ERP
Ch 4
Software
• The emergence of Enterprise Software over the past ten years has revolutionized not
just how computers are used but the very way companies think.
• In the past, a typical company would design its own software for individual operations
or would purchase “off the shelf” software for specific tasks. This led to a complex mix
of nonmatching systems that rarely communicated well and led to extensive
maintenance of systems.
Companies had large IS (information systems) or IT (information technology)
organizations that wrote software, provided the linkages to purchased systems, and
maintained
the system.
What has happened here is that companies are moving from a wide variety of
relatively simple systems but with complex interfaces, to a single complex system with
simple interfaces.
The Enterprise System software (ES) has already been installed.
Now the company wants to improve its business processes by implementing ERP
CATEGORY 1: ES ALREADY INSTALLED
• The good news is that having the software already installed certainly makes life easier
in some important respects. First, the software selection step shown in Figure 4-1 can
pretty much be dropped.
• Second, the software installation and enhancement step on the Proven Path should be
straightforward.
• One last point: Companies that have already installed an ES are strong candidates for a
Quick-Slice ERP implementation.
CATEGORY 2: INSTALLING ES SIMULTANEOUSLY WITH ERP
• Frequently companies in this category do so because of an interest in ERP. They want to
do ERP; they know they need software to do that, so they go out and buy an ES.
• If you decide that you can succeed with a combined ERP/ES implementation, then the
section that follows applies to you.
(It may also be of interest to companies that decide to install their ES prior to ERP.)
CATEGORY 3: NO ES AND NO PLANS TO GET ONE
• The typical company here has neither ERP nor an Enterprise Software system.
It wants to implement ERP but is not interested in going through the blood, sweat, tears,
and expense of an ES installation.
Regarding software for its ERP implementation, it either has it or it doesn’t.
• In the first case, “having it” usually means that it has an older, preES set of software
for MRP II.
Perhaps the company took an earlier stab at implementing the resource planning
processes—master scheduling, MRP, Plant and Supplier Scheduling, etc.—but didn’t
succeed.
• The second case states that the company doesn’t have software to support ERP.
Perhaps its legacy systems are home grown, and they contain logic that simply won’t
work in an ERP environment.
ENTERPRISE SOFTWARE
Now that we have talked about the choices, it is time to discuss a bit more about
Enterprise Software. We’ll take you through our thoughts on ES in four steps:
• Selection,
• Configuration and Enhancement,
• Installation,
• Ongoing Support.
• The Selection step is the beginning of the project when the company must decide
which software company will best handle the information transactions for its business.
• Configuration and enhancement are handled by design teams.
These are the internal teams that make sure that the right switches are thrown for each
decision process and identify needed enhancements and extensions.
• Installation is probably the most obvious step since whatever is chosen must be put
in place.
The opportunities and challenges are in maximizing learning during implementation and
minimizing
crashes
• Ongoing support refers to the maintenance and improvement of the system after
start-up.
Software Selection
• There are lots of software choices available. The key point here is that there is not a
single right software choice.
There are good choices and not so good choices for your business
how to proceed?
First, understand your business and the opportunities for change. Of course, you
know your business. But:
• do you know where the real weaknesses are in the business?
• Are you having trouble with delivery timeliness and accuracy for your customers?
• Are cost projections erratic and unreliable? Do customer orders “get lost” inside the
system, requiring
massive human intervention?
• Understanding these and other questions will tell you what areas are of most
importance to you in choosing a software provider.
Each of these questions impacts a different software module and each software provider
offers different approaches to those areas.
Configuration and Enhancement
In an ERP/ES implementation, if you find that your company can’t staff all the design
teams necessary, then you have two choices:
1. Combine ES design teams with ERP project groups, thus minimizing the head count
required,
or
2. Decide to go to an ES only project now, with ERP to follow
• A good middle of-the-road option would be to have a few software consultants
involved who can help facilitate the team decision process without having to be
complete experts in your operation.
Installation process
• Be flexible.
• Pilot the software before going live.
• Make deliberate haste.
BOLT-ON SOFTWARE
This is the name given to software that’s outside of the main ES suite or legacy
system, typically coming from a third-party software supplier.
Most bolt-ons we’ve seen in ERP environments come in three categories:
• Resource planning enablers.
• Front-end/back end.
• Supply chain optimization/advanced planning systems.
In summary, bolt-ons can be quite valuable, but they come at a cost—not only in
dollars of course, but in loss of integration and increase in maintenance.
SELECTING BOLT-ON SOFTWARE
• Don’t be premature.
• Don’t procrastinate.
• Don’t pioneer.
• Save the pockets of excellence.
MANAGING REQUESTS FOR CHANGES
• This is where effective management enters the picture.
Key people, particularly members of the steering committee and project team, need to:
• • Principle 1—Resist isolated changes
• Principle 2—Always follow a recognized change process.
NEW RELEASES
With software, the new release can represent a major investment of resources and
may not only not provide benefits to your business but may interfere with your operation.
One last word about software changes. It is always easier to make changes on the
output and the input than it is on the internal logic of the system.
Any changes to the internal logic of either ES or supply chain software should be
considered as major and thus, kept to a minimum.
THANKYOU
