How could a manufacturing business that bends, cuts and welds metal benefit from Cloud ERP? With ongoing supply chain disruptions continuing to affect all industries, that’s a question that the fabricated metals industry is beginning to ask.
Supply Chain disruptions are creating a chain reaction across the metal fabrication industry
By nature, the Fabricated Metals Industry creates made-to-order products based on specific customer specifications. This means that the industry is reliant on bringing in specific raw materials and because of this ‘hands-on’ approach, the industry has become increasingly susceptible to supply chain disruptions.
According to the recent SYSPRO global research survey, an enormous 82 percent of Fabricated Metal Manufacturers experienced supply chain and material handling disruptions over the past twelve months. When exploring what key technological investments, the industry made in response to those disruptions, only 12 percent looked at data analytics to interpret data and identify any real-time shifts across the supply chain. This means that the industry has been unable to have full visibility into supplier shifts or changes in customer demands.
Connecting through Cloud ERP
Ongoing supply chain disruptions have clearly highlighted the importance for connectedness and to do this, Fabricated Metals manufacturers require cloud enabled business systems that are underpinned by meaningful data to secure their digital future.
One of the main technology disruptors is cloud infrastructure and supporting tools. These are empowering companies to build more efficient and effective IT footprints and also enabling them to use increasingly large amounts of data to manage their businesses better.
The term platform, used in the technology industry, is the central hub for building and managing systems, applications, and operational processes of a company. It is becoming a more common term among manufacturers as a technology solution on which a company builds its business to attract an ecosystem of suppliers and customers who derive value from it. A cloud ERP system can be such a platform.
What does Cloud ERP Mean for metal fabrication?
As in other manufacturing industries, metal fabricators are dealing with the advance of digital technology whilst also being constrained by older plant equipment. Many realize the benefits they could achieve with the Industrial Internet of Things and Industry 4.0. These would help them to address the pressures to deliver high-quality parts efficiently and cost-effectively, on schedule, and with more customization.
Manufacturers might balk at the idea of investing in fully integrated digital machines that generate data, but there are existing cost-effective solutions for semi-automated and manual machines. For example, a manual machine can be outfitted with a power measurement device that will support data collection on idle time, run time and downtime. Time-stamped data records can be integrated with a cloud ERP system to improve the ability to make decisions quickly and optimize operations. The great advantage of the cloud is that storing this information is far easier and cheaper than on-premise data storage.
Reaping the benefits of Cloud ERP
The cloud can be used to analyze everything in the business. It is easier to access and share data and insights using a cloud ERP system.
There are cost benefits to going with a cloud ERP system:
1. Reduced administration time and costs:The cloud ERP provider deals with infrastructure and management, allowing customers to focus on their core business.
2. Lower upfront costs:Cloud systems are typically licensed on a subscription basis. It is therefore a lower commitment to become a cloud ERP customer than the high cost of implementing the system on-premise.
3. Cost predictability: With on-premise systems, upgrades and enhancements must be individually purchased, whereas the subscription for cloud software includes all of that.
System and data security is becoming an increasing concern for businesses. With an ERP system running on-premise, a manufacturer needs their own security staff who require frequent training as security issues change. Because of some well-publicized breaches, there is a mistaken belief that the cloud is not secure. But an on-premise network is generally far less secure than cloud storage. A cloud ERP solution offers advanced security options, as well as 24/7 monitoring and management of cloud storage. This means data stored in the cloud is more secure than it is in an on-premise ERP system.
Increasingly, cloud computing and artificial intelligence (AI) have become two interdependent technologies. With a Cloud ERP, manufacturers have access to a flexible, reliable, and cost-effective solution to store data and manage processes and people. AI goes to the next level by helping with the analysis of that data. However, AI solutions require huge computing power and few organizations can afford the investment to make that possible. Cloud computing makes AI far more available without requiring a huge investment. With the help of AI, organizations can get valuable insights from their data and optimize workflows, leading to a better customer experience.
Metal fabricators are aware of the potential of technology to make their businesses more agile, efficient and profitable. The issue is to find ways to increase agility, reduce risk, and innovate faster. With Cloud ERP, Fabricated Metal manufacturers can ensure flexibility, while ensuring supply chain resiliency.
