As the calendar year winds down many manufacturers ramp-up production, to meet the “end of year rush.” But to avoid the chaos that may come with increased demand and constant supply chain disruption, manufacturers must consider implementing technology tools to get ahead of the demand – and that also can benefit operations year-round.
This is challenging due to the complex nature of manufacturing: Customers’ needs and requirements can make it difficult to maintain everyday operations while planning for the future. To keep up with the demands of the industry, manufacturers must be as efficient as possible, so having a culture that embraces innovation is critical to long-term success.
Managing to streamline
Efficiency starts with a manufacturer’s approach to business management. This is where planning and profitability intersect, allowing manufacturers to streamline operations by eliminating redundant processes and systems. Not only does this speed up the pace of doing business, having a strong foundation here also can have a major impact on lowering the overall cost of doing business. Cloud-based infrastructure has made this technology more affordable to small and midsize manufacturers, so manufacturers no longer have the excuse to miss out on streamlined operations due to an outdated tech stack.
Adding a layer on top of this, artificial intelligence (AI) and machine learning (ML) continue to drive more intelligent solutions and generate more powerful business data. With this combination in solutions such as enterprise resource planning (ERP) systems, manufacturers can convert outputs, like machine utilization, into actionable insights that can be leveraged for important business functions that help the bottom line, such as process improvements and decreasing down time.
Additionally, intelligent business management solutions can improve staffing and better allocate employee time. For example, automating existing manual tasks speeds up business processes and reduces overall errors so more manufacturers can focus on jobs that contribute directly to the bottom line.
Tapping business intelligence
Manufacturers manage a lot of data from a lot of different places – everything from customer data to machine operations data – and it's important that manufacturers have the infrastructure in place to mine this data to help derive business decisions.
A great starting place is mapping out key performance indicators (KPIs), which are critical when establishing baseline performance metrics and how these are tracking over time – especially during busier seasons when any downtime can mean lost revenue. Business intelligence platforms can help align manufacturers under a consistent set of KPIs that can be easily tracked and monitored, providing a constant pulse on operations.
Having this intelligence lets manufacturers see into their processes to determine what is going well, what needs to be improved and if are any major inhibitors that are strongly impacting performance. Armed with this insight, changes can be made immediately so operations can get back on track and minimize the downtime certain bottlenecks may have been causing.
While we’re still in the early stages of manufacturers embracing the value of business intelligence, more manufacturers understand the potential benefits of data for staying competitive and maximizing their growth potential. For example, with demand forecasting, manufacturers can predict customer demand by analyzing numbers and trends from previous years so they can plan accordingly and minimize the impact of external and internal disruptors, such as supply chain delays and inventory shortages.
Insight into profit margins
With profit margins so essential to business growth, the need to stay vigilant of every cost is paramount. For example, the quoting stage can be a pivotal time for when profits are made or missed. Just one unidentified cost, one slight gap in inventory can impact that delicate profit and turn it into a loss.
Having a business management solution can provide manufacturers with up-to-date data that helps pull together a profitable quote that is more accurate and reflects the latest internal numbers. Additionally, an integrated solution goes beyond just quotes and estimates, by also tracking the exact costs of materials, labor and overhead of every job in real-time. With this extra level of insight, manufacturers can have a stronger pulse on operations and where they will net out. While this is extra critical as the year ends and manufacturers aggregate and report on yearly financials, having this information throughout the year ensures there are no surprises or unexpected gaps in revenue.
Beyond the rush
Today’s economy adds another layer of difficulty for manufacturers trying to end the year on a positive note. With concerns of a recession looming overhead, now’s the time to invest in the technology tools that can future-proof operations and create a more resilient business model during both expected and unexpected challenging times.
Technology can help manufacturers accomplish more with less and stay in front of the competition, even during times of uncertainty. Manufacturers who haven’t made this a priority will need to get onboard as soon as possible if they want to meet the “end of year rush” and head into the new year with confidence.