In 1789, Benjamin Franklin wrote, “In this world nothing can be said to be certain, except death and taxes.” I think he got it mostly right. He should have said: “In this world nothing can be said to be certain, except death, taxes, and the need for custom reports from your ERP system.” In Ben’s defense, computers and ERP systems weren’t invented yet, so he did the best he could...
In the job shop machine industry there is a funny answer to the question, “What do you make?” The response is, “Chips. We make metal chips. The faster we make them, the better we are doing.” (Metal chips are made with a metal cutting tool removing the material you don’t want. The tools are used on equipment like a lathe or a mill. Want to know how they work? Read this.)
I hope everyone had a nice summer. Now that all the kids are back in school, maybe you should think about going “back to school” as well. Let me explain.
My guess is the headline above didn't tell you anything you don't already know. There is a difference though between knowing and doing. You don't need me going into detail of the benefits of flossing your teeth or eating right, so I'm going to focus on the benefits of documenting your ERP system procedures. I promise you two things: This won't be a finger wag if your procedures aren't documented. Also, I will reveal an easy way to document your procedures. The third point isn't a promise, but it is a goal. I'll try to make this interesting, so keep reading.
Before I go into the right and wrong ways to run your enterprise resource planning (ERP) system demo process, let’s establish what it is you should be evaluating during the entire selection process. Obviously, it’s ERP, but it’s not only ERP. You will also be entering into a long-term relationship with the company providing implementation and ongoing services. Your implementation provider is as important to the success of your ERP project as choosing the right software. That may sound like a bold statement, but think of it this way: Buying a plane doesn’t make you a pilot. Training, practice, and passing certification tests does. Buying ERP doesn’t implement it. Developing new procedures, training, practice, and successfully completing real-life scenarios does. Who assists you through all this? Your implementation provider. ERP is worthless if it’s not implemented properly, so don’t overlook the importance of your implementation provider.
It seems like managers involved in the manufacturing production process never have enough reports or data. It’s not uncommon for our consultants at Visual South to get requests that begin with, “It would be great if I could get a report that…” Truth be told, the requests usually make a lot of sense. So, we develop the report and our customers start using it.
Back in the late 80s, I was an Operations Manager at a job shop manufacturer. I was responsible for all aspects of the business group I ran (except sales) and had seven supervisors reporting to me. The data I used to measure how we were doing was our on-time delivery; because that was the data Senior Management used to judge me. I'm proud to say my group consistently outperformed the two other business groups in the company.
When I talk to Visual South customers about using their ERP system to guide them to manufacturing process improvements that could be made, I always ask who is responsible for the variance in estimated vs. actual costs in a completed work order. In some cases, I get a quick answer with a name. That speaks volumes to me because it means they are proactive in looking at cost data. Companies who do this become comfortable with the accuracy of the data. This doesn’t mean they like all the data; but that’s the point. If there is an unacceptable variance, they find out what caused it. Perhaps the standard was wrong (in either direction). Perhaps the execution was flawed or exceeded expectations. The important thing is they know about it, and can do something about it.
I created the image used in the header of this blog about a year and a half ago for another project I was working on. Since then, it's also become the main image the Visual South website's homepage. I like the image because it tells the story of who we are as a company, and how we work with our customers to help them become more efficient. You've seen the image, now let me tell the story in words.
Let’s talk about the Porsche 911 and Chevy Spark. While both are cars, there is a big difference between the two. The 911 is a refined sports car with a base price of $91,000. The Spark is an economy car with a base price of $13,050. Both will get you safely from point A to point B; both have an engine, doors, windows, breaks, airbags, etc. Clearly though, they are not the same and aren’t even in the same market. They appeal to different types of buyers and are designed with that buyer in mind. If you go no further than category of vehicles and only look at price, you could end up buying a Spark, going to the racetrack, and being on the receiving end of a humbling experience.
