Reduced capital deployments and modernization trends are pushing small-to-medium sized food and beverage processors to adopt cloud ERP solutions.
There’s been a lot of talk about smart manufacturing in 2016 and the general move toward better enterprise asset management applications for motors, compressors and valves. However, cloud-based enterprise resource planning (ERPs) systems and, to some degree, manufacturing execution systems (MES) are paving the way for smaller food and beverage processors to manage their assets with the skill of a major, multinational food producer.
Today’s ERP solutions are helping manufacturers drive efficiencies via better material tracking visibility, production planning, and paperless work orders. A recent PricewaterhouseCoopers report states that hundreds of companies have recalled products over the past five years, with costs ranging from $10 to $30 million for each recall.
With paper-based work orders, the cost of recalls can be much higher, but cloud ERP cloud platforms also offer less capital upfront costs for multiple site projects.
“As a company deploys its first [cloud] ERP installation, enterprise decisions about process and configuration are made for the rest of the plants [in multiple plant installations],” says Pat Welsh, ERP consultant at Revolution Group in a recent webinar. “Plant success with software as a service (SaaS) is considerably easier compared to on-premise applications.”
Revolution Group assisted Cincinnati, Ohio-based Dominion Liquid Technologies (DLT) in specifying a cloud ERP system after experiencing years of growth but with little business intelligence to support it. The mid-size, contract manufacturer and private labeler of syrups, cocktail mixers, sauces and isotonics implemented a cloud platform from Plex Systems.
“We really felt like we had to shore up our systems and drive repeatability across the process,” says Darren Brown, quality manager at Dominion Liquid Technologies.
Brown points out after testing the ERP system and going online; data-point decisions came in real-time with ingredient tracking. “We can track materials in real-time and find every pound or every ounce of an ingredient in the production run,” he says.
Revolution Group stresses that it takes some thought and refinement for companies as they begin to implement strategies after moving away from a paper-based model. Welsh states, “I look at the information from an ERP system in two ways: One is just actionable data that you need to have to do the job every day, and two is more data analysis for production performance information.”
DLT realized a connection pretty quickly with inventory and production performance “We used to struggle from time to time with our inventory accuracy,” says Brown. “We'd start a production run and find out that we didn't have as many bottles as we thought we did.”
For the daily operations angle, DLT is now able to attach an electronic copy of the certificate of analysis for each lot that comes in and provide access to operators with the proper permissions. DLT finds this visibility useful for an audit or when a customer asks for order details.
DLT also has gone to mobile devices on the plant floor, too. “We utilize iPads on the floor,” says Brown. “Those touch screens have made life for the QA techs and line operators much simpler, and the whole process flows much more smoothly.”
With drivers like Food Safety Management Act and plant efficiency, lightweight cloud ERP platforms will make an impact with smaller players in the food and beverage industry.