ERP Implementation and Integration: Changing the Culture of Manufacturing
Manufacturers are increasingly feeling the pressure of doing more with less and in a shorter period of time. Lead times decrease as work loads increase. Furthermore, matured global competition means that the bottom-line is being bombarded by tighter and tighter margins. To combat these forces against profit, manufacturers have turned to gaining greater productivity through the reductions of waste in the system; that is, to find efficiencies in the manufacturing process where profits are squeezed out of production itself.
To this end, total enterprise resource planning (ERP) is the name of the modern manufacturing game. Within the context of ERP, “single input” concepts mean that an organization hopefully moves and thinks as one.
Thus, the operative aspect of ERP is not so much “resource” or “planning”, but that of enterprise. That is to say, ERP is a whole system collective where the goal is to have everyone and everything (i.e., the enterprise) working in clockwork-like synchronization—where everyone is on the proverbial “same page”. For this to happen, however, ERP implementation must be a system-wide integration, and this is easier said than done in manufacturing environments that are historically reluctant to change.
Indeed, a thorough ERP implementation by definition requires a complete mindset change of the existing manufacturing culture of standalone departments. In short, for ERP implementation to succeed it must be viewed by both management and staff as a transformative initiative.
The best way to achieve a total ERP implementation is to express the inevitable changes in the system as those that will realize strategic organizational visions and goals. Of course, realistic time lines must be established for ERP integration, and proper resources of personnel and capital investment must be allocated to the project. As integration moves along over time, both quantitative (production) and qualitative (anecdotal/observational) metrics should be used to measure the degree of successful ERP implementation.
It is important that any latent or silent declining expectations of the ERP project be interdicted if not avoided altogether—especially from those most reluctant to change. Indeed, if the ERP project is left as merely an “installation”, project results are sometimes biased as disappointing which in turns leads to employees “blaming” the system and a further reluctance to become vested in or even use the system.
However, it has been shown that for those manufacturers who do a totalizing ERP integration, the single input mindset brings about a synergistic culture where production efficiencies are maximized. Inventory and accounting departments act in concert with each other—accounting is always and immediately updated when inventory is increased or diminished. Time and attendance is instantly tied to payroll and job costing. Scheduling is facilitated by a real-time and predictable awareness of work center loads.
Purchase orders constantly update inventory to achieve just-in-time pull-production lean objectives for efficient cycling. Most importantly, single input data results in synchronous decision-making in all aspects of the manufacturing enterprise.
For all of these reasons, complete ERP implementation and integration is vital to the success of the project. Change of culture must be, from the outset, a continuous message communicated from a supportive management who, themselves, must believe wholeheartedly in the successful outcome of the ERP effort. Thus, the positive attitude necessary for the change of culture is not isolated to just the rank and file of the shop floor, but is an integral philosophy that must permeate the entire enterprise from top to bottom. Anything short of this sort of commitment will result in unacceptably diminished ROI results for the ERP project.