Engineer-to-Order Manufacturing



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The engineer to order company can sometimes be mistaken as a job shop when in fact it is not. Engineer to order companies often are engineering heavy and production light, and the ratio of engineers to production staff is a good sign to look for. More engineers than production works means you are probably looking at an Engineer to Order company. Quantities produced of one or two maximum are also normal.

Engineering to order companies will take a product or requirement provided by their customer and design a machine to produce, rework, test or otherwise do something to the requirement. They may have a job shop like production area with a variety of machines or they may only conduct final assembly. They often purchase the majority of their parts from subcontractors, and tracking purchasing against a job is critical to them. Actual job costing, WIP and revenue recognition are requirements as their jobs will often take months or even years to complete.

Some engineer to order companies also install, service and manage their products. They occasionally look like Make to Order businesses or Configure to Order if the products they engineer appear very similar.

One key tell that allows you to identify an engineer to order is that they call their sales “projects” or “jobs” and each sale has an assigned project manager.

Benefits of Microsoft Dynamics NAV for YOUR Business

The NAV Job Management tools, layered with Sabre’s proprietary manufacturing enhancements have capabilities out of the box specifically designed for your engineer, project managers, buyers, assemblers and accounting team.

  • Graphical view of purchase statuses
  • Change orders
  • Muiti-level Task structures
  • Roll-up Reporting
  • WIP and Revenue recognition by upto 6 different methods
  • Planning and Dispatching of materials
  • Real Time Estimate-To-Completion
  • Estimate at Completion (ie: Usage vs Plan)

Too many manufacturing solutions rely on the bill of material, routing, scheduling of shop resources, MRP and other modules that are specific to production manufacturing. Engineer to Order manufacturers are not like production manufacturers. Their projects often continue into a field service activity where contractors or their own skilled trades are installing the product they have sold. They often involve an unknown structure of work when the project is won, and the bills of materials, work assignment, delivery details are worked out by project managers during the course of the work.

Job Management in NAV is specifically designed to make this process easy. It allows a manufacturer to see the committed costs linked to a job, regardless of whether the final bills have been submitted by your contractors. It allows you to see the not to exceed numbers you have defined. It allows you to add Change Orders and track your time and materials against them – all of this integrated into a world class accounting system.