Evolution of ERP software Q&A

One change in enterprise resource planning (ERP) software that has propelled its usage is its move to the cloud. The prevalence of mobile devices and social media in the consumer arena has permeated the industrial sphere as well. In addition, real-time data collection, open architecture, and browser-based interfaces have contributed to making ERP software integral to manufacturing. Photo courtesy of Epicor Software Corp., Austin, Texas.

Ten years ago enterprise resource planning (ERP) software was considered something of a luxury, a status symbol, and a frivolity. Today it is a necessity for metal fabricators to consistently deliver quality parts on time, according to ERP software companies’ spokespersons.

ERP software has reinvented itself during the last decade, becoming more integrated, intuitive, and indispensable, said Epicor Software Corp. Vice President of Manufacturing Product Marketing Terri Hiskey; Global Shop Solution’s Vice President of Service Mike Melzer; and Macola Software Director of Software Development Derek Ochs.

Interchangeable modules, user-friendly features, cross-platform usability, real-time data collection, open architecture, browser-based interfaces, and cloud sourcing have made ERP software an integral part of manufacturing (see lead photo).

FABRICATOR: In general, how has ERP software evolved over the past decade?

Terri Hiskey, Epicor Software: Historically, ERP implementations have been expensive and time-consuming, and it was perceived as incredibly complex. What has happened over the last decade is the emergence of new technologies such as mobile, social, and cloud, as well as the wide acceptance of open architecture. Now, instead of having to implement one big system, manufacturers can use interchangeable modules to connect and collaborate in a secure system across global facilities.

I also think that ERP is evolving to meet the needs of users today. Manufacturers want to be able to use their software right away with a minimal amount of training. OEMs have had to make their applications easier for people to understand and use across many platforms—not just on the desktop, but on tablets and smartphones also (see Figure 1). The days of having to go through weeks of training to learn how to use an ERP system are gone. The software has greater visibility and the ability to track metrics to understand value.

Mike Melzer, Global Shop Solutions: Real-time data is becoming more important. We’ve added 75 key performance indicators (KPI) and dozens of dashboards that put real-time information at manufacturers’ fingertips (see Figure 2). 

In the past plant owners and managers would rarely log into the system because they were not everyday users. Instead, they would ask someone to print a report and analyze the information for them to make decisions. Now owners are logging in and getting real-time information from the KPIs and dashboards. They can run these right from a tablet so they can be anywhere in the world and still be in sync with what is going on back on their manufacturing floors. 

Derek Ochs, Macola Software: I think one of the biggest evolutions over the last decades is open architecture. The ERP industry has come to the realization that no one system can do everything, so proprietary closed systems have converted to open systems that use standard application program interfaces (API) and plug-in architectures. This allows manufacturers out-of-the-box functionality that adds value and meets their exact needs.

Over the last decade we’ve also seen a huge emphasis on software for geographically diverse companies. Today’s businesses often have distributed teams and employees, and they want their information to follow them wherever they go.

Figure 1
Metal fabricators want to use ERP software across many platforms—not just on the desktop, but on tablets and smartphones also. Photo courtesy of Global Shop Solutions, The Woodlands, Texas.

Also, browser-based interfaces are becoming the standard because they can be used across many different types of devices and allow easy access from anywhere (see Figure 3). Additionally, a new focus on user experience over the last few years has made simplicity and usability a must-have feature for business software. 

Another evolution in the ERP space is that systems have evolved from simply recording transactions to handling interactions between various stakeholders in business processes. This is commonly called workflow management and has been a new emphasis of many modern ERP systems.

FABRICATOR: What do you view as the three most important updates and improvements? What problems did they solve?

Melzer, Global Shop Solutions: The three most important ERP updates are user software development, material certifications, and an import/bill of materials comparison.

Our software development kit has been a competitive advantage for our customers. This tool allows manufacturers to store more data about a part, sales order, and so forth—something that is not standard. Users can apply an update to their ERP software and it will not break anything. Most people in their 20s and 30s have taken some sort of programming class in school, so that generation of manufacturers like it. When we first released it in 2007, we thought everyone would start using it, but it’s taken time. 

Requirements for material certifications have exploded. The aerospace, medical, and oil and gas industries require it. For example, when a part is used on an oilfield rig, data has to be collected about everyone involved in producing the part, which mill the steel came from, where it was sent out for finishing—everything. So we created a process that pulls up this information each time a part is shipped or after it’s shipped. We call it a Cert Packet.

The third most significant update is an import\bill of materials (BOM) comparison (see Figure 4). Let’s say you have a 500-part assembly and you are working on the quote or you already have the order and just need to get everything into your ERP system. With an export from your modeling software, you can simply click a button and have the ERP system create parts and the BOM so you do not have to do this manually. Previously it might take a day or two to get that 500-part assembly entered into the system. 

Then if they send you an updated version of the model and you have to figure out what has changed, that’s where the BOM Compare module comes into play. It will pull up the new version and compare it to what is already in the system and highlight the change. Then you can update the BOM. 

Hiskey, Epicor: The three most important ERP updates are the move to the cloud, open architecture, and the capture and analysis of big data with actionable results.

The move of ERP to the cloud has picked up the pace of innovation, with releases coming out much quicker—often every six to nine months, instead of what was an 18- to 24-month cycle. The cloud has also enabled greater mobility and faster access to the software across various locations and with any device.

Figure 2
User-friendly dashboards let manufacturers view multiple aspects of their operations at a glance. Photo courtesy of Global Shop Solutions, The Woodlands, Texas.

Open architecture is significant because ERP needs to be built for outside integration so it is capable of anticipating growth while also dealing with big data. Support of service interactions is especially important as many companies are growing revenue by adding and selling services in addition to their product offerings to be more customer-centric. It is important for manufacturers to be able to be a one-stop shop to support their customers.

ERP is often the central data collector. Data might track financial or sales transactions or it might reveal how well equipment is performing on the shop floor or in the field so it must be able to capture and analyze big data for actionable results.

Ochs, Macola: Our latest version, 10.6, continues to add user interface improvements to create what we think is the best user experience in the industry. For one, we now have a graphical status bar that shows, at a glance, the status of an order. Second, we also added support through an additional type of invoice order that can fast-track an order through the system. Third, we increased functionality to our API that offers manufacturers more ways to extend our system.

FABRICATOR: What bombed?

Hiskey, Epicor: I don’t think anything necessarily bombed, but I have heard the term data fatigue. This is when your systems collect data at various points from the moment an order is taken to when it is designed, built, and received. The problem is that so much data is collected that it can be overwhelming. So now we prebuild analytics data that flows in and out of ERP to reveal insights that are important to the business.

Melzer, Global Shop Solutions: That is a tricky question. We’ve done a few projects like GS Mobile that allows fabricators to look up customers, sales history, shipments, parts, and contacts from their phones. The ones who use it, love it, but it hasn’t been as widely used as we thought it would be. I think most fabricators go on their tablets or pull up their laptops and just log into the main system to get their information. It’s not a tool that every plant is taking advantage of. 

Ochs, Macola: As with every release, we take customer feedback – both good and bad – and use that feedback to improve our system. The 10.6 release has more than 100 updates and enhancements, many of which were based on customer feedback.

FABRICATOR: How do you think that ERP software will evolve in the future?

Ochs, Macola: I that ERP software’s final frontier will be the ability for systems to make intelligent recommendations on ways to better run a business. Today many business decisions are made based on gut feel, intuition, tribal knowledge, and guesswork. Although these methods will always be part of how business decisions are made, the rapidly growing fields of big data, machine learning, data science, and analytics hold potential for systems to assist decision-makers in identifying waste, suggesting changes, and driving more profit to their organizations. The data is already there; we just need to tap into it and exploit it.

Melzer, Global Shop Solutions: Manufacturing machinery has become more automated, so we’ve had to adjust how we collect labor data to get accurate job costs. Instead of an old-fashioned time clock, labor time is pulled right off the machine the operator is using. As shops upgrade their machines, this is going to become a bigger issue. Even though this solution exist now, I know we are going to have to make improvements.  

Figure 3
Browser-based interfaces are becoming the standard and allow easy access from anywhere—the office, plant, warehouse, or in transit. Photo courtesy of Macola Software, Dublin, Ohio.

The big trend in ERP now is for the system to run in the cloud. This eliminates ERP maintenance for the fabricator, and it also lets them get to their information from anywhere. That capability is already here, but it’s going to continue to grow.

Hiskey, Epicor: I believe interactions with ERP will become more personalized. Fabricators will be able to personalize their home pages, decide what they want to be alerted about, and access their ERP system from any device, from anywhere in the world.

ERP software will be at the center of companies’ tracking efforts—not only financial performance, but also manufacturing, distribution, services, and in a holistic way. ERP will be able to integrate with new technologies, such as IoT-enabled sensors, to monitor machine performance, with 3-D printers producing parts, and virtual or augmented reality so fabricators can visualize changes and see the financial impact in real time. The possibilities are endless.

Epicor Software Corp., www.epicor.com

Global Shop Solutions, www.globalshopsolutions.com

Macola Software, www.macola.com

Figure 4
An import\bill of materials (BOM) comparison module gives manufacturers a side-by-side comparison of how design modications change the BOM. Image courtesy of Global Shop Solutions, The Woodlands, Texas.