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Why Automotive Manufacturers are Using ERP and So Should You

The Auto Industry is on the verge of revolution. It drives the world big time and plays a massive role in the global economy. Being a dynamic and customer-driven industry, the automotive sector deals with components of different sizes and varieties that are required in varied workstations for assembling, polishing, painting the automobiles and its parts.

The global automotive industry will continue to grow for the foreseeable future. Manufacturers are faced with the growing demand for electric vehicles, autonomous vehicles, and connected mobility. The deep focus on customer satisfaction remains. Recalls and quality-related issues can negatively impact the original equipment manufacturers’ (OEMs) brand. As a result, the supply chain is under increased pressure to transform the organization while maintaining profitability, providing high-quality products and delivering on-time.

Where we once imagined an automotive factory focused on the digital, robot-driven production floor; reality has transcended the factory floor to include the entire manufacturing ecosystem—connecting employees, processes, machines, data, and customers—far beyond what was once envisioned for the automotive industry system. Modern Enterprise Resource Planning frameworks can clearly help accomplish these objectives and rethink significantly one’s organizational progress.

Here are the top 9 reasons why you should use ERP for your Automotive Industry:

ERP for Automotive Industry

While factory workers, machines, processes, data, and other elements of production support automobile manufacturing factories, empowering transformative customer experiences is truly at the heart of the modern factory. The desire to adapt to quickly-evolving demands is nothing new, except now technology trends such as industry-specific automotive industry software solutions are being adopted and integrated into ways that finally deliver on this real-time, customer-centric vision. Such industry-specific frameworks provide manufacturing organizations with a far-reaching set of elements that helps in tracking and analysis of current policy making, rolling out sensible improvements and control departmental work.

When we talk about the automotive industry software, ERP systems have truly added more value to the organization by optimizing operations, reducing cost and maximizing profitability. From integrating value chain activities to maintaining the warehouses, improving CRM and real-time information access to enterprise visibility, an ERP for the automotive industry helps you make the right decision while reducing errors.

ERP is a business process management software that allows automotive business owners to prudently manage their important auto parts, schedule and plan workstation and flow of BOMs.

As per a study published by CIO Magazine in 2008:

CIO Magazine

Approximately 10 years later, this survey still holds the same essence.

So, let’s take a look at why modern manufacturers are using ERP for the Automotive Industry –

  • Increased Real-time Data Access

Modern ERP systems allow users to smoothen the informational flow within an organization. It consolidates the data of every department and empowers the decision makers to make prompt decisions. Automakers need up-to-date information about customers, availability of resources, employee management, and manufacturing status – ERP fills this gap. Manufacturers can view, edit and manage the entire data with just one solution.

  • Secured Data

Organizations create and maintain tons of content pieces – HR policies, QC reports, forms, business plans, Barcode labels, Batch numbers, Routing reports, etc. From reports to customers’ data, an ERP helps you manage end-to-end processes on a single screen. When deployed on the cloud, the data is safe and driven by automatically scheduled backups to prevent failure. Data security, update, and storage is managed by the cloud provider.

  • Enhanced Inter-organizational Communication

ERP aims to suppress communication barriers between teams and departments. Every authorized person has access to view and edit the data and push it for further processing. Let your employees work collaboratively to achieve the given goals. With an ERP solution, management can have a bird’s eye view of the entire organization and activities going on in departments (production, QC, supply chain planning, procurement, shipping, HR, Finance, warehouse, etc.)

  • Utmost Compliance

ERP developers understand the need for stringent quality standards that the automotive industry requires. Smart ERP facilitates detailed labeling capabilities, AQL (Accepted Quality Level), RQL (Rejected Quality Level) to ensure adherence to the quality parameters. Automotive manufacturers can take prompt decisions by tracking sample frequencies, production defects, viewing and executing the quality plan.

  • Inventory Optimization

Surplus inventory is an undesired expense while stock-outs can hamper customer needs. It is impossible to ignore your warehouse and considering this, OptiProERP with SAP Business One facilitates report generation, recording warehouse transfers, capturing inventory and process tasks and transactions on the plant floor.

  • Automation of Tasks

With electronically generated reports and sheets, you don’t need to manually generate delivery notes and invoices – everything is done at the touch of a button. This indeed saves money, time, and effort and reduces the number of errors done.

  • Lowered Cost and High ROI

When an ERP is hosted on the cloud, manufacturers don’t need to hire multiple servers or recruit a team of IT professionals for installing and configuring the systems. It is all set and done by the cloud providers. Modern ERP promotes cost-efficiency, minimum implementation time, access through mobile-enabled devices and employee satisfaction.

  • Quality and Customer Relation

Successful manufacturers opt for the ERP solution embedded with rich and powerful features that facilitate swift actions. The QC module of OptiProERP is devised seamlessly to enhance QA processes and reports. From receiving and delivering inspection to bin management, skip QC, Material Review Board, you can evaluate every aspect and thereafter make a prompt decision. When an optimum quality standard is met and products are delivered on time, customers are ultimately satisfied.

  • Employee Efficiency

Happy employees work with more efficiency. With ERP, automated operations, data redundancy, and duplicate data entry are eliminated – this adds more to employees’ confidence, productivity, and efficiency. Moreover, ERP offers the facility of accessing data with handheld devices, they can easily enjoy working from home or remote areas.

  • Greatest Optimization of Resources

ERP solution drives lean manufacturing and helps businesses develop a lean supply chain that can ensure optimum utilization of resources, improved lead time and less wastage. When tasks are allotted to the right person, he/ she does it with sheer commitment and in the best possible manner.

The major advantages of ERP for the automotive industry are summarized below:

ERP Benefits for Automotive Industry

To wrap it up, Enterprise Resource Planning application is one of the agile and powerful business suites for automotive manufacturers that enables growth, productivity and prompt decision making. Whether on the cloud or on-premise, OptiProERP offers a clear view of tasks and activities that are taking place on the shop floor, warehouse, procurement, shipping or QC. Those manufacturers who have not yet deployed an ERP or who are still struggling with the traditional methods should invest in one that can allow them to grow beyond horizons.

If you are someone who wants to know more about the benefits of automotive ERP software and how you can leverage it, please feel free to email us at

Download this whitepaper on An Overview of Automotive Manufacturing Industry if you wish to learn more about Automotive Manufacturing ERP Software and how it can help your Automotive manufacturing business with its functions.