GlossaryKind of term: Manufacturing termERP
What is ERP?
ERP is business software that brings orders, items, stock, purchasing, planning and invoicing together in one system.
ERP stands for enterprise resource planning. In an ERP the processes around an order share one database: sales orders, items and bills of materials, stock, purchasing, works orders with routings, capacity, booked hours and invoicing, with the financial accounts underneath. In a manufacturing business it usually holds the master data: item numbers, routings, hourly rates and purchase prices. An ERP plans by order and by work centre, typically in days or weeks; what happens minute by minute on the shop floor often reaches it only as booked hours or reports.
How does the ERP work in practice?
An estimate often leans on master data from the ERP: the last purchase price, the hourly rate per machine or machine group, the routing of an earlier order. How reliable those figures are depends on who maintains them and how often. A rate or price that has not been updated can find its way into new quotes unnoticed. If the estimate is made outside the ERP, in a spreadsheet or a separate package, item, routing and price still have to be entered in the ERP afterwards; retyping takes time and invites errors. Many ERP packages for manufacturers include an estimating module, which usually works with times someone enters or copies from an earlier order.
What is the ERP often confused with?
ERP is not MES: the ERP manages order, stock and invoice and plans on a coarser time scale, while an MES directs and records execution on the floor, per operation and per workstation. Many ERP packages do have a shop-floor data collection module, so the boundary is blurred. Nor is ERP the same as MRP: MRP (material requirements planning) works out material requirements and is a function inside most ERP packages.
How does a quote from Blake get into your ERP?
A quote version leaves Blake as a PDF, with CSV and JSON export. You take that file to your ERP or spreadsheet; what your ERP can do with it depends on the package. You keep hourly rates per machine and your own purchase prices, with source and history, in Blake itself.
Frequently asked questions
What is the difference between ERP and MRP?
MRP works out from orders, bills of materials and stock which material is needed and when. ERP is broader: it includes MRP and adds sales, purchasing, works orders, hours and finance in one system.
Does estimating belong in the ERP?
Both approaches are common. An estimating module in the ERP avoids retyping but usually works with times someone enters. A separate estimating package can do more of the calculation; its result then still has to reach the ERP, by file or by integration.
Which ERP master data affect the cost?
Mainly hourly rates per machine or group, purchase prices with their date, routings with setup and machining times, and bills of materials. How current they are decides how far you can trust an estimate built on them.