Why Does Lean Manufacturing Need ERP?

Our whitepaper explains that the most effective Lean manufacturing solutions are implemented both on the shop floor and the ERP (Enterprise Resource Planning) system.

That’s because Lean and ERP are tools designed to improve the manufacturer’s business processes.  Lean and ERP mutually support and enhance the other when they are properly implemented in a manufacturing environment.  In fact, implementing Lean processes within the ERP system is a proven approach that helps manufacturers gain competitive advantage.

ERP manages all of the functional areas of the enterprise from inventory control to finance, quality, shipping, receiving, sales and customer service.  A Lean initiative that is worthy of the label must aim to eliminate ‘wasted’ time and activities throughout the enterprise.  When the manufacturer’s ERP is capable of implementing, managing and monitoring the ‘best practices’ discovered through a Lean audit, the manufacturer can reap the benefits by continuously improving its operations.

Synergy Resources’ Continuous Improvement team has provided Lean manufacturing solutions to dozens of companies.  Katie Farrand is Synergy Resource’s Continuous Improvement Manager.  Katie is an advocate for synchronizing Lean practices with ERP.

“We see so many companies that don’t realize their potential and what they could be,” said Katie.  “It is so satisfying to see companies become re-energized when they see the results from using Lean tools to make process and ERP system changes that drive such significant improvements”, continued Katie.

A few of the benefits reported by manufacturers who have implemented Lean into their ERP include:

• Shop floor productivity gains of 30% to 60%
• Lead time reductions of 20% to 60%
• WIP reductions of 40% to 70%
• Inventory reductions of 30% to 60%
• On Time Delivery gains of 20% to 45%