Are You ERP-READY?

by Dave Garwood

Fast Track Manufacturing has been busy investing in new information technology. They recently hired an experienced information systems executive and carefully evaluated the latest packages on the market. They have selected an integrated ERP system with all the bells and whistles. The conversion plans to the new software are moving along with lightning speed.

Is Fast Track ready to take advantage of this cyberspeed technology? Are they ready to turn on this new capability and fly at Mach 2? They think they are. But are they?

Fast Track has many veterans in executive and managerial positions. As I listen to the CEO talk about the "experienced" staff, I glance across the office. Engineers are adjusting their T-Squares and pulling slide rules from their belt holsters. Secretaries have bottles of Whiteout and a box of carbon paper next to their manual typewriters. Accountants are adjusting their green eye shades and arm bands. Inventory planners are inserting new panels into the Kardex files. And the corporate pilot is outside wearing his leather helmet, goggles and hoisting a windsock. Everyone is experienced all right ... experienced and comfortable in 1950's technology. The company is trying to compete at turn-of-the-century speed with new tools and old mindsets! Incompetent people? Probably not. Lack of the necessary knowledge to utilize new technology? Definitely!

While this profile is admittedly an exaggeration, the scenario isn't that far off. Today, many companies are spending big bucks for new, state-of-the-art ERP software while clinging to their old outdated, but comfortable practices. And they often spend millions to modify the software to perpetuate these obsolete practices.

Y2K: Software vs. Business Process Compliant?

Insuring Y2K compliance has been a major factor for spending six figures for new ERP software. But the opportunity for improving business performance is a more effective Supply/Demand process .... resulting in delivering on time, defect free, innovative customized products in a shorter lead time. Yet, it's still business-as-usual after the software is installed. While the tools are new, the business practices for their Supply/Demand process are the same. Sales, manufacturing, new product launch and financial plans are not integrated. All are floating on separate islands. Inventory records and bills of material are still inaccurate. Sales forecasts are not credible. Hot lists and expediting continue to be the tools of choice. Late shipments, excess inventory and high costs are the result.

Wrong software? We think not! The problem is failure to change the fundamental business process. They fail to run the business differently and overcome the root causes of the problems. Boot Hill is crowded with the victims of this common problem. Your company doesn't have to be the next victim.

A Path Out of Your Comfort Zone

Most companies have a lot of hardworking, loyal and intelligent people. Surviving depends on wholesale changes -- major paradigm shifts -- in the processes used to run the business. The challenge is to move people out of their comfort zones and business-as-usual practices. And to get them to do it willingly and enthusiastically! In short, make major changes in how they do their jobs. New tools and old practices will only achieve old results. Change is an inevitable necessity.

People don't resist change. They fear failure.This fear of failure is the major cause of the business-as-usual mindset.

How do we overcome this fear and get people to enthusiastically try something new and take risks? The answer starts with building confidence by increasing their understanding of new business process technologies. What do they need to understand? R. D. Garwood, Inc. has developed a simple evaluation tool to answer this question.

We've worked closely with many leading-edge companies and observed their Best Practices and the principles those practices are based on to improve their Supply/Demand process. We have drawn on this experience to develop a tool to help you determine the readiness of your staff for effectively using ERP software. We have assembled a list of topics, concepts and techniques that key leaders in your organization need to understand to make the Supply/Demand process a high-speed performer. The objective is to use this tool to evaluate your company's level of understanding of these new concepts and tools. Email us to request your complimentary ERP Readiness Test. We will email it to you right away!