Dynamics 365 Business Central, a powerful cloud-based ERP system provided by Microsoft, is successfully used by thousands of SMBs across many industries. Retailers, for instance, implement it to track inventory in real time and accurately manage sales orders, while financial services companies leverage Business Central to enhance accounting, budgeting, and other finance-related processes.
Nonetheless, Microsoft’s Business Central has gained particular traction in the manufacturing industry, where companies widely use it to manage production planning and control, equipment maintenance, and other business aspects. In this article, experts from Itransition, a firm providing Business Central consulting, will highlight five notable capabilities of this ERP system that can help streamline your manufacturing company’s operations.
1. Demand forecasting
At the beginning of the production cycle, a company needs to estimate its production target and determine what products and in what quantities to manufacture. With the help of Business Central, a manufacturer can easily do this based on existing sales or service orders data stored in the ERP system (as these reflect actual customer demand) and already confirmed production orders for the next few weeks or months.
Nonetheless, for more accurate calculation, a company should also forecast how many additional sales and production orders it might receive later on. To address this, Business Central functionality allows companies to create sales or production forecasts, either separately or in combination, to accurately determine future production quantities. Based on these forecasts, companies can generate supply orders to ensure they have enough materials and components by the production start.
2. Production planning
Once a manufacturer has determined its production targets, it can proceed to production planning. Depending on the manufacturer’s needs, Dynamics 365 Business Central can help the company automatically calculate a master production schedule (MPS), a material requirements plan (MRP), or both.
The calculation algorithm for both document types works as follows: the ERP system uses data from the existing orders and demand forecasts to identify what products are required now or will be required in the future to fulfill production orders. The system then compares this quantity with the materials and components that are currently available based on real-time inventory data and existing supply orders.
If the ERP system determines that a manufacturer does not have enough resources to produce enough items, it can suggest replenishing inventory levels and placing a supply order. If supply orders are already being executed, Dynamics 365 Business Central can recommend accelerating their fulfillment or offer other relevant suggestions.
3. Production tracking and control
If a manufacturer has all the resources needed to fulfill its production orders, Dynamics 365 Business Central can put these orders into production automatically based on predefined rules. Work centers (groups of equipment or employees) will execute the orders in the sequence defined by the production routing rules, which can vary depending on the manufacturer’s business requirements. In short, Business Central’s routing capabilities allow manufacturers to define key production operations and their sequence, assign employees with the required skills to complete these operations, and distribute available tooling and machinery resources among operations.
Also, during order execution, Business Central can collect many types of data about used materials, produced quantities, and time required to fulfill an order. A manufacturer’s production managers can track this data in real-time to closely monitor the production and take corrective actions when needed.
Business Central’s analytics tools also allow manufacturers to analyze their production performance, identify areas for improvement, and eliminate production bottlenecks. In particular, a manufacturer can analyze the historical workload of different work centers and optimize their production load accordingly.
To leverage more advanced analytics, a manufacturer can also integrate its ERP with Power BI (a Microsoft’s business intelligence platform) and use it to analyse production data from Business Central. The use of Power BI, for instance, enables manufacturers to run scrap analysis to determine what proportion of raw materials and components is wasted during production and use the generated insights to optimize production yield.
4. Product shipping and delivery
Once a product has been created, Business Central can help a manufacturer deliver it to the customer timely and efficiently. For example, in Business Central, manufacturers can create warehouse shipping documents directly from sales orders. These documents contain all the data needed to properly distribute the product, such as the items to be shipped, their destination, and shipping methods.
After the product specified in this document has been physically picked and prepared for shipment, a warehouse employee can use the ERP system to automatically generate the documents required for product’s subsequent shipping, including packing slips and invoices. Once the product is shipped, the manufacturer’s inventory level is automatically changed in Business Central. These changes will be visible to the purchasing and manufacturing teams, helping a company avoid inventory stockouts.
5. Product maintenance and servicing
Providing excellent customer service even after clients receive a manufacturer’s products is also critical, as the quality of post-purchase service largely determines customer satisfaction and loyalty. However, as a manufacturer’s customer base expands, providing great service to each customer can become too challenging. Fortunately, Business Central’s capabilities can help a manufacturer handle this aspect of the business.
Specifically, the ERP system allows manufacturers to schedule and manage service visits for their technicians via a control panel, keeping track of service orders in progress and already completed. Manufacturers can also use Business Central to distribute specific service tasks among service personnel based on their availability, qualifications, or other attributes.
Final thoughts
Dynamics 365 Business Central is a popular ERP system that helps SMBs across industries work better, including those operating in the manufacturing sector. Some notable capabilities of this ERP help companies manage product demand forecasting, production planning, and production control more efficiently, while others facilitate timely product delivery, maintenance, and client servicing.
To ensure more smooth and cost-efficient adoption, we recommend turning to certified Business Central consultants to analyze your business requirements, define the optimal required ERP functionality, and provide a tailored Business Central implementation plan. Consultants can also provide you with technical assistance if needed to help handle integration, customization, and other Business Central implementation tasks.
