Tuesday, April 4, 2017
Simple Manufacturing ERP for Life Sciences
Posted by Steve Chapman
Most life science companies in the pharmaceutical or medical device space will need to use some ERP functionality associated with inventory and manufacturing to accommodate their specific industry needs. The needs for inventory and manufacturing generally broaden through the product life cycle. Read on to learn about my recommendation for the right ERP for life sciences companies as they continue to grow.
These are the typical scenarios we see:
- R&D – Need core financial functionality and basic inventory functionality to identify items used in R&D, control purchasing and use of items, and report financial results to the general ledger. May use bill of material functionality at least from an engineering perspective.
- Prototype Development – Need basic inventory to organize items, assign suppliers, and properly value associated costs. May use bills of material and assembly transactions to generate finished goods and sub-assemblies from component inventory.
- Pre-commercialization – Need inventory and manufacturing functionality to track operations related to procurement and manufacturing. May use to track owned inventory located at and controlled by 3rd parties. Control the transfer of inventory used for product testing and sales sample purposes.
- Product roll-out – Need integrated purchasing, inventory, manufacturing, and sales functionality. May require MRP and sales forecasting functionality to plan for long-lead items and processes.
- Full commercialization – Need a fully integrated ERP system that can scale to meet volume and geographical expansion.
Ideally, a single ERP solution can take a company all the way through their products’ life cycles. Starting with a solution that requires a smaller investment and solid ease-of-use, but that can incrementally scale to support the company’s growing needs, is a perfect option for growing life sciences companies.
Microsoft Dynamics GP is a scalable ERP system that many life sciences companies use to meet their unique industry needs. You can start with basic core financial functionality and financial reporting, and add functionality as you need it, with guidance from your trusted advisers on possible re-implementation or changes to your system configurations.
Here’s an example of a multi-level bill of material to help visualize a part of how this ERP for life sciences would work for your organization:
Take a look at the video below to see a complete manufacturing process in Dynamics GP, including MRP, Sales Forecast, and Purchase Orders.
Steve has over 15 years of experience in business systems consulting, and 20 years of experience in management accounting and finance with small and mid-sized businesses in the construction, distribution, service, and technology industries.