For many manufacturers, there’s a significant amount of trust put into their enterprise resource planning (ERP) systems to handle every aspect of inventory management. And why wouldn’t there be? With the cost to maintain their ERP systems each year, it only makes sense to assume the system is sophisticated enough to ensure service parts planning success.

However, simply relying on ERP systems for service parts planning still requires manual processes to achieve acceptable inventory performance. This means time and funding are being spent managing the process rather than on worthwhile cost saving projects like IT initiatives or a more optimal inventory management solution.

That’s why investing in a sophisticated inventory management solution is time-critical for OEMs looking to optimize the after-sales service side of their business while simultaneously preparing for the future. But how should the right solution interact with existing ERP systems?

How Inventory Management Solutions Interact with ERP Systems

Most ERP systems, at their core, are designed to plan like a manufacturing inventory system. But, what many of these systems lack are the unique capabilities of an after-sales service focused inventory management solution. That’s where sophisticated solutions like Syncron Inventory come into play.

While an OEM’s ERP will always be the system of record for manufacturing data, supply chain data, finished goods data, and all the other types of supply data required to function, an intelligent inventory management solution is designed to work with – not replace – these data flows. Think of it as a decision support system; the inventory management solution extracts existing ERP data, runs algorithms for intelligent planning scenarios, and then returns with better decision-making data for the manufacturer to plug back into their ERP system.

But, despite the significant aid these solutions provide to complex inventory planning scenarios, many manufacturers believe they can manage these decisions through homegrown inventory solutions. Unfortunately, though, most are finding that by resisting investing in an intelligent inventory management solution that works with their ERP system, they are actually incurring even more costs due to things like capital, service, time and resources. And, in today’s changing world, OEMs can’t afford put the after-sales service side of their businesses at risk.

Why Experienced Partnerships are the Best Investment

Balancing a business’s immediate needs with its long-term growth is both paramount and challenging to any growing company. Challenging debates arise, like whether to take the less expensive, more conservative approach in the short-term or to invest in long-term initiatives. And, in the case of after-sales service, that debate comes in the form of homegrown processes versus vetted, sophisticated solutions from an experienced industry partner.

The problem is: most homegrown inventory solutions lack the advanced functionality required for modern service parts planning. Take rotable parts planning, for example. Service parts planning for rotable parts is different than planning for, say, consumable parts. A homegrown solution may apply blanket inventory planning algorithms to both kinds of parts, but intelligent inventory management from an experienced after-sales service partner can provide advanced optimization for rotable items and dynamic inventory policies that take into account scenarios like repair lead time versus supplier lead time, providing a more comprehensive view. And, for OEMs to attempt to duplicate that kind of agile intelligence on any level in a homegrown solution is simply not cost effective.

And, just as it is with service parts pricing, there’s no real way for OEMs to achieve intelligent inventory management – at scale – on their own. Even if, skill-wise, inventory planners working in spreadsheets are excellent at creating formulas, running advanced reporting, etc. – they’re still just managing within the limitations of a homegrown solution.

When it comes to after-sales service, achieving optimal inventory management is ultimately about taking the time to shift priorities toward a more collaborative after-sales service ecosystem that’s going to drive the most change – and that starts with implementing an intelligent inventory management solution. That’s why some of the industries top academia, management consultants and executives from leading OEMs are working with Syncron to help guide manufacturers through these business challenges together by creating solutions that work best for their businesses today, while also preparing for future business models that may impact the way OEMs do business for good.

Interested in learning more about how to start your journey toward better inventory optimization for your organization? Reach out to us today to speak to an expert about how you can get started with an intelligent inventory management solution that meets the needs of your business today and will evolve with you into the future.