When to use ERP Software Consultants

Many times companies try to select and implement ERP software on their own. Sometimes this works and sometimes it doesn’t. So the question is, when should a company use an ERP Software Consultant to guide them in their ERP Selection or ERP Implementation?

The answer is not so simple. If a company is mature and has the resources that can look independently at the business processes, then it may make sense to embark on a selection on their own. Most of the time in mid-market sized or even smaller clients, then it is difficult for them to 1. Spare the resources and 2. Look at the business processes objectively.

Any good ERP Selection begins with a company evaluating their business processes. Borrowing from the Toyota Production system (aka Lean Manufacturing), a company should first eliminate waste and then consider automating. Automating bad processes will only make things worse faster. However, automating good processes will help grow the business and promote better communication.

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ERP Software Consultants – Best Practices

The real question becomes how much is the company willing to flex their processes to adapt to “best practices” that are usually built into a commercial software system. If the company is flexible (and this takes a lot of leadership to make happen), they can select a system and model their business around that system. The larger commercial systems, such as those from Microsoft, Infor, SAP, Oracle, and others have all grown up from thousands of implementations from all sorts of companies. They have developed efficiencies that many companies who adopt the software’s methodology can benefit from.

The real key is understanding the fit of a software package to the business. If the company does some niche processing, then a mainstream commercial package may not fit. However it the company is a distributor or a manufacturer of discrete products as an example, then a standard mid-market product would likely work for them.

So how do you choose the software, it is back to the business processes and the key requirements. “Key Requirements,” not just all requirements. The things that the old system does not do well and those things that it does very well are good places to start. Additionally, discover those requirements or processes that set your company apart from others in your industry. Usually processes around your competitive advantage are part of the key requirements.

Going back to the original question, should you use independent ERP Software Consultants? If you have a clear and objective understanding, you can afford the time to really research the vendors and you have a strong will with salespeople, then going it on your own might be reasonable.

If you do not have the time, the understanding of the ERP Software market, or the will power to manage at an arm’s length the software vendor’s salespeople, then an ERP Software Consultant would be a wise choice.

ERP Software Consultants

Discrete vs. Process in ERP
by Chris Shaul

One of the saddest things is a manufacturer who chooses an ERP software system that does not a fit with what they do. For example, a chemical producer who selects and implements software designed for a type of company which manufactures solid objects such as furniture. There once was a company that provided consumer packaged goods to the convenience marketplace who selected fish disassembly software. These are obvious mismatches. But the specifics may not be clear.

There are two types of manufacturing. There is discrete manufacturing, or a company that assembles products from widgets. There is also process manufacturing, or companies that blend liquids. Process manufacturing companies process formulas or recipes. While the majority of manufacturing is discrete (automotive, aerospace, or anyone else who builds component parts), there are a select group of manufacturers who are process manufacturers. These include food processors, cosmetics, chemical producers, paints and coatings manufacturers, and anyone else who deal with liquid or batch produced products.

What makes process manufacturing different from discrete? Process manufacturing uses formulations or recipes. A discrete manufacturer uses Bills of Materials (BOMs). A discrete manufacturer assembles along a routing, whereas a process manufacturer blends in a batch.

There are companies who operate in both environments and are often called mixed mode manufacturers. These manufacturers need both a process and discrete manufacturing system.

So what sort of ERP system works with these types of manufacturing modes? This can only be answered by looking at the markets these software companies serve. There are certain products which are clearly process, such as Batchmaster Software or Ross Software. These software deal with formulations, batching, and the other specific issues around process manufacturing. There are other software systems that are clearly discrete such as DBA software, Intuitive, or Made2Manage. These handle Bills of Materials, Routings, and specific discrete requirements. These are all systems that serve their niche.

When you get into larger systems, there is not a clear cut solution as they operate in Mixed-Mode. For example QAD software can handle both discrete and process requirements. Others that can do the same are MS Dynamics AX, Deacom, Ramco, and of course the Tier 1 players SAP and Oracle.

So the real lesson is to understand what you do first before looking at software. Are you a processor of liquids, or do you assemble individual items to create an assembled product? Knowing this will go a long way to help you properly choose software that fits you like a glove.

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Chris Shaul is an ERP Consultant and a regular contributor to ERPandMore.com

Tag: Software System