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Modernizing Your ERP: What Every Manufacturer Should Know

January 11, 2018

If your company has an ERP and you’re struggling with lack of visibility into your manufacturing processes, lack of trust in the data, increased downtime, and rising costs—it may be time to modernize.

Consumer demand is harder than ever to predict. New competitors are popping up all over the world. And with the Industry 4.0 trend, data matters more than ever before.

If you’re like many of your peers, you’ve tried to adapt to these changes by squeezing better performance out of your operations but your ERP just can’t keep up. That’s all too common. Unfortunately, replacing it with a new manufacturing ERP is a major undertaking in terms of both time and cost.

Yesterday’s ERP systems can’t support the connected manufacturing strategies that are a key to survival in today’s marketplace. They were designed to address the corporate functions and don’t have the functionality required for the typical modern manufacturing operation. And they’re not agile enough to adapt to today’s more data-driven strategies.

If you’re thinking of replacing your old system with a more modern manufacturing ERP, focus on running a collaborative evaluation process that incorporates input from various functions across your business. Here are three tips to guide you on your way:

Tip 1: Stay Focused on Outcomes

Not to scare you off from the process of choosing a new manufacturing ERP solution, but consider this: a recent Corporate Executive Board (CEB) study of technology buyers found that 39 percent of the time, buyers give up in frustration because they’re overwhelmed by the challenge of getting everyone to agree on one solution.

So, how can you avoid this fate? It may sound obvious, but the biggest thing to keep in mind is that your new system must meet your company’s overall business objectives—not just the specific goals of your department. Connecting the business objectives of each department for the greater good of the company is the responsibility of all leaders. Remember that your top priority is to enable connected manufacturing for your company.

Of course, there’s more to this than simply being flexible and letting your team’s goals take a back seat every now and then. You’ll also need to be a salesperson. People are naturally resistant to change and you’ll probably need to convince some of your colleagues to let go of the legacy processes and systems that may be holding the company back. By working collaboratively to understand everyone’s needs, you’ll likely uncover the mutual benefits of connected manufacturing, and they’ll eventually see the light—or have to defend their ad-hoc ways.

Tip 2: Remember that Connected Manufacturing Is a Team Sport

The CEB has more to say about the process of choosing new technology, but it’s not quite as daunting as the previous factoid: the typical technology purchase involves 6.8 influencers. As mentioned above, be prepared to collaborate with several other stakeholders as you choose your new system. (Sorry, we can’t give you any guidance on how to deal with that “point-eight” of a stakeholder.)

For a modern manufacturer, it’s typical to include influencers from the following teams:

  • Manufacturing Operations. They’re driven to improve productivity across the production cycle and want to find systems that are intuitive for all skill levels.
  • Business Management. They want to drive profitability and growth while reducing costs, and they’re frustrated by outdated systems that can’t generate the timely, accurate reports they need.
  • IT. They’re always looking for ways to make the infrastructure more reliable and secure. They are often the ones doing the “grunt work” of installing and maintaining new hardware and software so they will be looking for systems that add value for the company without becoming a burden to them.

Tip 3: Understand Your Buyer’s Journey

Nobody knows your company like you do. But from my experience in hundreds of ERP evaluations: if you’re serious about finding the right manufacturing ERP for your business, you’ll focus on getting all your stakeholders on board early.

The key here is communication. From day one, give each business group a chance to express their needs for the new system. Get every group to sign off on the necessary milestones before proceeding to the next phase of the decision. Be sure to emphasize your points of agreement so that when (not “if”) disagreements arise, you can keep everyone focused on what really matters to your business.

Keeping these three tips in mind will help you make a smoother, more successful journey towards your new manufacturing ERP system. Want more insight on what connected manufacturing could mean for your business? Download The Definitive Guide to Connected Manufacturing

About the Author

Stu Johnson Director of Product Marketing, Plex Systems