In my 30 years of manufacturing, I've come across many different acronyms for various processes and software systems that are used within a facility. In fact, a lot of plants that I've gone into have their own handbook of acronyms that they use each day in the plant.
If you want to keep up in meetings, you better learn these quickly or you might be left behind.
I have been guilty of just throwing around acronyms and thinking everyone involved knows what they are. And I have also been left in the dust, only to stop and interrupt the synergy of the meeting by asking what they stand for.
But the main ones that you normally hear, at least for software, are ERP, MES, LES, MOM, CMMS, MRP, PLM, along with many others that are used to support the plant. I want to talk about two of the main ones that are used and the differences between them. ERP and MES. These two are used in almost every manufacturing facility every day.
What is an ERP System?
ERP stands for Enterprise Resource Planning. And it's kind of like the brain of your factory. It ties together many of the other business processes within the plant and enables the flow of information between them. It's the financial engine for the facility and includes:
- Accounts payable, receivables, payments, and collections.
- Purchasing of raw components to build the product, including the consumption of the components for the reordering of those parts and tracking the delivery of the product.
- It also helps in managing your supply chain and inventory management, warehousing, and storage locations.
- Sales of product orders and helps manage when to build and ship those orders.
- Production planning and BOMs (another famous acronym) for the production builds.
- Managing human resources for payroll, benefits, and hiring.
So, ERP software is very good at purchasing, planning, and managing the resources who work in the plant. Oh, and not to forget, paying the bills to keep the lights on. Also, it is a storage of the data and reporting on key financial KPIs so management can make decisions on where to improve. Those are the primary things the ERP system does, along with a number of other details, depending on the add on modules the ERP company may also offer.
What is an MES System?
MES stands for Manufacturing Execution System. MES is used to monitor the product being made on the floor through the machine and sends the data to other systems and to servers for storage. Many companies like to custom build out their MES systems so that they can track in greater detail the specifics of the product that's being made. The main points you need to know about an MES system and what they are really good at are:
- Part traceability and the genealogy of the components that go into making the product. Now, depending on the type of product you make, you may not need this level of detail. For those industries that require this level of detail and will pay for it, this is an essential part of an MES system.
- Recipe management. This sets up the controls of the machine to run the product. An example of this is like going to your microwave, and you push the popcorn button to pop popcorn. The microwave has been pre-programmed for the amount of time and heat needed to make a perfect bag of buttery delight.
- Machine process controls to monitor any change in the process and store the values for reporting. They can be capturing the pressures, flows, torque values, and many other variables to help maintain the quality of the product.
MES and ERP Working Together
These two manufacturing systems have a lot of crossovers between them in how they track the flow of the product through the plant. Most companies need a blend of the two in order to gain the most efficient way to run the factory. They need to be able to talk to each other, collect data, and present the information for those who need to make decisions.
I like to compare the many different software systems used in a plant to an automobile. A car is made up of many different components made by many different manufactures, and then brought together to get the best customer experience possible. With that said, you can think of the main body of the car as the people who built the product at the plant. The engine could be an ERP system. Then the MES is the transmission. Of course, there are many other components of the vehicle, just like there are many other software systems used to maintain the plant. Steering, gas, and brakes could be your Lean Execution System (LES), in harmony with others to help support and track progress in the plant.
Wrapping it all up
So the difference between an ERP and an MES and what they do best is:
- ERP is the financial information system for the company.
- MES is focused on the building of the Products that the company produces.
Now, when you're thinking of making a change or even going in a new direction in these systems, make sure you know what you need first. Start small and always use the evolutionary approach. It's always better to start simple than to use the revolutionary rip and replace strategy which will usually fail.
Start where you're at and let the problems and the data tell you where you need to focus and build upon that for improvements. You can spend a lot of time and money developing these two systems, both of which are limited resources for plants.
Hopefully, you learned something new here and the next time you’re in a meeting and you hear them talking about the ERP you can think, "Hey, I know what that does, it’s like the car’s engine." The financial engine, that is.😊
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