How to Implement ERP for Small Manufacturers

As a small manufacturing company puzzling out how to implement ERP, you will need to devote some time to thinking through the ERP implementation plan. A small manufacturer has the same fundamental trade-offs to choose from as a big company, with the caveat that ERP budget constraints probably carry a heavier weight. The three basic organizational approaches are (a) add ERP implementation responsibilities to your existing staff (b) hire – or assign if you already have one – implementation responsibilities to a full time IT professional or (c) hire an outside ERP consultant (or your ERP software vendor) to implement. Whilst discussing the pros and cons of each we will demonstrate how to implement ERP as a small manufacturer.

Adding implementation responsibilities to your existing staff can be a fun and bonding experience if managed that way; it can also be a divisive and stressful exercise if it is just thrown over the fence without leadership - the key is to plan ERP delegation. There is advantage in having all of your key leaders being somewhat familiar with the software (or at least, their portion of it), and it circumvents the later problem of someone claiming that he or she never agreed with the ERP design, but was never consulted. There are some potential surprises you need to consider (but not necessarily expect). For some staffs, this will be the first test of true teamwork, and you may find that you have some individuals who don’t work well in an ERP team and don’t play well with others. This exercise also tends to expose a wide spectrum of thought quality and ability to articulate ideas among your staff.

The Quickest Solution

Having or hiring a full time IT professional is probably the most efficient approach, both for ERP implementation and for the long term, if you can afford it. Your IT person can learn the product deeply, can be responsible for administering patches and updates, and can produce business reports and analysis. You have someone on your team who is always thinking about the future of your computer systems, and what lies over the horizon. The only two weaknesses of this approach are (1) an overdependence on the specialized knowledge of the function, such that turnover would be disproportionately painful and (2) establishing the culture that the way computers are used is someone else’s responsibility.

If you are struggling with how to implement ERP within your business, having the ERP vendor or an ERP consultant implement the system is likely the quickest and simplest solution. This is the case because they are already intimately familiar with the program and its operation. It is possible that implementation costs can be negotiated into the purchase price of the software, and tangential distraction to the rest of the business while preparing for implementation is minimal. The only real risk with this approach is who is responsible for tracking down and resolving system problems after the vendor has left, and what the process is for making modifications and changes to the system as the business model evolves.

Learning how to implement ERP is unlike any project you’ve undertaken before. When you are finished – no matter what methodology you choose – you should feel that your business is stronger, and that you have done good work along the way.

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Richard Barker

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Richard Barker

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