Wrestling with Your ERP System? These Five Questions Can Stop the Fight
There’s a wrestling match taking place within many manufacturing organizations. Manufacturers wrestle with the demands of their customers and the changing nature of their competitive environment, along with the limits of their legacy ERP systems.These organizations also wrestle with the thought of buying new ERP software. Should they “bite the bullet” and migrate to a new ERP system or can they wait just another year or two?
With key business factors such as ERP affordability and budget, overly taxed resources, other competing projects and priorities, it’s no wonder most manufacturers would rather “fight than switch.”
Noted here are key questions to ask about your current ERP solution. While not an exhaustive list by any means, these five questions could potentially end the wrestling match.
Does your current software vendor provide adequate support, upgrades and maintenance?
If you’ve used the same business software system for many years, chances are you’ve received notice that your software vendor is going out of business or has been acquired and the no longer support the system. If that is the case, it is certainly time to change.
Has it been more than four years since you’ve upgraded your current ERP solution?
According to researchers at Forrester, approximately half of companies using ERP systems are currently on releases that are two versions behind the current release. We’ve seen other research that shows more then half of the 40,000 mid market manufacturing companies operate with outdated ERP systems. Relying on an ERP system that is outdated, or only upgraded every four or five years at best, makes it difficult to manage change and maintain competitiveness in an uncertain and volatile market.
Can your current software system support your company’s growth plan?
Most legacy systems do not offer the functionality that comes standard with today’s ERP technology. For example, you might require a system that supports multi-language and multi-currency because you plan to expand internationally. Other functionality such as multi-plant, bar coding, CRM or WMS capability can also help you meet today’s business demands. Today’s Business Intelligence (BI) features are essential for organizations to compete and operate efficiently. BI provides the right information, to the right people at the right time for effective decision-making. Mobile access for a variety of devices is also now very important. Most legacy systems fall behind in these areas.
Are members of your staff forced to use “work-arounds” outside the current ERP software system?
This is a big problem. If the team performs tasks outside the ERP system, such as double entry work, cut/pasting reports, walking blocks between plants or warehouses to record/deliver shop floor information, then it is definitely time for a new ERP system. These manual and redundant efforts result in major inefficiencies, waste and cost.
Are there only a few IT people who know the current system?
Who within your organization is familiar with the legacy system? Whether it’s custom code or a heavily modified software package, there might be only one or maybe two people that know the “nuts and bolts.” That brain trust will be hard to replace. You’re vulnerable when those folks decide to leave and there is nobody to internally support the out-of-date information system.
After asking these questions, it’s possible the wrestling match has ended.A search for a new ERP system requires careful planning, research and discussions with management, the various ERP vendors and ERP consultants. By addressing the questions above, performing the required research on the new ERP technologies available and motivating the team for change, you can quit the fight and look forward to success with your ERP initiative.
About Jeff Carr
Ultra Consultants, Inc. is an independent consulting firm serving the manufacturing and distribution industries. As Founder/Managing Partner of Ultra Consultants, Mr. Carr brings over 35 years experience helping manufacturing and distribution companies improve their information systems. Mr. Carr has been a finalist for the KPMG Peat Marwick High Tech Entrepreneur Award and twice has won the Arthur Anderson’s Small Business Award twice . He is a member of the World Presidents Organization (WPO) and Chief Executive Officers (CEO).
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