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Call us for a free FastStart Consultation: (844) 680-2046


 
by Daniel Harris,
Market Research Associate
Last Updated: January 21, 2017


Job shop and machine shop specialties are limited-scale manufacturing, including prototyping and single unit production or “one offs.” Margins can be very thin, so successful firms balance their time spent on manufacturing with time on maintaining inventory and fostering customer relationships.

Job shop software is essentially an enterprise resource planning (ERP) system with a limited scope. In fact, it's is often part of ERP if the shop is a small part of a larger organization. Broadly speaking, the system is used to automate many of the tracking and scheduling duties within the company.

A prime requirement for job and machine shops is manufacturing resource planning (MRP), the system that schedules the manufacturing of each customer’s order. Inventory and order entry are important and must be integrated with the MRP system, particularly with the pipeline management system.

Screenshot of E2 Shop System scheduling whiteboard

Screenshot of E2 Shop System scheduling whiteboard

Contract manufacturing is a relationship-based businesses. As such, owners should use customer relationship management (CRM) to track sales history and to market opportunities targeted at specific customers. Strictly speaking, payroll is standard. However, one of the resources tracked by MRP is worker time spent per work order. This allows owners and managers to measure the profitability of each employee.

General ledger, accounts payable and accounts receivable are standard. Most job shop manufacturing systems are installed on premises. The computerization and networking of tools and the associated costs means that most of the infrastructure to support job shop scheduling software is already in place, negating the hardware cost arguments for cloud-based installations.

Here's what we'll cover:

What Is Job and Machine Shop Software?
Common Features of Job and Machine Shop Software
Market Trends to Understand

What Is Job and Machine Shop Software?

Job and machine shop software provide necessary, real-time data that is related to manufacturing and other operations, such as job scheduling, finance, estimations, employees, sales, materials, engineering, job accounting and job management. They also provide job data related to competitors, vendors, customers, marketplace and the overall supply chain.

A job and machine shop solution helps manufacturing units reduce waste, enhance productivity and improve the bottom line. The solution helps users meet the specific requirements of job shops that cannot always be achieved using traditional manufacturing solutions.

Common Features of Job and Machine Shop Software

In addition to core business functions, it's important to evaluate the following functions to meet the company's unique requirements:

Pipeline management Balances jobs against the available resources, checks inventory and prepares orders for materials. Advanced systems also factor in cost and price, prioritizing the most profitable production.
Customer sales monitoring Compares each customer’s historic sales to recent sales to gauge trends. Also, enables supports customer sales incentives.
Job estimating Evaluates required time, materials, machines and personnel to perform a job. Calculates costs and profit. Advance systems can substitute resources and optimize for time or profit.
Make/buy reporting Applies estimating to subassemblies to evaluate whether it’s more profitable to make or buy components. Advanced systems will factor in time to build or buy as well as cost.
Process planning reporting Helps plan and document each step in fabrication for accurate estimating and job tracking. The process planning reports track the development of the process plan for each contract.
Material supplier planning Assists in the make/buy process by helping material suppliers assign a bill of materials to each subassembly. Allows make/buy decisions to be based on current market prices for material and labor for each estimate.
Fabrication scheduling Supports dynamic scheduling fabrication process, changing as different jobs finish late or early and as materials arrive in inventory. Also allows schedules to be reprioritized.
Customer delivery scheduling Helps streamline flows of shipping/delivery/pick up for efficient fabrication process. Includes transit time and adjustable slack time.
Slipped/late jobs reporting Tracks and reports job status through the entire process from estimation to delivery. Advanced systems will have a dashboard that signals management as soon as a job slips past a defined threshold.
Work load planning Helps managers adjust the work load to leverage the most expensive equipment to depreciate or minimize usage of the most expensive to run. Also helps manage employee work loads, taking into account workers’ preferences.
Scrap reporting Provides efficient tracking to minimize the amount of scrap by planning production to make the most efficient use of material. Also helps tracks recyclable scrap through to resale to the scrap yard.
Engineering change management Tracks engineering changes and their impact on delivery date and profit on the project. It should also be easy to enter the changes into the system so that the changes can flow to other projects and the overall schedule.

Market Trends to Understand

In the past several years, many major trends have influenced the manner in which job shops operate in the manufacturing sector, and will continue to impact in the future. New technologies, such as advanced robotics, data analytics and mobile devices will enable small job shops to compete with larger enterprises that have state-of-the-art infrastructure.

To keep up with the latest developments, job shops must be aware of the key trends:

Fully digital supply chain. The digitization of operations in a supply chain is about to become obligatory, leaving no scope for paper-based work. In this situation, paperwork is unacceptable in even the smallest of job shops. An all-digital supply chain increases productivity and efficiency and minimizes the chance of errors.

Artificial intelligence and predictive analytics. The back office requires a finer and better grasp of the big picture for uninterrupted operation. Many low-cost analytics platforms in the market quickly gather data in the warehouse, on the shop floor and through customer communications. This information is then assessed through predictive analytics to shape various supply orders for the upcoming months. It also helps predict which machine is likely to fail soon and which customers to pursue in the immediate term.

Augmented reality. A few years ago, the concept of augmented reality services, such as Google Glass, was in hype but it vanished quickly due to the high price of these services and devices. However, the concept has great potential. In the coming years, the cost of wearable hardware linked to such concepts is expected to reach a more realistic level. It will create plenty of opportunities in inventory management and enable quicker response to overall processes and operations on the job shop floor.

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