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Managing Chemical Compliance With an ERP
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Managing Chemical Compliance With an ERP System
Managing Chemical Compliance With an ERP System 700 500 Xcelpros Team

At a Glance

  • $700,000: A proposed increase to the maximum Occupational Health and Safety (OSHA) penalty for willful or repeat safety code violations.
  • $50,000: OSHA’s proposed hike in minimum penalties for these same willful acts.
  • $25,000: California’s additional safety violation penalties that are added to the federal fees.
  • $15,000: California’s maximum daily penalties for failing to fix these same issues.

Introduction

When used effectively, modern enterprise resource planning software (ERP) can help companies in several ways when it comes to chemical regulations:

  • Financial components of a chemical firm’s regulatory compliance solution.
  • Occupational Health and Safety Administration (OSHA) regulations.
  • Gathering, storing and managing material safety data sheets.
  • Gathering information from far-flung sources to create effective reports able to meet government criteria.

One study cited a multi-national corporation’s subsidiary using an ERP to comply with the Sarbanes-Oxley Act of 2002 (SOX).

“The findings demonstrate how managers can use an ERP to develop effective internal controls for the most common material weaknesses reported under SOX, thus providing insights into the crucial role of IT as a facilitator of control and reporting processes, and, more specifically, into the role, use and purpose of ERPs in relation to regulatory compliance,” according to the University of Greenwich.

Key points related to the chemical industry noted in this study include firms often failing to customize their ERPs for the specific requirements of the business, this applies specifically to chemical companies. Working with an ERP vendor experienced in the chemical industry helps ensure software works exactly as the company needs it rather than just installing an out of the box solution.

Unified systems like ERPs can help identify and evaluate hazardous substances. Manufacturers are then informed of the risk levels regarding the use and distribution of their chemical products. Identifying these hazardous substances early also allows manufacturers to act proactively, resulting in better safety.

Identifying Hazardous Materials With an ERP

Today, U.S. government regulations require the identification and labeling of hazardous materials. Modern ERP solutions can help create and manage safety data sheets (SDSs) along with any Globally Harmonized System (GHS) labels as required by the Occupational Health and Safety Administration (OSHA).

Each safety data sheet has 16 sections, 12 of which OSHA requires. These include:

  1. 1.Identification such as common names for the substance, recommended use of the chemical and restrictions on its use
  2. 2.Hazard(s) Identification such as signal words, pictograms and hazard statements
  3. 3.Composition and Information on Ingredients such as each substance’s Chemical Abstracts Service number
  4. 4.First-Aid Measures such as the most important symptoms
  5. 5.Fire-Fighting Measures such as the type of fire-fighting
  6. 6.Accidental Release Measures including emergency procedure and methods of containment
  7. 7.Handling and Storage including safe handling precautions
  8. 8.Exposure Controls/Personal Protection including OSHA Permissible Exposure Limits (PELs)
  9. 9.Physical and Chemical Properties such as the chemical’s odor, flash point and flammability
  10. 10.Stability and Reactivity including if the chemical is stable under normal temperatures
  11. 11.Toxicological Information including how the toxins are brought into a human body such as through inhalation or eye and skin contact
  12. 12.Other information including when the SDS was prepared or last updated

OSHA also suggests-but does not require-data on ecological impact, including:

  • The disposal of hazardous materials
  • The transporting of hazardous materials
  • Any other regulatory requirements, as needed

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An ERP manages regulatory compliance by comparing your existing SDSs to OSHA’s requirements. Once your safety sheets are updated to meet federal requirements, they are stored in a central repository for reuse. A single update ensures that all SDS are accurate when the same ingredient is used in several products.

That information can then be “chunked” and converted into the GHS labels. One method where ERPs excel is their ability to generate QR codes for labels automatically. Simply scanning the label with a cellphone can provide internet links to complete safety sheets.

When every second counts, such as in exposure to potentially hazardous chemical, workers don’t have hours to pour through filing cabinets looking for the right SDS. They might have a few seconds to scan a label, tap a link and then know what type of first aid to administer.

Other Safety Features in ERPs

Because ERPs access information from multiple sources, one way they help promote safety is by limiting access. When data access cards or passwords are linked to an ERP, they can help prevent unauthorized—and untrained—workers from accessing dangerous or harmful chemicals.

Your ERP can be used to restrict access to based on the individual’s role. This helps protect their help while also ensuring your data remains safe from prying eyes.

Using your ERP to monitor safety also lets you identify areas where more training is required. It can be tied to a learning management system (LMS). This in turn reduces the risk of workers with expired certifications or lack of skills.

Your SDS chemical management can help pinpoint at-risk employee groups, document recurring injuries, map frequent injury locations and then help you create a plan to correct them.

For example, many production employees are required to earn OSHA 10 certification. This ensures they have at least 10 hours of safety instruction.

OSHA 30 certification goes into greater depth when it comes to safety. Among its enhanced requirements are the following:

  • Hazard communication, which is useful in preparing and updating safety sheets
  • Materials handling, such as hazardous chemicals
  • Personal protective equipment (PPE)

Your ERP can identify which employees have active OSHA 30 certification, which have expired certificates and who lacks it. By denying access to unqualified workers, you reduce their risk of injury while also dropping your chances of being tagged for an OSHA violation.

Under a current proposal, OSHA provisions for willful and repeat violations could increase from a minimum of $5,000 to $50,000 per violation. The maximum fines would also go up ten fold to $700,000 per violation, Cal-OSHA states. These fines can change based on your location. For example, if a violation occurs in California, you can expect to pay as much as $25,000 for serious violations. These infractions can accrue daily penalties up to $15,000 for failing to solve the hazard issue.

ERPs and HazCom

OSHA’s Hazard Communication standard known as HazCom includes a checklist of 10 requirements.

These include the need to perform the following:

  • Train employees on the hazardous chemicals in the workplace
  • Instruct workers on how to recognize exposure to hazardous chemicals
  • Provide training on container label elements
  • Offer instruction on Safety Data Sheet (SDS) format and content
  • Explain to employees how to access SDSs
  • Update SDSs when new versions become available
  • Update the written HazCom program as needed
  • Explain to employees how to obtain a copy of the written HazCom program
  • Train employees on any in-house labeling system used
  • Make sure all container labels in the workplace are compliant

An ERP can ensure that data on any single chemical or hazardous material is thoroughly covered in your documentation. For example, each SDS can be linked to related labels and training materials. An update to the SDS ensures everything that flows from it is also current. That means your employees are safer as is anyone else who handles your products.

The Bottom Line

While some executives think of ERP’s, they consider ways to improve efficiency. The reality, however, is that ERPs can also be used to make workplaces safer for everyone. This is primarily achieved with constantly updated processes and carefully labelling and managing any goods and raw materials.

Creating and updating an SDS in your ERP, for example, allows you to link all critical information about a product including labels, handling guidelines, storage requirements, training materials, and more. Increasing the safety and handling for everything you store and work with not only reduces the costs of injuries and by ensuring OSHA compliance, but you also minimize the potential for fines and infractions, which further helps to increase profits.

Also read: 3 Ways to Manage Disruption in the Chemical Industry

Streamlining Production Process in Pharmaceutical Manufacturing banner
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Streamlining Production Process in the Pharmaceutical Manufacturing
Streamlining Production Process in the Pharmaceutical Manufacturing 700 500 Xcelpros Team
  • There’s a consistent demand to scale capacity when it comes to pharma manufacturing as healthcare demand continues to rise globally.
  • Cost-savings, shorter turnaround time, and enhanced productivity are some of the key criteria for top executives in pharma manufacturing companies.
  • Automation of production lines, minimizing raw material wastage, stakeholder synchronization, optimized resource allocation, etc. are some of the ways with which pharma manufacturing can be streamlined.

Around the world, we continue to see rising demand for access to quality healthcare. Side-effects of the recent pandemic significantly added to this demand. This has placed a lot of pressure on pharma and biotech manufacturing companies, who are finding it difficult to:

  • Streamline research and development (R&D) processes.
  • Reduce overall costs and improve time to market.
  • Ensure 100% safety and regulatory compliance.
  • Enhance production capacity.
  • Expand market reach.

Pharma manufacturers must constantly upgrade their game regarding R&D, operations, production, and distribution with newer technologies and strategic business moves. With signs indicating the industry is poised for extraordinary growth, it’s becoming a given that manufacturers will need to invest in leaner, more agile production processes.

According to the 2020-2027 Pharmaceutical Market Size Report, by Grand View Research, the global pharmaceutical manufacturing market size was valued at USD 324.42 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 13.74% from 2020 to 2027.

These growth stats put focus on the need for ramping up production without compromising on safety, all while ensuring consistent profitability.

Key Factors in Pharma Manufacturing

Before we look into how manufacturing in pharma companies can be streamlined, we must consider some key processes involved.

1.Robust R&D: For pharma and biotech companies, continued investment in laboratories is essential in ensuring long-term success. With Robust R&D comes increased chances for innovation, which can define a pharma company’s overall market position in terms of being the first to manufacture a ground-breaking formula. The strategic movement towards streamlined manufacturing begins with ensuring superior, quality research in the labs.

2.Raw Material Acquisition and Distribution: Whether it’s small-molecule or biological drugs, pharma companies typically depend on an intricate network of raw material manufacturers and distributors to acquire safe and superior-quality products. In addition, complex formulations require compounds manufactured across multiple facilities to be stored and transported in optimal conditions. Manufacturers could be dependent on multiple different suppliers for raw materials globally.

3.Managed Production Lines: Today, pharma companies are more dependent than ever on fast-paced production lines backed by technology-enabled batch manufacturing, serialization, and traceability. Bridging the gap between hardware and software for streamlined drug production can make a huge difference in speed to market.

Manufacturing Process Issue/ Roadblocks How Technology Can Help
R&D Prone to human error, slower processes Automated data integration and analysis, AI for molecular identification
Supply Chain Highly complex, data discrepancies or duplication, missing information, stock-outs Centralized SCM for real-time visibility, centralized data access, real-time stakeholder communication, inventory management in ERP
Drug Manufacturing/ Production Shop floor to top floor communication glitches, communication time-gaps, human errors in reporting/ record maintenance Automated production lines, report generation in ERP, real-time communication between shop floor and top floor
Quality Control Counterfeits, fake drugs, human errors, formulation errors Computerized serialization, use of blockchain to ensure drug safety

4.Competent Supply Chains: Healthcare is a global business and, now more than ever, pharma manufacturers are dealing with complex supply chains involving multiple stakeholders spread worldwide. Ensuring that these supply chains are competently managed is critical to ensuring the overall streamlining of pharma manufacturing.

5.Quality Checks: When it comes to drug manufacturing, anything less than 100 percent is often unacceptable. Pharma companies are well aware of the perils of lawsuits, license cancellations, and other dire consequences regarding quality management. At every stage of pharma manufacturing, quality checks are paramount to ensuring drug safety and compliance with all required healthcare regulations.

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How Can Pharma Manufacturers Streamline Their Production Processes?

Pharmaceutical companies are embracing newer and newer technologies for quicker results, better process management, and enhanced productivity. Still, there’s a lot more that pharma manufacturers and their CDMOs can do to enhance the overall pharmaceutical production process for significantly better results.

  • Integrating new technology in the lab is proven effective in accelerating research and innovation. Leveraging Big Data and Analytics for data collation, integration, and insights generation from clinical trials can expedite the process and ensure accuracy and transparency. Similarly, computational permutations are effective in molecule identification for a particular drug. Gene sequencing, digital record maintenance, computerized medical equipment, etc., are becoming game changers in strengthening R&D and the production process typical in pharma manufacturing.
  • Pharmaceutical shop floors can and should be well-integrated with the IT infrastructure on the top floor. By embracing software-managed production lines, manufacturers can leverage automation for faster and error-free processes. Similarly, production supervisors can benefit from the automated data flow from an Enterprise Resource Planning (ERP) system to and back from the production lines. This software can manage tasks like reporting and serialization to save time and cost.
  • Newer technologies and software for SCM are becoming pivotal in helping pharma companies stay on top of complex supply chains and distribution networks. IoT solutions are leveraged in pharma manufacturing and distribution for real-time monitoring and communication. Better shipping times and inventory management become possible through effective data analysis. Many companies also use blockchain to ensure data security and encryption while managing complex supply chain networks globally.
  • The use of blockchain and comprehensive ERP software (for serialization) are also helping manufacturers ensure drug safety. Since these tools and technologies provide the option of complete traceability (from production to patent), drug counterfeits become extremely difficult, if not impossible. Drug quality and safety are major concerns for manufacturers, and optimal use of technology can ensure quality checks, thereby saving efforts, costs, and time.

Final Thoughts

Pharmaceutical manufacturers are embracing newer technologies for better production and profitability. With these technological advancements, companies could achieve their manufacturing goals without compromising quality and safety.

  • Newer technologies and software such as IoT, Artificial Intelligence, Data Analytics, SCM, and ERP play important roles in streamlining manufacturing processes in pharma.
  • Pharma companies need to reinvent themselves technologically to keep up with the complex and ever-expanding canvas of global healthcare.

Resources: Workflow Software for Improved Healthcare Solutions

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Streamlining the Label Management Process
Streamlining the Label Management Process 700 500 Xcelpros Team

At a Glance

  • $10 million: The average cost of recalls to food companies that can are caused in part by inaccurate labels.
  • $65,000: The average cost of incorrect labeling based on a 2020 survey. Of that group, 61 percent said mislabeling costs exceeded $50,000.
  • 10-26%: The number of products mislabeled every year according to a survey of 300 IT directors in the U.S., UK, France and Germany.

Introduction

Labels serve three primary purposes in a consumer’s eyes. Labels help to:

  1. 1.Identify the contents of a product
  2. 2.Identify the product name
  3. 3.Promote the brand image

In combination with well-designed packaging, certain label parts could be considered one component of an effective marketing campaign. From a business perspective, though, labels need to do much more than tell consumers what is inside. Efficiently labeling and tracking is the best way to monitor a product’s performance, along with ensuring customer safety is the best it can be. This is especially true when it comes to certain industries like pharmaceuticals.

Packaging and Labeling

There are many key points to note when it comes to packaging and labeling, including the following:

Definition:

Labeling refers to the text, design, symbol, logo, instructions and use suggestions printed on the product package. Labels are designed to inform and attract customers by providing information.

Objective:

Labeling provides all information required by the governments in the geographical location where the product is marketed, sold and used.

Focus:

While exterior packaging is about appearance, labeling focuses on what’s inside. For example, products are required to accurately list the primary ingredients and their nutritional value when it comes to food. Labels on medicines must include active and inactive ingredients, allergic reactions, and harmful side effects.

Label designs are usually simple and formal. They may follow a government or company template. These can require a set list of data fields such as country of manufacture and expiration or “use by” date. Hazard information is typically posted where a customer can see it before making a purchase.

Effective label designs also include inventory tracking options while also meeting government requirements.

Inventory Tag Controls

“When paired with a competent asset or warehouse management system, inventory tags can be scanned to inform your supply chain of changes in your current inventory. This practice helps build end-to-end visibility among all parties, from supplier to customer, as your inventory moves through your warehouse,” according to a blog post by CamCode.

Inventory tags can be integrated into a product’s label design. The most common inventory labels we see doing this are bar codes. Barcode are a series of vertical lines—generally black—of varying widths interspersed with white gaps. QR (i.e., quick response) codes are a form of bar code generally in a square or rectangular format with black blocks and white spaces.

Speed is the main advantage of using a barcode or QR code label. Handheld and machine scanners can read the barcode information, sending it to inventory tracking software. That software can then automatically update inventory counts, eliminating the need for manual checks. The result is a fast, more accurate inventory update. A critical part of inventory tagging with barcodes is using the right type. Before creating any labels, companies should ensure they understand any regulatory or equipment-based requirements for the barcode type, label size, and label material type.

Figure: 1Components of a Barcode

Example of a Barcode

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Different Types of Barcodes

Barcodes primarily come in three different types:

  • Numeric only with a row of numbers beneath the bars
  • Alpha-numeric with a row of letters and numbers
  • Two-dimensional (QR is one example) using a series of small dots arranged in a unique pattern

The type of barcode a company chooses often depends on its industry and how the product will be used. For example, the Postnet format encodes destination information using long and short lines. Retail items often use the Universal Product Code (UPC).

The U.S. Food and Drug Administration (FDA) has several requirements for barcodes. While the FDA does not require a specific code format, it mandates the barcode include the drug’s national drug code (NDC) number. Machine-readable information on blood and blood components must be on those labels.

“This new system is intended to help reduce the number of medication errors that occur in hospitals and health care settings,” according to the FDA.

These FDA rules apply to manufacturers, repackers, labelers, and private label distributors of human prescription drug products, biological products, and over-the-counter (OTC) drug products to protect consumers from dangerous side effects or worse.

Labels alone are not enough. However, companies need to be able to accurately track their inventory as well as safely manage any recalls or other issues with products. This only works when you have the right software in place.

Inventory Tracking Software

Software like Microsoft Dynamics 365’s Supply Chain Management includes several powerful inventory management features helping these businesses thrive today. For example, Supply Chain Management can automatically assign serial numbers based on manually entered (or scanned) batch numbers.

Dynamics 365 Supply Chain Management also makes creating and tracking barcodes for released products easy. This modern inventory management software also works with the GS1 bar code and QR formats for use on shipping labels.

Microsoft says, “Unlike older bar codes, GS1 bar codes can have multiple data elements. Therefore, a single bar code scan can capture several types of product information, such as the batch and the expiration date.”

With a system like Microsoft’s Dynamics 365 Supply Chain Management, you can use a predefined list of application identifiers to define the meaning of your data and connect it with GS1 codes. Microsoft suggests, “The setup of the application identifiers defines how the system should interpret a bar code and save it as a value in the system.”

The Bottom Line

With today’s focus on consumer safety, proper labeling and tracking of products, especially when it comes to pharmaceuticals and medicine, will continue to be of utmost importance, including efficiently dealing with government regulations. Today’s businesses need to ensure they’re taking advantage of inventory tracking software that lets them easily create labels that help track the flow of raw materials, from work in progress to finished goods.

Programs like Microsoft Dynamics 365 Supply Chain Management can create unique QR codes that contain a list of ingredients, allergy information, serial and batch numbers, hazardous warnings, and safety data sheets. Solutions like these let your warehouse staff scan products and send information wirelessly to any device on the network more efficiently than ever before. Is your labeling solution up to speed?

Resources: Packaging vs Labeling

Warehouse management challenges in the pharmaceutical industry banner
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Warehouse Management Challenges in the Pharmaceutical Industry
Warehouse Management Challenges in the Pharmaceutical Industry 700 500 Xcelpros Team

At a Glance

The pharmaceutical industry faces some unique warehouse management challenges. Many of these issues can dramatically impact medications, even though they may not exist in industries such as general retail.

Key issues facing warehouse managers include:

  • Keeping portions of their facilities at the correct temperatures to prevent medications from spoiling.
  • Following federally-mandating good manufacturing process rules.
  • Security issues for products and intellectual property.
  • Inventory controls.

Warehouse issues specific to the pharmaceutical industry include:

  • Temperature control: Active pharmaceutical ingredients (APIs), precursor chemicals, and manufactured drugs frequently require controlled temperatures. A general temperature range for a cool, dry place is between 59-77° F (15-25° C). Some products, such as vaccines, may require freezing. Exposing drugs to the temperature outside their effective ranges can cause chemical changes and reduce a drug’s effectiveness. For example, Baystate Health states that medications containing hormones do not work as well when exposed to colder or hotter temperatures.
  • Humidity control: Moisture condensing inside packages can impact a medication’s effectiveness. Baystate Health states that blood glucose strips exposed to humidity will give inaccurate readings.
  • Light exposure: Exposure to ultraviolet light from the sun and other sources can change the chemical structure of some medications. The light exposure causes photodecomposition, reducing the medication’s potency. Light exposure can also cause side effects after administration, such as phototoxicity and photoallergy, a 1997 post in PubMed states.
  • Adhering to the Food and Drug Administration (FDA) Current Good Manufacturing Process (CGMP) standards for warehouses, processes, and drugs: Includes keeping careful track of item locations within the warehouse.

According to Kanban, the FDA’s CGMP warehouse standards include the following:

  • Contamination prevention: Storage must allow inspection and cleaning.
  • Identification: Each drug must have a unique, traceable code that identifies the lot’s status, such as approved, quarantined or rejected.
  • Distribution Procedures: Written procedures describing the distribution process for each drug including recalls.
  • Storage Procedures: Written procedures describing the storage conditions for each drug are required.

Some pharmaceuticals require only temperature controls for specific ranges. Other medications require climate-controlled environments affecting temperature and humidity.

Figure: 1Pharmaceutical Warehouse Management Challenges

Pharmaceutical Warehouse Management Challenges

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Following GMP Rules

GMP SOP states that following the Good Manufacturing Process (GMP) rules enables manufacturers to:

  • Protect medicines and raw materials for medicines during storage
  • Prevent finished product degradation
  • Avoid contamination from other materials
  • Prevent damaged or expired products from being shipped

Warehouse managers also face the challenge of keeping track of three types of items appearing on the packaging bill of materials governed by GMP procedures. Each of these item types requires unique lot numbers:

  • APIs, precursor chemicals and other starting materials
  • Packaging materials
  • Printed materials

All warehouse managers face inventory control requirements. Those in the pharmaceutical sector also deal with intense government scrutiny.

Receiving Shipments

Other GMPs in the pharmaceutical industry require materials arriving from suppliers to be reviewed based on their use. For example, it’s important to check starting chemicals to confirm they are:

  • From a source approved by the company
  • Free of damage and defects
  • Labeled with all required information
  • Have a unique identifier
  • Registered in the company’s inventory database
  • Quarantined until quality control tests are performed
  • Stored appropriately and safely, such as in a temperature-controlled section or “Dangerous Goods” area for flammable and toxic materials

Unlike retail goods warehouses, pharmaceutical warehouse managers should also set aside an area for raw materials to be tested and confirmed to meet all required standards. A similar section should exist for any materials that fail these tests, GMPSOP states.

Sampling and Testing

Sampling and testing should be done in a room having sections with positive air pressure (i.e., the air pressure is higher than that outside, preventing contaminants such as dust, microbes, pollen, cleaning agents and lubricants from entering) and negative air pressure (i.e., the pressure is lower than that outside to prevent materials from inside the room going outside). An airlock with positive pressure keeps out external contaminants. With the airlock sealed, the inner testing can have negative air pressure to keep chemicals from contaminating the larger warehouse.

Other sampling room requirements include clean instruments and appropriate personal protective equipment (PPE) as required by the federal Occupational Health and Safety Act (OSHA) and the FDA. OSHA has a downloadable brochure on warehouse safety.

Storage and Tracking Inside the Warehouse

“Lack of control over material movement in the warehouse can, and has, led to defective products,” GMPSOP states.

General warehouse practices (GWP) require that:

  • Received unused goods and finished products are quarantined until approved for release.
  • Items have correct status labels (e.g., current, expired, etc.)
  • Unique identifiers are visible.
  • Products are stored by type when appropriate.
  • Access to toxins and addictive drugs or chemicals is stored separately. Access is limited only to approved personnel.
  • Materials are tracked as they move through the production facility from the Receiving area to Production and then to the Shipping.

When possible, warehouse managers should have separate sections to store damaged or returned goods, recalled items, “not for sale” samples and when identified, counterfeit materials.

Labeling

Another challenge for pharmaceutical warehouse managers is accurate labeling. GMP rules require labels to include a familiar name and Unique Identification Number that must be different from the supplier’s lot number. The UIN must be recorded in the lab, on the facility’s computer system, and in production. GMP SOP suggests not referring to the IUN as a batch number.

Other requirements unique to pharmaceutical labeling include:

  • Expiration dates
  • Barcodes for additional tracking options
  • Status indications, typically in the form of a color code
  • Quarantined products
  • Items being held for investigation
  • Rejection labels when an item fails to meet required standards
  • Approval and/or release labels indicating the item can proceed to the next step in the supply chain

Security Challenges

Medicines and other pharmaceutical products are in high demand, making them tempting targets.

Warehouses should have secure physical storage areas for raw materials and finished products.

In addition, Avcostar states that the formulary, drugs, and drug components are expensive and prone to theft. It suggests performing a risk analysis audit that includes where known security breaches occurred. “The company can then focus on identifying and eliminating the most vulnerable posts and systems against malicious access, modification or deletion of data, enhance access control to systems and data and implement new cybersecurity best practices,” Arecont Vision Costar VP of Marketing Jeff Whitney states.

The code of federal regulars 21 CFR Chapter 1 requires control of all production stages, including system validation and audit trails. Refer to this article from Cornell Law School for detailed information.

Solving Challenges

Effective use of warehouse management computer systems, such as the warehouse management module in Microsoft Dynamics 365’s Supply Chain Management, can help track inventory management in pharmaceuticals accurately and manage these challenges.

The module “has a wide range of features to support the warehouse facility at an optimal level at any time,” according to Microsoft. Among the warehouse module’s functions are:

  • Workflow support
  • Using mobile devices
  • Full batch and serial item support
  • Label printing and routing
The need for data to transform industrial operations
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How Data Management Helps in Optimizing the Manufacturing Process
How Data Management Helps in Optimizing the Manufacturing Process 700 500 Xcelpros Team

Introduction

What side of the Covid-19 divide is your company on? Are you still trying to do business the same way you were before the pandemic? Or are you adapting to a more modern world, ready to use technology to help your business grow?

Either way, it’s clear the effects of the pandemic are still being felt throughout the business world and were likely to see the same results for much longer.

45% of respondents were dealing with sudden materials shortages

41% percent saw sharp drops in demand

30% percent were experiencing worker unavailability

Source: McKinsey

Each of these effects adds increased strain to supply chains worldwide. One such issue saw 111 cargo ships off Long Beach, California, on November 10, 2021. No matter what your company produces, odds are some of your products were stuck on those ships. Newly enacted—but not imposed—“container dwell” cargo container fees reduced the line of ships.

Four foundational technologies can be applied to the value chain, according to McKinsey:

  • Connectivity, data and computational power, which includes the Internet of Things (IoT), cloud computing and blockchain
  • Analytics and intelligence in the form of advanced analytics, machine learning, and artificial intelligence
  • Human-machine interactions using virtual and augmented reality plus robots and automation
  • Advanced engineering, which includes using renewable energy and additive manufacturing

Some companies are using these technologies to drive growth through process optimization.

Benefits of Process Optimization

Process optimization in manufacturing covers three vital areas:

  1. 1.Improved machine uptime. Using a data-based approach, companies can reduce downtime and increase the overall use of their equipment, Machine Metrics states. Using advanced analytics, companies can determine the causes of unplanned downtime. Clean, clear data lets manufacturers attack the worst offenders first.
  2. 2.Faster responses to issues at the machine level. Analytics looking at alarms and where workers are when they occur helps improve training, equipment layout, and other issues.
  3. 3.Improved maintenance. Using IoT sensors, the equipment can be used until it nears—but does not reach—the point of failure. Parts are replaced when needed instead of too early or only after a key machine is shut down.

Each of these steps involves digital manufacturing operations applied to the overall manufacturing process.

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Digital Equipment Is Critical

The only way to achieve these goals is by collecting and thoroughly analyzing data. Objectively analyzing data lets managers discover where bottlenecks are occurring and what’s causing them.

Downtime analysis lets managers analyze why some machines are down more often than others. Are they not operating because of unplanned maintenance, a lack of personnel, jobs, or machine setup, or is it something else?

Having computers perform predictive analysis, companies estimate when a tool will need replacing before it damages a machine or wipes out products.

Lean Manufacturing

Lean manufacturing is another way of looking at the production process. Lean manufacturing looks at a plant’s current process and asks: how can it be done more efficiently? How can the company’s goals be achieved while paying less for energy, such as by using energy from renewable sources, and also generating less waste? How can waste items be used to lower operating costs?

Examples include using “waste” to create new products, replace existing packaging, or fueling an on-site power plant.

Companies following a lean strategy seek to reduce and ideally eliminate waste, improve quality, cut costs and reduce time, according to TWI Global.

In an online article on Lean Manufacturing, TWI Global states there are now eight “wastes” in lean manufacturing:

  1. 1.Unnecessary transportation
  2. 2.Excess inventory
  3. 3.Unnecessary movement of people, equipment or machinery
  4. 4.Idle people or equipment
  5. 5.Over-production of a product
  6. 6.Making a product overly complex by adding unneeded features
  7. 7.Defects that are expensive to repair
  8. 8.Unused talent and ingenuity

While lean manufacturing has three benefits—saving time and money, being environmentally friendly, and improving customer satisfaction—it also has three disadvantages. These are:

  1. 1.Placing employee safety and wellbeing below achieving company goals
  2. 2.Focusing on the present and not on the future
  3. 3.Lacking a standardized method

Companies will want to balance the benefits and the costs to see if lean manufacturing works for them.

Recycling and Green Manufacturing

Green manufacturing seeks to reduce environmental impacts while still producing quality products. This includes source reduction to reduce the waste initially created. Recycling—using or reusing wastes as ingredients in a process or as a substitute for original feedstock—and green product design are key components.

In a report by two Carnegie Mellon researchers, the top waste minimization actions cited by large hazardous waste generators include:

  • Improved maintenance schedule, recordkeeping or procedures: 8.9%
  • Other changes in operating practices other than different equipment: 8.0%
  • Raw materials substitution: 7.1%
  • Unspecified source reduction activity: 6.5%
  • Stopped combining hazardous and non-hazardous waste: 5.1%
  • Ensuring materials were not in inventory past their shelf-life: 4.1%

Each of these green methods involves cost. They provide opportunities to expand a company’s supply chain in terms of raw materials sources while opening the door for new and different products.

Determining What Works Best

Ultimately, companies must find a combination of production process optimization methods that work best for them and their customers.

One common requirement shared by Industry 4.0, process optimization, lean manufacturing, and green manufacturing, is a requirement for data: the more accurate the data, the more accurate the forecasts and predictions.

Obtaining this information requires sensors that can measure flow and wear. On top of that, you need software that aligns the entire operation, from executive suites to the shop floor. It requires a digital network to help ensure consistent product quality, integrates with the shop floor, control waste, and spot opportunities.

Final Thoughts: Five Ideas to Spur Innovation and Growth

Competing in today’s technological world requires a willingness of top management to examine the production process and ask:

How can we do more with less? Consider these five ideas that may help your company achieve its goals.

  1. 1. Work with an innovation partner that can help your company gather the data it needs to grow.
  2. 2. Create a plan that covers your immediate needs while allowing room for growth, including in unexpected directions.
  3. 3. Include training existing employees and hiring new ones with the skills you need not only today but will require in one, two and five years. These people can help ensure you grow the way you want.
  4. 4. Invest in IoT sensors, especially at critical points in the production process. The sensors provide the data you need to make the hard decisions.
  5. 5. Spend the money now on modular software that provides the necessary control and data analysis. A modular system lets you start with one piece, such as Supply Chain Management, and then add others when the budget permits.

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Brochure Azure Arc-enabled data services
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erp for chemical industry
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Digitization of the Chemical Industry-Role of an ERP system
Digitization of the Chemical Industry-Role of an ERP system 700 500 Xcelpros Team

At a Glance

  • Chemical companies are more frequently moving towards fully adopting newer, digitized technologies and away from legacy systems and processes historically operated in silos.
  • A well-functioning Enterprise Resource Planning (ERP) system helps chemical companies in all parts of their operations- procurement, manufacturing, supply chain, vendor management, aftermarket, and more.
  • Implementing an ERP system doesn’t need to be costly or daunting, provided companies go for the right system and take the help of experts.
  • The ongoing Covid-19 pandemic has highlighted the need for chemical companies, with the sector providing most of the raw materials used in sanitizers and personal hygiene products.

While digital transformations have been a big help for the advancement of every industry; many sectors are still looking for new ways to utilize these technologies to their fullest. The chemical industry is on the cusp of legacy and advanced software and systems. Many companies have departments working in silos, manual documentations, slow change management mechanisms, data discrepancy issues, and an overall fall behind when it comes to digitization and automation. Chemical companies can address these issues and many others by investing in a high-end ERP system.

According to PwC’s 23rd Global Annual Survey, 42% of chemical company CEOs prioritized and invested in digital operations and related technologies.

This statistic indicates that now’s the time for chemical companies to systematically restructure their IT base and look at ERP as an option and a way forward to sustainable growth. After all, every sector is looking to leverage digitization to their benefit, including the chemical industry.

Here are five benefits of an ERP software system for chemical companies:

1.Digitization of Processes Leading to Accelerated TimelinesAn intricately designed yet easy-to-implement ERP system such as the Microsoft Dynamics 365 ERP comes equipped with artificial intelligence (AI) and machine learning (ML) based features that can automate many processes such as documentation, reporting, log entries, etc. This will reduce manual intervention (providing personnel with time to invest in more innovative aspects) and mitigate errors. Digitization in the chemical industry also helps expedite processes as the data can be accessed, altered, and verified in real time. With Microsoft Dynamics ERP, chemical companies can realize the vision of going agile.

2.Fortifying Supply Chain Management (SCM) A comprehensive ERP for the chemical industry can facilitate better management of your supply chain by interlinking the departments and creating a data pool between finance, sales, and delivery. This way, you will digitize and monitor the procurement of raw goods, oversee warehouses, manage inventory more efficiently, channel communication between different stakeholders, and streamline the workflow.

Figure 1: A Multi Pronged ERP System to Integrate Different Departments in a Chemical Company

A Multi Pronged ERP System to Integrate Different Departments in a Chemical Company

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3.Better Response Time and Quicker Time to MarketAn ERP for the chemical industry provides companies with a competitive advantage by giving better process and resource visibility, interconnecting departments, and avoiding bottlenecks. ERP also enables chemical companies to identify their slow-to-move inventories and find quicker delivery options. This considerably reduced time to market. The overall product development process in chemical manufacturing companies is also expedited, thanks to the automation and optimization features of ERP systems, and this also results in quicker time to market.

4.Dynamic Change ManagementThe chemical manufacturing processes are subject to changes at different levels, from pre-formulation to production and packaging. These changes take time to get recorded and notified in a legacy system-backed environment, leading to delays. With an ERP, chemical companies can be more flexible and dynamic in their change management approach. As data becomes centralized and systems become integrated, more collaboration can occur, expediting the communication network in a change management ecosystem. Even at the supply chain and aftermarket levels, ERP allows better visibility across several stakeholders, enabling manufacturers to respond quickly to any changes.

5.Better Customer Service and Enhanced Customer Satisfaction Like any other industry, the chemical industry strives to satisfy its customers- be it other industries, retailers, or end-users. With an ERP system for chemical manufacturing, companies gain insights into customer preferences and can anticipate market needs. Companies choose ERP systems designed to respond quicker and better to customer demands. With the ever-changing customer expectations scenario, chemical companies need to invest in a system that gives them better customer visibility and agility to respond.

ERP is a solution of possibilities, and chemical companies can turn these possibilities into opportunities. To survive, sustain, and thrive in this era of digitization, the chemical industry can use this software to integrate and collaborate better than ever before. It can also help to work with experienced consultants to maximize performance and reduce costs. While every company has different problems and requirements, well-designed chemical ERP software can efficiently address some issues.

Key Takeaways

  • The chemical companies must analyze their as-is IT infrastructure and identify the right ERP system for their requirements.
  • ERP is a dynamic, flexible software; thus, chemical companies can evaluate many aspects of their operations comprehensively with the help of a single system.
  • With learned ERP experts, chemical companies can go places in terms of operating smoothly and delivering consistently.

Also Read: ERP Solutions to Rev Up Oil and Gas Industry

References: PwC’s 23rd Global Annual Survey

Key Features and Benefits of ERP Systems
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Key Features and Benefits of ERP Systems
Key Features and Benefits of ERP Systems 700 500 Xcelpros Team

At a Glance

  1. 1.Poor software fit /inaccurate requirements
  2. 2.Business leadership is not committed to the implementation
  3. 3.Insufficient team resources
  4. 4.Lack of accountability to make timely, high quality decisions
  5. 5.Lack of investment in change management
  6. 6.Insufficient training/support
  7. 7.Insufficient funding
  8. 8.Insufficient data cleansing
  9. 9.Insistence on making ERP look like legacy
  10. 10.Lack of testing

Sources: ERPFocus.com

Introduction

Overall cost reduction, improved security, and interoperability are why small businesses invest in newer and agile enterprise resource planning (ERP) software.

The biggest question companies have at the start is: Do we use an on-premise solution or a cloud-based ERP?

On-premise solutions require more up-front costs for:

  • Purchasing servers
  • Creating databases
  • The initial implementation
  • Consultants

Ongoing costs involve:

  • Information technology (IT) staffing
  • On-line security
  • Data back-up
  • Duplicating this set-up for every site

Keeping everything local requires ongoing maintenance, specialized in-house or on-call consultants, upgrades, and updates. You’ll likely need more hardware as your company grows. As you add additional facilities, your computer infrastructure will also continue to grow.

Moving to the cloud can help reduce most of these costs by about 30 percent. Depending on the age of a company’s existing equipment, there may be some hardware costs in the form of upgrading existing equipment to ensure compatibility. These costs will pale compared to the expense of having to add or outright replace servers.

Among the features of a successful cloud-based ERP implementation are:

  • The vendor is responsible for the cloud servers since it hosts and manages the software
  • No additional IT costs for staffing, maintaining the hardware and software, software updates and upgrades
  • The host (vendor) is responsible for your data security

This is just a small example of features and benefits of an ERP that pay off over time, especially when a company grows.

Other Cloud-Based ERP Advantages

Purchasing a cloud-based system has several other advantages beyond hardware and maintenance costs, including:

Scalability: A key reason growing companies move to the cloud is their ability to grow with it. Adding another 100 users might require expanding your server. As your company grows, adding new users to your ERP is just an internet connection away.

Agility: Does one part of your company require extra help with Supply Chain Management? An open-source-based ERP likely has a module designed just for that. Assuming you start with financial management, adding a sales component is a logical complement.

Disaster Recovery: Natural disasters such as fires, floods, or earthquakes are common everywhere. So are unnatural disasters in the form of riots and even wars. Cloud-based systems keep your data on multiple servers in different regions. When one server goes down, your data is safe on another. How safe are they? One ERP provider estimates that cloud systems are so secure and redundant its customers experience less than eight minutes of unplanned downtime a year.

Storage and access: This same geographical dispersal that means your data is safe from disasters also means that when you need more space, it’s easy to get. When your server farms occupy large warehouses, adding more terabytes—Western Digital has 18-20TB drives available for home computers with those in the 100TB territory made for commercial firms—is a power and data connection away.

Automatic updates: Cloud service providers provide around-the-clock monitoring. They are constantly finding ways to improve performance and data security. Microsoft, for example, employs 3,500 security engineers. They protect customer data in part by ensuring the Azure cloud computing platform is safe from all attackers.

Get started to learn more about key features and benefits of ERP systems

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Plan Your Implementation

No matter what software your company has, and how robust your network may be, it’s still possible for your ERP implementation to fail. In fact, the average estimate of all ERP installations that fail is between 40% – 60%

Successful implementations often require focus on seven critical aspects.

Figure 1:Plan Your Implementation

Pharmaceutical Analysis using Power BI

  1. 1. It is choosing the right team. Your implementation team must have a good mix of talent. It should include people with experience in your particular business segment. Include business analysts, developers, software architects and project managers. The team must also include a strong-willed and senior management Champion from your company whose goal is ensuring the highest priority tasks are accomplished first.
  2. 2. We are planning a phased approach. Install the implementation in logical sections. This reduces disruption, especially when moving data from the old system to the new.
  3. 3. It was moving useful data only. Client data that is no longer relevant is not worth keeping. Bring over material that helps now and in the future. Reformat your data as it’s brought from the old system to the new while you perform the build. Separate that data into static, one-time entry data like customer lists, and dynamic information such as transactions.
  4. 4. It is setting achievable goals and expectations. A great way to accomplish long-term goals is by breaking each into a series of smaller steps, each with its payoff. Build on the previous step to accomplish the next and keep going.
  5. 5. Using the implementation to fine-tune your business. Many companies purchase an ERP system to reduce costs. Use the implementation to take a critical look at each business process. Where are the bottlenecks? Where is effort duplicated? How can each process be streamlined to be more efficient and effective?
  6. 6. Time is a sixth critical part of an effective ERP implementation. Don’t be in a hurry to turn the key; fire it up and race off. Successful implementations take six months to two years. Effective, thorough planning and a thoughtful, well-researched approach before purchasing will help ensure your ERP implementation is successful.
  7. 7. Another important task is understanding that a new ERP will look different from the old one. While having a familiar look and feel is nice, your staff will embrace an optimized newer version once they understand how well it performs. Microsoft’s Dynamics 365 line of products may look different than your old ERP, but it will retain some familiarity for Office 365 and Azure users.

Final Thoughts

Online ERPs are designed for flexibility and expansion. A cloud-based ERP is less expensive to maintain over time, no matter where your company has its production plant, warehouse, or office. Small businesses considering ways to improve efficiency and encourage growth will want to examine the many top ERP solutions available.

Before you buy, though, make sure you have:

  • A plan with short-term, medium and long-range achievable goals
  • An upper-level management champion
  • A budget based on hard facts
  • A willingness to change
  • The strength and stubbornness to know that growth requires pain, the pain of change.

Taking the right approach will help your company prosper and grow.

Also read: Top 5 ERP System Trends in 2020 to help plan for 2021

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Pharmaceutical Analytics and Business Intelligence using Power BI
Pharmaceutical Analytics and Business Intelligence using Power BI 700 500 Xcelpros Team

Introduction

Modern pharmaceutical companies are undergoing a significant transformation with new opportunities from digitization, big data, and analytics. In response to COVID-19, businesses are seeing an increased need for an agile enterprise Business Intelligence (BI) architecture to leverage these opportunities in order to grow. Successful Pharmaceutical companies are looking beyond standard operational and statutory reports to implement more powerful Analytics and AI-driven solutions. These new solutions provide actionable insights and useful KPIs to help make better decisions. This leads to more empowered teams and new engagement that drives additional revenue.

Pharmaceutical companies generate massive information every day through their day to day operations. But the data is not always being put to the right use. Some companies tend to look at reports with a traditional eye that doesn’t drive a ‘call to action’ to grow the business.

The strength of any analytics software lies in its ability to help users easily create quick insights, especially for an agile business like pharmaceutical manufacturing. Creating reports in days instead of months frees up hundreds of hours in unnecessary spend to gather these hidden insights. This allows business leaders to repurpose cost savings towards other operational improvements and growth.

There is a right and wrong way of reporting – one provides overwhelming numbers, while the other means to understand those numbers and make them actionable.

As the pharmaceutical industry continues to undergo significant adjustments to new opportunities presented by digitization, big data, and analytics, more enterprises continue to see the need for an agile enterprise Business Intelligence (BI) architecture to leverage these opportunities & seamlessly deliver business-critical insights to executives.

The Strength of PowerBI

Power BI, Microsoft’s business analytics solution, lets you visualize your data and make it accessible to your Organization. Insights can be easily shared through various platforms of your Organization by embedding them in your app, portals, or website, collaborating on Teams, and integrating them into your ERP or CRM applications. Microsoft’s Power BI makes it easy to combine these numbers from different sources, streamline analytics onto a single dashboard, act on newfound insights, and enhance visibility to other teams in your organization.

Leveraging PowerBI interactive reports in a few quick and easy steps

  • Onboard
    • Access PowerBI either from powerbi.com or any of the Microsoft ERP/ CRM applications.
    • Connect to your data wherever it lives.
    • Explore your data with interactive visuals.
  • Collaborate & Share
    • Publish reports and dashboards.
    • Collaborate with your team.
    • Share insights inside and outside of your Organization.
  • Access insights from anywhere
    • Act with seamless access to data insights from your desk or home.
    • Access on the go with Power BI visual reports built rapidly.

Book a demo to learn how Power BI can boost your pharmaceutical analytics.

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Turning Industry Data into Smart Decisions

Leading Pharmaceutical companies who are transforming into agile organizations need 360-degree insights for business-critical functions such as manufacturing execution, sales productivity, financial management, purchasing raw materials from approved suppliers, quality assurance & quality control.

Today’s pharmaceutical organizations collaborate, monitor, and communicate on available live data to achieve operational excellence. Pharmaceutical business intelligence enables these organizations to monitor real-time data from multiple sources and combine them into one pharmaceutical dashboard with the ability to drill-down into the report to identify issues, as necessary.

Figure 1: Pharmaceutical Analysis using Power BI

Pharmaceutical Analysis using Power BI

Usage in the Pharmaceutical Industry

01.Interactive Reports

Power BI is an analytics software that brings to the table a strong background in delivering end-to-end BI analytics to modern Pharmaceutical companies such as

  • Efficiency Reports On Lot Production
  • Trending And Analysis Of Quality Control Data
  • Recommendations Based Clinical Trial Reporting
  • And Financials Per Batch Produced For Each Product
  • Product Go to market assessments (how much spend and types of activity is involved, expected and actual results)

02. KPI Reporting

Accurate decision making occurs when reporting provides clarity on both good and bad data points on prime KPIs. With business analytics in the pharmaceutical industry, companies can acquire intelligence in real time and can track key performance indicators like:

  • Machine utilization
  • Process efficiency
  • Cost of Sales
  • Inventory levels
  • Batch Losses and cycle times
  • Quality standards of a product line
  • Customer engagement and customer experience

03.Real-Time Analytics

One of the essential requirements for agile Pharmaceutical companies is to have real-time analytics of overall operations, and to be able to make quick corrections and proactively handle situations before they turn into risks. Especially for manufacturing execution and pharmaceutical inventory management, knowing the work is progressing and inventory is turning around helps production supervisors to manage batch production processes much faster and make on the fly corrections. This real-time reporting on screens throughout a production plant gives needed visibility to both the managers and operators who can be alerted and fully aware of any issues.

Figure 2:Real-Time Data Tracking with Power BI

Real-Time Data Tracking with Power BI

Benefits of PowerBI enabling business improvements

  1. 1. This information gives the ability to make changes to processes based on how well resources are functioning to increase productivity, and how each product lot produced is performing in the market.
  2. 2. Getting real-time alerts with Power BI mobile apps makes your operations more efficient, allowing you to achieve a higher level of organizational agility and minimize response times.
  3. 3. Power BI enables monitoring of your supply chain end-to-end, letting you identify problems and potential bottlenecks before they can affect critical processes.
  4. 4. Monitoring quality inputs and outputs from all sources, including your customers, allows you to make quick and meaningful decisions that will improve the quality of batches that are manufactured.
  5. 5. The ability to share your dashboards with suppliers and partners is a plus and accommodates adjustments to the latest information available to work towards making your processes leaner and smarter.
  6. 6. Microsoft’s Power BI is a full-featured BI solution that offers a number of benefits to many different organizations on their path to success such as –
    • Global Scale – Local Speed
    • Agile Business Processes
    • Predictive Analytics
    • Machine-to-Machine
    • Employee Onboarding

Basic analytics used by the Pharmaceutical Industry

  • Products & Inventory
    • Full Track & Trace Functionality
    • Enhanced Global Marketability
    • Customer Requirements
    • Product Quality
    • Product Recalls
  • Sales
    • Quotes & Order analysis
    • Pricing and Cost reporting
    • Available-to-Promise reporting
    • Order Profitability
  • Supply Chain Management
    • Match demand and supply
    • Improved Supply Chain Responsiveness
    • Updated and efficient Logistic analysis
  • Financial
    • Product Profitability reports
    • Batch costs
    • A full audit of transactions
  • Manufacturing
    • Safety and sustainability analysis
    • Realtime production data reports
    • Equipment failure predictions
    • Production rescheduling

Final Thoughts

A big step towards change today comes from enhancing visibility across all operations including manufacturing execution, sales force productivity, procurement, and financials. Power BI brings to the table a strong background in end-to-end BI services for modern pharmaceutical companies – covering BI strategy, managed services, implementation & support, and even more. From the moment you start considering a BI solution for your growing Pharmaceutical company, the benefits of Microsoft’s Power BI become evident very quickly. Microsoft’s Power BI will continue to be a must-have product for leading Pharmaceutical companies by delivering a 360-degree insight of operations.

References: Advantages of Using Power Bi

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Effectively Tracking and Controlling Inventory
Effectively Tracking and Controlling Inventory 700 500 Xcelpros Team

Introduction to effective inventory management

Especially today, manufacturers, wholesalers and retail businesses from several different industries share several standard business practices, with inventory management at the top of the list.

An efficient, capable inventory management system can distinguish between struggle and success. Any boost to the efficiency of managing your inventory can result in a significant return on investment. To drive the effectiveness of your inventory management, especially when if you’re just getting started, it helps to pay attention to 10 popular techniques:

1.Fine-tune your forecasting Accurate forecasting is a must unless you want to either tie up precious capital in product stuck on warehouse shelves or be unable to meet your customers’ orders.

2.Identify low-turn stock Have a flexible ordering approach that, combined with accurate forecasting, lets to adjust inventory based on customer priorities.

3.Regularly audit your inventory Knowing—not guessing—what you have at any given moment lets you adjust ordering to ensure a balanced inventory.

4.Track stock levels You want to track all inventory from the moment you purchase raw materials or components to when you deliver finished goods to your customer’s door.

5.Keep track of your equipment Especially in a production plant – Knowing what you have, how quickly it wears and when to schedule repairs for optimal life ensures uninterrupted production runs.

6.Verify Quality Ensure all items in your inventory meet your quality control standards, ideally from the moment they arrive.

7.Categorize inventory based on customers needs Ensure you have the most sought-after products in stock at all times, working your way down the line to the least popular products.

8.Consider drop shipping This is much quicker especially for any items you don’t make yourself, especially when it becomes part of your product. An example is a Siemens ® controller for industrial machinery.

9.Rotate your stockTurn your stock so the oldest items are sold first This is especially true for pharmaceutical products with comparatively short shelf lives.

10. Use good inventory management software A viable program that meshes with your financial and sales software helps keep everyone informed, making for happier customers.

Get a consultation on how to track and control inventory in the warehouse.

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Figure 1:Common inventory management challenges

Common inventory management challenges

Common Inventory Management Challenges

Among the most common inventory management challenges that can affect a number of different businesses are the following:

  • Inconsistent tracking Working with older software that relies on manual data entry opens a company to data entry errors. Mistakes are bound to happen when different departments use different spreadsheets to input the same information.
  • Inaccurate data Companies need to know how much of everything they have on hand and in the pipeline. Without accurate information, you won’t be able to track your production. This can be a massive problem if you’re still manually entering data.
  • Order management Manufacturers often live on the edge of logistics, struggling to make sure deliveries are going out just in time – right before their customers need them.
  • Juggling a complex supply chain Manufacturers need alternate ways of obtaining raw materials and shipping finished products. For example, your primary port is running behind because dock workers are sick. How do you get what you need when you need it?
  • Communications and planning Intercompany communication is critical, especially in a world where companies often have business units in different countries, keeping everyone focused on the same task can be difficult.
  • Robust competition In every industry, competition is ready and willing to grab your customers when you make a mistake or find yourself unable to deliver on time and within budget.

These are a few examples of the challenges faced by modern manufacturers. Thankfully, the good news is that modern ERP solutions can be a huge help when it comes to addressing these issues.

Inventory Management Software As a Solution

Several inventory managements programs available on the market today that focus not only on addressing these challenges, but also by identifying potential issues before they can impact your operations. Some of the best solutions available, like Microsoft Dynamics 365 Supply Chain Management, can seamlessly integrate with your existing software, reducing data silos, allowing different departments to share more information. Instead of requiring three departments to input the same information into a database, each group is able to provide material unique to their specialty.

Effective inventory management programs like Microsoft can print barcodes and QR labels. When these codes are scanned with a hand-held reader or cellphone, users can be rewarded with a wealth of information. The most critical data to track are precisely how much of any product you have, where it’s being stored, and what it will be used for.

For example, you need to produce 20,000 doses of a Covid-19 treatment. Your customer needs them yesterday but will settle for next week. Do you have enough raw materials on hand to meet your customer’s deadline? If not, what can you do to obtain what you need?

Using this information wisely lets management develop complex plans, like the ability to track everything from small lots to pallet loads. A company can learn by checking an item’s progress at different points—its arrival at the warehouse, use in production, loading onto a truck or ship, and delivery to the customer. By examining reports, you can identify potential delays or roadblocks and find ways to speed up delivery.

Supply chain management software on a secure cloud computing platform like Microsoft’s Azure let’s you communicate securely and safely with other researchers, salespeople and vendors. With Azure, you’ll know that your intellectual property and contracts are safe from competitors.

Boost Decision Accuracy with Power BI

With today’s supply chains – seemingly constantly in a state of upheaval – effective inventory management that goes beyond tracking stock on hand is critical to operations. Effectively managing your inventory and raw materials ensures you’ll have the materials you need when you need them. It means having more than one source of supplies and materials. It also means constantly checking with vendors to ensure you have the goods to meet your own delivery deadlines. This is where an integrated business intelligence solution comes into play.

Microsoft Power BI let’s you connect to hundreds of data sources, preparing reports you can easily share. You can confidently deliver interactive messages to customers using information from inside and outside your company. Inventory planners can be warned of potential shortages in time to find alternate supplies. Salespeople can be told of possible delivery delays caused by outside forces, giving them time to ask the customer if they want to use a different shipping method.

Accurate business intelligence at your fingertips puts you ahead of competitors stuck using their “tried and true” methods that are becoming increasingly worthless every day.

Final Thoughts

Effective inventory management comes down to data: knowing what you have and where it is.

A modern inventory control system that supports labels and barcodes lets you track raw materials, work-in-progress and finished goods simultaneously, with high accuracy.

An inventory system with business intelligence helps you find faster and alternate ways of obtaining raw materials and pre-made products, mainly when shipping delays occur. That information can help you get your products to your customers when needed, balancing everyone’s inventory.

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