How The Cloud Powers Lean Operations For SMB Manufacturers

By implementing advances in technologies like the cloud, manufacturing companies can put the correct tools in place to operate a lean business, boost customer satisfaction and drive profitability.

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Logan PaquinLogan Paquin

As the manufacturing industry continues to grow, it is more important than ever for manufacturing companies to deliver fast, efficient service to retain customers, attract new clientele and stay ahead of increasing competition. To do this, it is vital to streamline operations on the shop floor and optimize back office processes so employees are not wasting time sifting through irrelevant information, missing internal deadlines and increasing the risk of late delivery, which can be a major detriment to the customer relationship. In fact, according to a recent survey conducted by Exact, 25 percent of customers will not work with a company again if a delivery order is late.

By implementing cloud technology, small and medium-sized manufacturers can work against such roadblocks by eliminating waste, saving time and allowing employees the opportunity to focus on value-added activities. The end result is a lean operating system, which can benefit companies by:

  • Attaining a holistic view of all operations: Most of the issues that damage a manufacturer’s reputation can be linked back to a lack of insight into the business and, beyond that, the wider supply chain. Yet if employees can access comprehensive, real-time information on the entire business — from quoting and purchasing raw materials to production and delivery—all in a single online application, it can make a world of difference. With this insight, a history of similar jobs will always be on-hand, and the manufacturer will be in a better position to provide accurate quotes and deadlines for similar projects. Other helpful information includes precise timeframes on when raw materials are going to be delivered (or not), so the manufacturer can confirm when he or she really can start production, rather than when he or she hopes to. Finally, the ability to analyze current workload levels provides the information needed to order raw materials and outsource work quickly. With this information, changeover times can also be optimized and operational efficiency maximized. Plus, research suggests that companies that lean on data insights have experienced revenue growth of 21 percent in the last financial year, as compared to 9 percent for businesses reporting limited use of data.
  • Allocating valuable resources strategically: By implementing cloud technology, small manufacturing companies can ensure materials, personnel and time are spent only on value-added activities instead of mundane out-of-date tasks such as paper-based reporting. Automation — and simultaneously modernization — is the great equalizer, allowing the small manufacturer to operate the same way large manufacturers operate by managing business processes from beginning to end, but at an affordable price. This also allows manufacturers to set and meet customer expectations, the main ingredient of a strong reputation.
  • Optimizing experience by keeping customers informed: Satisfied customers are loyal customers, so it's important to proactively identify any issues that could hinder success. Manufacturing companies can create happy customers with cloud capabilities that quickly generate quotes, inform customers about the status of their order at each stage of production and guarantee on-time deliveries with an interconnected value chain. The first potential roadblock is the threat of low inventory. It happens all the time — a company thinks stock levels were higher than they actually are, so they’re short of the materials they need to go ahead and produce the order. Issues like this can have an adverse effect on customer satisfaction and wreak havoc across the entire production floor — but can be avoided with access to the right data. Cloud technology can provide important insight into the company’s stock position (i.e. what’s on-hand, how much is planned in and planned out), as well as visibility into supplier delivery issues, such as changes to an order. Cloud can also ensure that everyone (i.e., shop floor employee on the shop floor, sales rep on the road, etc.) knows of changes at the same time.

There are many different moving parts in the manufacturing industry and it can be difficult to keep track of activity and keep customers happy. By implementing advances in technologies like the cloud, manufacturing companies can put the correct tools in place to operate a lean business, boost customer satisfaction and drive profitability.

Logan Paquin is Director of Product Management at Exact.

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