Three trends leading ERP utilization today

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Business management software has many uses, but some factor into the versatility of high-quality solutions while others are standard features every company should look for. In manufacturing ERP software in particular, there are a few trends that firms should consider major drivers for adoption.

  • Cloud flexibility – New cloud-based ERP solutions can save firms time and money, especially midmarket manufacturers, due to their ease of integration and the simplicity of customization. The cloud offers a scalability that many manufacturers find valuable, but it also enables cost savings that allow companies to embrace other useful trends faster.

    "Less money spent on IT means a lower cost of product delivery, enabling businesses to get a competitive pricing edge and/or higher margins. This also frees up dollars to devote to hiring, R&D and other growth initiatives," said Christine Hansen, product marketing manager, Epicor, according to Enterprise Apps Today.

  • Mobile integration – The availability of mobile ERP platforms allows manufacturers to make their workforce more productive and efficient by enabling remote access, and demand is increased of mobile support from employees as well. The news source noted that ERP is catching up with CRM in terms of mobile viability.
  • End of Life upgrades – Many firms are seeing their ERP systems reach their end of service life dates currently, or in the near future, making it prime time to update to more advanced solutions that support these new technologies, like the cloud and mobility. Many core ERP systems sit on outdated platforms, like Windows NT, as well, making new solutions key to advancing overall manufacturing software systems.

Ultimately, adopting newer, higher-quality ERP solutions can kick-start growth and help firms start leveraging their back office technology for profitability more effectively.

Midsized manufactures gain new focus on ERP software offerings

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Their unique position in the industry presents opportunities and challenges to midsized manufacturers. These firms are large enough to take advantage of advanced management methods and technologies, but small enough to maintain a consumer-focused operating strategy. However, on the other end of the spectrum, midsized manufacturing companies have traditionally struggled with finding optimized business management software and ERP solutions that meet their needs on both fronts. TEC recently released a report that could help firms overcome this struggle though.

According to the technology advisory firm, manufacturing ERP software has evolved due to advanced in related technology, such as mobility and the cloud. As such, midsized firms have broader opportunities to take advantage of higher-quality software for manufacturing, enabling more of the benefits that larger firms have often received from these tools. In the past, finding ERP solutions that fully met operating needs was difficult for midsized firms, causing companies to invest in ill-fitted or manual software, the firm reported.

ERP solutions are a standard for growth and profitability for manufacturers, and investing in the right back office software will provide significant advantages to firms that didn't have these tools in place before, or had solutions that didn't quite conform to the unique demands of these companies. Now, real-time computing environments, mobile monitoring and management of resources and the Internet of Things allows firms to adapt and optimize production while still retaining their focus on smaller consumer bases, maintaining focus on quality of quantity and the customer-centric philosophy that gives midsized manufacturers an edge.

Midsized firms have to compete with global scale challenges, growing pains and a demand for continuous innovation that can be costly over time. Optimizing ERP software to support these specific needs can boost efficiency, save resources and enable the necessary growth to continue improving.

Continued focus on ERP software changing enterprise IT needs

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As more firms invest in manufacturing ERP software to optimize back office management, other IT demands, such as infrastructure design and data storage, are also evolving. New approaches to workflow applications for accounting, inventory management and other processes are met head on by the increased demand for data availability, security and management, as well as optimized network and system infrastructure to streamline access and ensure flexibility of these systems. The ends result is a number of investments, rather than a solitary one, that firms need to adapt for.

Jamie Thomas, the general manager of software defined systems and storage at IBM, recently noted that the need is there to address a new generation of applications and workloads, fundamentally changing infrastructure needs in modern enterprises, according to Silicon Angle.

"Over the last 19 months more of our clients have been capturing unstructured data around social and mobile," Thomas explained. "They need a different way of deploying infrastructure. This capability allows them to achieve both flexibility and economics around those deployments."

These trends present critical risks in manufacturing, especially as firms develop their own mobile apps and turn to the cloud and other emerging resource. It isn't just data storage or accessibility that is affected, however, but the the demands on the business management software itself. In order to adapt and overcome, firms will need to focus their efforts on improving the software acting as the glue holding their back office processes together.

Even beyond administrative processes, firms need to take into consideration the capabilities of their other systems to align new ERP investments with current operations. Legacy systems, site-specific issues, inventory control and other factors, some of which may change regularly, all have to factor in for as stable, beneficial deployment. With growth as the end goal for every business, investing in the right manufacturing business software is critical the first time around, and taking evolving IT needs into consideration first will help companies ensure they make the right decision.

ERP marketplace grows 3.8 percent in 2013

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When it comes to business management software, enterprise resource planning (ERP) is one of the top suites in the market. The integrated applications are used to collect, store, manage and interpret data from many business activities which can include:

  • Product planning, cost and development
  • Manufacturing or service delivery
  • Marketing and sales
  • Inventory management
  • Shipping and payment

The data collected through these processes can be viewed and analyzed in real time, using common databases maintained by data management systems. It is a multi-billion dollar industry that is only growing as more companies are starting to get on the business software bandwagon.

According to the most recent survey from Gartner, the worldwide ERP marketplace grew 3.8 percent in 2013. That is an improvement from the 2.2 percent growth that was experienced in 2012.

The leaders in the marketplace are selling billions of dollars worth of product. SAP leads market share with 24 percent and $6.1 billion in sales in 2013. Oracle was second with 12 percent market share and $3.11 billion. Several other companies followed with market shares in the single digits. Overall, technology companies invested $25.4 billion in the ERP market in 2013.

An article from Forbes examined the study and some of the major trends to come out of it. The first is the fact that being complacent can be a problem. The businesses that are thriving in the landscape today are those that did not sit ideally by, but instead innovated. Not only should vendors look to provide the top of the line services, but organizations that are investing in new systems need to make innovation a priority when selecting a solution provider.

The second trend is born from the vendors that were not represented in the survey because they were considered "too small." While some of these organizations are acting defensive, those that are able to create a business model that must deliver value on a daily basis. This is not the time for companies to be complacent.

The article does make reference to the fact that the cloud platform is playing a major role in how organizations operate. This kind of solution is gaining traction because it can be cost effective when managed properly.

"Impatient for results and systems that can deliver them, the high growth areas of the ERP market are being driven by companies who see cloud-based systems as more agile and responsive to their changing business model needs," the article reads. "Legacy systems designed for business models long gone yet still on maintenance are being extended today with cloud-based systems capable to keeping pace with an entirely new level of performance companies need to survive and grow."

Businesses in a number of different sections are starting to look into the possibilities of ERP solutions and how they can help transform how the organization operates. One of the smartest ways to do this is by partnering with a business management software provider that not only offers the top systems, but also manage them once they have been deploy within your business. This removes some of the pressure and makes it easier for companies to take the step into the future.

Tips for selecting an ERP software solution

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Adopting any kind of business software solution can be a complicated process. Not only do organizations need to know what is on the market, but what they need the system to do.

A recently released white paper examined the Enterprise Resource Planning (ERP) landscape and offered advice for any organization considering a change of business enterprise solutions.

"An ERP system is a series of software applications or modules that collects data from your sales, purchasing, finance, inventory, supply chain, manufacturing and quality functions into a common database so that your company can share the information, coordinate activities and collaborate," the report reads. "If you're looking for your first ERP system or looking to upgrade from an existing system, the evaluation, selection and implementation process is a long-term strategic decision for your organization."

The report goes on to layout several steps that organizations should take in order to successfully deploy an ERP system. These include:

  • Evaluate – A diverse internal team needs to be created that can provide feedback from all aspects of the business to make sure enterprise-wide acceptance of the final decision.
  • Assessment – Examine the systems that are currently in use to see where the gaps or what challenges could come from.
  • Establish criteria – Following the assessment, this is where businesses determine what it will require an ERP system to do. This can included features, price and platform. They should then be ranked by importance.

At this point, organizations should follow the standard procedure of any enterprise purchase, meet with multiple vendors, create a shortlist, prepare questions and check references.

The report concludes by saying the best course of action could be to partner with an external business management software solution provider to make the process easier.

Wendy’s runs ‘almost perfect’ ERP upgrades

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All across the corporate landscape, organizations are starting to embrace software solutions that can be used to streamline operations. In many instances, this means investing in enterprise resource planning (ERP), inventory management, customer relationship management or other forms of business management software. However, in many instances, this is easier said than done.

A recent article from IDG profiled the most recent ERP upgrade that was carried out at the fast-food giant Wendy's. When the vendor they relied on announced a new version its 12 separate software modules, it became time to upgrade in order to keep running effectively.

According to Robin Nelson, a business analyst who worked on the project, the company decided to take an "as-is to as-is" approach to the upgrade. This meant basic upgrades were handled immediately and end-users requests for new features were added to a wish list that is being prioritized for future action.

During the development process, a core team of most internal staff of four database administrators, eight developers and five analysts, were in charge of the deployment. Nelson said that the organization hit it out of the park before the project even started.

A extensive communication system was set up before deployment was underway to ensure that all parties were in the loop at all times. By using Microsoft SharePoint, the company was able to have a centralized location for all project documents and collaboration notes. The team also made sure to engage the business users involved early and often. This added another level of accountability across the entire project.

Nelson said that from planning to execution, the entire upgrade – hardware, software and systems – was completed in six months. It also went "almost exactly as planned." There were some important takeaways however, that can be used to improve the deployment process going forward.

First, there needed to be a better investigation into the third party applications and hardware that will be affected by a new ERP system. There were also subject-matter experts brought in to handle specific training to employees on the process. However, a more formal training regiment was preferred by workers.

Nelson added that there was another factor that helped streamline the development process. The vendor that Wendy's is using does not offer much customization, making it easier to make decisions because their are few to think about. Regardless, this kind of project success is what every organization should strive for.

"On any enterprise project, six months from conception to go-live seems like an unusual feat, especially if the project remained within budget and users are happy with the results," said analyst Michael Krigsman, CEO of consulting firm Asuret, and an expert on IT project failures. "Apparently, Wendy's took a disciplined approach, clearly defining project goals at the start and minimizing mid-stream changes of scope. The basics always pay off: Clarity around goals, strict governance on change requests, and active communication."

Deploying any kind of manufacturing ERP software can be challenging, but that doesn't mean organizations need to go at it alone. With the help of a solution provider that specializes in these systems, any organization can gain the upper hand on these deployments.

Adopting business software keeps organizations from falling behind

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When it comes to the latest technology, many organizations can find themselves overwhelmed. This is particularly possible when you consider the sheer number of options on the marketplace and the hoops that need to be jumped through to justify a new investment.

A recent article from ITWeb Business features an interview with Stuart Scanlon, the sales and marketing director at New Era Solutions. He spoke about how this idea helps when it comes to enterprise resource planning (ERP).

He mentioned that with the current economic pressures, manufacturers, distributors and service-based organizations cannot run the risk of becoming complacent when it comes to managing operation costs.

On top of that, companies are no longer able to take months to react to market changes as speed has become the name of the game. This is where having real-time access to meaningful data through an ERP system becomes a major benefit for organizations, which has become a mature solution.

"IT trends do drive investment in ERP, and this is evident in mobile and ecommerce," Scanlon said. "Organizations that have not yet started to consider either of these two technologies are quickly finding themselves behind the late adopters and will need to play catch up as their competitors move forward."

The same can be said for nearly any technology solution or business management software. More organizations need to start adopting the latest innovations to improve operations and efficiency. With the help of a third party solution provider, any organization can take steps toward successfully deploying these programs.

Are traditional ERP systems becoming ‘legacy?’

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One of the major problems for technological systems is the fact that after time it will become "legacy." This does not mean that it loses any of its effectiveness, but the cost of repair and maintenance increases, as well as adds a new layer of complexity when it comes to finding parts, because the new systems are cheaper and more readily available.

For example, after several years, it becomes more cost effective for Apple to offer a new MacBook or iPhone, instead of trying to repair an old model. That is why the Genius Bar has specific cut-off dates for all of its products.

All technology solutions have this problem. A recent article from PCWorld recapped a study by Gartner about enterprise resource planning (ERP) solutions. While basic systems are still evergreen and are easy to upgrade, highly customized ERP software will be considered "legacy" software by 2016.

The report makes the case that many organizations have been improving operations and data sharing because of these solutions, they have also spent vast amounts of money to create these "perfect" systems. This has helped create a strong software vendor market.

"However, the main beneficiaries were the major consultancies who managed the business process re-engineering and implemented the ERP solutions," the analysts wrote. "These implementation service providers secured themselves a prosperous future by utilizing lucrative continuous service contracts that went beyond implementation into extensive customizations."

All of this led to a situation where it is easy to find a single business that has spent up to 10 times as much on customizing these systems. The problem is that the net result of 15 years of this process is that ERP systems are not "extremely arthritic, increasingly slow and expensive to change."

What do businesses do now?

With ERP solutions becoming legacy, what is the next step for businesses to take? The report also attempted to answer this. According to the research, the next step will be moving toward the cloud.

"The notion of a single, integrated ERP system to handle a company's every need is being replaced by the emergence of cloud point solutions that deliver functionality business users want that the IT-controlled and centrally-mandated ERP megasuite previously struggled to deliver," the report reads.

It goes on to say that it could take a decade or longer before a majority of companies have adopted cloud-based ERP systems. However, there will be hangups because traditional systems have offered such strong support and benefits.

With the help of an IT solution provider that specializes in manufacturing ERP software, any company can easily take the steps to deploying the latest innovations.

ERP systems ‘vital’ for manufacturing industry

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When it comes to the manufacturing industry, many organizations are aware of the use of enterprise resource planning (ERP) software and adoption levels have been gaining steam. However, with new business technologies taking root, ERP systems can be complicated and challenging to install and maintain, especially as the IT landscape tightens its grip on daily operations.

A recent article from CRN recapped a white paper by IDC Manufacturing Insights. The goal of the report is to reveal barriers for high-tech manufacturing companies that are not using ERP solutions.

The study found that 35 percent of total companies and 80 percent of organizations with over 5,000 employees believe their ERP solution is vital to improve the customer experience. 

However, according to the numbers, 45 percent of companies run into struggles when it comes to integrating front and back office operations into a single solution. This is typically the fault of a rigid IT solution and a lack of flexibility.

The article features comments from John Hiraoka, the Executive Vice President and Chief Marketing Officer of Epicor.

"We believe it is imperative for high-tech manufacturers to create an agile and flexible supply chain by investing in technologies that enable faster decision making, collaboration across the organization and with business partners resulting in superior customer experience," Hiraoka said. "Improving real-time access to data and sharing information with modern ERP solutions leveraging mobile, social and cloud concepts will bring greater competitive advantage and growth."

Implementing a manufacturing ERP software solution can be complicated. With the help of an IT consulting firm that specializes in these solutions, any business can deploy them more easily.

Manufacturing ERP software offers more challenges than other industries

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Every business investment comes with a set of challenges. As the complexity level of these solutions increases, so too do the hurdles that need to be overcome for them to be successful. One prime example of this is enterprise resource planning (ERP) software.

In the manufacturing industry, ERP solutions are becoming a key factor for success. This system improves operations and streamlines data sharing and communication. Unfortunately, according to a new study by Panorama Consulting, 53 percent of companies went over budget and 61 percent exceeded the deployment schedule when implementing ERP.

While those were the averages, the manufacturing industry experienced a worse result. The study found that 63 percent of manufacturing companies exceed the budget. From a financial standpoint, this vertical overran by $3 million. By comparison, non-manufacturing industries averaged $1.7 million.

According to Eric Kimberling, a managing partner at Panorama, manufacturing has a larger gap than other verticals between expected ERP costs and actual costs. The software is only one component of the investment. Businesses need to be aware of the "hidden" costs like re-engineering, training users and interaction applications. Prices can also be driven up by customization and technical integration.

"Because manufacturers deal with purchasing, procurement, logistics, global supply chains and distribution, they do tend to have more complex business processes than non-manufacturing companies," Kimberling said in the report.

When it comes to implementing manufacturing ERP software, partnering with the right vendor can be a wise solution. This will ensure a company is able to limit the "hidden" costs while staying on time and budget.