Simplifying the Making of Complex Products - Control Design

WHITE PAPERThe Right ERP System can helpIndustrial Machinery ManufacturersMaster the Global Economy BodyAs it prepared to launch a groundbreaking new product, the managementteam at IONICS Mass Spectrometry Group realized the company needed torevamp a number of business processes.The new product, a molecular analyzer that incorporated many new technicaladvances, was destined to be a fast seller, and IONICS needed a reliablemeans of tracking the nearly 12,000 parts that go into each unit. It alsoneeded a direct link between its inventory management and productdevelopment systems to ensure that the parts it keeps on hand alwayscomply with the most recent engineering specifications.To accomplish that, IONICS adopted a fully integrated ERP suite that providescomplete visibility into all of its critical business data. In addition to improvingits inventory management, IONICS is now able to forecast, with a highdegree of accuracy, the actual demand for all of its products. It also can seewhen demand patterns shift, which allows it to consistently build the exactnumber and mix of products its customers actually want to buy.Perfecting this type of juggling act has always been crucial for companiesthat make industrial machinery and components, but it has become evenmore important—as well as more challenging—in recent years. And there isgrowing evidence that a properly configured ERP system is the ideal tool forcompanies seeking help in overcoming these challenges.For instance, a recent study by Aberdeen Group, a leading business researchand consulting firm, found that best-in-class companies in the industrialmachinery and components sector make more extensive use of ERP than theirpeers. Aberdeen confers best-in-class status on companies that rank in thetop 20 percent on the following key performance indicators:• Inventory management, which entails keeping inventory levels low aswell as maintaining accurate counts;• Complying with planned manufacturing schedules; and• Delivering customer orders that are complete and on time.Scoring high in these areas keeps operating costs down, which typicallytranslates to higher profit margins.As Aberdeen and other industry experts have noted, however, simplyadopting an ERP system will not earn a company best-in-class status. Toachieve that level of performance a company must first choose an ERP systemthat fits its business, and then implement it properly.Simplifying the Making of Complex Products 1