EVS Blog

Ok, enough bloviating for a few minutes while we talk about my chosen career and passion; process manufacturing. Over the years, I’ve developed simple tests to help people identify true process manufacturing ERP software systems vs. discrete systems acting like process manufacturing systems, aka a “wolf in sheep’s clothing.”

One of my favorite simple tests is to determine how the ERP calculates production yield. For process manufacturers, yield is such a simple and basic concept, it’s hard to believe that not everyone does it the way we do. Here’s the formula to calculate yield, process manufacturing-style:

Qty Output / Qty Input

If you have an output of 90 pounds (maybe packaged in multiple pack sizes) and the inputs were 100 pounds you have a 90% yield.

Simple!

The problem is, that’s not how discrete manufacturing ERP works. Since their bill of material assumes a discrete quantity (multiples of 1) there is a link between the items issued to a work order and the output. So most discrete ERP modules, if they have yield at all, typically only allow a variable output, the input is static based on the bill of material.

This is a problem.

Because in process manufacturing you may have QC adds that effect input quantities and machine issues and yield loss which effect output quantities. Yield has to be flexible enough to understand variable inputs and outputs to calculate yield.

It’s the little things that make a system work for you as a process manufacturer vs. a system that just doesn’t; almost like a rock in your shoe, it’s just irritating.

If you are evaluating process manufacturing ERP, dig deep into how yield is calculated. A simple test will revel much.

Knowledge, understanding and Wisdom. While these terms are interrelated and complimentary, they are not interchangeable. Just for fun, let’s gain some understaning on these three terms.

Let’s build a car

As I read the instruction manual I gain knowledge of valves, camshafts, timing belts, alternators, etc. All of the parts are interesting and have a defined purpose in the engine.

As I learn how the parts work together I begin to gain understanding.

With wisdom, a car can be re-engineered to run on hydrogen.

Knowledge is by far the most dangerous as it can deceive us into thinking we are wise. When someone reads an instruction manual, the newspaper, a blog, political commentary, etc. they have knowledge but may think that they have understanding or wisdom. Knowledge alone can lead to arrogance. Listen to people debate politics, they spew facts at each other (knowledge) but have very little wisdom…unless you listen to O’Reilly or Judge Napolitano (!)

Whether you are learning new ERP software, refining your political or religious beliefs, or learning about our economy, understand where your level of learning lies. If you are at knowledge, seek understanding (and keep your ego in check); if at understanding, seek wisdom.

A Proverb says “How much better to get wisdom than gold, to choose understanding rather than silver.”