ERP Selection Facts and Figures Case Study - Part 2: Qualitative Assessments and Analysis




ERP Selection Facts and Figures Case Study

<

Overview of the Selection 

A mid-market Engineer-to-Order manufacturer in the aerospace and defense sector retained the services of TEC to help select an Enterprise Resource Planning System. This system is intended to replace disparate applications that lacked the functionality and integration to support the company's Lean Manufacturing initiatives.

The Scripted Scenarios allowed TEC to gain a detailed understanding of the strengths and weaknesses of each product. ERGO 2001, TEC's decision support tool, was used to record and analyze the results of the scenarios (For more information on ERGO 2001 see ERGO 2001 IT Evaluation Tool).

About this note: This is a two part note. Part One includes the Business Scenarios Model and Results. Part Two contains the Qualitative Assessments and Analysis, and User Recommendations.

Qualitative Assessments 

Each vendor also had qualitative advantages and disadvantages captured outside ERGO 2001.

IFS

Advantages: IFS Applications support many to many relationships between Engineering Change Requests and Engineering Change Orders. Its applications also easily handle stockable and non-stockable phantom subassemblies. Customer account creation is very user friendly. Passing Kanban inventory from any location to any other location is very simple. Sales order and product profitability analyses are done through pre-built scorecards that run off of sophisticated queries that eliminate the need to populate OLAP cubes.

Disadvantages: Identification of components with long purchase lead times at an early design stage and for early planning purposes is poor.

Overall: Online help is very useful. Email routing help is very sophisticated. Screen navigation is intuitive because users only have to learn five different screen forms in order to use the entire application suite. Document Management tool is fairly sophisticated. IFS' workflow tool is visual and powerful. Its Web portal tool, which consists of a number of configurable portlets, is very intuitive. IFS also provides native Product Data Management (PDM), Customer Relationship Management (CRM) and Advanced Planning and Scheduling (APS).

J.D. Edwards

Advantages: Online Expense reports and procurement cards are highly integrated with the General Ledger. JD Edwards' back-flush capabilities are also very strong. The ability to report deviations from Bill of Materials in production is very sophisticated

Disadvantages: Distinguishing between internal and external comments on Purchase Orders and Purchase Requisitions is poor. Identification of components with long purchase lead times at an early design stage and for early planning purposes is poor. Adherence to certain industry specific messaging standards is not supported out of the box and requires an XML mapping exercise.

Overall: JD Edwards' integration with Microsoft Office is very sophisticated. The company has also partnered with Siebel for Customer Relationship Management and Microstrategy for Business Intelligence such that JD Edwards directly provides support to its customers. This brings exceptional functionality in these areas while mitigating some of the traditional problems of using a multi-vendor solution.

Oracle

Advantages: Procurement cards are highly integrated with the General Ledger. Design-to-Order and Manufacture-to-Order cost and schedule information is very useful. Repair action recording and sales forecasting are also strong.

Disadvantages: Online Expense reports were cumbersome and not user friendly. Identification of components without suppliers was difficult. Oracle has no out of the box dashboard or scorecard functionality. Use of a shipper's memo to drive stock transactions is poor. The ability to accumulate labor against a work order was limited. Many industry specific forms are not available out of the box.

Overall: Oracle has very tight integration between its application modules and its database. In general, functionality in financials and manufacturing is very strong.

SAP

Advantages: Document Management tools can handle sophisticated importing of Engineering Bill of Materials that are made up of multiple engineering documents. The ability to view and move Kanban locations is very powerful and visual. Tight integration with FEDEX enables automatic generation of FEDEX tracking numbers.

Disadvantages: Out of the box scorecard and dashboard functionality is very limited.

Overall: SAP is more functionally robust than any other vendor. The company has native PDM, CRM and APS.

Analysis 

Figure 9 indicates how the vendors compare relative to two factors, Business Scenarios (product functionality) and Flexibility. Note that the size of the dot indicates the vendors' rank in the overall model such that larger dots denote higher rank. It is evident that the Business Scenarios percent match score for each vendor is very close, but the Flexibility percent match score varies significantly. The client perceived SAP and Oracle to be very inflexible compared to IFS and JD Edwards.

Figure 9. Business Scenarios vs. Flexibility

A similar result exists in a comparison of Business Scenarios and Ease of Use and Navigation. Figure 10 indicates that both SAP and Oracle were perceived by the client to be more cumbersome and less intuitive compared to JD Edwards and IFS.

Figure 10. Business Scenarios vs. Ease of Use and Navigation\

The strengths and weaknesses graph below indicates the relative strengths and weaknesses for each vendor relative to the model categories. The graph indicates that IFS' scores in Flexibility contributed proportionately more points to their percent match score than Business Scenarios or Product Ease of Use/Navigation. Contrarily, SAP's Business Scenarios score contributed proportionately more points to their percent match score than Product Ease of Use/Navigation or Flexibility. Note that the length of the bars does not indicate how the vendors compare to each other. It indicates in what categories the vendors generated their percent match scores with respect to how those categories were weighted. Each vendor's bars sum to zero.

Figure 11. Strengths and Weaknesses Graph

User Recommendations 

The client used the preceding results and analyses to make an ERP selection decision as part of TEC's selection process. When beginning a selection process it is important to keep the following in mind:

  • Auditing the selection process is vital. Auditing the process allows the client to hold the winning vendor to specific claims made throughout the selection at the time of implementation. This includes RFI responses, product demonstrations, and pricing proposals.

  • Creating an unbiased selection environment is necessary to find the best match vendor. Selections performed without the aid of an unbiased third party often succumb to internal politics and management and selection team prejudice. Furthermore the selection team may be more exposed to vendor marketing "fluff" and as a result this may detriment their ability to focus on ensuring the vendors substantiate their claims. Also, using a third party selection consultant that has a business relationship with vendors involved in the selection introduces bias. If your selection consultant will generate additional revenue by selecting a particular vendor because they can perform the implementation, an obvious bias will exist.

Sidebar Information

The graphs shown have been generated using the TEC's patented decision analysis software ERGO (formerlyTESS), which uses the Multi-Attribute Utility theory (MAU), Analytic Hierarchy Process (AHP) and TEC's patented decision science to compare vendors and products relative to one another in a statistically valid model.

 
comments powered by Disqus