How Cloud ERP Drives Manufacturing Innovation

  • Staff Writer
  • July 13, 2016
  • Customers

Manufacturing has always been driven by innovation, from the first production line to modern sensors and robotics. Today, wearables and other connected tools are poised to transform how things are made. A central force in this transformation is cloud ERP—which now reaches all the way from materials in the supply chain to the employees and equipment on the plant floor to the hands of the customer. 

While some are still cautious about cloud ERP technologies, those manufacturers who have embraced it are discovering that the cloud drives innovation in multiple ways. From making big data and other technology initiatives possible to enabling knowledge, talent, and resources to be reallocated back to the business, innovation is much bigger than using futuristic devices or tools. It is about transforming the way manufacturing enterprises operate.

Focusing on Continuous Improvement

For Accuride, a leading supplier of wheels and wheel-end components to the commercial vehicle industry in North America and Europe, innovation means becoming a lean organization. The company underwent a complete transformation of its core business, investing more than $150 million into its steel wheel capacity, expanding its aluminum wheel capacity, restoring its Gunite wheel-end business, and implementing common lean operating systems.

A critical component in this strategy was a manufacturing cloud. The cloud helped Accuride build one version of truth across the entire company that had grown through several acquisitions—each bringing a new system with siloed data. The company found that it had been spending more time gathering and interrogating data than using it to make decisions.

Once Accuride had its system and data consolidated, the company was able to get a real-time view into what was happening on the plant floor, and with its overall business, at any given moment. This agility became the basis for implementing lean manufacturing standards within the cloud ERP system rather than using a traditional logistics model. Doing this helped Accuride’s plants in Kentucky, Pennsylvania and Illinois earn the Association for Manufacturing Excellence (AME) award in 2014-2015 for their lean accomplishments. Accuride became the first commercial truck component manufacturer to win this award and was the AME's only 2015 recipient.

Competing in Bigger Markets

For manufacturers who want to expand production, all knowledge, talent, and resources need to be focused on pursuing bigger opportunities. FloraCraft, a Michigan-based manufacturer and supplier of floral foam products, set its sights on becoming the go-to partner for larger retail companies, which meant growing from a mid-size operation to full, mass-market production.

FloraCraft’s strategy to land these bigger opportunities was to capitalize on its reputation for basically doing anything to please its customers. The challenges came on two fronts: limited IT resources and a legacy system that made scaling impossible. Cloud ERP technologies provided not only the unburdening of managing hardware, software, and maintenance, but also the ability to revamp older, unsustainable manufacturing operations processes and uncovering opportunities to enhance the business.

Innovation for FloraCraft turned out to be how the company could more efficiently run and grow operations while focusing on what it does best: make customers happy with its floral foam products. Today, the company uses its manufacturing cloud ERP to get a view of one of its largest customer’s forecasts (Walmart) versus what they have on order. This visibility into lead times for suppliers and the ability to dynamically schedule production enables the company to ensure they it has the right quantities of materials at the right time. In fact, FloraCraft has performed so well it received Walmart’s Supplier of the Year accolade—an award in which FloraCraft credits its cloud ERP system for making possible.

Enhancing Operational Collaboration

For Quatro Composites, a contract component manufacturer and developer offering a full line of services for advanced composite structures, innovation means connectivity. The company has expanded eight times in 10 years to accommodate 25-50 percent year-over-year growth, and its inherited legacy ERP system couldn’t keep up. It also did not provide the single integrated, automated capabilities to run the business that Quatro required.

The company found a manufacturing cloud ERP solution that solved all those issues. Now Quatro can monitor the health of its business and make good business decisions faster. Connectivity enables levels of collaboration for the company that was previously not feasible. For example, the company’s customer requirements for metallic to composite part conversions must be readily available for engineering to complete product design. The transfer process from engineering to production is equally important. Customers and prospects want to see a product prototype, a “first article” that has come from the production line and is representative of the final design specifications, as well as the manufacturing process that will be used in mass production of the part. Connectivity with the cloud enables Quatro to define the transfer process as a workflow so that the process is well defined and efficient, speeding the time it takes to get from development to prototype to final production quality without the limits of geographical boundaries.

As adoption of cloud ERP within manufacturing plants begins to become the norm, it will no longer be the exception. Cloud ERP will be a requisite for continuing to compete on a global scale.

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