Does your ERP system need a service?
Your car probably works hard for a living. You rely on it and depend on it. Consequently, at regular intervals, you will put it in the hands of people you trust to check it over and make sure it is running correctly. At the same time, they will re-tune it for peak performance.
ERP systems are not cars. One difference is that lives may be at risk if the latter fail but only livelihoods are jeopardized if the former fail. We need to use the word 'only' with some circumspection here: try telling people that their company is 'only' closing and that they are 'only' losing their jobs. The analogy remains valid, though: ERP systems require regular servicing (and maybe even a yearly inspection) to ensure that they are running correctly.
“How come?”, you ask. “Surely software just keeps ticking over, at least until we hit a bug or problem, and then it just needs fixing.” Well, you could perhaps say the same thing about your car; that you should just keep on running it until it stops (or, in the case of a brake problem, fails to stop). But would you advise that? Probably not. So what can go wrong with an ERP system, especially one that may appear to have been running contentedly? Well, let's look at some possibilities.
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1. System enhancements
For the moment, let's assume that your ERP system was implemented with the help of consultants and system integrators who were knowledgeable and competent (though more on that later). At the time that you implemented it, you will hopefully have been advised of what that particular system can do, what it cannot do and what it cannot do very well. You will then have made pragmatic decisions about how to use it, bearing in mind that all package software requires compromises.
However, most ERP systems are updated at least yearly. New functions are added and sometimes old constraints removed. That opens up possibilities for improvement in the way that the system is used and in the results that it can generate. The advice you were initially given wasn't necessarily wrong but it was very likely constrained by the tools available at the time and perhaps those constraints are no longer valid.
2. Changes in expectations
Frequently, when a new ERP system replaces something that has not been working properly for some time (or may never have worked properly at all), all the users ask for, and want, is something that works. Their expectations are limited to a reduction in the pain they have been suffering. But if your new system has been in for a year or two now, and has settled down, you perhaps are already thinking of pushing back the boundaries. Are there areas that you did not include in the original implementation because solutions to these problems seemed beyond reach? Were there things that you would have liked at the time that the budget just would not stretch to? Have times changed? Have people's expectations changed? If so, then perhaps it is time to revisit those expectations to see if they can now be satisfied: which leads us to point number 3.
3. Incorrect decisions at go-live
As mentioned in point number 1, when originally implementing the system, it is likely that you were guided by the system integrators and consultants who were working with you. You will have been, to a greater or lesser extent, reliant upon their expertise and knowledge of the system. But these people, regardless of the fees they charge, are rather like the curate's egg; good in places.
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Were the people that you worked with as good and as knowledgeable as they should have been? If they were not, then the advice that you received was not as good as it should have been either. Even if you had good consultants to work with, they may have been new to your company and maybe even new to your industry. You will both have started out from a position of knowing little about each other's patch; you of their software and they of your company. Under these circumstances, unless great care was taken, the risk of making bad decisions would have been high, particularly if either party was inexperienced. (In fairness to consultants, they frequently work under constraints of both timescales and budgets and are frequently not allowed, by parsimonious clients, to do the job they are capable of.)
Finally; you will also have made decisions on 'static' data, like batch sizes and lead times. Times, manufacturing methods and working practices change. With the system up-and-running, now may be a good time to revisit all of these decisions. Are you getting what you wanted and expected from the system? Maybe it's time to get the system up on the ramp and have a look underneath.
4. Sitting with Nellie
Perhaps a dated expression, what it used to mean was the type of training that one received from a job incumbent. The view was that, if you sat alongside a person who actually did the job, you were best-placed to learn how to do it. A few years down the line from implementation, it is quite likely that a few of your people will have 'sat with Nellie'.
There are many reasons why 'sitting with Nellie' is not ideal but I will restrict myself to just a few:
- Nellie may well be the best person to tell your staff how the system is used currently but is she the best person to decide how it should be used? A common human trait may also come into play: people do not like admitting ignorance. Asked, “Can the system do this?”, most will hesitate to say “I don't know” and will attempt a confident sounding “No!”. Is your productive use of the system being constrained by staff knowledge?
- It may be some time since Nellie had her training in the use of the system. Can she remember all of it? How much of what the system can do differently, or in addition to, your current ways of working can she remember?
- Is Nellie a skilled trainer? Did she pass-on all of her knowledge or did she, through neglect or design, hold some things back? Is she protecting her position or giving herself an easier life by hiding knowledge or functionality?
Sometimes getting your training from the driving instructor is better than getting it from someone who has been trained by the driving instructor
5. Bad habits
Regardless of how well your system was originally implemented, over a period of time, bad habits inevitably creep in. Sometimes these are driven by laziness (“I know I'm supposed to do it differently but I've found a short cut.”) and sometimes by conscientious people trying to improve things but with insufficient knowledge to recognize the consequences of their actions or inactions (“I know I'm supposed to do it differently but I've found a short cut.”).
Frequently, at a managerial level, you will not even know that these deviations from recognized procedures are occurring. Do you have time to police and audit the use of the ERP system? Almost certainly not.
6. Company drift
By this I mean that times change. The company starts to do new things, or old things in new ways. Companies are living, dynamic organisms. They change over time and their needs and wants change with them.
Systems are less so. They do change (see point number 1) but they do not automatically change and evolve hand-in-hand with the way the company changes. Manual intervention is called for in order to ensure that the system remains tuned and relevant to its environment. Failing that, you will gradually find that you have a system that is perfectly suited to yesterday's requirements when what you actually want is it for it to be suited to tomorrow's.
Check out our ERP requirements guide for all you need to know about determining your ERP functionality needs
Having established that your system may benefit from a service, we now have to consider who is best placed to carry it out. There are three obvious candidates: your original consultants, new consultants or your own in-house team. Let's look at the pro's and con's of each of these.
A. The original ERP consultants
There are several reasons why these may be best:
- they should have kept up-to-date with system enhancements and should know which of these may be beneficial to your company,
- they may still have available the individual consultants who worked with you originally and there will be little time wasted in bringing them up to speed,
- if already known to your staff, they may already have their respect and your staff may 'open up' to them.
- do you have confidence in your original consultants? Are some of your problems caused by them not having done a particularly good job in the first place?
- if they come in to look at the system and find that they made errors in the original implementation, will they be honest and admit to them or will they try to cover them up?
- will they just see it as an opportunity to sell more modules, more training, and more consultancy?
- some of your problems may have been caused by cutting back originally on consultancy and training to save money (“If you think that knowledge is expensive, try ignorance”). If you go the external ERP consultants route, will you be tempted to penny-pinch again?
B. New ERP consultants
Most mainstream ERP packages are now sold by 'resellers' or 'partners' of the software authors, or by one or other of the large 'system integrators'. If you are unhappy with your original consultants, there may be opportunities to use others who are conversant with your software. Pluses include:
- they may bring a fresh perspective to your problems, having worked with companies that are similar to yours,
- if they find errors in the way that the system was originally implemented, they will have no vested interest in a cover-up,
- they may be keen to get your business and this may be reflected in their charges.
- you will have to spend some time educating them about your company, its business environment and your current use of the system,
- unless they have been recommended to you by someone you trust, such as another company that you have contacted via a user group or someone that you have networked with via your professional institute, their provenance will be unknown,
- they may see you as someone to sell to, rather than someone to work with.
C. Your own internal team
In their favor:
- they know the company and how it operates,
- you may have an opportunity to mix people who were part of the original implementation with new blood and, if these people joined after the original implementation, they may bring new ideas.
- they will be cheaper than external consultants.
- they may have vested interests,
- they are unlikely to know of all the new functionality and features that the system may now offer,
- they may be unable to share experiences of how other companies have used your particular system to get around some of the problems that you are facing.
Depending on circumstances, you might even opt for a mix of the above. One thing is for certain though; with each passing day, the need for a proper service increases, as does the cost of operating a system that is not as good as it should (and can) be.
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