With the agility, flexibility, and affordability of today’s ERP systems, small manufacturers can choose a manufacturing software platform that is suited to their specific needs.
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Searching for the right ERP system can be a daunting task for any company. With a dizzying array of options, it can be intimidating. Often, a company will gravitate toward a well-known name brand because of the familiarity with other products and applications they may have used in the past. But for ERP systems, this isn’t always a good choice.
One such example is Microsoft Dynamics AX (Now rebranded as Dynamics 365) and Microsoft Dynamics NAV (Now rebranded as MS Dynamics 365 Business Central). Both are ERP solutions designed as a full service and full-featured system. However, there are differences between the two based on the size and scale of the enterprise where they are deployed. Let’s look at a few of the differences:
- Client focus – MS Dynamics AX is designed for large international clients who must manage an ERP across multiple locations and potentially international borders. Dynamics NAV, on the other hand, is geared more toward medium-sized businesses and is scalable as they expand.
- Industry Flexibility – With MS Dynamics AX, six specific industries make up the bulk of deployment. They are service, manufacturing, distribution, finance, public, and retail. While Dynamics NAV is a flexible and adaptable ERP that can adapt to any industry.
- Complexity of Implementation – Because MS Dynamics AX is designed for large entities, it has a lot of features and therefore takes longer to implement. MS Dynamics NAV, on the other hand, is easier and faster to implement and maintain. Both offer on-premise and cloud-based service.
How Big is Too Big?
A review of both MS products immediately yields an acute observation. While Dynamics NAV may be geared more towards medium-sized businesses, they are both often too large and too costly for small manufacturers looking for ERP solutions as well. When faced with purchasing a system that is overpowered for their needs, many small manufacturers falter. They realize they need a full service and agile ERP but can’t afford or don’t need all the features of either of the two products offered by Microsoft. And once this realization sinks in, small manufacturers are left with unrealistic options from a brand name they know so well.
However, there are alternatives for small manufacturers to both MS Dynamics AX and MS Dynamics NAV. These solutions offer the service level and features that make them a full-fledged ERP while providing agile, flexible and affordable solutions in a modular and cloud-based environment. Let’s look at some of the alternatives that small manufacturing companies may wish to consider.
ERPs that Cater to All
On one end of the spectrum are other well-known ERP name brands. These brands have a long history of performance that equals MS Dynamics AX and MS Dynamics NAV in functionality, and they are used by small, medium and large businesses. Most also have financial software functionality as well, a distinction that helps smaller companies manage their finance operations to best practice standards. These ERP systems include platforms such as:
- Oracle eBusiness Suite – Oracle eBusiness Suite is a cloud-based platform that streamlines business processes for manufacturing to optimize production capacity as well as develop efficient and concise workflows. The platform also has a host of applications for everything from maintenance management, financial performance, HR and CRM.
Companies find the software easy to configure and highly compatible with third-party applications. Training and ease of use for staff reduce the learning curve. However, Oracle eBusiness Suite’s modular list of applications can result in higher prices than many manufacturers may be looking for. While each company’s cost will differ depending on what features are used, it is still one of the more expensive options on the market.
- SAP ERP – As another well-known performer within the ERP space is SAP. SAP ERP has manufacturing operations, HR functionality and finance management at its core. The platform integrates well among different functional areas and is intuitive and easy to learn, it is also highly customizable and known for high data security.
Some cons include slow response time depending on the number of users on the system at one time as well as cost. Like Oracle eBusiness Portal, SAP ERP, while versatile and modular SAP still tends to aim for the mid to large enterprise and this is reflected in the cost.
While these solutions are viable alternatives to MS AX and NAV, they are not ideal for small manufacturers.
AX and NAV Alternatives for Small Manufacturers
Concerns such as cost, flexibility, and an opportunity to build utilize a full-service ERP with affordable a la’ carte functionality are high on the list for small manufacturers. For those smaller enterprises seeking full-featured and cost-effective ERP solutions that are agile flexible, there are many manufacturing software systems that can be deployed that will give these companies an ERP system on par with larger systems.
- MRPeasy – MRPeasy began as an MRP system so its core functionality for manufacturing, shop floor control, material planning, inventory, sales order management, warehouse management, and work order management is long-established and well tested. MRPeasy has since moved into the realm of a full-fledged ERP.
Many small companies seeking an ERP system are concerned about financial management to comply with best practices. MRPeasy has designed its ERP platform to integrate with both Xero and QuickBooks. These programs are used extensively by small and medium-sized companies as their accounting software of choice. With its built-in Standard Accounting module, or integrating MRP functionality with QuickBooks Online and Xero, MRPeasy can offer a fully functional ERP solution for small to medium-sized companies from 10-200 employees with the familiarity and ease of use of a finance system already familiar to employees. For those small manufacturers with small office staff, the ability to use a familiar system of payments and bookkeeping helps reduce the anxiety as well as the learning curve required for a new system.
The MRPeasy system is exclusively browser-based and requires no installation. And because it is browser-based, there is no maintenance and updates are instant and under the covers experientially. It offers a wealth of User Manuals, FAQs and other tools to streamline the learning curve and training required for implementation. The integration with Xero and QuickBooks lends immediate credibility to the finance and accounting functions due to their partner’s name recognition and reputation. The system also works on mobile devices including Android and iOS.
Negatives may include concern for security and connectivity due to the browser-based setup. However, these concerns are mitigated by the fact that data is kept on dedicated servers with hot backups to provide continuity and safety.
As a browser-based system, there are some upper limits within the lower three packages in areas such as SKU counts, total allowable BOMs, lines per work order, etc. These limits assure server capacity optimization. However, the Unlimited package does not limit computations for any functionality.
Starter and Professional packages for MRPeasy are available at $49 and $69 per user per month for the first ten users. The most popular offering is the Enterprise version at $99 per user per month. There is also and additional Unlimited level available for $149 per user per month that has the same features as Enterprise but with added API integration capability. MRPeasy’s pricing applies to the first ten users only, meaning additional users as a company scales bring the average cost per user down even further.
- Sage100cloud – Sage100cloud offers ERP for small manufacturers needing to automate processes. Their ERP is full-featured including manufacturing, Inventory management, and warehousing, purchasing and supply chain, CRM and accounting and finance. Modules can be purchased and customized a la’ carte to allow a small manufacturer to build an ERP system customized to their unique needs.
The Sage100cloud platform is highly customizable per user and has clear, dynamic and user-friendly interface options. It is available as a cloud-based option as well as an on-premise option and can also be run as a hybrid.
Negatives include a slow response from customer service for bug fixes and trouble tickets. Users have also complained about the number of windows that can be opened on the platform at one time. Also, exporting can be slow for very large data sizes.
While Sage100cloud does not list pricing on its website, third-party research indicates that their pricing is tiered. All their packages are priced based on the number of users with their Essential package for 1-5 users coming in at $50 per user per month and their Complete package coming in at $66.67 per user per month for 1-5 users. However, unlike MRPeasy, Sage100cloud continues to charge per user per month over ten users (their Complete package for 25users or more is $53.33 per user per month).
- Syspro – Syspro offers ERP functionality ideal to small enterprises. This system is modular and additional modules are available as the company scales. Their platform contains common ERP functionality including shop floor control, inventory control and financial functions. Syspro also has robust scheduling functionality that allows the system to track actual vs estimated labor and manage materials and scrap for work-in-process. This is a valuable tool for smaller manufacturers where material costs can make a big impact on profit. The system also has Engineering Change Control (ECC) that allows accurate tracking and traceability for different product iterations. The platform has an intuitive user interface.
Negatives include difficult to use out of box reports which often must be customized to be useful to the enterprise. Syspro offers both cloud-based and on-premise deployment. It is sold primarily through resellers and pricing is around $199 per user per month after installation costs.
- IQMS ERP – IQMS offers manufacturing options for adding capabilities with additional models as small companies. Its core functionality includes manufacturing and resource planning, scheduling, supply chain, CRM, purchasing and accounting. The IQMS ERP system also has Vendor Management Inventory (VMI) and embedded EDI functionality. VMI allows a company to undertake consignment arrangements with vendors as well as allowing manufacturers the ability to utilize JIT manufacturing through their supply chain.
The embedded EDI feature creates seamless automation in purchasing from point of order through the delivery of raw materials and key components. For companies attempting to build lean best practices into their operation or who must manage on a tight budget in bootstrapped operations, these features are critical.
IQMS does have some cons. It has inventory analysis and there have been issues with software bugs and limited functionality on some modules. Also, the system does not connect work orders to sales orders to create a seamless chain. The system is available as both cloud-based and on-premise deployments. The price range can range in the tens of thousands annually.
Manufacturing is a highly competitive and diverse industry. For small manufacturers, size and scale can mean a different set of challenges compared to larger companies. But with the agility, flexibility, and affordability of today’s ERP systems, small manufacturers can choose a manufacturing software platform that is suited to their specific needs. Because of the attention to the needs of this size company, these providers can provide ERP functionality on par with those of their larger competitors such as Microsoft Dynamics AX and Microsoft Dynamics NAV.