ERP Systems – The Art of the Possible
Modern integrated ERP systems are developing rapidly and include functionality that would, only a few years ago, have seemed like science fiction. This is where a business can flourish.
There’s a countless amount of opportunities that implementing a new ERP system would bring. In terms of creating the necessary space in order to challenge current processes and also ways of approaching key aspects of the business. It reflects the ways in which functionality contained within modern ERP systems fundamentally challenges business as usual. It’s not designed to be at a level of detail necessary to provide a full ROI statement, but more to indicate what might be possible in the “brave new world.”
As companies and their staff are becoming more decentralised, new ERP software provides mobile functionality so users can stay connected and well-informed on their business processes and performance at all times.
ERP systems can be accessed on laptops, mobile phones, tablets and even wearable devices anywhere in the world with an internet connection. In addition, alerts indicating a need for action, highlighting a new order etc can be delivered directly as an SMS message.
The whole idea of an ERP system is to gather the entire company into a unified environment, allowing all departments or business units to share a common vision and coordinate in real time. Nobody wants to run a siloed business with each department or business unit functioning separate from the other. Collaboration is a crucial and often necessary part of the business. With the data entered into ERP systems being centralised and consistent, there is no reason why departments cannot work together. ERP software also touches on almost every aspect of a business, thus naturally encouraging collaborative, interdepartmental efforts.
However, departments work best when they are autonomous. But autonomy can create the problem of blind spots. Without insight into other departments or business units, an organisation can waste resources duplicating efforts to solve the same problem. A central portal helps departments share information, customised data, and generate individual reports. It promotes cooperation and sharing of knowledge and resources.
With ERP enabling collaboration across the business, decision-ma
king can be delegated, the business can operate as a whole, with standardised processes, whilst maintaining the uniqueness of each unit and ultimately moving to a process-centric organisation rather than a location-centric one.
As well as internal collaboration, modern ERP systems support external collaboration with customers and suppliers, opening up the data in the system to them. Data that is accurate and up-to-date, enabling both self-serve and collaborative supply chain decisions. In this way, the business can become a value-adding supplier to their customers, supporting closed-loop tracking of product, for example.
Easy access to accurate, timely and relevant information will enable the business to take quick, transparent and informed business decisions. Many surveys have revealed that ERP systems help companies plan better and be reactive to change in demands, competition and unexpected disruptions. The availability of information as well as the user friendliness of the system allows businesses to be more responsive and to keep up with fast-moving markets, enabling companies to develop products based on consumer understanding.
ERP software will also give the tools needed to create more accurate forecasts – bringing S&OP into the heart of the business. Since the information within the ERP is as accurate as possible, realistic estimates and more effective forecasts can be made. In this new world, business intelligence metrics will drive ERP changes directly, turning ERP from a “system of record” into a “system of intelligence.” The ERP system will be able to generate direct recommendations — based on real-time, accurate data — for factory floor and supply chain managers.
An ERP solution eliminates repetitive processes and greatly reduces the need to manually enter information. The system will also streamline business processes and make it easier and more efficient for companies to collect data, no matter what department they work in.
One of the benefits of ERP systems is that you can see how products and services are moving through the pipeline. Raw material management, order tracking, inventory tracking, and revenue tracking are made easier with the help of these efficient ERP tools.
In today’s world, it is impossible to think how an enterprise could implement a fast delivery process without the help of an ERP solution. An ERP system improves both front-end and back-end relationships through creating an efficient shipping and delivery system. It streamlines shipping times, creating a much better experience for customers.
Imagine being able to gain valuable new insights into each step in the supply chain, production, fulfilment, installation and service processes, finding out how each contributes or detracts from total product quality and delivering an excellent customer experience.
The core goal of an ERP system is to provide actionable data and information to company leaders. But collecting accurate data is an ongoing and vexing challenge. The Internet of Things (IoT) has the potential to massively expand data availability and improve accuracy. This has significant implications for customer service, forecasting, inventory management and business intelligence.
The business intelligence metrics that typically accompany ERP systems out of the box present data from the past, such as a summary of past transactions. With the Industrial Internet of Things, we can expect to see metrics that show the present reality and enable true, actionable business intelligence.
This visibility into the activities on the production line that is made available with IoT can transform areas such as quality and traceability. What is supposed to happen can get replaced with what is actually happening within the business, making ERP more useful. In this way, a business can monitor quality and machine availability across the entire business real time.
Other positive impacts
Whilst the above points have been focused more on technology-enabled benefits, there are other positive impacts that will be delivered through. Implementing a modern ERP system, where processes have been defined in alignment with best practice, will deliver business transformation in its own right across the business. In this way, the business engages in the process, recognising that this is not, in any way, an IT project.
Any proposed deviations from standard functionality can be challenged, with the aim of moving away from levels of complexity that add no value. Designing future state processes based on what the selected system offers, rather than enduring the lengthy debate over which site has the best processes, should facilitate easier adoption across the entire business hierarchy. In this way some of the risks around change management can be mitigated.
The Next Step
Clearly, all of the above points will deliver significant benefit, but, and it is a big but, this can only happen if you follow an appropriate implementation process. Every step of the implementation needs to be carefully managed to ensure that the outcomes and decisions align with the objectives of the project. Project activities, programme control and change management need to work side by side as they are intrinsically linked in delivering real value and a transformational outcome. The effort cannot be understated or the benefits to be achieved over-stated.
The investment in the system and technology will be wasted without a comparable investment in the implementation process – populating the project leaders and team with people who will constructively challenge the status quo and create a can-do, continuous improvement attitude.
If you’ve like to find out more, contact us today for an initial, no obligation discussion about your aspirations and how we can help you and your business deliver your vision for the future on +44 (0) 1282 463710.
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