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ERP and PLM: Addressing Differing Manufacturing Needs
December 31, 1969 |Estimated reading time: 5 minutes
By Chuck Cimalore, Omnify Software
There is some confusion in the industry as to what role enterprise resource planning (ERP) and product life-cycle management (PLM) systems play in a company's business process. Clarification of the key features of ERP and PLM, where they fit in the product development and manufacturing process, and how integrating these environments can deliver positive results is important for manufacturers to understand why each is critical to success. A clarification of these systems also will help manufacturers maximize the functionality of each system, and gain the most from their investment.
Although PLM and ERP systems have unique value in their own right, organizations typically get the best value from deploying a PLM when they integrate it with an ERP. For a manufacturer that finds a need to share engineering and manufacturing data directly through an automated process, a PLM system combined with an ERP system offers a solution. This combination eliminates the error-prone task of hand-entering information, resulting in improved data integrity across an organization. An integrated environment decreases redundant efforts and guarantees that all departments involved in the product development and manufacturing cycle have access to current and accurate product data. By synchronizing these two systems, engineering teams can access business-level data from the ERP system to support better design processes and manufacturing. When integrated with PLM, ERP reduces data duplication, speeds product-development cycles, and improves new product turnaround time enhancing the overall process in getting product to market.
One company* selected a PLM solution to support development of its next-generation, advanced audio technologies. The company had used a manual, paper-based process that hampered the engineering team's ability to gain control over design information; they looked to move to a PLM solution to streamline development cycles and speed production innovation. This required evaluating existing processes and changing the way the company developed and maintained products. A PLM solution was chosen because it provided an easy-to-use, powerful tool. For example, the sign-off process for engineering change orders ranges from a few hours to a day, instead of days or weeks as was the case with the previous system. With the PLM system, engineering status can be checked at any time, and history tracking provides accountability.
The company* chose to implement an open and flexible PLM solution that allowed the engineering team to quickly import and cleanse data relating to more than 30,000 parts. In addition, it could assign part numbers based on their schemas to import and export data from an ERP system. By interfacing with the engineering design tool directly, engineers have complete control over schematics. All documents are available electronically from a single source and the company* is able to link all associated data to a part, including vendor data sheets, fabrication, and assembly drawings. New part requests and engineering change records are processed electronically through the PLM system and routed electronically using a workflow engine. The PLM system updates affected products automatically and provides the updated information to the ERP.
The ability to export information from the PLM database into an ERP system has been critical in eliminating duplicate data entry. The ability to pull information from an ERP into the PLM database gives engineers visibility into extended information such as costs, lead times, and vendor status to help them make better design decisions.
The Value of ERPAn ERP system is a business management tool used to fulfill the needs of many facets of a company in managing business data, including finance and accounting, distribution, human resources, customer service, and manufacturing. ERP supports these departments by delivering improved processes, such as an automated method for order fulfillment; providing a single location for tracking cost information to ensure consistency; and helping human resources standardize information.
ERP is used to manage the logistics of getting a product to market once the engineering team releases a design. It is geared toward capturing information at the manufacturing stages of a product prototypes, production runs, redesigns, etc. This information typically consists of a bill of materials (BOM), manufacturing and test procedures, schedules/timelines, and logistics which are then used to execute the entire manufacturing process.
Due to the inherent purpose of an ERP system, some are not designed to manage the amount and type of information required for engineering. Some systems do not contain the detailed information that engineers need to drive design, including part specifications, design and test notes, and vendor-supplied documentation. In addition, ERP systems typically do not provide the security or capability to enable external manufacturing partners to access product data directly, and participate in development processes.
The Value of PLMPLM was designed to manage product data throughout the product life cycle. A PLM system is crucial during the design phase, where engineers need instant access to product data such as specifications, engineering parameters, and documentation. PLM centralizes all of this information for easy access by all team members, and tracks and manages component data, BOMs, product documentation, engineering changes and revisions, and compliance data. PLM systems can also offer the flexibility to support several design iterations before going to prototype and manufacturing phases.
A key component of a PLM system is that it provides an automated change-management facility, allowing users to electronically propose product changes to BOMs, documents, and vendor/supplier information. Using a workflow engine, these changes are then routed to the appropriate resources automatically for electronic signatures. Once all constituents have approved the change, the PLM system updates the affected products with the suggested changes automatically, and provides the updated information to the ERP system. An electronic change process eliminates manual data-entry errors, streamlines routing, and allows all involved resources to view and sign changes simultaneously. The combination of these factors results in a reduction in the engineering change process.
Automating product-design processes can enhance overall product development by shortening cycle times for engineering changes and new part requests, improving data integrity by eliminating the human error from hand-entering data, and ensuring all product data is accurate by sharing information between engineering and manufacturing.
ConclusionUnderstanding the value that enterprise technology brings to each department and the entire company can ease implementation and increase added value. Enterprise applications that complement each other such as PLM and ERP play a role in supporting and improving product development and achieving bottom-line operational benefits. Recognizing the distinctive features offered by ERP and PLM, as well as the benefits of creating an integrated environment, will help manufacturers maintain their competitive edge. Adopting a PLM system to work in conjunction with ERP can enhance a manufacturer's product-development performance, resulting in the ability to deliver higher-quality products in less time, and maintaining a competitive advantage in the marketplace. SMT* Harman Specialty Group, Bedford, Mass.
Chuck Cimalore, chief technology officer (CTO), Omnify Software, may be contacted at (978) 988-3800; e-mail: ccimalore@omnifysoft.com.