Utilizing an enterprise resource planning (ERP) system can significantly enhance supply chain management performance by improving purchasing, inventory control and information exchange between internal departments and external partners. Manager of professional services at Cincom Systems, Mark Butler, outlines these insights on what takes place as you implement an ERP system. Let’s visit each of these factors.
Understand your current system’s shortcomings
Have an understanding of why you need to change the current system and ask yourself the following questions – Is the software outdated? Does it not have the features needed to improve on-time performance and throughput? Outline the shortcomings relating to your business practices in order to come up with factors you want for the new system.
Start in the boardroom
Attain executive-level sponsorship to alleviate risk and ensure your goals for the new ERP system align with larger corporate goals. This is for the initial key performance indicators, and the corresponding mapped plan for improving the manufacturing process – from the inbound processing of supplies to inventory management and the movement of goods through the internal system and on to the customer.
Appoint a strong internal project team
The project manager must have an in-depth understanding of the project. They must also be organized and detail-orientated, know when to take the lead and have the ability to negotiate. Additionally, collaborate with representatives from important business areas, namely operations, purchasing, inventory control and customer service so to fully complete the team.
Create internal mapping
Have a clear understanding and vision of your organization’s processes and recognize the challenges too. Afterwards, define new workflows to support improvement goals.
Determine equipment needs
An example to look at when considering this factor is if needing real-time inventory data to meet performance goals, and decide to implement mobile solutions and radio frequency identification (RFID) technology, the ERP you select will need to support these tools.
Define the budget
Make certain that all relevant costs like hardware, software, third-party implementation and training are included and looked at.
Engage the entire company
You may keep the project team informed, but it’s important to also update the whole company from time to time about the ERP implementation’s progress. Communication helps facilitate a positive teamwork environment for everyone in it.
Resist the urge to use all the bells and whistles right away
Some organizations attempt to implement all the ERP system’s features and functions from the beginning. There is no need to use all of the aspects that the system offers such as mobile-friendly apps, RFID integration and retinal scan security. First, select the features needed for important functionality and then consider the other facets afterwards.
Update business process selectively
Carefully assess whether to customize the software to adapt to your processes, or to change your processes to work within the standard solution. Your process may better suit the operation than the ERP’s best practice does. In general, the biggest improvements often need a certain level of re-evaluating business processes, given current conditions.
Have a plan in place that will periodically evaluate the system. Have role players from all areas of the company involved so that they can give input on how well they find the system to be working. Decide what you need to change and identify the functions that need to be implemented in the future.
Follow more leading industry news at Dovetail!