Specialists in IT Strategy and ERP.

April, 2009


This month's features.

Back to Basics - Why ERP? For the past couple of issues, we've focused on the current challenging economic climate- and what that means to you on a personal and business level. This month we get to some ERP basics - Why ERP? And in our TIPS column, John Pellegrino talks The 2 Sides of Good Communication - probably the single most important aspect of ERP projects - *and just about everything else!

No guest column this month - we're getting ready for the launch of our NEW WEB SITE and NEW NEWSLETTER FORMAT. We'll be talking a lot more about this in the weeks ahead.

 

Back to Basics - Why ERP? By Paul Sita, Principal, Innovative IT Consulting, LLC. Paul can be reached at 631-549-1685 or psita@innovativeitc.com.

Not if, when. Like it or not, ERP is the way to a more efficient, more effective and "Best Run" company. It may be difficult, it may be expensive, but at some point if you want to continue to grow and prosper, then implementing a single system that brings together all major operational aspects of your company has to happen. It's only a matter of WHEN you choose to tackle this.

Don't run from the truth. Companies who successfully implement ERP report reductions in inventory of 15- 20 %, reduction in head count per transaction of 10 -15 %, improved quality in terms of fill rates, on time deliveries - the list goes on. It's not that you can't achieve these results in any other way. It's just the case that you might not. If you are looking at HOLISTIC measures of company success, then you need a HOLISTIC system on which to run your business.

We didn't get here overnight. It won't change overnight. You don't replace 10-20 years of home grown systems cobbled together overnight. Not to mention the PEOPLE AND BUSINESS PROCESSES that use those systems. Part of why successfully implementing ERP takes time is because it takes time to get people, departments, and organizations to change as well. Not only do they need to learn something new. This might only take days or weeks. They need to ACCEPT the fact that they have to learn something new. This could take MONTHS, YEARS, or in some cases NEVER.

However, if you want to plant the seeds for ERP success, here's a few key strategies to try BEFORE you formally kick off a project.

    1) Acknowledge Current Shortcomings. Look for opportunities to point out ways in which the current systems and processes create work and make information gathering difficult.

    2) Benchmark. Do some preliminary research about your key competitors, particularly those you want to surpass. Look at key operating metrics and ratios. Find out if those competitors have implemented an ERP system, and if so, which one.

    3) Educate. Bring in a training firm to educate staff on modern methods, Lean Manufacturing, Six Sigma, ERP and Supply Chain effectiveness (WE CAN HELP HERE). This can start an entire movement toward improvement!

    4) Assess. Assess your weakest areas, particularly from a change management perspective. Where do you expect the greatest resistance? Where are your processes most out of date?

    5) Identify Champions. Find some members of your team who have ERP experience, who are ready and willing to be change agents. Make sure they're up for a challenge.

    6) Vision. This is the perfect time to be doing some long range "envisioning" for your company. ERP is an enabler for a long term plan, not a short term fix for some IT problems.

    7) Goals. Use your visioning sessions to create goals. Aim high.

    START. I'm not saying you need to do all of the above. If you can help your company do one or more of these you will be setting yourself up for ERP Success ahead of 80 - 90 % of the organizations that attempt to tackle an ERP project only to find out that they're not really sure why they started in the first place. Plus you'll have the long term goals clearly out in front. The basics are more than basic - THEY'RE ESSENTIAL!

     


    Tip of the Month

    The 2 Sides of Good Communication.
    By John Pellegrino, Principal, Innovative IT Consulting, LLC. John can be reached at 631-549-1685 or jpellegrino@innovativeitc.com.

    For those of you that read my tip last month, you may have expected to see something about the first “chunk” of work for implementing an ERP system, the Design Chunk. However, I changed my topic to that of communication because, frankly, I failed at one side of this last month. A respected colleague of ours, Chuck Langenhop clangenhop@cfo-advisory.com of CFO Advisory Services took the time to point this out, and for this I thank him. Now, on to communications.

    “Speak” in a Clear “Voice”. I put the 2 words in quotes because there are many ways to deliver a message besides the spoken word; there is the written word, body language, art, music, etc., even silence is a form of communicating. The first side of communication is delivering your message clearly so that the people you deliver it to understand it. It is the “speaker’s” job to make sure this happens. If someone does not understand what you are communicating don’t throw up your hands and declare the person incapable of understanding. Instead work very hard to deliver your message in a different way so that they do understand. Following is my attempt at this.

    It’s all in the process. Last month I introduced the topic of ERP implementations and delineated 4 “chunks” of work – Design, Build Test and Install. I stated that regardless of the ERP being implemented these 4 “chunks” were basically the same. By stating this I implied that every implementation was similar to every other implementation. This could not be further from the truth. In fact, every implementation is unique and different in more ways than I can state – that’s what makes our job so interesting. What I was trying to communicate is that although they are called many things and sometimes broken into 5 or 6 “chunks” the high-level implementation process is similar – that’s why professionals like us can duplicate it. And yes, I have seen non-professionals build without design or install without test – disasters, for sure.

    “Listen” Quietly and With an Open Mind. The other side of communicating is the willingness to receive the message being delivered. This takes a discipline of being able to accept other points of view, absorb them into your thinking, and molding yourself into a more learned individual. I hope I have succeeded with this second side.

    Back to the "Chunks" of wisdom in the months ahead!

     


    Word Scramble Time.
    A group of people key to the successful implementation of ERP in an organization.
    _ _ _ _ _ _ _ _ _

    S N M C P I H O A


    Answer to last month's word scramble.

    The phase when most ERP benefits are achieved (2 words). (POST IMPLEMENTATION)

     


    A Look Ahead To Next Month

    New Newsletter Format. Increased focus and content. Stay tuned!!  

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    Innovative IT Consulting, LLC
    (631) 549-1685