Hello,
With the Australian Manufacturing Week AMW Sydney Expo 2024 just around the corner on April 17-19, I would like to share an editorial I wrote for AMTIL in the AMT (Australian Manufacturing Technology) magazine in Oct 2023.
The article provides guidance on considerations when choosing an ERP system.
I hope it is of benefit to you. If you do attend the Expo, come and see us at the Odoo booth. My colleagues and I will be happy to talk to you.
I have extracted the text from the editorial as a copy of the magazine page didn't convert well.
You can read the article directly from the AMTIL website: Magazine Page 72 (Page 74 of the reader). Please review the rest of magazine it is very informative: The Australian Manufacturing Technology Insititute represents the interests of Australian Manufacturers and definitely worth checking out and joining.
https://amtil.com.au/amt/2023-amt-magazines/amt-oct-nov-2023/
Enjoy!
ERP systems and manufacturers
Considerations when choosing an ERP system and provider.
John Gellel from WMSSoft Australia brings his experience and guidance.
The decision to implement or change your Enterprise Resource Planning (ERP) system is one of the largest information technology innovations you will make to your business. It can either propel your business into information nirvana or leave you weeping in the pit of technology failure. The associated effort, costs and business disruption are significant, so it is worthwhile to perform your due diligence.
The ideal scenario for your ERP implementation would be one all encompassing system managing your information processing needs via one central information repository, seamlessly inter-connecting your customer e-commerce portal through to sales, scheduling, manufacturing, warehouse, dispatch, finance, accounts, dispatch, CRM and much more. When implemented correctly it's poetry in motion.
There will be two major decisions required in moving forward with implementing an ERP: Which ERP and who will install and support it.
Typical ERP choice considerations are an ERP’s features, fit for
purpose, licensing, hosting and implementation costs, upfront and
hidden costs, scalability, capability, access, customisation(ability)
and quality, support, security, ease of integration, ease of use and
flexibility.
Typical ERP provider/implementor choice considerations are
upfront and hidden costs, capability, relevant industry experience,
professionalism, certifications, office location, IT project best
practice (management, analysis, documentation, sign-offs, project
control), training, support/communication quality and level of care.
Many factors will influence your choice of ERP and provider. Meeting with different ERP providers will be a time of discovery, knowledge and power. Devoting your time and efforts in the selection process will be worthwhile in the long run.
The following are worthy areas to discuss when meeting with ERP
providers. If the providers don’t cover these, prompt them and
gauge capability based on their answers.
Initial scoping: What business modules do you intend to implement
and what is the base functionality required of each module? Sales,
Purchasing, Manufacturing, CRM, finance, etc. By defining the
ERP modules from the outset and asking questions about your
basic workflow and functionality required, an ERP implementer will
gain information to provide an implementation cost estimate. An
implementation project requires these to be defined from the outset.
Analysis and Requirements: During initial meetings with an ERP provider, they can gain an understanding of what you need in each module (from the scope) to determine a rough estimate. Actual costs can vary greatly based on the complexity required in each module, the ability of an ERP’s base (vanilla) functions to meet your business needs and the work required if development (code customisations) are made to get the system to a state where it works for you. Correctly analysing and designing your manufacturing requirement and solution is going to be the most complex task, and by itself, generally equal to all other business modules combined and also the area where failure to correctly implement occurs.
Once you have chosen your ERP provider, the real work begins. Be confident that your potential ERP provider has ERP certified consultants, experienced business analysts capable of understanding your business, analysing your workflow, documenting each and every requirement, comparing those requirements to the vanilla ERP system and designing solutions when a requirement does not match the vanilla out of the box software. Even without IT knowledge, you can gauge capability by how they answer. Do they answer in a manner that explains a defined, phased, project structure or is the approach ad hoc? Are they simply developers with no business analysis and project management skills? An ad hoc approach with no clear boundaries can open the door for open ended costs without finalized solutions.
Lack of ERP knowledge: Will the ERP consultants provided to build your solution be adequately trained in the ERP system and modules that they will be working on? What training and certifications do they have? Are they local? What is the format of communication? Face to face, video meets, phone, email.
Lack of Manufacturing knowledge: Manufacturing workflow is complex. You know it well. Be sure they do too. Ensure the solution they provide is aligned with your business workflow.
Bad Data/Data migration: Ensure the ERP provider asks questions about your current data, identifying your data issues and how they will resolve them. Ask how they will assist in the identification of bad data, clean, it, transform and load the data to the new ERP system. If unresolved data issues are moved to the new ERP system, you will have trouble.
I hope the above points will help you on the start of your ERP journey. Good luck!
John Gellel is the Implementation and Sales Manager at WMSSoft Australia with over 35 years experience in IT development, business analysis and project management.
wmssoft.com.au