Before I get into the best costing methodology for a work-order-driven manufacturing company, let me define both methods. With standard cost versus actual cost, the discussion centers around how the ERP system values an inventory or labor transaction. Here is how the different costing methods calculate the value of the transactions.
SAP is a technology company that has been around a long time and offers what is often regarded as the top ERP software in the world. SAP ERP is built primarily for large companies in a variety of industries. Companies that are household names (e.g. BP, Coca-Cola, BASF, Audi, Burger King, and Citrix) very likely use SAP’s ERP software somewhere in their operations.
Visual South sells ERP for manufacturing-centric companies. More specifically, we sell Infor CloudSuite Industrial (SyteLine) and Infor VISUAL ERP. My experience with VISUAL goes back decades: When I was a plant manager, I bought and implemented VISUAL; I was a VISUAL consultant for years; and I’ve taken deep dives into CloudSuite Industrial.
Manufacturing ERP solutions and manufacturing processes go hand-in-hand. Your manufacturing process is typically defined by how you make what you make: the materials needed, the operations required, and the sequence of those steps. An ERP digitally supports any given manufacturing process by giving users a tool to help them execute, track, and analyze results of that process. When the tool used to support manufacturing process planning changes (like replacing Excel sheets with a new ERP), the processes typically change, too.
A mixed mode manufacturer is a company that does not have a single manufacturing process. It is typically a combination of one or more of the following modes of manufacturing:
Discrete manufacturing differs from primary modes of manufacturing in the following areas:
Discrete manufacturers typically have production lines or areas where the finished good is produced in a non-continuous process. In addition, they are often categorized as “to order” manufacturers, with mixed mode components when there is a make-to-stock or forecast demand to be addressed.
The types of consultants are: project managers, manufacturing consultants, finance consultants, and technical consultants. All of these individuals are typically engaged in a new implementation and used for varying consulting and technical efforts. There are a select number of consultants who are versed on the three primary areas of manufacturing, finance, and technology; we are proud to have these rare talents on the Visual South Professional Services Team. Please remember that the team helping you implement the software is just as important as the software itself . Our consultants exist to coach you on how to successfully use the application.
At Visual South, we have decades of experience implementing ERP software. I personally have been with Visual South for 20 years, and spend a lot of time working with manufacturing companies. Some of our customers are looking to get the most out of their Infor ERP, while others don’t have a solution and need help evaluating which ERP platform is the best fit for their company. Regardless of where they’re at in their ERP journey, I have found that just about all of these companies are working to have better manufacturing process control. How they do that is highly dependent on the tools they use to manage their business.
Not all ERP systems are designed with the capabilities to address the somewhat unique requirements for manufacturing organizations that specialize in engineer-to-order products. There are significant differences in the business requirements of engineer-to-order manufacturers, compared to those of repetitive, make-to-stock, mixed mode, and even make-to-order manufacturers. The key difference is that engineer-to-order companies may build a specific design and configuration only once. That’s it. You need engineer-to-order manufacturing software to be able to accommodate the unique requirements of creating singular products.
I like a sense of order. If a picture is crooked, I straighten it. If there is a mess in the kitchen, I clean it up. I’m not obsessive about it, but it is part of my nature.
I also like data. Not data for data’s sake. Rather, data that brings clarity to a problem or situation, which brings me right back to my desire for a sense of order. Data helps me understand if a problem is fixed, or situation is under control. The data feeds my need for a sense of order.
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