Early last month, a group of East Midlands manufacturers assembled in Nottingham to sample the culinary delights of local fine dining favourite, Harts. The group discussed their experiences with IT and specifically ERP and, as Tim Brown writes, while no two experiences were the same, the consensus among those present was that paper based systems are unequivocally a thing of the past.
The anecdotes expressed over the course of the evening demonstrated an impressive understanding of the opportunities available to their businesses through IT. While the experience of each company was different, all agreed that manufacturing IT process management systems such as ERP represent a indispensible route to establishing competitive advantage. The Manufacturer would like to extend its thanks to the sponsors of the evening, Microsoft and ERP experts Columbus IT, for enabling this Directors’ Forum Dinner and the important discussion that it prompted.
Steering the downturn
While the impact of recession differed from one company to another, all agreed that the removal of stock from their customers’ inventories had become common practice. Steve Hately of silicon hose manufacturer, James Dawson, spoke of the resultant need for increased flexibility in production rates and lead times with ERP as an excellent assistant to that requirement. Furthermore, he said, “carrying more ‘work-in-progress’ goods rather than completed products has also become more widespread” which has increased the intricacies of inventory management.
As has been well documented, the impact of the recession has spurred a new imperative to ensure all operations are as lean as possible.
While unsurprisingly IT and ERP was cited as a big part of the lean efficiency drive, a quick show of hands revealed most companies believed they would not have coped without the assistance of ERP and various IT improvements implemented pre-recession. Administration was cited as a common area that would benefit from further lean attention.
Words to the wise
Admittedly each of the manufacturers attending spoke of the importance of preparation and research in choosing the correct ERP product.
Steve Musgrave of window, door and conservatory systems, Synseal warned against allowing a system to run the business and making too many changes to the day-to-day operation of the business so as to adapt to an ERP system. However, it was agreed that some compromise was important as change was inevitable as benefits present themselves during the demonstration, consultation and implementation period.
Nick Linney of printing company, Linney Group, agreed but re-iterated it was not necessary for companies to accept any “negative compromise” which could adversely affect the smooth running of the business.
Simon Charlton of Columbus IT said that in general, a new ERP system will open a company’s eyes to new and better options and that by reducing old degenerative systems “staff are better mobilised to drive the business forward”.
Gareth Edwards, commercial director at Synseal, recommended the involvement of all departments during the implementation of an ERP system. This, he says, will avoid a lack of balance in functionality of the system across all functions.
Linney said that in his experience, “if there is any element of the business for which an ERP system doesn’t work then there has been a mistake” in either the implementation or the choice of system.
Functionality as standard
The vast improvements, in recent years, in out-of-the-box functionality of ERP systems was commended, with most agreeing that such an implementation maximised the chance of successful installation and operation. While IT manager at James Dawson, Mark Williams, spoke of the success of their bespoke option, of which a large part was developed in-house, others commented that from past experience, changes made to bespoke systems were often over complicated and made software difficult to update in the future. This does not necessarily mean system upgrades are not possible but that bespoke changes may not flow through following an upgrade installation.
Consensus of necessity
It was agreed that the initial integration of improved IT systems, such as the implementation of an ERP system, inevitably increased costs. However, the benefits of a successful implementation were said to be numerous with IT playing an important role in allowing a business to grow and develop. Such noted improvements included all employees having improved visibility of the entire operation.
In addition ERP enables a longer strategic view which many agreed incurred big and important culture changes within their businesses and was a vital step in continuous improvement and competitive advantage.