Reinforcing links with your heartland

Smaller manufacturers in the UK are facing a double whammy," says Andrew Buckley, director of manufacturing business at Sage. "First, the pressure is starting to increase as competition from low-cost economies hits home. Smaller manufacturers are having to adapt, by focusing on their cost base and by improving the quality of their operations, particularly in terms of flexibility and delivery times. Second, they are facing additional pressures from their own customers, as the need to adopt the principles of agile and lean manufacturing works its way up the supply chain." Sage's approach has been to provide the technologies that help manufacturers meet these challenges on several levels. Buckley highlights three areas becoming increasingly important for small and growing manufacturers: customer relationship management (CRM), business intelligence (advanced reporting) and advanced planning and scheduling (APS). Extended power Buckley points, for example, to a rapid increase in sales of Sage's CRM during the last year as manufacturers start to recognise how the benefits can help them address their business problems. "CRM is not just about managing customer relationships. It also enables manufacturers to manage their suppliers, for example by tracking vendor performance. "Manufacturers can also use their CRM to track customer returns, and this information can also be fed into product development. Manufacturers can also use CRM as a more intelligent forecasting tool to improve factory operations and develop much more realistic production schedules. Equally, CRM can now integrate with our back-office financial systems and shopfloor systems, so data is readily available across the business." As far as business intelligence systems are concerned, Buckley feels the challenge of any manufacturing operation is to turn data into information they can use to make more informed operational and strategic decisions. "Historically, BI systems have been the province of large companies with sophisticated IT. The challenge for small and growing businesses has been to find tools that go beyond existing reporting, but at the same time are easy to implement and use." Sage is just introducing a new advanced reporting tool, Intelligent Reporting, to meet that requirement, as part of its Sage Line 50 accounting package. "We are taking the benefits of BI one step farther. This means the data cubes will have been pre-built, or can be easily assembled using a wizard, and the data output to Excel. Users can then drill down into the data itself – sales, stock etc – with all of the information dynamically refreshed, because Excel is directly linked to the Intelligent Reporting system." Then on the APS front, Sage is also responding to the increased importance manufacturers are ascribing to efficient and flexible materials and capacity planning, and more optimised production scheduling. "Lead times are shorter and customers more demanding at the same time as the pressure is on to reduce inventory," states Buckley. "Delivery performance is becoming the life or death element of any small manufacturer's business, but in the past APS has been such a specialist area that it's been separate from ERP vendors' software. "In typical Sage fashion, we've addressed the issue by simplifying the approach and carrying out much of the integration work for users. Initially, we focused on addressing the mid-market requirement, by building graphical planning, finite capacity scheduling and graphical MPS tools into our Line 500 ERP suite. These are the fruits of our relationship with Preactor. "However, we believe that smaller manufacturers can also benefit from better planning and scheduling. So the latest release of our Line 50 Manufacturing now incorporates integrated graphical planning. It is a true finite capacity scheduling tool, also from Preactor, and it's rare for manufacturers to have access to such functionality at the entry level." While there is much doom and gloom about the state of UK manufacturing, Buckley says Sage is seeing more demand for its solutions than ever. "This is partly to do with the sector realising that it had to sharpen up its act, and one of the ways to do that is to buy better IT and exert more control. Also, Sage's strong presence in the back office has enabled us to make more of our systems available to small and growing manufacturers – and more accessible, in terms of usability and price. And that isn't just in the high-tech sectors, but right across traditional manufacturing."