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At A Glance:
• Today’s manufacturing enterprise is challenged by rising material costs, increasing competition, and ever-changing customer requirements.
• Manufacturers are faced with dizzying levels of complexity, duplication of effort, and in the worse cases, poor quality and customer service.
• This paper describes the warning signs that an ERP system is killing a business and suggests how companies can thrive with a new approach to business systems.
Why Does ERP Fall Short?
Most manufacturers look to their Enterprise Resource Planning (ERP) system to enhance the organization’s overall performance. In many cases, the original drivers that led to an ERP selection were the goals of streamlining and simplifying business processes for a sustainable competitive advantage. In case after case, implementations miss their mark. Instead of delivering promised cost reductions, business agility and performance improvements, ERP systems create complexity, duplication of effort, and in the worst cases, poor quality and customer service, and a dangerous lack of visibility into the business. Likewise, legacy ERP systems don’t keep pace with change. The manufacturing sector faces continually changing business processes, data, and requirements which make it nearly impossible for a typical, inflexible ERP system to keep pace with what the business really needs.
The Warning Signs
Check these ten warning signs to see if your ERP system is killing your business.
1. Your ERP system can’t integrate mission-critical business data. Your data is “locked up” within your outdated ERP system and is difficult to access. You can’t easily analyze it for decision-making. Worse yet, quality management, engineering and design, EDI, customer orders, and release accounting all reside in “silos” of information that exist independently of each other. A silo environment increases complexity and ensures duplication of efforts with different versions of the truth, which compromises the quality, reliability, and accessibility of vital information.
2. Changes to the system are costly and time-consuming. The software vendor provides releases every 24 months and rarely provides the new features you need on a timely basis. Any change coming from the vendor seems to cost you six figures and many months to complete. Nor can you find skilled resources to help with these updates at an affordable rate, so you are stuck using an outdated system and facing the costs.
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