Former Hewlett Packard chief executive John Young once said, “You can’t manage what you can’t measure” Indeed, how can you know whether you’ve reached your business goals if you don’t measure your criteria for success? (more…)

Executive information systems (EIS) have been undergoing an evolution since they were first developed in the 1980s as a vehicle to summarize important operating data for top management. Early EIS usually consisted of custom programs designed to summarize key information from the mainframe in an easy-to-read, easy-to-access format for the CEO. The data was refreshed periodically and took the place of “flash reports” in helping the executive keep informed without wading through mounds of computer printouts. (more…)

Many manufacturers have taken the big leap to Material Requirements Planning (MRP) software systems or are considering such a purchase. These systems tell the manufacturer what, how much, and when to order or produce a part or final product, on a “just-in-time” basis, enabling the manufacturer to maintain low inventories while retaining the ability to produce the product on time. (more…)

Manufacturing technology has changed dramatically in recent years. As automation, computerization, and robotics have become more commonplace, direct labor has declined as a component of total production costs. Unfortunately, cost management techniques have not kept pace with changes in the manufacturing process. (more…)

Like most manufacturers, you are no doubt concerned with inventory management. You may have invested a lot of time and money incorporating MRP, JIT, ABC, and other techniques into your inventory management systems. Or, you may concentrate on managing gross margins. If you’re like many of your peers, however, you may not fully appreciate the importance of inventory turnover to effective inventory management. Another important area that’s often misunderstood is the relationship between turnover, margins, and profitability. (more…)

Most manufacturers rely on standard costing techniques to calculate product cost, profit margins, and appropriate price levels. And for many manufacturers, these methods yield adequate results. Under certain circumstances, however, standard costing may not generate accurate product costs. (more…)

“Quantity control” . . . “item balance integrity” . . . “record accuracy.” Each of these terms means the same thing to a manufacturer: the ability to know what you have in raw material, work-in-process, and finished goods, and how to find it when you need it. The accuracy of inventory on-hand balances are of great importance to any manufacturer, especially those operating within a closed-loop MRP II system. In an MRP II system, inventory record accuracy determines the level of system performance and serves as a clear measure of the system’s quality. (more…)

For the manufacturing company with sales of $1 million or more, the decision to acquire manufacturing software is something like marriage-it isn’t so much a question of whether to do it, but with whom to do it. In choosing manufacturing software, however, there may be a better chance of doing it rationally…we hope. (more…)

A manufacturer’s selection of an information system must begin with a needs assessment-a look at which departments or divisions will use the system and why. Only when this preliminary decision has been made can a company begin to research software productsthat may meet its expectations. Customary considerations for a manufacturer are inventory tracking, resource scheduling, timely product delivery, accounting, and billing. Although it is unlikely that a single software program will address 100% of a company’s wishes, a manufacturer should search the software market until it finds one that will handle at least 85% of its demands. (more…)

In the race against the competition to satisfy customer demand, the spoils of victory will go to the manufacturer that most effectively accesses, processes, and utilizes information. (more…)