How Can SMEs Optimize Production Process By Going Digital | TranZact

Jan 9, 2021 in Digital



Are you a manufacturing firm? If so, are you also constantly trying to make a plan and ensure that you have all the inputs ready for production. In this article, we'll try to summarize how you can optimize production process in your business using digital solution.

A guy managing inventory on desktop

Production planning is all about sidestepping the puddles on the manufacturing road that tend to waste any team's valuable time and resources. By filling these voids in once and for all, you can streamline the whole process and make the production flow smoother. When the goal is to optimize production process, you should aim at improving things that can be improved easily. Then gradually you can move towards voids that may be a little tricky to fill.

Easier said than done? The following guide highlights how a cloud-based integrated platform like TranZact will help you optimize production process.

Streamlining Inventory Management

Keeping inventory is a major headache for every business. Occasional overstock causes unnecessary space shortage which causes a delay in fulfilling demand. Inventory management is the string of processes. It ensures that a manufacturing enterprise has the appropriate materials in the right quantity to complete the manufacturing process.

Read More - Inventory Management: Ultimate Guide for SMEs

How will a digital platform help

Centralized Inventory - All the inventory data of the company will be incorporated in one system where all teams can easily access it and be in sync with each other. It will enable businesses to control their logistics, operations, finance, and inventory from a singular system reducing errors and improving efficiency.

Design (Bill of Materials) - Using an ERP to create and manage your BOM makes procurement of parts easy. During the design phase, while your engineering department will be busy at work designing and engineering a new product, your procurement team will have easy access to the EBOM. Thus orders can be placed early, giving you time to get your hands on these parts before production begins. Also since everything is managed in one system it automatically links to inventory. Therefore the purchasing department always knows what is needed, and what is already sitting on your shelves, ready for production.

Minimum and Maximum Inventory Levels- You can simply set limits that represent a maximum amount and minimum inventory amount. When your stock of a certain product reaches the minimum level the system will give you an alert to reorder. Also, you can’t order more than the maximum limit. This helps to optimize production process and makes it efficient.

Material Resource Planning - Material requirements planning (MRP) is a planning and control system for inventory, production, and scheduling. Doing it in one platform synchronizes the flow of materials, components, and parts in a phased order system. It also combines and tracks hundreds of variables. For eg. Purchase orders, Sales orders, Shortage of materials, Due dates, Forecasts, Inventory, and Data.

Read More - 6 ‘Must Haves’ Features For Your Inventory Software

Prepare Efficiently For Customer Demand

It is incredibly hard to be informed on what levels of inventory are required from one quarter of the year to the next when all data is tracked in a manual manner. The forecasting department can make an educated guess, which is based on the previous data they have. However, this may be prone to human error. It also won't take into account current changes in the market for the manufacturing business.

Drawing inferences about customer trends in manual forecasting won't take into account how customer demands have changed. In that case, the results you will achieve via approximate guesses will be prone to error and less accurate.

How will the ERP system help

Captures Shifts In Demand- If you implement a digital solution in your business, the software will notify you about these shifts in customer demand using both previous and real-time data. This makes forecasting future customer demands very easy and effortless. Also, results are more accurate and reliable as opposed to employing manual methods.

Real-Time Data and Business Intelligence- It offers built-in business intelligence (BI) features and reporting capabilities, Role-tailored dashboards, charts, and other visualizations. Also, it offers detailed reporting templates and streamlines data capture for analysis

Effortless Communication with Customers and Suppliers

Many SMEs operate on different software cobbled together that either overlap or produce a gap between functional areas.  As a result, communication does not take place at critical times for equally critical processes. The use of spreadsheets, repetitive data entry, and different units of measure from department to department can almost make it seem like the communication that does take place is being done using different “languages". Data from department to department then is not always transferable in raw form and must be “translated”, or converted, for useful analysis. This procedure repeats as it moves to the next department making it all cumbersome. This results in discouraging communication between teams. When teams are not able to communicate amongst themselves how will they be able to communicate well with customers?

How can an ERP system help in effective communication?

    1. Unified Database- One way a digital solution improves communication is by creating a single version of the truth.  Data is unified in a single database that is not specific to executives, or purchasing, or manufacturing.  The data is available to everyone in the team.  The unified database removes the need for different data implementation between departments and brings everyone under a common umbrella. This results in streamlining communication.
    1. All-Inclusive – A second way that digital solutions can improve communication is that everyone is a part of the new platform Effective communication within an organization doesn't leave anyone out. Each functional area can communicate effectively because of data standardization.  It is no longer just a conversation between manufacturing and scheduling alone.  Now, finance, inventory control, purchasing, supply chain, and executives can see the system in action and understand their place and functionality within the system.  By including all departments in its core functionality and calculations, a manufacturing ERP system can help everyone feel like part of a unified team working in the same direction communication becomes more effective in this way.

Read More - ERP for SMEs? Think again


Bringing about a transformation within an organization is obviously difficult than it looks. However, a Cloud integrated platform like TranZact is a must-have tool for SMEs. It helps them stay at par with other competitors in a cut-throat market.

To stay ahead in the curve, Manufacturing SMEs need to utilize all the right tools they can get their hands on to boost efficiency. Be it the design stage, the manufacturing stage, or the distribution process; the ultimate goal is to have as few obstacles as possible. This has to be achieved while keeping labor costs minimum and manufacturing premier quality products that are what the customer wants.

In the modern manufacturing landscape, digital solutions have the capacity and then some to fill the void between cutting-edge technology popular these days and conventional manufacturing processes. The end result is the business taking enormous strides on the path of revolutionary innovation.

Check out TranZact here


TranZact is a team of IIT & IIM graduates who have developed a GST compliant, cloud-based, inventory management software for SME manufacturers. It digitizes your entire business operations, right from customer inquiry to dispatch. This also streamlines your Inventory, Purchase, Sales & Quotation management processes in a hassle-free user-friendly manner. The software is free to signup and gets implemented within a week.