Why on Earth Do I Need an ERP System?

Why on Earth Do I Need an ERP System?

My boss once said to me that nobody wakes up in the morning and cries “I’m going to implement an ERP system!” 

It’s a fair point.  Apart from a few business process masochists that I’ve met over the years, few people out there really go out of their way to implement an enterprise system.  Enterprise systems are costly and they drain a lot of time and energy from key resources within a company.  They can be generally…painful to implement.  And yet I’ve seen so many companies make the move to enterprise systemand benefit greatly from the transition, in spite of the challenges.  This raises a question that I’ve had more than a few prospects ask me: “Why on earth do I need an ERP system?

Pundits have long noted that the “E” in “ERP” is the most important of the three letters.  The value ian ERP system comes iits applicability to the entire enterprise and not just to a few selective functions within the organization.  And while ERP has been around now for many decades, there continues to be ample opportunity for better enterprise-level integration among companies.  Quite often, the “why” of ERP comes in a quick analysis of a Company’s current-state application architecture. 

With many of the customers that I’ve helped migrate to Epicor’s ERP platform, I’ve observed a current state application map to include one or more of the following:

  • The utilization of stand-alone financial modules such as QuickBooks for financial management.  Such systems are good for counting waves, but not for making them.
  • The use of manufacturing oriented work order systems for managing the shop floor.  Job Shop-oriented systems can be effective in defining product structures and working them through the shop-floor, but are less effective in managing the selling and shipping of manufactured products anin comparing the resultant revenues to costs.
  • 1980s-era ERP systems, with one or more bolt-ons for managing product configuration and/or the shop floor.  First-generation ERP systems are generally solid when it comes to inventory management, and basic order-to-cash cycles, but are limited in many areas, and are a burden to maintain.
  • Paper-based systems for inventory management & time card entry—some customers are still pounding the paper when it comes to basic warehouse and shop floor transactions.
  • Varieties of macro-enhanced spreadsheets for doing one of many things.  Spreadsheets are a great gap-filling tool, but their limitations quickly become apparent as multi-user capabilities and large data requirements become a necessity.

Based on the above, iis no surprise that companies come to us looking to implement Epicor because their current state is a drafty quilt of poorly-stitched and poorly-patched legacy applications, homegrown boondoggles, and siloed modules.  Customers come to us believing that there must be a better answer, anin most cases there is.  The problem is, most companies took a lifetime to grow into their patchy ponchos.  At certain early stages in their relative existence, most companies can get away with the above scattershot array of systemand pseudo-systems.  But these same systems become hindrances as the company looks to scale up, expand its offerings, ramp up its output, or better integrate with customers, suppliers or best-of-breed applications.  As these challenges become clear, the “why” of ERP begins to take shape.

Our work as Epicor partners quite often has to do with explaining the “why” of ERP.  My own “why” came to me many years ago.  At the time, I was still a customer and still quite naive regarding the ERP space.  Working on a process-improvement project with my company’s Vice President of IT, I asked him point blank whether our recent ERP implementation had been a success.  “Yes!” he replied, emphatically.  “Why?” I responded.  I was a Lean Six Sigma Black Belt at the time and was practicing my “5-Whys” methodology.  I only needed one of them, for his answer changed the way I’ve seen enterprise systems ever since.  By implementing an ERP system, we were laying the foundation for everything that was to come.  In our case it was configurability—we were an engineer-to-order company, living ian increasingly configure-to-order market, anneeded to make moves toward configurability before our old methodologies priced us out of that market.  By implementing an ERP system, we set in place the building blocks for product configurability, and our subsequent initiatives took these building blocks and reshaped the way the company did business.  Fifteen years anan ERP system later, my old company is still successfully competing iits target markets, proffering configured products, andoing so profitably.

Now every company owns its own specific point in time, and faces its own set of unique challenges, as it tries to grow and thrive in changing markets.  I’ve seen a lot of good reasons for moving away from a patchwork of solutions to a more integrated and comprehensive system.  My own story may resonate with some, or there may be other stories that better answer the question as to why a company might make the move to an enterprise system.  This is all to say that there are a lot of reasons for implementing an ERP system.  And everyone here at the Estes Group would love to hear your story.  Anif you don’t think you have a reason for implementing ERP, we’d love to talk to you about that as well.

The Material Handling Industry Continues to Trend Upward, Outward, Inward

The Material Handling Industry Continues to Trend Upward, Outward, Inward

Emerging Trends Impacting the Material Handling Industry

Pundits, progenitors, and prognosticators are apt to riff on the emerging trends of a given industry.  Not surprisingly, a longitudinal view of such trends leads us to infer that the emergence of such patterns is less an instance of Aphrodite’s divinity spontaneously rising from the primordial sea foam than it is one of the all-too-human Agamemnon and his men, rowing their long boat across to Aegean from his citadel at Mycenae to the broad plains of Hector’s Ilium. 

That is to say, a trend is a flower that opens not over the course days but of years, and while the attached article was penned in 2014, a quick look at its list trends tells us that these items are still unfolding into bloom: Ten Mega-Trends of The U.S. Roadmap for Material Handling & Logistics and Why 2025 Matters Today

A look over the many industry tendencies that have faced and continue to face the material handling industry tells us that these trends affect all aspects of the companies involved–from the HR and finance departments through to product design and delivery.  For companies producing the equipment that services the needs of the material handling industry, a few of these trends are especially noteworthy, and a number of these are important for their ramifications on business systems.  Companies can no longer rely on spreadsheets and CAD drawings to compete, as industry shifts apply greater pressure on companies to rapidly supply equipment that meets these changing needs. 

Below are a few items, culled from the above article, that will affect the business systems of the future, in support of the companies working within this changing industry. 

  • The prevalence of Robotics and Automation: With the increased desire to automate as much of the supply chain as possible, the ability to move product with a minimum of human intervention becomes increasingly important.  Companies need to be able to tailor their offerings to provide integrated solutions that address these requirements, and to be able to integrate these different elements into systems, not only physically, but from a sales and delivery point of view. 
  • The increased use of sensor, wireless, and mobile technology: Coupled with automation are the needs for greater integration, between material handling subsystems, and between the overall material handling system and the facility in which it resides.  From an enterprise application standpoint, the importance in being able to quickly and consistently translate new features and options into their component materials and related operations becomes of great importance. 
  • The continued emphasis on “mass personalization”: As mass personalization continues to figure prominently in the arenas of product delivery and distribution, companies producing equipment to serve these industries similarly encounter the desire for increased personalization and configurability in the equipment used as part of the delivery cycle.  No two warehouse facilities are the same, and material handling equipment frequently needs to be easily tailored to support the discrepancies between buildings. 

 

For producers of equipment serving these industries, the challenges not only manifest themselves in the material handling products delivered but also in the processes and systems used to orchestrate the creation and delivery of these products.  Making the best equipment isn’t enough if it cannot be designed, produced, and delivered at the right time, and for the right price points.  In support of this, configurability continues to be of great importance, as are the abilities to quickly generate requests for proposals and rapidly engineer custom orders.  With its extensive product configuration capabilities, which are tightly bound to its Bill-of-Material structures, Epicor ERP is an excellent enterprise software option  for companies looking to scale up their organization to meet the challenges of this evolving industry.  

 

Are you looking for a strong material handling industry-based solution? Do you want to talk with Brad Feakes, Director of Professional Services? Contact us, and together we can make your company run better.

Is your Enterprise Resource Planning (ERP) System Dying on the Vine?

 

Hi, I’m Brad Feakes with the Estes Group. Now, with summer a distant memory and autumn full upon us, the winter still ahead, it’s a fitting time if you’re the leader of a manufacturing company to ask yourself whether your legacy ERP system is dying on the vine.

Doesn’t it seem like yesterday when your company first turned on its new ERP system and went live? Everything was blooming with possibilities, and your company was in its earlier season with its ERP system.

And then the years slipped away, and now your organization finds itself struggling with its legacy system’s withering limitations. And these limitations become an inhibitor to future growth. The truth is, winter is coming for manufacturing companies living on legacy ERP systems.

But you don’t have to hang your head over it, the ERP market is blossoming with different options, such as Epicor’s Version 10, with it’s Microsoft centered stack, and rest service compatibility, it offers the perfect platform for scalable growth.

As you assess your organization and its IT infrastructure, you need to ask yourself the question, have you harvested all the benefits of your legacy ERP system? Are you tired of endless patches? Are you frustrated with the narrow field of vision that your current system affords you? Is your legacy ERP system a husk of its former self? And are you ready to put it to pasture? Are you ready to leave your legacy ERP system behind.

I’m Brad Feakes with the Estes Group, and I’d love to talk to you, see if could help put some spring back in your business systems. 

Levels of Leadership: The High-Flying and the Etherized

Levels of Leadership: The High-Flying and the Etherized

Photo by @rawpixel

“When the evening is spread out against the sky like a patient etherized upon a table” – T.S. Eliot

When I first began dabbling in the field of Business Process Management, the terminology of this new and strange body of knowledge perplexed me greatly.  The concept of elevation, for one thing, was utter babble to me.  Or Babel, perhaps.  My notion of “high level” carried with it certain ancient connotations—height was a luxury in the ancient world, and only the most powerful civilizations were able to get a view from above the tree tops: from a Babylonian ziggurat or an Egyptian pyramid, for instance.  Height, therefore, implied greatness, or to use one of Aristotle’s favorite terms Eudaimonia, sometimes translated as “flourishing.”  At the highest Olympian point, one breathes the rarest of airs, or so I thought.  But I was breathing the ether of an entirely different allegory.  Height, in this new world, dealt not with levels of greatness, but rather with levels of precision and abstraction.  In the business world, for something to be “high level” inferred that it was at some level of aggregation and abstraction as to be disconnected from the tactical nuances of day-to-day operations.  News to me.

Back in the day, it was common war room parlance to utter something to the degree of “we’re looking at this from thirty-thousand feet” at least once a day.  It was not until my first airplane flight that I truly understood what it meant, to look at something from that kind of distance—beautiful, and a little terrifying.  I’m more of a pavement-and-pothole kind of guy.  The other day, I was skidding down the highway in another rental, that was fortunate enough to still have a CD player hidden amongst its many modern accoutrements.  I had borrowed Jim Collins’ “Good to Great” in CD form the local lending library and spent the better part of my ride listening once again to his seminal work.  It was a fun listen: Collins began by underscoring some of the key principles of successful companies, and then went on to expound on some examples of excellence, such as…Wells Fargo, and um, Circuit City, and well…Fannie Mae?  My ride, all at once, seemed a little…dated.  I thought to myself that Collins would do well to write a follow-up to his earlier work and title it  “From Good to Great to God Awful.”  Now that would keep me engaged while ripping down the interstate!  So, maybe Lord Jim’s examples have not stood the test of time.  But I believe that the good leadership qualities that underscore successful organizations have outlived their exemplars.

To that point, whenever I think of flashy and charismatic leaders in business process management, I smell pizza. Not because of any neurological condition that would make me a risk on the open road, but due, rather, to a story a man recounted on a flight from Minneapolis to Memphis, regarding the former executive of a large manufacturing company.

Let’s call this former executive “Pep.”  Now Pep came to his role of eminence in this company not as an internal promotion, but as an outside hire, touting a flashy resume from one of America’s well-known pizza chains.  And his demeanor was more flashy than his letterhead, and greasier than the pizza he peddled.  He’d bound down the hallway in a shiny suit, talking like a sailor and firing off one-liners, like the proverbial mouthy guy at the end of the local bar.  One of his favorite lines was “yesterday’s news wraps today’s meat.”  It was a line, with his delivery, that could drive a man to veganism.  Another time, his personal assistant heard him cussing out his computer and rushed to his aide, not to discover that the company’s earnings report was unfavorable, but that he had just lost another game of solitaire.  All of this from a guy with a Fortune-500 pedigree.  It was his story, among others, that led me finally to realize that CVs are like statistics—they can be twisted to tell you whatever story you want to hear.

Of his many witticisms, one line stood out to me from the others.  When commenting on the company’s long-standing issues with the accuracy of its outside sales staff, he exclaimed.  “If they wanted you to be exact, they wouldn’t have called it estimating, they would have called it exactamating!” 

Exactamating.  As you might have guessed, Pep was a rather high-level guy.  He sounded like such a high-level, that I imagined him bantering about exactamating in the first-class section of a transatlantic flight, sucking down a gin & tonic, while eating a big greasy slice of pizza, all at thirty-thousand feet.

As you might imagine, he was also afflicted with many of the ailments that bother high-level fellows of his ilk.  For one, he didn’t sweat the details—he liked to make big decisions, make them fast, and then walk out of the room and have someone else fill in the finer points.  If you locked him in a board room with the VP of engineering, he’d find a way to slip out the ventilation shaft for a smoke before the hour was quartered.  To the folks in the trenches, it seemed like simple impatience—he seemed too impatient to be bothered with the details, and similarly too impatient or just incapable of holding any of his people accountable at any kind of detailed manner.  But at any level, the company’s failing business results empowered the CEO to request that this high-flyer to take the next flight out of town. 

Back to Good-to-Great, one of Collins’ key observations from the book has to do with the demeanor of those with good leadership qualities. Good leadership qualities for business process management, according to Collins, tend not to be of the flashy variety, full of id and ego. Rather, they tend to be soft spoken, less interested in their own presentation than in the success of their company.  Interestingly enough, this same company, who sent Pep the Pizza Man packing opted to replace him with a leader who fit Collins’ model.  For one, the new executive was a hire from within the company, and not a fly-in, as had been his predecessor.   Moreover, the new leader was much less of a showman.  Most importantly, the new leader’s obsession with the company’s success drove him to understand the company’s inner-workings at all levels.  Don’t get me wrong—he was never going to replace any of the data entry clerks, but his willingness to engage the organization, and its members at all levels was one important part of the success that the company went on to have under his leadership 

I’ll admit it: one of my guilty pleasures is the legalized blood-sport commonly referred to as mixed martial arts, or MMA.  As you may be aware, MMA involves the combination of multiple fighting arts, and they best fighters are often the ones who excel in combining these disparate arts into one integrate skillset.  One related skill in this field is the ability to “change levels”—to convince your combatant that you are going to attempt a strike, and then drop down for a wrestling takedown and quickly haul your opponent to the mat.  In my work as a consultant, I have had the good fortune to meet and work with many different managers and leaders, each with differing motives, differing personalities and differing intensities.  I find that the most successful leaders are those who similarly have the ability to change levels as needed—to move from high-level strategic thinking, down to tactical or operational problems, and then back up again.  The high-level folks often struggle with this: they are the proverbial kick boxer in a wrestling match—great when they’re on their feed, but hopeless at the ground-level.  All that being said, the next time that I have to take a flight, I think I might sneak a New York slice in with me, before I leave the ground.

Ask us any question you many have about good leadership qualities for business process management and ERP Software Implementations, we would love to chat.

Winning the Business Shuffleboard Game on the Deck of the Titanic: How lack of leadership and misguided direction sunk one long standing company

Winning the Business Shuffleboard Game on the Deck of the Titanic: How lack of leadership and misguided direction sunk one long standing company

A colleague recently recounted a story to me from his own past. It had to do with a failing business.  The company had numerous issues, in the areas of acquisition and execution, of revenue and of profit.  The issues had gotten so out of hand that the company was on the verge of closing its operations entirely.  In a last ditch effort to turn the company around, the company’s president initiated a series of process-improvement projects.  The hope was that the results of these projects would provide the necessary impetus to pull the company out of its tailspin and provide a foundation for its revitalization.  Moreover, the president had democratically distributed the projects across the organization–one for each department.  As we all know, projects consume resources, and not all of the selected projects were of the same potential impact to the company.  As such, lower-impact projects ended up pulling away resources from some of the mission-critical areas of the business, areas that had been suffering the most.  Ironically, the attempted intervention had made things worse.
 
In one telling instance, the HR department had been tasked with implementing a new HR management system.  The HR and IT staff dutifully went through the implementation cycle, soliciting requirements, selecting software, configuring the application and converting data.  Leads, supervisors, and managers spent their free time logging employee metadata into the new system.  And all of this occurred while the company missed shipments, struggled with quality issues, and scrambled to get new orders, while key employees fled to their competitors.  The HR department rolled out its new system shortly before the announcement that the company’s assets were being dissolved.  While the company overall was a disaster, the HR project was a ringing success, and when it came time to terminate the company’s staff, they were able to use the new HR system to efficiently and effectively carry the task through to its macabre conclusion.

That is, the HR department had won the proverbial shuffleboard game on the deck of the Titanic.

 In my own career, I’ve encountered a few folks who were winning deck games on a sinking ship.  And like my friend’s story, the game they were winning had nothing to do with the water that the ship was taking on.  This seems to be a common failing business mistake, in general. During good times or bad, failing businesses more often focus their efforts on the wrong areas, and because of this, the efforts of their best employees go underutilized.  Failing businesses also make the mistake of democratic project selection. Instead of business planning strategies involving a hard analysis of the key pain points in the business, management adopts generic strategies that try to support the general betterment of the company, while in truth, they are diluting their efforts with low-impact initiatives. Other times, failing companies exhibit the tendency to chase random rabbits down their burrows, mistaking the thrill of the chase for the value of the bounty.  Quite often the least successful companies are also the nicest–they avert stepping on toes and pointing out obvious issues.  Had they been on the Titanic, they would have been the ones to reclassify the iceberg as an upright collection of water molecules, the gaping breech in the hull as an additional sprinkler system, and would have continued with their polite game on the upper deck while the water levels rose.
 
In looking back at these situations, it is hard not to see this as a failure of leadership.  The leaders of the company are the ones who truly have the ability to steer a company in one direction or another.  Often, the direction is as simple as the projects that the company chooses to execute over a given year.  But the projects selected quite often serve to have the most impact on the company’s ultimate destination.  
 
But one might ask just what kind of business planning strategies separate leaders who safely pull their ships into harbor from the ones that send them to Davy Jones’ locker. While there are probably a number of reasonable answers to the above question, I would contend that the most successful managers from my own past were buoyant due, among other things, to their knowledge of their industry.  The best managers obsess about the workings of their business, and the industry in which it resides, and base their business planning strategies and a vast and well-integrated understating of the dynamics of the environment in which their company competes.
 
To put it simply, there is no replacement for domain-knowledge.  The best leaders I have worked with understand this principle.  No leader is an expert in all areas, but when good leaders assume leadership of a company, they immediately dive into a phase of learning–about the business, its culture, its business climate, the market conditions, and whatever additional factors are required to allow the leader to be able to make good decisions.  And once this knowledge has been amassed, the leaders go about applying their knowledge to their business planning strategies. They make an honest assessment of the company, its opportunities, and its issues.  And in response, they make decisions that drive how the company’s limited resources are to be sequestered, to address issues or take advantage of opportunities. 
 
And their decisions tend to be the better ones.  Far away from the shuffleboard deck, they are at the helm, altering course to avoid the bergs and burglars that would threaten their business.  The worst managers I’ve encountered take the opposite approach–they tout the importance of surrounding themselves with good people, while they themselves are often missing in action, preferring instead to galivant about town, wining and dining the city’s elite, seeking to impress, when they should be impressive, seeking to woo when they should be working.  While I certainly do not question the importance of a manager building a first-rate team, it takes leadership and involvement to collect, engage, and focus the individual talent in the right direction.  And the inability to make good directional decisions, to guide these good people, generally results from the leaders’ inadequate preparation and/or dedication to his or her craft.
 
To return to the title of this post–if the captain of the ship is wasting his time winning games of shuffleboard, the crew will flounder, and ultimately, the ship will founder. So contact the EstesGroup today, and take advantage of our business process review, management, and improvement services.