Six Ways to Become a Preferred Manufacturing Partner

Summary

In manufacturing today, the reasons for becoming a preferred supplier have evolved from simply driving repeat business to locking in more profitable business for longer periods of time. This requires building relationships with customers, which are not only based upon price and service levels but also on documented quality, ease of doing business and transparency.
 
As a result, the path to becoming a preferred supplier now demands a dual-pronged approach. The first element is possessing the technical capacity to deliver on the manufacturing promise—i.e. the fundamental plant and equipment, engineering talent and operating personnel to build the product. This aspect is top of mind for most manufacturing businesses.
 
Less obvious, but equally important, is a second factor: having the business practices and controls in place to assure that certified products are delivered on time. The good news is that manufacturers can streamline and automate many of the processes required to support this second requirement by tapping into their enterprise resource planning (ERP) system functionality.


 
Let’s look at six critical business processes and controls where manufacturers can use their ERP systems to drive the superior quality and visibility that are the hallmarks of preferred providers.
 

Maintain certifications and compliance

Fundamentally, certifications are commitments that good manufacturing practices are in place with audits and controls being applied to ensure their day-to-day application. A comprehensive manufacturing ERP system is essential for effectively maintaining compliance to the full scope of certifications for government and industry standards.
 
A manufacturing ERP system can ensure that any procedures, follow-ups and risk mitigation strategies that have been defined are also followed and audited. Notably, it automates two key elements of maintaining standards certifications. First is taking process controls that require inspections and enforcing their execution through management alerts and exception reporting. Second is automatic, organized record keeping, which facilitates the documentation of manufacturing processes and their proper execution.
 
Third, an ERP system can validate operator training and certification by answering questions such as: Does the operator have the credentials to allow the job to start? When does an operator need to be re-certified on a job? For instance, it can verify that only certified operators can perform a task at the point-of-production. It can also enforce and document procedures during production.
 
Such capabilities add value and elevate a manufacturer from a supplier to a full business partner.
 

Provide lot and item-level traceability

Many products place exacting demands on raw material inputs, so processes that ensure the validation of raw material inputs are imperative. A manufacturer must be certain that incoming raw materials are validated before being used in production, and the continuity of their use must be certified throughout the entire production process.
 
An ERP system can be configured to insist that when lot or item-level traceability is required, no manufacturing can take place prior to the proper raw material lot numbers being validated by supervisors, material handlers and operators. Failure to properly sign-off on material inputs will cause the ERP system to alert management of the missed step and make notification before production can proceed. In addition, records will be kept that can be recalled and presented to a customer as evidence that proper procedures were followed.
 
Creating and enforcing traceability is the first and essential step in providing full traceability services. But an equally important step is the ability to accurately back trace an item through its production lifecycle. Known as track and trace, this functionality works by searching on an item’s unique identifiers, such as the part number and date of production, a lot number, or a serial number. With this information, track-and-trace functionality can walk a manufacturer backwards through the product life cycle to find out what material was used, which machines and operators handled production, what inspections were made and even the machine process parameters at the point of production.
 

Record and report manufacturing process data

Many of the tasks in a manufacturing operation are highly influenced by management, supervisors and operators following procedures and doing the right things. But a great deal of influence comes from the production equipment itself.
 
For example: Is the machinery operating at the right speeds, pressures and voltages? It’s hard for operators to instantly track such process parameters. However, the real-time process monitoring provided by a manufacturing ERP system, can capture streams of data from sensors and machines to track process variables in real time.
 
Real-time process monitoring offers benefits during and after production. Throughout production, process monitoring delivers advanced warnings if the equipment is trending towards a boundary-level operating parameter—for instance, if a stamping pressure is too high, a barrel is too cool, or a voltage is cycling. All are warning signs that a machine could soon start producing bad parts. In short, process monitoring can prevent problems before they happen.
 
Process monitoring offers two added benefits. One, if bad parts are discovered in the postproduction quality assurance inspection, the historical process data can be studied using statical process control (SPC) techniques to determine if equipment issues were the root cause of the problem. Two, parts passed onto customers as having passed quality inspections can not only be accompanied by the inspection documents but also by the digital trail of information documenting that the equipment used was performing correctly at the time of production.
 
Being able to provide a digital history of production to customers is a clear differentiator between an average manufacturer and an outstanding one.
 

Enforce quality control procedures

Another key competitive distinction for manufacturers rests in the difference between having processes in writing versus putting those processes into action. Consider: Are inspections really happening at the right time, or are they being pushed out to future dates or perhaps not happening at all? Manual recording and enforcement of inspections has been the norm for years, but it is a hit-and-miss process.
 
By contrast, automated inspection procedures are very reliable because the oversight features of an ERP system expect them to happen and will alert management when a scheduled inspection hasn’t occurred. Not only does the ERP system watch for missed inspections; it also flags values that are so far out of specification as to be suspect data entries. And it digitally records and files the inspections for future reference and customer documentation.
 

Provide repeatable, transferrable quality and SPC records

When manufacturing and inspection processes are executed under the supervision of an ERP system, they are inherently automatically recorded and documented. This data capture can take the form of a timestamp signature, the date of a material validation, the name of an operator, or a histogram of process parameters. If the ERP system is running the workflow, it also knows what happened and when.
 
The records captured by the ERP system are extremely valuable to internal operations—for example, facilitating the effort to back-trace the root causes of problems or build continuous improvement programs. Additionally, they serve as proof positive for customers that the manufacturer has the procedures, controls and documentation in place to keep their commitment to building quality products, and as we will see next, delivering those products on time.
 

Deliver timely and accurate product delivery data

Another dimension to becoming a preferred supplier is being transparent and easy to do business with. One major aspect of transparency is predictability—to be able to answer the simple question, “When will the product be ready?” and then to deliver to that promise.
 
The answer for product availability starts with the initial quotation and sales order and ultimately, the bill of manufacturing (BOM). The BOM not only includes the raw materials that go into the final product; it also covers the tooling, machinery, labor and secondary operations required to build the product. All these items have lead times, competing demands and other constraints that require comprehensive consideration and analysis before an accurate delivery date can be promised.
 
The functionality required to perform this detailed analysis is called capable-to-promise (CTP). Similar to an AI tool, CTP uses the material resource planning and scheduling capabilities of an ERP system to traverse all the potential procurement and production scenarios and produce a promise date that has considered all constraints. Moreover, it suggests areas where changes to constraints could enable production to be completed earlier. Examples include expediting a material, freeing up a piece of equipment, or bringing in additional labor. In this way, CPT ensures that the original promise date is executable based on a thorough consideration of the all the events that need to align to deliver on time.
 
Once the BOM and the delivery date are set, it is the responsibility of the material resource planning (MRP) and scheduling system to put the plan in place to procure, allocate and disposition the resources necessary to run production. But this leads to a new set of questions that both management and the customer will want answered: Is the job running on time? What are the actual cycle times? Have any unexpected delays occurred? Tracking production progress from step one to the end of the job is the role of production monitoring.
 
Production monitoring uses sensors to note and time stamp a job’s production cycles. It might simply be an injection molding machine opening and closing its jaws or more complex like the visual recording of assembly steps. Either way, the two important data points are if the process is running and what are the cycle times.
 
The seemingly simple data points from production monitoring yield a wealth of information. For instance: When did the process stop? How long did it stop? How does this impact the completion time? Are the cycles running fast or slow? How will this impact delivery time? The results of production monitoring, which is an essential manufacturing practice, are back flushed into the ERP system to automatically update schedules and completion times.
 
The information is then available in real time to inform management and customers about the status of projects and when they can be delivered. This ability to speak to the exact status of a job and answer delivery questions with real-time information is a highly valued differentiator in manufacturing.
 

Conclusion

Achieving excellence as a manufacturer requires not only having the basic production and engineering talent necessary to build the product but also having the business practices and controls in place to assure that products are built to spec, properly documented and delivered on time. By harnessing the full power of their ERP systems, manufacturers can automate not only their factory floors but also their business processes and controls to meet these demands—and establish a role as a preferred supplier that can command premium prices in return for premium services.