The heat treating industry is a unique one, in the sense that it provides so much for the manufacturing industry in its entirety, but seldom gets recognized for these critical jobs. When metal finishing job shops seek a software solution to button up their operations with better workflows and data, it’s easy to get lost in the options.
Some plants outsource developers to design a custom-made solution specific to their needS, but they end up with improvements that can’t be made, or an outdated, underutilized solution that gathers dust. Alternatively, some seek the latest and greatest in enterprise resource planning (ERP) or manufacturing execution systems (MES) but grow tired of the lack of customization and customer service. When identifying the least expensive options (or the greatest return), job shops secure the basic functions while still exploring paper trails and redundant data entry.
Owners and operators want to run their shops more efficiently. They want full control of their expenses and throughput, but without technology and data they are running their shop with the lights off. Let’s evaluate the difference between choosing an ERP, MES, or homegrown solution for your plant.
What Sets the Heat Treating Industry Apart?
As mentioned above, this industry is part service provider and part manufacturing. Since they typically have a wide variety of customers, parts, and processes, their daily work volume is very high. Many orders per day make tracking orders impossible without an MES or ERP, which is why so many job shops are frustrated with paper processes and excel spreadsheets.
In these dynamic environments, labor tends to be the largest cost driver, and cost can vary wildly from part to part, with no way to track it. Additionally, high operator turnover means constantly training new team members how to rack, coat, load, mask, etc. To summarize, these unique operations require dynamic, reliable, easy, and fast solutions to maximize throughput.
Why Out-of-Box-ERPs Don’t Work:
Enterprise Resource Planning technology has come a long way and deserves a lot of credit for the issues it solves. However, there are many shortcomings when launching an ERP or MES in process manufacturing environments. For example:
- Not specifically set up for finishing projects and tasks
- Possible for the front office, impossible on the plant floor where it matters most
- Very little production data
- Little-to-no job cost data
- Not set up to replicate treatment processes and other nuanced production techniques
- ERP and MES options are high friction, not suited for fast-paced finishing
- System STILL relies on paper, driving data entry, and eliminating valuable insight
Another element that should be recognized is that ERP Customer Support is notorious for being technology focused without knowledge of the specific industry and processes at hand. Customer support is generally outsourced or managed via a call center without direct communication options for issue resolution. This means issues can last days, weeks, or indefinitely due to a lack of support resources.
Why Homemade/In-House Software Doesn’t Work:
Those who ride the “customization is key” bus need to get off before the cost of updates, customization, and cybersecurity risks break the bank. Homegrown software has its benefits as well, but there are also many shortcomings to in-house software, such as:
- Maintaining reliable software is a liability
- Single point of failure if an individual quits
- Hiring a new developer takes months (if the new developer can understand the code at all)
- Maintaining your own servers is a liability
- Cybersecurity is a massive liability
- Your business is less attractive to prospective customers with in-house software (less trust)
- User experience is typically terrible dragging on current employees and putting off new ones
- The cost of custom software is very high
- Typically does not offer robust, secure, remote access
- When it comes time to sell your business, a new buyer may not look favorably upon your creation
The Importance of Job Costing in Manufacturing Software
In a chaotic environment with lots of labor and many jobs, everything possible should be monitored. Variable labor cost is the most important to track by identifying what your labor worked on, and how much revenue it procured.
Understanding the time it takes in each phase of the heat treating process will allow you to understand the cost for each job performed to better understand your profit margins. If this information isn’t directly calculated for each customer, you are unknowingly causing a leak in your profits from customer to customer. This is data that isn’t generally available in an ERP or MES and is a complex afterthought when building an in-house solution.
As the thermal processing industry continues to change at a rapid pace with a labor shortage pressing operations, it is important you audit your current plant technology to make sure your operations are as efficient as possible.
Article provided by MTI Member, Steelhead located in Laurium, MI. Steelhead offers a customizable platform built to match your shop’s job operations. To see more details on Steelhead, visit gosteelhead.com.