Driven by market demand and aiming at straightening out business process and management mechanism of enterprises, reinforcing management, obtaining market information rapidly and exactly and utilizing enterprises resources properly and effectively, Inspur ERP-PS successfully applies advanced technology to the business environment of enterprises, satisfying enterprises’ complex, changing and personalized application demand and helping enterprises immediately respond to market changes in shorter period and at lower cost. After years of development, Inspur ERP-PS has become the first choice of many successful enterprises and has helped these enterprises achieve remarkable benefit.

Analysis of Industry Application of Inspur ERP-PS— Machinery Industry

Development of the Industry

In 2004, Chinese machinery equipment market was thriving in both production and marketing. Both the gross amount and micro amount of output value and revenue created a new high in history; unprecedented overall substantial increase even appeared in the output of product and the output of most important products created the new highest records in history at the same time; some mechanical equipment was in active demand in market, whose marketing speed exceeded producing speed. In the aspect of import and export trade, both the gross amount and the newly added amount of export of mechanical equipment created new records after the reform and opening-up. The export rate has increased more than 14 percents since 10 years ago.

Compared with international enterprises, Chinese mechanical equipment enterprises have a long way to go, which is shown by the following:

First, the products have few varieties, low technical content and unstable quality.

Chinese mechanical equipment products have a few varieties and low technical content; the supply of the full set of basic mechanical products and major technical equipment can not satisfy market demand; the overall quality standard of some Chinese mechanical products is lower than that of developed countries, and a gap exists between the national standard and international standards; structural excess and severe overstocking of low and medium mechanical products takes place.

Second, technical equipment has a low level and a weak development capacity.

In general, there is a gap of approximately 15-20 years between Chinese level of mechanical equipment and that of developed countries. Only few Chinese enterprises have begun to adopt advanced foreign manufacturing process, equipment, technical designing means, advanced foreign ideology and method of management. There is a lack of product technologies with proprietary intellectual property rights, while the technologies of newly developed products are mainly from abroad, so Chinese enterprises have not grasped the initiative of product developing on the whole. The development period of new product is more than once longer than that in countries with advanced industry, together with even longer period of product updating and poor quick reaction capacity of market. All these have become the primary reasons for the constant failure of Chinese mechanical products in market competition.

Third, enterprises have incomplete management system and low management level.

Enterprises do not have complete management system. A large number of state-owned enterprises have neither completed their restructuring nor adapted to the new situation of increasingly intense competition in domestic and international market, together with the historical burden formed over a long period, these enterprises are facing difficulties. Enterprises do not have high level of management, resulting in impeded internal process of enterprises and difficulty in process control.

2. Characteristics of the Industry and Difficulties of Business Management

2.1 Main Characteristics of the Industry

With the accelerating of reform, domestic mechanical equipment industry has pulled up to the fast lane of economic development. In the changing era of knowledge economy, global economic integration has become an inevitable trend of economic development and enterprises are facing huge pressure and challenge. In order to remain invincible, enterprises must possess the service capacities of rapid product innovation, distribution, production and marketing, so as to satisfy customers’ demand.

Ø Products of various specifications and models are provided and they are updated at a high speed. Due to the rapid development of science and technology and technologies introduced from abroad, domestic mechanical equipments manufacturing industry has made significant progress. Mechanical equipments have been developed into numerical control machines at present from former common machines. The basic conditions of our country decide that mechanical equipment products must be differentiated into various grades to satisfy the demands of different customers.

Ø Limiting production to market ability demands much on delivery time. At present, the market of mechanical equipment manufacturing industry is changing from time to time, the pattern of “basing sales on production” applied by enterprises will result in vast overstocking of products and capital and increased risk of enterprise operation. Therefore, enterprises must choose the management pattern of limiting production to market ability. It is the investment of enterprise to purchase mechanical equipment. Customers need to catch up with project progress against time and require that equipment be put into operation as soon as possible, so they demand strict delivery time of mechanical equipment products.

Ø With discrete type, machinery manufacturing industry possesses “just-in-time” (JIT) production.

2.2 Difficulties of Business Management

With independent management information, decision-making is short of data support. Due to manual management of business system and financial system, independence of department, impeded information, inability of resource sharing, high cost of statistics statement (some statements can not be realized, such as: the tendency of raw material price and the analysis of purchasing demand), it is difficult for enterprise leaders to master information from market timely and exactly. Therefore, they can not immediately make correct decision and prediction on market (when to order which material on a large scale, the influence of price fluctuation of raw material on product cost, and the price of products, etc.)

Refine purchase management and strengthen order tracing. With the constant expansion of enterprise size, the business amount of enterprises is more and more complex, and it is impossible to trace all purchase orders. It is difficult to know the quantity and amount of warehousing entering, the quantity and amount of bill making and the quantity and amount of payment of every purchase order clearly. Since the delivery time of products is especially important for mechanical equipment enterprises and the timely arrival of purchased materials is one of the most important factors that influence the delivery time of products, so the comprehensive understanding of arrival of orders is of great importance for mechanical equipment enterprises.

The variety of materials creates difficulty for warehouse management. Since there are varieties of materials of mechanical equipment manufacturing enterprises, manual management creates problems such as lack of standardization of material name and inability to ware location management. The problems that no space can be provided to store picked materials and mistaking entering and exiting usually happen, resulting in big difference between book quantity and actual inventory, and the information of book quantity of inventory can not instruct production and purchase. The records of entering and exiting are filled manually, the large business amount and low working efficiency usually cause errors and high cost of statistics statements; since the over stored and lacked materials can not be checked in time, problems of stop for materials and excess materials usually happen. Therefore, it is the major problem to be solved by enterprises to improve warehouse work efficiency and to reduce inventory turnover.

Control workshop loss by limiting material picking of workshop. Since mechanical equipment products have complex structure and one product is composed of several hundred kinds of materials, it is quite difficult for production department to control workshop’s material picking according to production plan and product structure. Strengthening the control by limiting material picking of workshop can effectively reduce workshop loss and improve the efficiency of workshop’s material picking. Therefore, implementing limited material picking of workshop is the objective of production management that mechanical equipment enterprises pursuit.

Trace the entire course of the quality of finished products to improve customer satisfaction. In order to strengthen the tracing of quality of product, mechanical equipment products are marked with factory numbers. In order to realize the effective tracing of the quality of products, enterprises establish delivery account for every set of mechanical equipment based on the factory number to make sure that the problems of product quality can be traced (including information of material manufacturer, production workshop and teams, etc.)

Strengthen tentative estimation business management to grasp all the accounts payable of enterprises. Due to the large number of material manufacturers of mechanical equipment manufacturing enterprises, the large business amount of communication with units and the problem that product has arrived while freight bill has not arrived, the quantity and amount of monthly tentative estimation is very high and the annual processing of tentative estimation has complex business and large work load. The lack of tentative estimation of enterprises will cause inaccurate cost accounting and incomprehensive account payable of enterprises (excluding the part of arrived product and non-arrived bill), as well as negative influence on enterprises’ plan of capital using.

Safety stock management is difficult and the control of picking application of material is difficult. Mechanical equipment enterprises usually have various kinds of materials, while the lack of only one material may prevent the manufacturing of the product and delay product and affect delivery. Therefore, mechanical equipment manufacturing enterprises usually apply the method of safety stock to manage C-class materials. However, since manual management of safety stock demands much on warehousemen (i. e., warehousemen should care for the quantity of safety stock of every material and should know the actual stock of every material at the moment), error is inevitable in manual management of material safety stock, resulting in stopping production for material. As mechanical equipment enterprises need a large number of measurement instruments, the control management of application and picking of measurement instruments is also important. The warehouse should carry out strict tracing management for the application and picking of measurement instruments to avoid the disorderly application of measurement instrument or the situation of application without use. However, it is quite difficult to control the manual management of application and picking.

3. Solution of Inspur ERP-PS

The personnel of mechanical equipment manufacture industry have a high quality and strong consciousness of informationization in general. Mechanical equipment manufacturing enterprises with certain size have basically realized financial computerization, while the construction of information system based on enterprise class application is developing slowly. Based on the situation, Inspur Common Software is the first to issue the solution of mechanical equipment manufacturing industry with the combination of advanced information technology and scientific management concept in China on the basis of years’ experience in finance and management software and the demand of many mechanical equipment manufacturing enterprises.

Complete business flow management is provided from demand planning, purchase planning to issuing purchase order for goods to be purchased; from arrival, inspected to approval for warehousing entering of goods; form sales order, goods picking, settlement, delivery to customer tracing. Complete enterprise business management is provided, and work flow can be customized in accordance with actual application.

Increase purchase efficiency by complete tracing of purchase order. Inspur ERP-PS provides meticulous and detailed order management function, the main content of purchase order tracing involves quantity and amount of arrival, the quantity and amount of bill making, the quantity and amount of payment, and the tracing of overdue order, etc. Inspur ERP-PS purchase order management also provides the functions of relation query, detail query and random statistics.

Improve work efficiency and strengthen warehouse management. Inspur ERP-PS can realize full sharing of sales data, purchase and production departments and the one-time inputting a full-course application of business document; it applies advanced material number (mnemonic code) for routine operations of warehouse exiting, warehouse entering and check, etc., which greatly reduce the work load of staff and enhance work efficiency. Inspur ERP-PS stock management carries out classified management and control for the routine service of materials, managing the quantity, cost and capital using of stocked materials from different aspects of class, warehouse, goods allocation and factory number of products. The software provides functions of safety stock, maximum stock, guarantee period and product re-inspection, etc., analyzing the situations of over storage, shortage and excess of stocked materials and giving alarms automatically.

Reduce workshop loss by strict limited material picking. Inspur ERP-PS provides powerful function of limited material picking. The software can create limited material picking of every workshop and every warehouse by the calculation of production plan and product structure, and the warehouse can feed workshops according to the quantities of limited material picking. When workshop consumes more than the limited quantity, the company shall carry out appraisal through limited amount to strengthen the consciousness of conservation of every worker in the workshop and to save material and reduce production cost finally. The software also provides powerful functions of query and statistics of the bill of limited material picking (e. g. data of limited material picking can be accounted by workshop, by warehouse or by product to satisfy the demand of every department).

Strengthen cost management by flexible tentative estimation. Inspur ERP-PS provides two modes including backwash on arrival of bill and backwash in the next month. The software provides the function of intellectual tentative estimation backwash, that is, tentative estimation backwash automatically creates a red bill to counteract the former blue bill and automatically creates a blue bill to cancel purchase invoice at the same time. The tentative estimation and backwash of the software support the detailed variety and quantity of documents in order to satisfy enterprises’ complex business of tentative estimation.

Purchase management is provided with powerful function of data analyzing. The analysis of material price can not only analyze various prices of different materials but also analyze different prices of the same material. Price information includes price ceiling, planed unit price, actual unit price, and the latest unit price, the lowest quotation of suppliers, the highest quotation of suppliers and the mean quotation of suppliers. The analysis of material price fluctuation can analyze the prices (invoice prices) of a material at different times, and graphic analysis is provided by the system. The analysis of purchase proportion can analyze the proportion of quantity and the proportion of capital of various material purchased by an enterprise during a period of time.

Rich and Flexible Function of Statistics Query

Query of warehouse account: The query of various accounts related to detail account is provided in the stock system, including: the query of stock balance, the query of detail stock account, the query of batch account balance and the details thereof, the query of unit stock balance and various original bills, the query of auxiliary information, the query of various summary statements, the query of batch tracing, and the query of material state distribution, etc. Explanation: the accounts and statements can be inquired usually refer to the results that have been recorded. If you want to include original bills that have not been recorded yet, you can choose the option “pre-accounting of bill before account”, then the result will include bills before account. 

Function of purchase accounts: The query of accounts provided in the system includes the query of account payable, the query of original bills and the query of random statistics and purchase statistics, the query of purchase analysis, and the query of supplier information, etc. Wherein, the query of account payable includes the query of balance of account payable, the query of original currency balance of account payable, the query of tentative estimation account payable, the query of detail account payable and aging analysis. The query of original bills can inquire purchase demand, purchase plan, approval form of price, query sheet, quotation, purchase agreement, purchase order, purchase warehouse warrant, purchase invoice and payment order in any month and year. Any detail bill can be traced and inquired backward, and the statistics statement can be defined as needed. Purchase statistics includes purchase capital plan, purchase payment plan, the query of purchase plan completing, and the query of purchase order completing, the statistics of overdue goods, the statistics of goods in transit, and the statistics of goods being inspected. The query of purchase analysis includes contrastive analysis of material prices, the analysis of material price fluctuation and the analysis of purchase proportion. The query of suppliers includes the query of information of suppliers, the query of credit of suppliers and the query of goods supply of suppliers.

Original document summarizing: The software provides a large number of basic business statements, but various statistics exist in actual business. If the various query functions provided in the software still can not satisfy your demand, the system also provides powerful expansion function, that is, the function of customizing summary statements. You can summarize any original documents as necessary to form required statistics statement.

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