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10 Tips on How Microsoft Dynamics-based Automotive Suppliers Stay Ahead of the Competition by Reducing Costs, Managing Output, and Improving Accuracy

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With Microsoft continuing to develop industry specific solutions, such as those for the automotive manufacturing industry, more frequently Dynamics-based organizations are relying on vertically-specialized Dynamics ISVs to complement their ERP investments. For automotive suppliers, they need to implement more flexible, powerful and responsive production systems to stay ahead of the competition. Understanding this requirement, Microsoft Dynamics’ automotive manufacturing software solutions deliver the key capabilities to automotive manufacturers, but an ISV with automotive supply chain expertise can deliver the extra nudge needed to surpass the competition.

As I noted in a similar post focused on Growers using Microsoft Dynamics, both clients and perspective Dynamics users now require customer evidence of vertical capabilities, and a little industry lingo won’t go far. Once you find an ISV that can successfully address your vertical requirements, you’ll see how a true ISV partner will work in synergy with Dynamics to progress your business.

Here are the top 10 (plus 1!) things that automotive suppliers should consider when selecting an ISV solution provider:

1. Cumulative Quantities (CUMs)*

How are you going to handle CUMs as manual processes can be risky? If you don’t maintain the CUM shipped, or utilize a manual process, you will struggle with the tracking process. Each time a release arrives, you’ll need to manually calculate what is in transit for every item you ship. For small shops this manual process may seem manageable, but as business grows, the potential for error and risk grows as well.

Given the risk, how are you going to handle CUMs if the manual process is not an option? Can your solution provider handle CUMs management or will they tell you to find another way, either enlisting another third-party solution or customizing your Dynamics ERP platform?

2. Replacement Logic

Each of your customers/trading partners most likely has different requirements. And so a solution that supports replacement logic accurately will help you manage the transaction detail in your ERP without manual keying of data.

3. Production Schedules and Releases Inbound

With all the data flowing freely from customer to supplier, you can easily lose track of where you are in the ever-changing schedule. With potentially hundreds or thousands of items to monitor, things could quickly get out of control without a dependable tracking mechanism.

To address this tracking challenge, there are two methods for staying in-sync with your customer. The first method is for the customer to maintain their CUM received while the supplier maintains their CUM shipped. The supplier can then compare their CUM shipped with the customer’s CUM received to systematically determine what is in transit.

The second method is for the customer to send Release Authorization Numbers (RANs) in their releases. A RAN-based system provides a unique identifier for each firm requirement (date/quantity) that they want you to ship. These unique identifiers have many names (e.g. RANs, Kanbans or SIDs), but they all provide a unique number to track the order from release through to fulfillment.

4. Robust Inventory Inquiry Reporting

Having strong inventory inquiry reporting for all parties helps streamline the entire supply chain by cutting down on overstocked items, items being delivered when they should be and much more.

5. Kanban Handling

Toyota developed Kanban (pronounced ˈkɑnˈbɑn) in the late 1940’s to assist with scheduling that communicates what to produce, when to produce it, and how much to produce. By integrating Kanban systems via EDI, Microsoft Dynamics ERP automotive clients can start helping to eliminate the human errors attached to manual entry and lost cards.

6. Aftermarket Distribution

The increased pressure to control costs, manage shorter lead times and improve delivery precision is not going away anytime fast for aftermarket distributors. In order to stay ahead of the competition and position yourself as an industry leader, you have to think outside of the box, which includes collaboration between suppliers and customers, and making sure you have transparent integration processes with the supply chain. Success partly depends on sharing information quickly and efficiently, so when selecting your EDI solution vendor pay close attention to how they can increase the speed and accuracy of data transactions.

7. ASN Labeling**

Getting ASN’s wrong can be costly and quickly effect your bottom-line. Making sure that you have a completely automated solution in place is key to eliminating these unnecessary costs. To help you during your technology decision-making process, hear are some questions you might ask:

• Does the solution support multi-user packing, ASN creation and native UCC-128 labeling?
• Are there single-click packing options?
• How easy is the user interface?
• How does the solution handle manifest and shipping system integration options?
• Can the solution interface to FedEx consignee shipments?
• Does the solution also help with VICS bill of lading printing?
• Can the solution support ASN standards, including SOPI, SOIP, SOTPI, SOTIP and SOI?
• Does it support EDIFACT (DESADV)?
• Who will be managing compliance?
• How does the EDI vendor complement and support WMS solutions with built-in ASN solutions?
• Does the solution have the capability to work as a “standalone” solution without Dynamics ERP integration?
• How easily can shipments be re-opened and edited before re-sending ASN’s to partners?
• Is there a way to set-up the system to auto-pack for standard pack and “pick-and-pack” operations?

8. Handling Organizations such as Transnet and/or ANX

Does the vendor offer an end-to-end solution including network service that reaches partners on ANX, Transnet and other popular value-added networks?  Is it flexible enough to distinguish customers vs. ship-to’s in a manner consistent with the way you structured your ERP?

9. Impact on the Dynamics ERP Platform

How does the solution integrate with your Dynamics platform? If the solution requires customization to the ERP, how much effort and risk will be involved when you either have a new patch/hot fix, decide to upgrade to the next version, or even change Dynamics platforms?  How will implementation of new partner mandates via customizations impact your production system?

10. Ongoing Transaction Costs

These days your trading partner may allow you to send and receive data via a direct connection. Does your solution provider support this direct connection while not charging you for any transactional costs? If they do, this defeats the whole idea of utilizing direct connections to help lower costs in moving data back and forth. Even if your Trading Partner(s) don’t allow for direct connection today, they may allow it down the road, so make sure your EDI technology investment can support your requirements both today and tomorrow.

11. Performance

You may sell 100’s, 10,000’s, 100,000’s or many more parts on a daily/weekly/monthly basis, so what performance data can your EDI provider share with you? Do you have seasonal trends or other spikes during the year? Performance analysis is critical and you need to know how your EDI vendor will get information in and out of your Dynamics ERP efficiently and quickly so that you can plan accordingly and avoid bottlenecks.

With all of the other potential risks that your business can face, you can easily avoid a costly, risk-filled EDI proposition by keeping this “Top 10” (plus 1!) in mind. It doesn’t matter where you are with EDI, whether evaluating solutions or entrenched with a solution, it’s always worthwhile to make sure the route you are taking leverages your Microsoft Dynamics investment to stay ahead of your competition.


* For a more detailed description on “How Do CUMs Work” download our Microsoft Dynamics ERP Automotive white paper  (page 5).

** Turn to page 7 within our automotive EDI white paper for a deeper dive into why automating your ASN’s is ideal candidate for streamlining your processes.


Other Resources:
3-minute Video: Take a Peek! Dynamics EDI Integration for Automotive Suppliers
Customer Success: Microsoft Dynamics GP Customer Overcomes Stall and Revs Engine with Dynamics EDI
Post: Friend or Foe? EDI Requirements within the Automotive Supply Chain

by Data Masons

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