Is Your ERP System Supported by Educated Manufacturing Professionals?

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Over my 15 years as an Enterprise Resource Planning (ERP) implementation consultant, I have been involved in over 100 implementations.  Each implementation is different, but the one factor that remains constant is the need for an ERP system to be driven by educated professionals WHO understand the operational processes that are feeding the software.

My career has evolved in the key areas of Purchasing, Production and Inventory Management, as well as Manufacturing Engineering and Costing,all of which I have formal training in.  When implementing ERP software for a manufacturer, all those involved in the project must have a certain level of process knowledge to make key decisions and increase opportunities for success.  It is difficult to engage in a meaningful discussion of an area which needs improvement, when the stakeholder who is responsible for this area has limited general knowledge.

For example, here are a couple of typical scenarios:

ERP Software Analysis Phase

The ERP project team is examining the current process for determining Safety Stock quantities and discovers that quantities have not been updated in 5 years, even though business volumes have increased by over 25%. The Materials Manager does not have any documentation on how these quantities were determined, and does not know how to go about recalculating new values.

ERP Software Design Phase

The topic of determining a Sales Order delivery date is being discussed. The terms “leadtime” and “Available to Promise” come up in discussion. The Customer Service Manager has never heard of these terms before, and is having difficulty understanding what they have to do with establishing a delivery date. He is used to picking up the phone and calling the production manager to get a ballpark delivery date.

In both of these examples, fundamental Supply Chain and Logistics knowledge is required to make decisions that will affect production performance.  Process blueprints and functional process scripts are structured according to the information gathered in the initial project phases. In these specific examples, the ERP system is at risk of improper configuration that could result in future materials and production shortages.  Training your staff on basic manufacturing concepts while in the process of ERP software implementation is simply the wrong time!

Here are other drawbacks that can arise from a misconfigured ERP system due to project members lacking manufacturing process knowledge:

  • benefits and expected ROI will be diminished
  • lack of system performance will be misdirected at the ERP implementation partner or the system itself
  • stakeholders will direct all of their energy at fixing a new ERP system that is NOT broken rather than investigating process issues
  • users will resort to tools outside the ERP software, like Microsoft Excel and Microsoft Access, to complete job functions

It is the responsibility of management to sponsor the education of its employees, which is frequently done through employee reimbursement of job related training and exams.  It is also the responsibility of staff to take the initiative to assess their personal training needs and take advantage of available education programs.

Several professional organizations offer training and certifications in Supply Chain, Logistics, Production and Inventory Management.  In particular, American Production and Inventory Control Society (APICS) offers excellent training and certifications specific to manufacturing and distribution industries. Purchasing Management Association of Canada (PMAC) also offers courses and certifications specific to procurement and purchasing management.  Classes are flexible in each case, providing evening and weekend classroom training as well as online courses.  In addition, these organizations offer memberships and support local chapters that host monthly meetings for added networking and knowledge.

As a consultant, I encourage companies to promote education with their staff, but it is rather late in the game once an ERP software implementation starts.  The importance and value of training and certification in these areas is a key to a successful implementation – which is too often overlooked. Going forward, perhaps our goal should be the continual promotion of education for the advancement of the overall manufacturing industry - in this manner, our ERP software implementations will also reap the benefits.

BDO Solutions is a national firm with local practices throughout Canada, a Microsoft Gold Certified Partner and Reseller of the Year in Canada for 2010, 2011 and 2012.

By Kevin Cosman, Solutions Consultant, BDO Solutions, leading Canadian Microsoft Dynamics ERP & CRM Partner.

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