Tuesday, August 9, 2022

ERP in Supply Chain Management a Boon to Businesses in Kenya

When the Covid–19 pandemic struck Kenya in March 2020, all industries that contribute to the country’s economic growth were left vulnerable to supply chain disruptions. These industries ranged from the manufacturing, agricultural and even health sectors.

The manufacturing sector was particularly hard hit and over the following months, supply chain disruptions in this sector emerged as a main area of concern together with market volatility and the economic recession occasioned by the pandemic.

Today, Kenya has largely emerged from the hard years of Covid–19.

But as the fears over market volatility due to the pandemic subside, fears over supply chain disruptions have persisted and even grown.

In January 2022, business leaders from Kenya told global underwriter Allianz that supply chain disruption was one of the most likely threats to smooth running of businesses this year.

These sentiments were in line with global concerns that have seen supply hiccups push up prices of products such as cooking oil.

The sentiments were part of a survey which polled 2,650 business leaders in 89 countries was carried out between October 20 and November 17, 2021.

These concerns are not so far-fetched. According to Collins Musyoka, a business lecturer from Mount Kenya University, supply chain can be very intense to the productivity of the manufacturing sector and this complicates the working business environment for lean and flexible operations.

Musyoka reckons that building strong supply chain resilience can help reduce supply chain complexity and overcome risks through developing strategies that can help the supply chain recover to its original functional state following a disruption.

“These strategies can be used to build a strong supply chain, namely, supply chain re – engineering, strategic sourcing, integrating global supply chains, risk awareness, operational flexibility, agility and strategic supplier partnership or collaboration among others,” he says.

In Kenya, one of the most effective ways a manufacturer can build strong supply chain resilience is through the globally-accredited SYSPRO ERP for Supply Chain Management.

“Supply chain management involves the handling of the flow of goods and services from the raw manufacturing of the product through to the consumption by the consumer,” says Eric Githiomi, a supply chain management consultant based in Nairobi.

He says that this process requires a manufacturer to have a network of suppliers that serve as links in the chain to move the product through each stage.

Githiomi cites SYSPRO as one of the most secure and efficient solutions for manufacturers and distributors.

“This system is backed by over 40 years of industry expertise, that gives you the control you need and the experience you want along every step of your supply chain journey,” he says.

Whether you’re expanding into new territories, adding new product lines or if you simply want to be more efficient and productive, this system will empower you to take the next step by enabling you to connect both internally and with your suppliers and customers. It will also allow you to easily adapt and scale as and when the need arises.

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Interestingly, SYSPRO ERP for Supply Chain Management is not a one-size-fits all solution. Designed in a modular fashion, this system offers over 50 individual modules you can integrate seamlessly into your operations. These include procurement, operations management, and sales and management.

“SYSPRO ERP’s built-in, integrated, and digitalized procurement solution provides you with a real time view of your resources and assets to allow for better decision-making. It gives you the ability to strike the right balance between rapidly responding to market disruptions and ensuring the long-term growth your business needs,” SYSPRO said in a statement of response to Bizna Kenya.

This is echoed by manufacturers who have taken up the modules into their businesses.

One of the businesses states that SYSPRO allows them to properly plan their supply chain management, from originating orders through the shipping and warehousing stages to the accounting processes in one all-inclusive system.

“We now can track orders at any stage of the order process and make any necessary adjustments to ship dates in real-time. We are utilizing the Inventory and PO modules to cost inventories in a very accurate manner,” the manufacturer said.

A spot check by Bizna Kenya on the multiple benefits your business will stand to gain include a reinforced supply chain, a hedge against the obsolescence of raw materials stock, improved governance and transparency in the purchasing process, and improved on-time and in-full delivery.

Once you have your ideal suppliers in place, your next key challenge is maintaining the correct stockholding, and balancing supply with demand. With this, you will be equipped with solutions on Inventory Management, Inventory Optimization, Bill of Materials, Materials Requirements Planning, Lot Traceability, Landed Cost Tracking, and Return to Supplier.

You will also get operation solutions including Manufacturing Operations Management, Work in Progress, Job Nesting which is designed to support customers who typically manufacture components from the same raw materials, Warehouse Management System, Materials Requirements Planning, SYSPRO Mobile which is a solution that lets you use your SYSPRO business software on any popular smartphone or tablet, and Return Merchandise Authorization.

In your sales and marketing segment, you will be equipped with solutions such as Pricing Engine with Trade Promotions.

This will enable you to segment customers based upon buying performance and place them on a structured price list, with the ability to reward them for loyalty and timeouts payment.

Others will include Product Configurator, Sales Analysis, Sales Orders, Product Recall, and Return Merchandise Authorization which will facilitate the processing, management and analysis of returns, replacements, recalls, credits, and repairs.

SYSPRO finance solutions you will get will include Accounts Receivable to improve cash flow management by accumulating and managing customer activity and ensuring timely revenue collection and effective reporting; Accounts Payable to boost your cash flow, provide timely, accurate and efficient control of invoice processing, payment of bills, the application of discounts and the total expense analyses for a close relationships with suppliers; General Ledger which will be a central repository for collecting and analyzing your business information with financial statements including the Balance Sheet, the Income Statement, the Cash Flow Statement, and associated financial reports such as the Trial Balance.

In addition to these solutions, the SYSPRO ERP for Supply Chain Management will come with procurement solutions tailored to provide the following four solutions:

Request for Quote (RFQ)

This will provide you the ability to extend a formal invitation to suppliers to tender on the supply of goods or services. It automates the creation of the request for quote from requisition and allows your suppliers to access it online.

As a result, this solution provides the highest form of transparency of the tender process and improved governance, and helps your buyers make informed procurement decisions by comparing offerings from different suppliers.

Preferred Supplier

This feature facilitates and optimizes the management of sourcing strategies during procurement and recommends suppliers during the purchasing cycle.

Supply Chain Portal

This is an interactive web platform that facilitates online transactions between an enterprise, its suppliers and customers.

It streamlines the collaboration between buyers and suppliers and minimizes document handling. This effectively reduces potential fraud.

It also automates business processes and ensures that there is transparency of supplier and customer transactions.

Purchase Orders

This is an integral part of the organization’s distribution and manufacturing functions. It provides you with the functionality to simplify your purchasing and receiving processes while ensuring greater order accuracy.

It enables the monitoring of the quality, accuracy, lead times and cost of purchases, while providing comprehensive supplier performance analysis.

From the foregoing, it is evident that deployment of a robust ERP system therefore helps in effective demand forecasting and lean inventory, reducing production bottlenecks and enhancing transparency through the business.

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