ERP

Overcoming the major problems

Keith Launchbury business scientist and supply chain consultant
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Most Enterprise Resource Planning (ERP) implementations are way too complicated, with too few people in the organisation who understand how to apply it. That’s according to US-based business scientist and supply chain consultant Keith Launchbury (CFPIM, CIRM, CSCP), whose decades of experience in supply chain research have delivered a wealth of information on what really works when it comes to ERP.

Launchbury will present a workshop on Overcoming the 10 Major Problems of ERP at the SAPICS 2015* conference, taking place from 31 May - 2 June at Sun City.

Simple systems needed

According to Launchbury, the problem begins with ERP software vendors who do not want to support customised versions of their systems. “That’s why they program their software to fit every conceivable type of business. This one-size-fits-all approach makes the ERP system excessively complex. The same ERP system can work in many different business environments, and while this is good for selling software to top management, it leaves the burden of implementation on middle management,” he says.

The problem gets worse when Senior Management isn’t involved in the implementation process. “The correct implementation of ERP imposes strict disciplines in many businesses, and some organisations have difficulty kicking bad business habits,” he says.

Towards a cross functional approach

Businesses are organised around traditional functions such as sales, production, accounting, engineering etc., whereas Launchbury says successful ERP implementation requires a cross functional approach.

“Some companies think that ERP implementation is an IT project, but you cannot simply migrate data from one software system to another. Successful ERP demands complete data integrity, and policies and procedures in place to ensure the ongoing accuracy of every piece of data in the system,” he says. This also requires a specially trained kind of person to handle the kind of integration that’s needed.

Business generalists vs. specialists

Successful ERP implementation requires a level of business integration that crosses multiple disciplines. “So, in order to be successful as a member of a cross-functional project team, a person must be capable of thinking outside the traditional box of their profession,” explains Launchbury. “Just as technology has become more mobile, so must our people. The more exposure they have to multiple disciplines the more valuable they will become.”

To this end, Launchbury says what’s needed is a sharp move away from education that pushes people into traditional career paths in the silos that pervade most businesses.

“People are restricted to narrow functional disciplines that do not reflect the reality of the world today. Take a subject like using 3D printers to create human organs from stem cells for example. Where does that fit in a traditional university curriculum? It is necessary for a researcher to understand the physics, biology, medicine, engineering, and legal issues involved,” he says. “Business today needs generalists not specialists. It is no longer good enough to understand one narrow discipline.”

ERP of the future

Another problem that Launchbury sees with ERP is that it is looking very dated.

“Most ERP systems were developed several decades ago whereas today’s computers have advanced and changed dramatically since those mainframe days. We live in a world where data has to be mobile,” he says.

While it may be difficult to imagine how SAP or Oracle could work on mobile devices, some companies are making good progress in research.

According to Launchbury, Google is working on integrating ERP systems to mobile devices such as Google glass, wearable devices, smart watches, android phones and tablets. Also, applications like salesforce.com address the issues that are created when companies sell products by subscription using software as a service.

“Furthermore, the advent of new technologies such as customised medicine, 3D printing, RFID tracking to avoid counterfeit goods, and cashless payments will force changes to the way in which we use ERP systems,” he says. “It’s simply not possible to effectively implement ERP in 2015 if you’re still using a system and approach that dates back several decades.”

Cathlen Fourie

 

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