Using an ERP for manufacturing companies can be a game-changer. Recent research indicates that an astonishing 70% of ERP implementations encountered delays and cost overruns due to suboptimal planning strategies. Our post offers an ERP implementation checklist specifically for manufacturing companies. Following these steps will help you avoid many pitfalls and ensure the success of your project.
if you need help getting started, don’t hesitate to reach out to the ERP consultants at Blue Lotus 360, or download our complimentary checklist to make your journey easier.
10 Pre-Implementation ERP Checklist for Manufacturing Companies
1. Define Clear Business Goals and KPIs
Take time to analyze what you are trying to achieve with an ERP system before implementing one. Build an ERP development strategy. Make sure that the goals set are in line with the company’s objectives, such as enhancing production speed, minimizing machine downtime, and improving inventory precision.
After formulating the goals, the next step is to outline specific measurable results, also known as Key Performance Indicators (KPIS). Some of these are:
- Reducing production lead times by twenty percent.
- Curtail production costs by fifteen percent.
- Achieve a 95% rate of on-time deliveries.
These will serve as the foundation for your ERP customization and post-launch evaluation strategy. It is easy to stray off course without these guiding principles in place.
2. Assemble an Internal ERP Team
It is wise to have all hands on deck to ensure a smooth transition to manufacturing ERP implementation. Select Employees from production, finance, supply chain and IT departments. Having all these departments will guarantee that the ERP system takes care of everyone’s needs.
Select a project champion: A decision maker who can mobilize resources and rally people to get things done. This is usually an IT manager or the Head of Operations.
Set policies on who signs off on decisions, interacts with vendors and performs other relevant tasks. Even the best teams will not be able to deliver as expected if they are not organized. It helps in ERP project planning.
3. Document and Map Existing Processes
You can’t improve what you don’t understand. Conduct a thorough audit of your current processes. Take into account everything from procurement and inventory to production and dispatch. Document every step, even the small ones.
Look for inefficiencies, like manual data entry or delays in material ordering. These are opportunities for the ERP to shine. Create flowcharts or Standard Operating Procedures (SOPs) to share with your vendor. This helps them tailor the system to your workflows, saving time during setup.
4. Create a Budget and Timeline
ERP projects require careful financial and time planning. Account for costs like:
- Software licenses or subscriptions.
- Hardware upgrades (if not fully cloud-based).
- Customization, training, and ongoing support.
Create a pragmatic plan that allocates adequate time for testing and training, including all necessary steps, such as gauging employee feedback. Decide on a “big bang” approach versus gradual implementation, also known as a phased rollout, starting with inventory and then production.
Protect against unanticipated setbacks by building in an additional 20% padding for missed deadlines. Having a strategy will help avoid funds being mismanaged or schedules being rushed.
5. Evaluate and Select the Right ERP Vendor
Many ERPs are not designed for the complexities of a manufacturing business. Go for a vendor that has specific capabilities relevant to your sector, such as BOM management, shop floor control, and quality assurance tools. Evaluate vendors regarding:
- Customization options for unique workflows.
- Scalability to grow with your business.
- Robust reporting for real-time insights.
Blue Lotus 360 stands out for its manufacturing ERP expertise. Their platform offers custom workflows, machine integration, and mobile dashboards, making it a top choice for manufacturers. Request demos and talk to references to ensure the vendor fits your needs. Added thai to ERP readiness checklist.
6. Clean and Prepare Your Data
Every ERP system runs on data. Having low-quality input will lead to unsatisfactory results. Outline pertinent data which needs to be maintained, including:
- Bills of Materials (BOMs) for production.
- Stock Keeping Units (SKUs) for inventory.
- Chart of Accounts
- Opening Balances.
- Supplier details and machine logs.
Remove duplicate records, outdated records, errors, and clean your data to enable a smooth transition. Make sure it is in the format required by the new ERP system; vendors like Blue Lotus 360 provide templates. Having clean data allows for seamless business transitions and accurate reporting from the start.
7. Plan for Integrations
Your ERP doesn’t work alone. List other tools you use, like Manufacturing Execution Systems (MES), Warehouse Management Systems (WMS), CRM, or accounting software. Check if the ERP supports seamless integrations through APIs or built-in connectors.
For instance, QuickBooks and Shopify are popular services that Blue Lotus 360 integrates with, enabling timely data syncing. “Check integrations during planning to avoid surprises later”, says one of the developers from Blue Lotus. Integrated ERPS become a bundled system that saves time and reduces errors.
8. Develop a Change Management Strategy
ERP implementation means change, and employees may resist it. Some might worry about job security or struggle with new technology. Address these concerns early.
Communicate the benefits, like faster inventory checks or fewer manual tasks. Involve end users—machine operators, supervisors, and warehouse staff—in planning and testing. Their feedback ensures the system works for them. A proactive change management plan builds buy-in and reduces pushback.
9. Schedule User Training Early
For success regarding ERP, training is critical. Ideally, start well in advance before the actual systems goes live. Provide different training for each group, based on their roles:
- Production operators are taught how to track production.
- Supervisors control tools mastery reporting.
- Handlers learn stock control.
Make use of instructors’ hands-on sessions, manuals, guidebooks, and videos for people with different learning styles. Custom training from Blue Lotus 360 helps businesses as far as mid-sprint gets teams to meet expectations. Schedule post-launch opportunities to answer questions and boost user confidence.
10. Finalize Go-Live Plan and Contingency Measures
The go-live phase is when your ERP becomes operational. To minimize risks, run a pilot test in one department, like inventory or production. This catches issues before a full rollout.
Create a detailed go-live plan, including:
- A checklist of tasks (e.g., final data migration, system checks).
- A support team to handle immediate issues.
- A rollback plan if major problems arise.
Monitor the first 90 days closely. Track KPIs and gather user feedback to fine-tune the system. A solid plan ensures a smooth launch and quick recovery if things go wrong.
Key Considerations for ERP Implementation in a Manufacturing Company
- Bill of Materials (BOM) Configuration
Ensure that all components, quantities, part numbers, and hierarchical structures are clearly defined and documented. A well-structured BOM is critical for accurate production planning and cost tracking. - Demand Forecasting Strategy
Decide whether you want to incorporate demand forecasting into your ERP. If so, determine whether forecasts will be based solely on historical sales data or if they will also include external factors such as market trends and seasonality. - Capacity Planning Readiness
Confirm if you plan to use capacity planning features. Ensure all relevant data—such as machine availability, labor schedules, and known bottlenecks—is available and accurately maintained to support effective planning. - Production Scheduling Parameters
Determine whether you require detailed production schedules based on demand and capacity. Assess whether you have all the necessary parameters defined for each product, routing, and machine to support automated or semi-automated scheduling. - Material Requisition Planning
Establish a process for identifying raw material requirements and generating purchase requests. This includes defining lead times, minimum stock levels, and supplier data to ensure timely procurement. - Consumption Recording Method
Decide how material consumption will be recorded. Will your team enter actual consumption data manually, or will the system calculate it automatically based on the standard BOM? This decision impacts accuracy, efficiency, and data entry workload.
Bonus Tip: Partner with an ERP Expert for Manufacturing
Implementing an ERP is complex, but you don’t have to do it alone. Blue Lotus 360 manufacturing ERP offers end-to-end solutions for businesses like yours. Their platform includes:
- Custom workflows for complex production processes.
- Machine integration for real-time equipment data.
- Mobile dashboards for managers on the go.
One manufacturer, a mid-sized furniture company, used Blue Lotus 360 to cut production delays by 30% within six months. Their team provides hands-on support, from planning to post-launch optimization. Partnering with experts like Blue Lotus 360 reduces stress and maximizes results.
Conclusion
Following ERP pre-implementation steps can transform your manufacturing business, but only with careful planning. This checklist—defining goals, building a team, cleaning data, and more—helps you avoid costly mistakes. Whether you’re streamlining production or improving inventory, a well-executed ERP project drives efficiency and growth.
Blue Lotus 360’s manufacturing ERP is designed to meet your unique needs, with flexible features and expert support. Don’t risk delays or budget overruns. Contact Blue Lotus 360 today for a free consultation or download our ERP readiness checklist to start your journey.
Download the checklist here – ERP Implementation Checklist for Manufacturing
