Common Manufacturing Challenges and How to Solve Them

Manufacturing projects require skilled workers, precision machinery and the right materials. In order to run a successful manufacturing project, there are plenty of factors you need to consider including profit forecasting, efficiencies, inventory management, reporting and much more. You also need to ensure you have an appropriate project management system, like SAP PS or a similar system and that all users have received the appropriate SAP project systems training.

With so many factors to consider, let’s have a look at some of the common manufacturing project challenges and how to overcome them.

Forecasting Demand and Profits

Before launching a manufacturing project, it’s essential that they have a good idea of what the customer demand is going to be. Failing to accurately forecast demand, resources and revenue can lead to improper budgeting, product overruns and significant losses. Unfortunately, some businesses simply don’t have the proper estimation tools for forecasting.

With today’s technology, there are plenty of digital tools that manufacturers can use to solve this problem. One of them is an SAP PS (Project System). This is a project management tool that helps manufacturers predict cash flow in a number of ways. First, it quickly creates forecasts using existing estimation templates. It then creates many different estimations to take into account different scenarios that might occur during or after the manufacturing process. An SAP PS also uses formulas to calculate profit margins, price escalation, contingencies and risks.

With this information, manufacturers will be able to know how many items they should produce in order to make a profit. It also helps them understand consumer behaviour, which will help in figuring out the best time to sell the product.

Improving Efficiencies

To maximise project profitability, you need to ensure the lowest possible production costs without sacrificing product or process quality. Having a more streamlined and efficient manufacturing process is one way of doing this.

As a general overview, manufacturers should aim to minimise material waste, optimise the time spent by your workers, and automate certain phases of production.

Of course, this is easier said than done. If you don’t have the proper resources, it can be difficult to identify the parts of your process that need improvement. As a result, it’s necessary to have a system that helps you identify inefficiencies in your manufacturing process. SAP ERP (Enterprise Resource Planning) systems provide real-time information to all departments in a business. This improves communication and reduces the risk of your workers doubling up on work. It also helps keep track of inventory, which can help with reducing waste.

Labour Shortage

One of the biggest problems that manufacturers face is the shortage of skilled labour. With the previous generation of workers beginning to reach the retirement age, manufacturing projects are struggling to find skilled workers among the upcoming generation.

One solution is to use online job platforms to attract younger skilled workers. To stand out among the hundreds of other companies, you might need a little social media push as well.

In terms of workers that are already on-board, you can provide regular training in order to improve their skills. Some companies use competency management software to keep their employees up to date with the latest technology and processes.

Inventory Management

Checking your stock is a must for any business. Having an inaccurate report on inventory can cause shortages or overstock. On the manufacturing side of things, it can lead to the purchase of unnecessary materials and the production of unneeded items. In the long run, these inaccuracies can have a significant effect on your profits.

As a result, regular inventory audits are necessary. This can be done efficiently using SAP project systems. Through an SAP project system overview, inventory managers will be able to track inventory levels at all times and receive alerts when restocking is necessary. For businesses with a physical store, an SAP PS can also be integrated with barcode scanners to make the process even easier.

This automated system will make inventory management more efficient and more accurate. For smaller companies, it will allow workers and owners to focus on other matters that can help scale the business.

Sales and KPI Reports

For many businesses, maintaining profits isn’t enough. In order to scale, you need to be constantly tracking sales and KPIs. This process is easier when your business is small. However, as your business grows, it will become much harder to keep track of these numbers. Inventory levels will start to grow and the manufacturing process will become a lot more complicated.

With project management tools, you will be able to constantly evaluate your business’ performance. With an SAP PS, you will have a better overview of which products are selling, which products require more stock and which ones need to be scaled back.

With so many moving parts, it can be difficult to manage manufacturing projects. But with today’s technology, there are plenty of ways to make the process easier. Hopefully, what we’ve discussed above gave you an idea on how to apply modern solutions to common manufacturing problems.