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About ERP Systems

Wishes and Wants Are Not Enough For Your ERP System

Mike Roman - Wednesday, November 28, 2012

It is common to find that organizations re-implementing an ERP System have not learned yet the tremendous asset they have right under their noses -- assets such as the availability of instant information, the capability to make sound judgments from business facts, and the raw power available from a properly implemented business management system (ERP) . Makes me wonder... Why is there such a rich market for helping a company do it right the second time?  Why didn't they get it right the first time?

It has been my experience that most people in those organizations know there are issues that can be addressed by good business management, but they wish they didn't have to deal with learning the system. They want the organization to be successful, but they want the issues to resolve themselves somehow so they don't have to retool or change their status quo. In a worst case scenario, they might think that an ERP system is just too complicated. Maybe it's those letters, ERP, and maybe we should replace the words Enterprise Resource Planning System with something simple like Business System (BS). No, that won't work.

Here are a couple of examples of when wishes and wants were not enough. There was the company that opted not to use customer due dates to schedule shop work; instead, a spreadsheet scheduled work by revenue dollars by month. As a consequence, customer deliveries were late. The VP of Finance was focused on managing cash flow and was not too concerned with orders being 3 to 4 weeks late. When the slow slide of orders going to their competition began, she wished things were different and she wanted the problem to go away, but she did not understand how her use of the system could stop the erosion.

Another company had two inventory management systems and each had a different answer for raw material availability. The problem had first presented itself five years earlier when the Supply Chain Manager took over that responsibility.  He wanted to fix it, but he "had not gotten around to it yet."  The result?  Air Freight rush shipments of raw materials from an offshore provider and late customer shipments.  That began a slow slide of orders going to the competition.

In both cases, we stopped the erosion and reversed it. How? Education about what the ERP System will do for and to the company. We helped the first company learn how to schedule a shop properly, and we helped the other company learn how to eliminate one of the inventory management systems. We also automated much of the production scheduling since we knew the real work center utilization and efficiency values.

Guess what?  I gave away the store once again.  Education saved these companies as it will for any organization that discovers that wishes and wants cannot compare to hard work and discipline. And that's no BS!

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