Three manufacturing ERP selection errors that project managers make
A year ago, you and your company chose and implemented a new manufacturing ERP. You carefully listed and prioritized all your requirements. You took your time evaluating ERP systems, vendors, and consultants. You selected a project manager with impeccable credentials and secured the support from your management team. Now the problems with the old ERP are still the problems with the new ERP. What went wrong?
1. Buying the sizzle instead of the steak
NetSuite, SAP, and other ERP systems are excellent products. But none of them are the right fit for every manufacturer. No one should read the advertisements in their favorite magazines and believe everything they read without considering how that software will fit the specific needs of the business.
Each of the ERP systems you considered had a very good sales person making contact with you and your team. There are sales persons who might be able to sell ice cream to Eskimos. It is the buyer’s responsibility to make the actual selection. Did you carefully examine your chosen ERP against every one of the requirements you set out as important to making the change?
2. Trying to do it all yourself to save money
There are consultants and value-adding resellers who specialize in manufacturing ERP. They are not inexpensive. Nevertheless, they provide a much-needed service to manufacturers. You are very good at making and selling your widgets. If you ever implemented an ERP, it probably was years ago. As an example, someone on your team insisted you load several years of historical transactions from your legacy system into the new ERP. It seemed like a good idea with no downside but you now find this added weeks to the overall implementation time and some of the transactions only show incompletely.
Without a good reason, few consultants would suggest history transactions be loaded. After all, you can keep the legacy system in a read-only mode as long as anyone wants to look at them. Those consultants implement ERP systems for a living and they do it every day. Maybe they won’t know your business initially, but they are good at their business, which is helping to select the right system and completing the implementation in a way that adds the value you hoped for.
3. Ignoring company culture and work practices
Every ERP has a working style it was built on. Transactions are done 1, 2, 3 and – enter. Your users had a style too before you implemented the new ERP. Have they changed their style to match the ERP or are they still doing what they did and wondering why things are so hard to get done?
Often people insist on customizations to their ERP to match some method already in place. Some of the time the goal could have been reached using the basic ERP system without customization if a little more time had been given to solving the perceived problem. No one had a chance to evaluate the actual customization when you were first evaluating the ERP.
You are a lean manufacturer who uses kanbans and other lean tools, but your ERP forces you to create production jobs, which create non-value-adding work. Why didn’t you pick this problem up during the selection phase? Lean has been around a long time and many manufacturing ERP systems capture it well. Are you using your system in a non-lean way?
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