You’ve probably heard the term Enterprise Resource Planning (ERP) software before. If not, or as a refresher, they are a powerful application companies use to streamline and manage daily tasks across different departments. ERPs are used in nearly every industry from finance to manufacturing to technology. Most ERP packages are well-suited for those industries, but that’s often not good enough for companies who engineer and manufacture a product for a specific customer need.
Engineer To Order (ETO) ERP Software has one key difference. It does everything a typical application does while providing specifically designed support for your engineering department.
The Engineer To Order industry is in an entirely different category than high-volume, low-mix discrete manufacturers. While ETO does indeed have many similarities to other industries, the difference is in how much more important your engineering departments are to the success and longevity of client relationships.
There are many ERPs to choose from, and they all help streamline processes, but finding one made for customer manufacturing such as machine builders is tougher.
Four Challenges Custom Engineering and Manufacturing Companies Face without Engineer To Order ERP Software
The concept of ETO has been around a lot longer than the computers and software we are talking about today. Many processes have evolved over time but still rely heavily on data entry, data collection, and data storage.
Without an ERP, you will typically experience four barriers to improved efficiency.
- Data silos
Many companies have highly specialized people, but especially in the engineering world. Many have worked in their departments for years. While each person is great at their job, there isn’t always the level of constant communication needed to be informed about what else is happening in tandem.
You end up with nobody quite knowing what’s going on across the facility or even on the other side of the office. This is one form of data silo.
Then there’s the data silo where a department or working group has a set of data that they own, manage, and maintain. This information often exists as a mixture of spreadsheets, emails, and information committed to memory. It’s not freely available or even known to the rest of the organization.
- Manual data entry
An Engineer To Order company generates a lot of data. Data can be anything from machine uptime reports, pricing quotes in Excel spreadsheets, BOMs, and capacity reports. It is all important information that modern companies need access to. Historically, most of that data gets entered by hand. And often in different ways by different departments to different systems.
Information about processes is always evolving, too. An ETO company is often doing something for the first time for each new project as discovery takes place. This creates volumes of communication between team members as they work to build something new. A lot of that data gets entered into legacy systems like spreadsheets (and sticky notes!)
- Inventory tracking
In the customer manufacturing world, there is a constant stream of new part numbers and new BOMS. You’re not buying the same parts every day because you’re not making the same parts every day. In this rapidly changing environment, it’s difficult to have an accurate count of inventory.
On top of that, you have to be conscious of what is being ordered into inventory. It’s easy for a person to mistakenly order 100 packages of a part instead of 100 parts. Spreadsheets and Purchase Orders don’t often differentiate those details. A simple misread can mean way too much or not enough inventory for your project.
- Poor collaboration and inefficient workflows
When you combine the previous three challenges, you end up with a lot of inefficiencies. Poor communication between teams and departments reduces visibility into project status. This piles on by making it harder to predict and schedule.
It can often feel like your teams are reacting to the needs of the project instead of getting a few steps ahead. That’s where Engineer to Order ERP software comes in. It will help you streamline every important process found in the ETO industry.
How ETO-focused ERP Software Creates Efficiency
One Source of Truth
By organizing your information from CAD files to purchasing orders, Engineer To Order ERP Software makes data easy to access. This one system unifies all the processes and standardizes data entry. It also eliminates errors caused by misunderstanding or nonstandard data collection.
Later on, when your company needs to go back years to understand an older design, all the information will be at the project team’s fingertips. You won’t run the risk of information locked away in the brain of someone who retired years earlier.
Finally, it eliminates the need to dig through emails, spreadsheets, and drive folders. All the information you need is accessible through a common interface. You will no longer have to worry that you aren’t working with the same, or up-to-date, information as everyone else.
Simplifies Changes
An engineer may change the design at any time. The customer, too, often changes their mind or pivots mid-project. This makes it difficult to have a regimented cost accounting practice. It’s hard to have the standard component cost of goods sold with a fixed overhead value with project requirements defined on the fly.
Engineer To Order ERP Software takes all those changes as they happen. It then updates any areas this change affects. With an ERP application, all the important departments will be updated. When a design is modified, procurement will know about quantity change. Purchasing can work on sourcing and cost. And assembly will be able to prioritize their workflow.
Better Visualization
Whether your organization is high-mix low-volume or high-volume low-mix, you need the ability to prioritize tasks. With efficient access to information, you know when you’re going to meet milestones. You can see if there are any potential bottlenecks and work to solve them or re-prioritize other work if you can’t.
An ERP application gives you eyes into each stage of the project for each department. You can see how the status and process of one area affect the next steps down the line. This is important in ETO because you don’t always know where the finish line is.
It’s another way your industry is unlike standardized high-volume manufacturing. It’s also why an Engineer To Order ERP Software application is going to benefit you more than a generic application.
How COUNTERPART works for Engineer To Order Companies
A unique aspect of COUNTERPART is that we are an Engineering-To-Order ERP solution. The application was built by engineering, purchasing, and business leaders who have worked in the engineering to order space for decades. It was their idea to provide solutions to other Engineer To Order companies.
It features direct CAD integration for a variety of projects, jobs, and customer demands. Whether it’s straight entering an order, aftermarket support, or build-to-print, the software can handle a high velocity of change.
And it’s not just about software, either. We’re implementation specialists from sales through customer support. We believe there’s no replacement for being in person when it comes to implementing an ERP system. It’s very difficult or next to impossible to do virtually.
We learn your company’s processes and talk to your people. We look at your departments, view your equipment, and understand your workflow.
The COUNTERPART software is continuously improved, too. This all comes with ongoing training and advice so you can get the most out of your implementation.
If you’re an Engineer To Order organization without an ERP, you’re missing out on amazing efficiency and project management abilities. We invite you to learn more about how COUNTERPART’s Engineer To Order ERP software can drive the process improvements you need.
You can check us out here.