Sage ERP can help manufacturers reach cost-savings goal | The Business Management Blog

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Sage ERP can help manufacturers reach cost-savings goal

3/21/2013 at 10:00 am by

The next 12 months figure to be active for manufacturers, as many firms are planning to hire more employees, expand further and launch new products. But another goal, according to a recent study by The Hackett Group, is to reduce total costs, even as companies continue to bring manufacturing processes back on shore.

One of the reasons executives are setting the bar so high, the report found, is that technology innovations are dramatically boosting efficiency throughout the workplace.

“New opportunities for cost reduction are emerging, including internal optimization, materials cost cuts and reduced energy prices,” said Dave Sievers, principal and practice leader of The Hackett Group’s strategy and operations practice. “For 2013, companies are clearly focusing on building the skills and infrastructure they need to take advantage of these trending opportunity areas.”

The study found that manufacturing goals for 2013 include:

- A 1.7 percent decline in internal costs.

- A 2 percent reduction in warehousing expenditures.

- Decreases in costs for goods sold, materials and logistics.

Manufacturers are projecting these savings despite a nearly 3 percent increase in supply chain investment, with a large portion of those expenditures going toward tech-related purposes.

Sage ERP proving beneficial for many companies
The manufacturing sector is doing well right now, and executives are starting to feel more confident. However, they still have a relatively small margin of error to work with – meaning leveraging the right technology is of significant importance.

For many companies, enterprise resource planning (ERP) solutions, such as those offered by Sage, could provide the balance between advanced capabilities and cost-efficiency.

“Sage ERP X3 reduced overhead expenses 10 times for the cost of ERP maintenance, reduced IT staffing requirements [no programmers] and provided greater ease in generating reports,” said an IT professional at a medium enterprise consumer products company.

Sage’s ERP solutions provide a streamlined process, with many applications that integrate directly with cloud, mobile, social media and business intelligence technology. A TechValidate study of companies using Sage ERP X3 found that the technology has produced benefits such as:

- Risk reduction, cited by 53 percent of respondents

- Helping to enable growth, which 53 percent of respondents listed as an advantage

- Boosting worker productivity

Nearly 60 percent of respondents to the TechValidate survey said they chose Sage ERP X3 over Microsoft Dynamics, and they have been more than satisfied with the results. From ease of use to improved web capabilities, the technology could be ideal for manufacturers looking to cut costs while improving their processes all around.

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The Sage ERP team report on various topics related to ERP and business management.

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