MRP is Just for the Big Guys? Not Anymore!

Making the “Previously Impossible” Possible

Just when you think that you’ve seen everything the internet can possibly do, it presents you with a new and valuable feature…

Cloud Computing. For smaller manufacturing companies, who deemed the purchase of an MRP system to be out of reach, the existence of the Cloud makes the “previously impossible” possible.

To understand just how significant this feature is and what it means to businesses, we need to understand a bit about the history of the internet.

A Brief History of the Internet

The internet is a global network of computers that uses standard communication protocols to exchange information. In the beginning, the speed and capabilities of these computers were limited and businesses only used the internet to send email. At the time, those emails could only include text.

As the internet grew, and computing technology progressed, the size of the content that could be “served” from the internet increased substantially. The world moved from text emails and web pages to the inclusion of pictures. The internet progressed further to include the ability to store, view and send video.

Within the last few years, the big leap forward for businesses is the ability to leverage The Cloud and Cloud Computing. The Cloud allows companies to access data and programs outside of their own computing environment. Here’s why that’s a huge gift to smaller businesses.

The Traditional Computing Environment

Traditional computing environments exist inside the walls of a company. Programs such as CAD systems, MRP software, and ERP systems all had to be installed on a physical server and used inside the building.

These traditional software licenses were incredibly expensive  ($100,000 was not unusual at the time), and each installation or software upgrade required a technical representative to come to your physical location to perform the task. Frequently, these upgrades failed, resulting in downtime of crucial production systems.

As you can imagine, when you added up the cost of a server, the cost of software programs to run operations, the cost of upgrades and the cost of an internal IT professional to maintain all of this, the total cost to run a server-based MRP system was substantial. To make matters worse, the server had a finite speed and capacity, so within a few years, the server was obsolete, unscalable and needed to be replaced.

The cost of a traditional computing environment was so high that server-based MRP systems were only a possibility for large companies. This arrangement didn’t fit within the budget of smaller manufacturing companies which then put them at a disadvantage relative to their larger competitors.

How the Cloud Changed All of This

The Cloud has created the ability to store data and programs outside of the traditional computing environment. Applications such as MRP programs and their associated data have already become available in the Cloud. This move reduces the cost of using MRP so much that smaller manufacturers can now afford it.

Using programs like MRP in the Cloud provides the following benefits:

1. You will never have to upgrade your MRP software. Because the program resides on the internet, the program is kept up-to-date for all customers at the same time.
2. The MRP program is scalable. In a traditional computing environment, you are limited by the capability of your own, in-house server. In the Cloud, you are essentially “renting” use of the software vendor’s server over the internet. The vendor is responsible for maintaining the speed and capacity of their server.
3. You don’t need a server or the IT personnel to maintain it. With MRP in the Cloud, companies can eliminate the need for purchasing a server for their production applications.
4. Virtually no down time. With MRP being such a crucial system to operations, using MRP in the Cloud means that you will have virtually no down time. Online vendors adhere to service level agreements (SLAs) that typically guarantee 99% up time. That’s far less risk than the risk associated with an in-house server application.
5. You don’t have to be on-site to use your MRP system. Because a Cloud-based MRP system resides on the internet, employees can use the system from anywhere in the world. View production calendars, material reports, workforce information and bills of materials from any mobile device.

What MRP Means to Smaller Manufacturing Companies

Having access to the benefits of an MRP system is no longer just for the big guys. MRP in the Cloud opens up the opportunity for smaller businesses to purchase MRP and a cost substantially lower than what a traditional computing environment costs.

MRP in the Cloud offers reduced IT costs, a scalable solution, collaboration efficiencies, and visibility into operational and purchasing data from anywhere in the world.