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Artificial Intelligence and ERP: Making your Manufacturing Business Intelligent!

In this era of cut-throat competition, manufacturing businesses are invariably looking to add value to their processes, which can help them gain a competitive position in the industry. Companies are on the lookout for ways to enhance efficiency across critical operations and improve overall organizational productivity. This encompasses all the areas of their business such as the inventory management, production, and supply chain management, among others, as organizations continuously strive to integrate all the internal departments so as to deal with the external challenges. In this bid, many manufacturing businesses are opening up to the idea of leveraging artificial intelligence (AI) for gaining competitive advantage.

AI has been the buzzword of late, with almost all the industry experts backing it to be the most disruptive force in technology in the coming decade. Going beyond the smartphones and house appliances, its scope has ventured into the realm of enterprise resource planning (ERP), as more and more manufacturing businesses around the world are preferring AI-enabled ERP systems to transform their business operations. But what this buzz has also meant is that the term artificial intelligence is being overused to an extent that its actual meaning is getting diluted. So, before understanding how AI & ERP are redefining the manufacturing businesses, let’s first understand what AI actually is.

What is Artificial Intelligence?

First defined over six decades ago, AI refers to the intelligence displayed by machines to perform a task in contrast to that of humans to accomplish the same task. Just like a human understands a conversation and gives an answer, or analyzes information and makes future plans, AI too does it. It employs machine learning, and is based on algorithms, statistics and finding trends and patterns in data. AI involves the use of computing power to solve specific problems faster, and often more accurately than humans can.

The English Oxford Living Dictionary defines AI as “the theory and development of computer systems able to perform tasks normally requiring human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages.” In other words, AI is anything that makes a system clever.

With digital assistants like Siri, Cortana and Alexa, AI has pretty much become a part of our life and continues to transform it. We’re becoming reliant on them for activities like making phone calls, setting alarms, and searching for information.

Artificial Intelligence & ERP – how they go together?

While these conversational interfaces have made our day-to-day lives increasingly easier, organizations have, at the same time, pondered over collaborating them with an ERP software in order to leverage their benefits at the workplace as well. As a result, the AI-enabled ERP software has become a reality, and are being used by organizations to boost efficiency in manufacturing. Such systems can provide manufacturers with tools to make more accurate decisions based on thorough data analysis, help with production reporting and updates from the shop floor, streamline production processes by automatically analyzing shop floor data and fixing the operational inconsistencies, and save valuable time and costly resources.

The AI-enabled ERP systems are smart enough to learn from their own data points and help prevent future problems. For ex: you can fix the issues related to the quality of supply from a particular supplier. In addition, organizations can also arrive at the cost of production based on historical data related to production and sales. This way, merging AI with ERP puts in place robust processes to run the business more efficiently and reliably. Today, AI-enabled ERP systems are delivering results for manufacturing businesses, touching different business processes and functions, and improving them in more ways than one.

How AI-ERP Integration is Making your Manufacturing Business Intelligent?

Integrating with an ERP, artificial intelligence is indeed making businesses intelligent by impacting their different areas. Let’s understand it better:

Automation: Eliminating the need for manual entry of data into the ERP system, AI saves on time and operating costs. It also eliminates any scope of error, as machines are more accurate than humans. Also, managing large data sets and complex algorithms, AI-enabled ERP helps businesses quickly analyze that humongous data and turn it into cost-efficient and more effectively run company operations. This way, it frees management of mundane tasks and frees up their time for higher levels of creative thinking.

AI can help with sales automation as well, helping the sales representatives keep track of their targets and interact with the customer in a smart manner by using data to determine what is likely to drive results. Further, AI and ERP integration can even help with equipment maintenance in manufacturing industries, with a digital assistant (DA) storing the critical information related to equipment, and assisting the service technician with repairing/maintaining the equipment efficiently.

Supply chain: AI has many applications and benefits in supply chain management. AI’s predictive analysis can help with accurate demand forecasting by identifying hidden patterns in historical demand data. AI also ensures more accurate inventory management, procurement management, quality inspections, improved compliance, etc. Ever imagined a robot, or a drone, equipped with a camera tracking inventory on the store shelves? It’s a reality now!

Workflow enhancement: As mentioned earlier, the AI – ERP integration facilitates the analysis of large amount of historical data, which paves way for strong internal work processes, streamlined workflow and optimized work processes.

Customer service: With the entire customer service history at its disposal, AI-powered ERP can enable chatbots to respond to the customers’ inquiries in a quick, consistent, and cost-effective manner. Such systems also collate and analyze customer data from different departments in real-time, thus continuously improving the quality of customer service.

Decision making & problem-solving: As mentioned earlier, AI – ERP integration facilitates informed decision making, allowing manufacturers to make data-backed operational decisions. Such a system enables users to access massive data sets, analyze patterns, and make predictive analysis, allowing better decision making and problem-solving. This way, when the errors unfold, the manufacturers can be ready with the data and can quickly fix the problem as well as improve the workflows so that similar issue doesn’t occur in future.

Closing Thoughts

It is fair to say that AI technology is going to be a dominant force across industries in the near future. This includes the scope of ERP systems as well, as the AI – ERP integration is going to change the ERP landscape, and revamp the business process completely. If you are on the lookout for a new ERP system, we at BatchMaster can offer good help.

Written By

Sanjay Panjwani, Co-founder & MD BatchMaster Software. A technology enthusiast, he is the brains behind BatchMaster ERP- ERP Software for process manufacturers. An avid outdoorsman by the weekends, he enjoys reading & playing sports too.

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