Tag Archive: implementation

Is Your ERP System Scalable?

August 14th, 2019

erp successSince we happen to be working on 3 or 4 ERP system projects concurrently, the topic of ERP is top of mind.

Let’s start by saying upfront that we turn down ERP selection project requests. Not everyone needs a new system. Perhaps a process upgrade and better utilization of your current system will sustain your business for 3-5 years. If so, why divert attention? On the other hand, waiting “too long” will quickly spiral into disaster. How do you know which of these is your situation?

An ERP upgrade is one of the most significant initiatives a company can undertake, and the statistics aren’t good. 80% fail to achieve the expected outcome! Yet, if your ERP system isn’t scalable, hiding your head in the sand will lead straight to unmitigated disaster. Thus, it’s best to be proactive, diligent and strategic when it comes to this topic.

Selecting a system isn’t something to delegate to your IT person. Instead, it is something you must “own”. After all, if your system will support your resources so that you can grow the business with the peace of mind that your system will enable a high level of customer service with additional customer-friendly capabilities (such as a customer portal), support your #1 asset (your employees and partners) behind the scenes and allow your business to scale with minimal if any investment of time and resources, it suddenly becomes quite relevant.

The 80/20 of success relates to just two items:

  • Your critical success factors – what is unique to your company or industry and/or what drives customer differentiation and profitability
  • Your design and implementation partners – although the focus typically goes to the software, as with business, the 80/20 of success is with people and partners.

Having an ERP system that supports your business objectives is another key component of creating a resilient supply chain. If you’d like a rapid assessment on whether your ERP system will support your growth and business objectives, contact us. And please check out our resilient supply chain webpage.



Have You Heard Horror Stories about ERP?

April 25th, 2018

enterprise resource planningSince we are known in ERP circles, it is a topic that comes up in conversation frequently.  Recently, at an Executive Forums meeting, one member talked about a situation he knew about where the company lost half its sales after a failed ERP implementation, and they ended up reverting back to their old system.  Can you imagine? The unfortunate thing is this is not uncommon although it is a more dramatic example.

ERP isn’t bad.  It is essential in achieving scalable, profitable growth although sometimes it can seem bad and have just horrible results.  

Similarly, no particular ERP system is bad; although some are definitely better for your particular situation and growth plans than others. We cringe when we hear about the plans of potential clients who were sold ‘ice to eskimos’ by ERP suppliers.  The challenge is that an ERP system can sound like a significant financial investment and so clients are tempted to not add cost by hiring an expert to assist with the process. However, since it is as significant as it is, when it goes bad, it extrapolates into many times the initial investment with unhappy customers, added cost and more.  Thus, it is no wonder clients stick with a ‘dead ERP’ longer than they should in many cases, which limits their ability to grow – and certainly achieve scalable, profitable growth.

All hope is not lost!  Here are a few things to consider when evaluating ERP and whether you should think about upgrading:  

  1.  Can you support your growth plans two years out? –  ERP isn’t something you slam in place unless you want to experience the horrific stories.  Start two years out. If you will be limiting your ability to grow profitably, it is time. It could be that you are on a system like QuickBooks, or you expect M&A activity or a potential sale, or you have a highly customized system or one that isn’t supportable two years down-the-line.
  2.  Forget about bells & whistles (cool items ERP suppliers show you) and evaluate a short list of critical success factors for your business –  This is #1 to success in evaluating ERP systems.  These critical success factors are items relevant to your profit drivers, maximizing the customer experience, unique to your industry/company, etc.  Once you identify them, tie them to functionality.
  3.  Consider your partners carefully – Although selecting the best system for your situation is cornerstone to getting the appropriate foundation on your house, if you have the wrong partner, you might as well hang up your hat.  The perfect software with the lowest cost proposal from a weaker partner will quickly surpass your highest cost proposal with a so-so partner and double it from there – at a minimum. Selecting ERP partners is quite similar to selecting any good partner – be aware you’ll be happily collaborating or stuck with them for quite a long time.

All businesses will go through ERP upgrades at least once or twice every 10-20 years (if done well, more if not).  Why not pay attention to how to make one of the most significant investments pay off?

 



The Value of Implementation

August 5th, 2016
change initiative

Successful project implementation requires leadership and hard work to pick up the pieces when something goes wrong – because something always will.

Strategy and plans do not fail in formulation; they fail in implementation.  Time and time again, my clients prove this statement.

Although I am an expert in helping clients select the best ERP system to meet their objectives (and have developed a proprietary process for just this process – ACE), system implementations go awry during implementation. I also happen to be an expert at significant change initiatives in complex organizations (whether merger and acquisitions or culture change) – undoubtedly, they go off the rails during implementation; not formulation.  Thus, it is quite critical to consider the value of implementation.

Because these initiatives are core to success, it is worth thinking about what has the most impact on results. The problem with implementation is that it requires hard work and leadership. There aren’t short cuts on this path to success. For example, when going through a merger, acquisition or selling the business, it is important to think through how you’ll handle issues that arise.  If there is one certainty with these types of projects, it is that issues will arise.  If you haven’t figured out how to address them so that the team aligns with the path forward, damage will be done. Synergies will disappear. Margins will decline. Morale will drop. Customers might hit the road. Thinking through how to handle these scenarios in a way that aligns with “what you said you’ll do” and the company philosophy is important.

If nothing else, consider “thinking before you act” when it comes to implementation. It is easy to slide to the 80% fail rate to meet expectations.  You must be on your toes, proactive and fully understanding the value of implementation for success to consider following you.

 

Did you like this article? Continue reading on how to strengthen your Eagle Eye:

It Begins and Ends with Leadership 

Uncommon Common Sense Project Management

 



Why Implementation is the 80/20 of Success

February 9th, 2015

supply chainI’ve had a few client situations arise this week which brings the critical importance of implementation to the forefront. The best plans are useless if not implemented. Similarly, I’d take a “good” plan with an exceptional implementation team any day over a “great” plan with a “so-so” implementation team.

For example, if you determine that you can improve your customer service and reduce your inventory levels by implementing a specific plan of action, little is achieved if you do not explain the plan, ask for input, incorporate changes that make sense and provide education and training for the roll out. Unfortunately, it is not uncommon to end up with worse results by partially implementing the plan and not bringing key people on board with the process upfront.

In another example, we were collaborating about implementation timing. There were true risks on both sides. By talking through the scenarios and intended results and risks, the best path forward emerged. Since implementation is vital to any project’s success, it makes sense to take a step back and think through options.

One tip to implement this week:

Think about a project you are in the midst of implementing or thinking about implementing. What can you do to “stack the deck” in the favor of success? How can you bring the best team members to the party? Can you develop metrics to keep the implementation focused? I have no doubt that, at a minimum, you can ASK the implementation team and related parties for ideas and feedback. Undoubtedly, your chances of greater success will improve. 

Looking for more ideas to keep your supply chain connected? Access more tips and resources on my blog. And keep connected by subscribing to my newsletter and email feed of “I’ve Been Thinking…”

 



Is On-the-job Training Enough?

December 19th, 2013
Skills gaps manufacturing

On-the-job training is rarely enough! In a survey conducted by my firm, LMA Consulting Group Inc. in conjunction with the APICS-Inland Empire chapter, it was found that on-the-job training is the most frequent methodology used to train workers yet 87% of manufacturers and distributors surveyed are experiencing a skills gap.  What else can be done?

In my former career as a VP of Operations for a mid-market manufacturer, we frequently utilized on-the-job training as it seems to be low-cost and quick to implement; however, it is not as it appears.  In my experience in working with multiple clients across many industries and geographies, I’ve found that the majority of on-the-job training can loosely be termed training.  It’s easy to fall into that trap as it seems the easiest way to get employees up-to-speed with existing resources; however, no one has extra time to train properly and it is rarely planned effectively.  I’ve fallen into that trap too so I know it’s easy to do; however, it is unacceptable – you spend more time, resources and money “trying to save money” than if you invested wisely.

Instead, what I’ve found to be effective is a smart combination of a pre-planned on-the-job training and development programs for those items which need to be integrated into the process with other education options.  To determine which training and education options to use, it is vital to take a step back and determine which types of skills and behaviors need to be developed for each employee.  Only then can the “right” comprehensive program be established.  Some folks need technical concept training – in these cases, APICS classes or community college technical training can be a great value.  However, they’d be useless for someone who knows what to do but who is unable to communicate it to his/her boss.  In that case, a communications class might be in order or a mentor type process could be preferred which could be something like Toastmasters.

Partnering with potential training partners is a smart move in today’s new normal business environment.  It would be rare for every situation to require one type of training program – or every employee to learn in the same way.  Thus, it makes sense to build relationships with several training options including groups such as APICS, community colleges and extended education partners, higher education partners (they are branching out more and more with projects to partner with the community), self-study programs etc.

The complete Manufacturing and Distribution Skills Gap report will be available in December.  To automatically receive the free report when it is available, register here.

Employers that offer training and education are more likely to retain top employees – will you jump on board or be left in the dust?