Medical device manufactures have many of the challenges of standard manufacturing including financial management, supply chain control, sales and customer relationships and productivity management. But, what makes the medical device manufacturing industry unique from an enterprise data management perspective is the amount of standards and regulations that must be observed. Because of these standards, there is an additional layer of complexity in managing for compliance and quality control. ERP systems bring together the tools to meet these challenges. This article will help you understand the available features in an ERP system for medical device manufacturers.
ERP software seeks to link financial and operational “back-office” functionalities with operational and “customer-facing” technology. Medical device manufacturing ERP software solutions offer a comprehensive approach to enterprise data information systems.
Some of the base benefits of an ERP system include:
The impact of operating in a highly regulated industry is something your medical device manufacturing business must deal with every day, in many different ways. The Food and Drug Administration (FDA) of course not only governs food and pharmaceutical, but has specific standards for device manufacturers as well. ISO 13485 is a certification that was specifically developed for medical device manufacturers which contains specific requirements for manufacturing, installation and servicing. ISO 13485 calls for:
Ultimately, compliance is a matter of quality control management and reporting against a set of standards. It can include planning, inspections, document tracking, product specifications, deviation tracking, parts approval tracking and testing.
Traceability is a big factor as well. Inventory management consists of track each sku but also tracking of serial numbers and lot tracking. This allows you to identify where and when each item was manufactured.
For many medical device manufacturers, the life of a product starts in the research and development stage. You can spend many hours designing and engineering the products, testing and doing market research. Tracking of those costs is very important. Software will not only help you track the costs but also help you identify where improvements can be made in the R&D process to ensure you have the most effective processes in place.
Managing the work done on the manufacturing floor is a big job. Important modules for managing that work include:
Purchasing control. Keep tabs on your suppliers, quality of parts supplied by vendors, and prices from vendors. Order as needed or set up automatic reorder points. Integrating with order entry allows you to order parts and materials based on incoming orders, thus reducing the amount of inventory you store in your warehouse.
Warehouse management. Track the flow of product in/out of the warehouse. Whether it is parts or finished materials, understanding where those items are at any given time is critical. Have multiple locations in the warehouse for a sku? No problem. Have multiple locations? Transfer product between locations. Also, track inventory set aside for specific customers or orders until those are ready to be fulfilled.
Shipping and logistics. Integrate with common shipping companies like UPS and FedEX or easily schedule pick ups from third party shipping companies. If you deliver your product using internal staff, schedule those deliveries in the system.
Shop floor scheduling. Schedule what is to be manufactured and when. This allows you to flex machines to sneak in a rush order but also allows you to know where each order is at any given time. This will not only help you with scheduling the orders but also help you with scheduling your staff.
Bill of materials. Import bills of material from your design systems to be used for manufacturing. Make changes and updates to the BOM as needed.
Job costing. Track the costs associated with each order. Whether you are using a paper traveler to track time and materials or a computer system throughout the shop floor, you can track the labor hours and equipment costs to specific jobs. Along with the materials costs, you can better understand the profitability of each job/order.
Order planning. Expect the expected and the unexpected. Track order histories and trends to know when you will need to order more materials to meet demand. This will not only help you maintain inventory for current demand but better plan future demand. Also helps you with planning your cash flow.
All of the features above will improve your time to market allowing you to make a quality product, using quality vendors and put the product in your customers’ hands in a timely manner.
Integrated CRM and sales software will allow you to prospect new customers, retain current customers and reach out to former customers. Create sales orders which are then transferred to manufacturing. Track customer history to see what they have purchased, when they purchased and what they paid.
Create mass mailings or emails to customers based on what they have purchased, location, or buying habits.
Stand by the products you sell by maintaining a service management system. This allows you to track warranty and service work, track product histories for trends in service needed, and allows you to manage RMA’s. Additionally, tracking of service work allows you to better work with the manufacturing and engineering department to create the best product possible.
Financial management functionality is the piece that brings all of the modules together. There are systems available that handle just the manufacturing function, but integration with your financials can help you better control your costs of labor and materials.
The financial management system will allow you to better manage your payables by associating payables transactions with purchase orders and invoices. Associate invoices in the accounts receivable but also track transaction history and payment history by customer.
The financial management system will also help you with budgeting and forecasting. It is not only important to know where you are now and where you have been but also important to plan for the future. Easily create budgets by company, by division, by department and roll that information up into an overall budget. Also create strategic forecasts allowing you to better plan for development of new products.
Included with the financial management system are business intelligence tools allowing management to track key performance indicators, view financial information about the company through management dashboards, and keep a pulse on the financial health of the organization. Having accurate data at your fingertips allows you to make better decisions going forward.
If you are at the point where you’d like to discover software options and providers who can assist with achieving medical device manufacturing software, we can help. Through a brief phone call, our software specialists will look to better understand your business and software needs to help you locate a handful of solutions that can address the issues you are currently experiencing. Get started today!