| How To Choose A Right-sized
Manufacturing System
by Dave Brown, CEO MISys Inc.
Chapter 1 - What do I want to accomplish?
Explore the first great conversation you should have with yourself, your accountant, or your computer consultant in the process of finding a manufacturing control system that will fit your needs and budget.
The First Question
If you are like a lot of people, your first inquiry into the world of manufacturing software will likely
be prompted by reading a whitepaper or magazine article entitled something like “Double Your
Profits By Going Lean” or “Get Total Control of Your Manufacturing In Just 60 Days” discussing
some esoteric subject of manufacturing control. Attention grabbing headlines such as these are
the darlings of editors bent on propping up subscriptions. But, as you might expect, they never
tell the whole story.
If you have a good relationship with your accountant or computer consultant, he or she may be
the first to call you by saying “I read this article…I think we should look into getting some
manufacturing software.” The accountant or consultant may have done some quick search of
the Internet and have the names of a number of products they want you to investigate further.
Product literature and online demos are readily available in this wired age.
My recommendation at this point is to adopt a “go slow” approach and invite the consultant in for
a discussion of your perceived needs and desired benefits. If the consultant is willing to offer
free advice, then you should accept it.
When the meeting takes place, your consultant will likely plunk a handful of literature down on
your desk and tell you about the one product he or she thinks looks most appealing. Rarely will
the consultant come to the meeting with an unbiased point of view – or pose the most important
question of all: “So, what do you want to accomplish by implementing a computerized
manufacturing control system?”
Many software developers rely on the influence of accountants and consultants in order to
generate sales. Even if there is no business relationship between the consultant and the
software firm, expect your consultant to exclaim about some whiz-bang feature they saw in an
online demo. The “go slow” part of this phase of your inquiry keeps pointing back to “exactly
how will that feature affect my business.”
Whether or not the consultant is successful in transferring their unbridled enthusiasm to you, the
bottom line for your business is finding ways to increase the effectiveness and profitability of
your manufacturing operation. It is time to put the literature aside and ask the hard question
over and over again “So, what do I want to accomplish by implementing a computerized
manufacturing control system?”
Don’t be satisfied with sweeping generalities such as “control my inventory” or “computerize my
bills of material” or “get a bar coding system.” You must compile a very specific list of objectives
– ones that can be accomplished in the context of the resources available to you.
A common objective, and a very achievable one, is to reduce your inventory holding costs by
20%. If you are sitting on an inventory of raw materials and WIP worth, say, $10,000 then
shaving off 20% of that is only going to net you $2,000. At that rate, you’ll need several years to
pay off a manufacturing software system costing $5,000.
On the other hand, if your inventory is worth closer to $1M, then paying $10,000 to reduce your
inventory holding costs 20% is something you should have done yesterday!
Finding a “Right-sized” Solution
In the marketplace you will be able to find manufacturing software that costs just a few hundred
dollars, manufacturing software that costs thousands of dollars, and manufacturing software that
costs hundreds of thousands of dollars.
Is there a solution that fits both your needs and your budget? Most certainly, but finding it may
require no small effort digging through piles of brochures and product demonstrations.
A few years back, I was a guest at a major manufacturing trade show sponsored by APICS (the
American Production and Inventory Control Society) where, in addition to makers of stamping
machines, roller bearings, conveyor belts, and thousands of other hard goods, over 400
manufacturing software vendors exhibited their wares. While it was an interesting experience, I
would definitely not recommend that you rely on such an event to help you find the right
manufacturing system.
Then how do you recognize a right-sized system?
Well, in general, you get what you pay for.
Low cost software is often authored by small companies with just one or two programmers and
support personnel. The makers of big, expensive manufacturing software will fly in their team of
sales engineers, systems analysts, and support personnel. Somewhere between these
extremes is a company and a software product that is right for your firm. |
