MRP software is still a very useful tool for capacity planning but to rely totally on MRP to drive the factory process can be problematic. MRP hit the scene around 1961 and one of it’s drawbacks is that it can be saddled on top of an inefficient process, seemingly give all the right answers, but then lead to the ruin of the company. There are plenty of disaster stories over the last 10 years to back this up.

Bill Waddell went on to say “MRP was useful - even necessary - under the manufacturing philosophy of the day. Trying to become lean using a 45 year old manufacturing tool won’t work, however. It is a lot like a world class, Olympic sprinter who breaks her leg. Sure, she is going to need crutches until her leg heals. But she better get rid of the crutches eventually if she thinks she is going to get to the Olympics. MRP was a great crutch for factories bloated with inventory, cranking out dismal quality products in the 1960’s. Nobody is going to keep up with Toyota using MRP, however.”

So what is the answer. A combination of Lean in tandem with more flexible software is the ideal approach. As an example, Accentis Enterprise has basic MRP features but you have total control over how the materials and capacity planning data should be utilised to support a manufacturing process.

Integrated into the Manufacturing, Job costing and Payroll modules, the Accentis Time Clock can be interfaced to barcode readers, touchscreens, radio-frequency identification (RFID) and biometric peripherals to produce a dead simple method for recording time-in-attendance.

The console can be just barcode-driven in combination with a standard LCD monitor or combined with an optional touch screen clock-in/clock-out console that takes the place of the traditional manually entered time-clock. This facility is fully integrated into timesheets, jobs and work orders so that employees can rapidly clock on and off jobs, work orders, job cost centres and work order routes.

Designed for shop floor situations the major strength of the time sheet console is the ability to collect and allocate time spent on every manufacturing routes.  This means there is unparalleled reporting on not just employee times but also machine usage, idle times and efficiency levels.

You can set reports to auto refresh so live data from the time clock console gives production managers a real time view of what stages work orders and jobs are at.

Using the timesheet console the labour savings alone are quite significant.  This example was taken from an Accentis shop fitting client:

This company has 41 staff of which 30 manually write up daily timesheets.  On the timesheet employees noted the hours worked for each job along with the start and finish times.

On a daily basis these time sheets were collated and checked by the admin assistant, Michelle.  Michelle took 25 minutes to enter timesheet data into the payroll system.  Each Wednesday the payroll officer, Jenny checked the overall times and confirmed pay rates for each employee. Jenny spent 2.5 hours on this task.

Michelle’s hourly cost is $23/hr and Jenny’s hourly cost is $28.50.  Let’s expand this out:

$23/hr x 25 minutes x 5 days =  $47.91 per week for Michelle

$28.50/hr x 2.5 hours = $71.25 per week for Jenny

That’s a total cost of $119.16 per week x 52 weeks = $6,196.32 per year.

With the implementation of two time clock consoles Jenny ended up spending only 1 hr 15 minutes each week on a pay run, so the true saving worked out to be $4,344.  When the time savings were then collated for shop floor employees, the estimated overall annual cost reduction was close to $15,400.

Automating every day tasks can save a substantial amount over a period of time. On a typical installation, a time sheet console including hardware would pay for itself in under a year.

Donated, I hear you say. Yes, when assets costs and values are not tracked sufficiently it’s like giving money away for no good reason. And like many small costs that go unnoticed, it’s another element that quietly erodes your net profit.

The best way to gain total control over your entire fixed asset life cycle ie:from acquisition to disposal - is with a fixed asset management solution that does 85% of the work for you.

Good asset management software should be simple to use and do things like: Allocating assets to groups; depreciating multiple assets at the click of a button; just as easily, revalue or dispose of assets; integrate with the general ledger; provide separate book and tax depreciation rates and allow percentage of private use calculations.

There are many stand alone solutions in the market. If choosing a stand-alone solution do your homework, make sure that it meets all your criteria, and it integrates with the accounting system.

I’m sure you’ll agree, the reasons for being in business are pretty simple: to make money to give you the lifestyle you want; to contribute and maybe build something great. You’re not alone with the frustration of trying to grow a business, hampered by underperforming software packages tacked together just to get half the job done. I understand… I’ve been through it myself.

The decision to purchase a new accounting and management platform for a business can be a daunting one. We understand the trepidation and the effort that goes into assessing a multitude of offerings and trying to select the right one for your business.

If your MYOB or Quickbooks software doesn’t cut the mustard anymore and you’re looking for a simple alternative to more complex ERP software then maybe I can help. For information about Accentis and how it can transform your business contact me on the following numbers.