Market uncertainty continues to affect companies across a multitude of industries. Supply chain unknowns, including delays in raw materials and shipping challenges pose significant threats to efficiency. Beyond logistical issues, economic uncertainty tied to inflation makes cutting costs even more difficult. Federal Reserve Officials now anticipate that core inflation will be 3.9% by the end of 2023, 0.3 percentage points above their March estimate, and nearly twice their target of 2.0%. To make matters even worse, labor shortages compound challenges everywhere. The U.S Chamber of Commerce reports that there are 9.9 million job openings in the U.S., but only 5.8 million workers are available to fill them.
The solution? Software. In pharmaceutical and cosmetic industries with high degrees of regulation and immense need for safety, businesses are familiar with adopting technologies that ensure visibility and quality control. Recognizing present uncertainties offers an opportunity for industries that have long relied on pen, paper or spreadsheets to implement these types of technologies too. Companies may be wondering if now is the time to do so, especially as cost cutting becomes more and more widespread. The truth is that without solutions that centralize data and make sense of it, handling regulation, traceability and quality control become nearly impossible to do efficiently.
Where ERP Can Help
Solutions that provide visibility and agility can help alleviate external pressure. Industries that to-date have relied on tribal knowledge and manual documentation like notebooks and Excel, are seeing the rising need for cloud-based ERP (enterprise resource planning) software. The seafood processing industry, along with meat and cannabis are just a few verticals seeing this increasing need.
This collection of industries shares a few commonalities. High levels of regulation, visibility requirements from government and consumer regulatory bodies, and quality requirements stand out. With an increased demand for information on food and cannabis, lack of supply chain transparency poses significant risk. This year, Consumer Reports released findings the ’10 Risky Recalled Foods You Should Know About,’ of the ten, four are meat. It’s clear that quality control is of the utmost importance, and a lack of available staff is not an acceptable excuse. The modernity of the marijuana industry brings forth excitement, but also risk. Companies can expose themselves without transparency into regulations that help them remain compliant.
With each of these industries, the need for help regarding regulation, traceability, and quality control are clear. By adopting technology solutions such as an ERP, organizations prepare themselves to navigate the market’s turbulent waters, and turn visibility and agility into a competitive advantage.
These three common issues below may mean that your company needs an enterprise resource planning tool.
Potential Oversight Due to Understaffing
The delta between available and required labor leaves companies at massive risk of oversight. At a dairy plant, for example, a lack of workers could lead to overall quality control issues. Without technology to assist, a lack of labor means less availability to inspect products, monitor and track the movement of goods, as well as trace the location, condition, or compliance status of products. With compliance mandatory and consumer expectations high, lack of quality is not an option. Each of these byproducts of a reduced workforce mean a higher risk of oversight, and greater risk that mistakes are not caught in a timely manner. With prices already driving up, the cost of being wrong is quite simply, too expensive.
Lack of Expertise, Over-Reliance on Tribal Knowledge
When a company relies on pen and paper or spreadsheets as opposed to centrally available and accessible databases, the consequence is an overabundance of siloed knowledge. Defined chiefly as information only known by a single member or small group of employees, this approach is detrimental for several reasons, the largest being the impediment it poses to growth, scale, and succession planning. A tribal knowledge system makes sharing information on a day-to-day basis tedious and rife with challenges, and other functions, like training new hires becomes even more difficult and inconsistent. With labor shortages putting increased pressure on existing staff, siloed knowledge can lead to risks associated with upholding regulatory compliance. Knowledge should not be housed on paper, or in one employee’s head – should they leave for vacation, maternity leave or another job, other employees will be unable to acclimate quickly, leaving an organization prone to quality challenges and regulatory infringements.
Perhaps an organization needs to adjust their shift schedules or change equipment. Without proper technology in place, these changes can introduce new quality control challenges and increase the risk of producing non-compliant or substandard products. Supply chain disruptions continue to lead to inconsistent production processes and timelines. Without centralized technology and knowledge, companies risk a lack of expertise in the right areas and ultimately, risk a lack of product quality.
Lack of Supply Chain Visibility
Supply chains continue to pose problems with delays, material shortages and costing being difficult to project. The past two years have demonstrated a clear demand for visibility into the complete supply chain. Without this information, disjointed and costly consequences arise. Technology that affords visibility is vital in terms of ensuring adherence to regulations throughout the entire process. If tracking data is incomplete or inaccurate, massive quality risks emerge, especially in highly regulated industries. Siloed systems become a waste of time and resources for companies already bootstrapped by the ongoing labor shortage. Relying on legacy solutions will only make it harder to weather potential ill-effects of the economic storm.
Utilizing Functionality and Flexibility
Leveraging a single system cloud-ERP technology sets organizations up for success by promoting adaptability and agility, all while enabling visibility through a single source of truth. This allows manufacturers to react quickly to market changes, recalls and other obstacles, with fewer workers required. As market pressures build, the flexibility enabled by an ERP allows business management with less overhead. Centralized data and insights across divisions means that information is shared in real time with ease. When talent leaves, an ERP solution acts as a throughline for the manufacturer and enables seamless transition of workflows. This combination of functionality allows companies to maximize productivity from their existing machines and their employees. By continually updating and investing in the latest technology, organizations position themselves to be driving efficiency.
