ERP and PLM both enable manufacturing companies to manage their design and production processes, but these tools are designed to work together, and aren’t an either/or solution. While PLM systems focus on the product record—the BOM, AML and revision history, ERP systems focus on the financial roadmap.
If you're doing outsourcing, manufacturing something that's remotely complicated, you will probably need both ERP and PLM. But what gets implemented first?
A Breakdown of PLM and ERP
PLM—the system of record for your product
- Bill of materials (BOM) management
- Item management
- Change management (ECR, ECO, ECN)
- Document management
- Compliance management
ERP—the system of record for your financials
- Inventory management
- Order management
- Sales forecasting
As you can see, these tools manage different things, and knowing which business systems to use for which purpose is a pretty big part of implementing these systems correctly.
Because PLM is intended to manage the development of your product and ERP is intended to manage the resource planning of your finalized design, I think it makes the most sense to start with a PLM system. After all, it’s a waste to plan out the resources for a product design that is still undergoing revisions.
To organize and manage product data, product data should be initially stored in a PLM system. Once the product design has developed to a point where resources need to be managed to produce the design, an ERP system that integrates with the existing PLM system is helpful. If you're managing your finances before looking at your product record, you may feel like you're focusing on the bottom line, but you're actually opening yourself up to scrap and rework. In contrast, if you implement a PLM system beforehand, you can be confident the product information is being accurately managed and the ERP system is working with effective data.
What do you all think? Any success stories of implementing one before the other?
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