Training in ERP
Various businesses, large and small, have implemented Enterprise Resource Planning (ERP) systems. ERP software supports the distribution of information between various functional departments and geographic locations of a company. ERP systems currently exist in many different forms and offer many different features.
Many manufacturing, pharmaceuticals, Construction, Trading, Transportation and many other companies rely on ERP systems to communicate data between departments such as production, shop floor planning, purchasing and accounting.
Although more and more companies are implementing ERP system to manage their business more effectively, the companies are facing a taunting task in finding professionals to manage the system. This is due to the fact that though the demand for trained ERP professionals are growing day by day, the market is not able to meet the demand due to shortage of sufficient trained professionals. Therefore pursuing training in ERP field is going to bring handsome career dividends for the IT professionals in immediate future.
Data migration is the process of moving required volume of data from existing systems to new systems. Existing systems can be anything from custom-built IT infrastructures to spreadsheets and standalone databases. migration of data encompasses all the necessary steps to cleanse, correct and move data into a new system. Technological changes, change in providers, software updates or data warehousing/data mining projects make such delicate and critical operations necessary.
A good data migration should allow one to:
From a user perspective, the migration of data should make sure that a strategy is put in place to achieve maximum flexibility and quality.
As you are aware that with a successful ERP in place, information will be freely available and any casual user can very easily generate any ad hoc queries or reports. The system will automatically check for the compliance for most of the standard rules. As such, a number of routine work will disappear. However, with the information system in place, many of the middle level managers can be empowered to perform far more interesting analysis, develop insights and suggest innovative schemes for improvement.
Often these are the real benefits of ERP. If an organization is not imaginative enough to empower people to perform such analysis, obviously ERP can be discredited with creating unemployment.
Take a look at the Indian Railway’s Computerized Reservation System. With the networked computer terminals, one can manage the issuing of the tickets with fewer staff. However, there are more reservation staff today than ten years back. The average counter hours across the country have increased from 6 hours a day to 12 hours per day. Now a person can make reservations from any place to any place from any one of the terminals, significantly improving service quality.
In a way Railway Reservation System may have taken away a few jobs involving certain categories but created many more jobs. In all such cases looking at the head count may be an incorrect way to approach the problem. The goal must be to provide better quality service and better quality of jobs.
ERP Selection Criteria – The question should address the company’s business needs and concerns and each issue or question should be given a weight according to how critical that function is for the company. For example, if the company has offices in different countries, then the capability of handling multiple languages and currencies becomes an important criterion.
Likewise the selection criteria should be divided into categories – vital, essential and desirable – and points should be given to each criterion. This point rating system will simplify the evaluation process; but remember the importance of human intuition and judgment should never be underestimated.
The best method for preparing the ERP selection criteria is to conduct a requirements analysis – find out what the company needs. The requirements must reflect those factors that the company considers indispensable for the successful running of the business according to company’s work culture and practices.
Tangible benefits are those measured in monetary terms and intangible benefits cannot be measured in monetary terms but they do have a very significant business impact. The tangible and intangible benefits are discussed below :
Tangible benefits
>> Improves the productivity of processes and personnel.
>> Lowering the cost of products and services purchased.
>> Paper and postage cost reductions.
>> Inventory reduction.
>> Lead time reduction.
>> Reduced stock obsolescence.
>> Faster product/service look-up and ordering saving time and money.
>> Automated ordering and payment, lowering payment processing and paper costs.
Also Read – ERP for Energy Companies
Intangible benefits
>> Increases organizational transparency and responsibility.
>> Accurate and faster access to data for timely decisions.
>> Can reach more vendors, producing more competitive bids.
>> Improved customer response.
>> Saves enormous time and effort in data entry.
>> More controls thereby lowering the risk of mis-utilization of resources.
>> Facilitates strategic planning.
>> Uniform reporting according to global standards.
Also Read – Cloud ERP Software for MSME
Stabilization period in ERP implementation – After an ERP system goes live there is what has been referred to as a “stabilization period” that typically lasts three to nine months. During that period most companies should expect some dip in their business performance and should expect that they will need to manage through that dip.
During the stabilization period, all those processes that once were just plans are now being used. New software and processes may be unfamiliar to the users. Hence, there may be problems with the quality of the work, and consequently the system may not operate as it was hoped. To avoid this, it is critical that users get the appropriate training at the right time.
During the stabilization period, processing and network response times may not be adequate for the implemented system, forcing changes in bandwidth and processing capabilities. Where does support for these problems come from? Internally, the original project team can evolve to provide support for user needs, assist with additional training and make necessary system changes.
Should SMEs implement ERP?
Every business now has the opportunity to take advantage of the internet’s geographical reach and potential for profit. Thus, the Internet has made it possible for small and medium-sized enterprises (SMEs) to compete effectively with the larger organizations. The enabling potential of the Internet guarantees that SMEs are appropriately represented and active participants in the globalized marketplace.
Today’s web-based ERP solutions provide SMEs with a technology solution having all the functionality and benefits with minimal investment and risk.
By not making the transition to this new way of doing business with the help of an effective ERP system, small firms run a serious risk of becoming less competitive, affecting both their present market positions and long-term viability. As larger companies integrate ERP and e-commerce into their business, small firms run the risk of being excluded if they are unable to establish strong e-commerce ties with others in their supply chains.
An ERP Manager must have the ability to exercise overall day-to-day control of project leaders and the resources of the program, balancing the needs for program success with the skills and capabilities of the staff. He should also be a good communicator and must interact regularly and comfortably across various departments — from individual to the ERP Management Team level in order to negotiate solutions that foster strong relationships and continued success of the project.
The ERP Manager is responsible for the development of an effective planning process, for the creation of an integrated project schedule that encompasses all aspects for the ERP Program and for the actual execution in conformance to plans and the continuing update and adjustment of plans and execution to fit changing circumstances.
Implement and lead an effective project change management process that pro-actively identifies project changes and incorporates an appropriate impact analysis and approval for such changes across the ERP program team. He is responsible for creating and maintaining a monthly financial management process that incorporates actual financial performance to forecasted performance and justifies all variances; accurately forecasts expenditures in alignment with the project budget and supports the budgeting process throughout the project lifecycle. He also must follow the company’s financial processes and policies.
Actively directs the development and maintenance of plans, practices and assignments to identify, quantify and contain the occurrence and potential impact of risks and risk events on the execution of a program and its likelihood of success.
An ERP Manager is responsible for making timely, effective decision at the project level and communicating those decisions both up and down the program structure, while approaching needed decisions in a logical and thoughtful manner and weighing conflicting information.
Leadership quality including the ability to motivate, inspire, counsel and facilitate individuals and teams to take responsibility and accountability for the goals will be an added advantage.
The Sales Operations Planning (S&OP) is management’s statement of intention and is the master scheduler’s authority to organize the use of the capacity and the supply of material to meet the plan. It also provides the means of comparing resources available against those required and this check is carried out by using resource requirements planning – an interactive what-if module.
The plan takes into account the fact that forecasts and plans can vary and, therefore, a provision is made for adjustments. This, difference is taken into account by storing the well-determined level of extra finished goods.
The significance benefits achieved through effective Sales Operations Planning (S&OP) are:
S&OP is a proven process to bridge the gap between manufacturing and sales. In fact, S&OP is likely to reduce the quantity of communication, but substantially increase the quality of communication between manufacturing and sales regarding demand and supply.
A real benefit of implementing an S&OP effectively is that an adversarial relationship moves to co-existence and ultimately to real teamwork.
Taking into account its features, S&OP in a way helps in driving the ERP strategy. Today’s business demands close contact with the customers and working with lesser inventory, Sales Operations Planning (S&OP) helps in both. It is called a “People Process’, and thus is significant for people across departments in the organization.
The answers to these questions are case specific. It will be difficult for to generalize the theory for it. Mostly decision on this depends on the readiness audit result, available strength of consulting human power – both internal and external – relevance of ERP at various units, timeframe, and the budget.
Therefore it is advisable to go for the key modules such as sales order processing, material planning including purchasing and factory management at the first stage. Modules such as human resources, document management, maintenance and even financials can be implemented later. If there is more than one business unit involved it is best to implement in a relatively easy but not untypical unit first then roll out the implementation to the other units.
