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Closing the Loop – SME manufacturers have to better understand the link between the shopfloor and their ERP system

Industry 4.0 and the Industrial Internet of Things (IIoT) is about to have a profound effect on manufacturing around the world, thinks Dave Worsman (pictured), joint MD of Ochiba. “Companies are starting to see the potential of it,” he says. “They are looking at things like embedding sensors and monitoring devices into their equipment to provide feedback and information on how their equipment is being used. Once the industry has fully understood what is possible, and how much data they can get from their devices, it’s going to radically change the way products are designed in the future.”

With 12 years’ experience as a specialist reseller of the SAP Business One ERP system, Ochiba are better placed than most when it comes to explaining why manufacturers should focus on their software as much as the factory floor when looking at becoming Industry 4.0-ready. Worsman asks: “If a company is spending money, will they invest in ERP or spend it on making the shopfloor more automated for faster throughput? The ERP system will traditionally be the one to miss out. However, it’s important to realise there are gains to be had by joining the two together.”

SMEs in particular stand to benefit from ‘closing the loop’ between the shopfloor and the ERP system, explains Worsman. “Many SMEs have an ERP system and a shopfloor, but they’re two separate entities. The two don’t really talk to each other. They might be connected insofar as they measure the completion of jobs, but the actual machines in the factory are not connected to the ERP system. The first step is in closing that loop. “Industry 4.0 is about automation: not just analysing data, but making the factory processes refine themselves. Companies don’t use their ERP systems to the max, and fail to get the best value from it.”

SAP Business One, while being designed for SME customers, is more than capable of handling the vast amounts of data Industry 4.0 will throw at it. “There has been such a convergence of technologies that SAP Business One has seen all the benefits of the bigger SAP products, like SAP HANA and SAP Business Objects, embedded into it,” explains Worsman. “SMEs can benefit from all that power at a more modest cost.”

‘All that power’ will be needed even more in the future, Worsman predicts, as manufacturing becomes even more complex. “Companies now offer fully flexible products,” he says. “That makes the manufacturing process more difficult – the more configurability you offer a customer, the less standardised your production will be. The system has to enable the generation of product variations ‘on the fly’ before the production process starts. We have extended SAP Business One with that in mind. The Ochiba OPTIONS engineer-to-order module has been created specifically to deal with this.” continues Worsman. “Offering more choice and being more flexible means that the internal manufacturing process has to be more intelligent than it ever has been.

“Companies need to learn quicker and refine their process better, but most importantly they have to be able to plan ahead. They have to be responsive to a customer tailoring their product to the nth degree; it’s all well and good making a one-off product, but you have to be able to manufacture it as quickly and efficiently as a non-standard one. Customers want what they want, and it’s not necessarily what’s on the shelf.”
With staff that have come from the manufacturing industry Ochiba are well-placed to offer advice to SMEs on the best ways to close the loop between ERP and the shopfloor, as well as looking at how to prepare your business for future challenges. “It is easier for us to teach people from the manufacturing area about ERP than vice versa,” reasons Worsman.

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