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Why #2 Pencils are the Worst Possible Investment for Manufacturing Organizations – EIN News

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From Paper Forms to Automated Data Collection
Angry Accountant
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Implies use of paper forms to track Inventory and Work-in-Process followed by manual keyboard data into Excel spreadsheets and accounting/ERP systems.
MILLBURY, MA, USA, October 6, 2022 /EINPresswire.com/ — If your organization is still tracking its inventory and work-in-process using paper forms, Excel spreadsheets, and manual keyboard data entry then you should read the white paper "Why #2 Pencils are the Worst Possible Investment for Manufacturing Organizations!" by Dr. Peter Green.

This white paper can be downloaded as a PDF file from the White Papers link at the bottom of www.KnarrTek.com.
According to a survey performed about 5 years ago, 80% of manufacturing plants in the USA were using paper forms to record their work-in-process on the factory floor followed by handing the paper forms to someone in the front office to manually enter the data into their ERP or accounting system. Also, a very large percentage were still supplementing their inventory tracking systems with extensive use of Excel spreadsheets to track data such as lot and serial numbers and expiration dates for traceability purposes. And it would appear that nothing has changed very much during the intervening time.

This use of paper forms has a number of problems:
Time for equipment operators and material handlers to write down the work-in-process and inventory tracking information on paper forms
Mistakes operators and material handlers make in writing data down on the forms
Time taken for office staff to key data into ERP or accounting systems
Time taken for supervisors to enter data into Excel spreadsheets. Mistakes made in data entry from paper forms into computer format.
Typically, at least a 24-hour delay between the materials transaction happening and the data being available for viewing by managers.
For many manufacturing plants, the full-time equivalent (FTE) labor time it takes to fill in forms and then subsequently key them into Accounting/ERP systems or Excel spreadsheets typically ranges from one to three people at a loaded labor cost of over $60,000 each per person per year. This does not include all the time that it takes managers and their staff to track down and correct the resultant errors in inventory and/or the status of customer orders.
Even more important, in these times of difficulty in hiring skilled people, this implies that simply by getting rid of the use of pencils and paper forms, a manufacturing plant can probably gain the equivalent of two already trained people at no additional cost in labor.
A major problem with paper forms is that it is easy for the shop-floor people to make mistakes when writing down the data and for people entering the data into a computer to make transcription errors. This can often result in inaccurate inventory tracking, poor job costing, and problematic materials traceability records.
But probably the biggest problem is the delay in data entry from using paper forms, which is often 24 hours or more. As a result, inventory shortages, delays in production, and late shipments of customer orders can go unnoticed until it is too late to take corrective action. These can result in lost customers and future orders from those customers, which can be very expensive.
In this white paper, Dr. Green then explains how the use of technologies such as barcode and RFID scanning, mobile computing, and Artificial Intelligence can be combined to essentially eliminate the use of paper forms for tracking inventory and work-in-process with an average cost savings of over $1 Million over a 10 year period for each manufacturing plant.
Dr. Green then goes on to explain how adoption of this technology can help solve the people recruiting problem, reduce operational mistakes, and prevent loss of future customer orders by making sure that orders get shipped on time.
This white paper was written by Dr. Peter Green, who serves as the Technical Director of KnarrTek Inc. which provides barcode and RFID container-based and asset tracking solutions for manufacturers and industrial distributors.
Dr Green is a systems architect who is an expert in implementing real-time inventory tracking and operations management systems for industrial organizations. He has led the implementation of over 100 such systems over the past decade. Dr Green also led the team which developed the BellHawk materials tracking software and MilramX intelligent information integration software platform, which have formed the basis for these systems.
Dr Green obtained his BSC (Hons) in Electrical Engineering and his Ph.D. Degrees in Electronics and Computer Science from Leeds University in England. Subsequently Dr. Green was a senior member of technical staff at Massachusetts Institute of Technology and a Professor of Computer Engineering at Worcester Polytechnic Institute
Peter Green
KnarrTek Inc.
+1 508-277-3353
email us here
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Overview of KnarrTek and its Inventory and Work-in-Process Tracking Systems

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