect production times and expenses, and this information needs to be fed back to accounting and cost management systems. This keeps pricing, assets, inventory, and product delivery information up-to-date.
IoT Increases Productivity

Manufacturing execution systems such as RunCard, help streamline factory-floor operations by managing and monitoring all work-in-progress, including providing real-time metrics and enabling traceability of both materials and product life cycles and makes corrective actions for defective products easier.

If there is a quality issue on the floor, real-time notifications via LAN and IoT sensor networks can be set to trigger necessary corrective actions and scheduled tasks.

Integrating predictive maintenance data with ERP systems can optimize workflow scheduling and help manufacturers diminish the impact of equipment unavailability by adjusting the production run. If defective material is detected, it can be removed from inventory and returned to the supplier. Manufacturers save money by eliminating scrap due to defective raw material and reduced exposure to recalls, limiting overall product liability risks.

Just-in-Time Delivery

Just-in-time (JIT) delivery and the precision it requires is not a new concept to many manufacturers. Still, now that supply chains are becoming increasingly intertwined with the Internet of Things, brands have a tremendous untapped opportunity to use the data. Supply chain managers now have the ability to track inbound and outbound inventory automatically with factual accuracy, and this visibility allows brands to react immediately to changes. Realistic ERP schedules incorporate quicker production times based on the latest production floor improvements.

Sensor networks provide data that impact just-in-time schedules, such as work-in-progress, parts inventory, etc. Any production downtime due to defective equipment can be recorded to the ERP system to push back delivery dates as needed. While in transit, sensors on containers provide the capability to deliver real-time insights to products across the supply chain.

The Bottomline

Digitization is vital to remain competitive. An MES must be capable of seamless integration with an ERP system in order to achieve enhanced and more automated production scheduling, product tracking, purchasing, and quality control functionality. Real-time data interchange between these two systems creates a powerful, unified, digital platform from which to control and scale your operations.

If you are currently seeking an MES to help solve your production challenges and gain full traceability within your factory line and beyond, please contact us. We will be happy to help you find the best solution for your current and future operational needs.