When Is It Time to Re-implement?

When Is It Time to Re-implement?
Featured Author - Bill Cone - November 27, 2004

Introduction

One "universal truth" still remains with all ERP systems deployed in companies today. Change in your business model is inevitable and if you do not readjust your ERP systems to support the change, your system can (and probably will), cripple your organization.

Change is good news for most organizations since it reflects adjustments in the markets they serve, and change can be used to their advantage to increase market share or perhaps increase their price point and ultimately, their bottom line. But change must be looked at introspectively, that is to say, "from the inside." Examine why you do things the way you do, and then look at the how.

As we all are well aware, every company, every industry has one thing in common. That commonality is indeed change! And if you want to survive, then you must be able to change to the new rigors of the market place you serve.

Fact: Companies today need to be ever diligent to the outside forces that shape the way they conduct business.The truth is, most companies' business models change because of forces outside their realm of control. Whether it is B2B operational pressure or perhaps a consumer driven influence that forces the winds of change upon them, companies need to have a plan in place to deal with the eventuality. The plan needs to encompass a critical look at infrastructure and methodology to support the end goal, be it new customers or higher return and improved company performance overall.

Fact: Whatever change occurs in the market space will affect hundreds of competitors in that space. Those who rise to the occasion and can command a competitive edge are most often the ones who have the ability to adjust their business models rapidly. They can adjust things internally and externally in a fashion that doesn't impact their service levels or their company's performance. These are the companies who have spent the time and effort to closely examine not just the easiest method of doing something but, the optimal method of accomplishing a certain task, be it order fulfillment cycles or materials procurement from web based auctions.

Fact: New business models are being adopted every day by all sorts of companies, in all types of business sectors. These models are being implemented to better serve the customers and maintain or even increase the company's own competitive advantage. Rapid deployment of precise business models, that are well thought out and executed to the utmost, can propel a company well ahead of it's competition. These models must be thorough in design and take many factors into consideration but most important in the equation is the complete supply chain. Every nuance of daily process activity affects the performance of the supply chain (up or down) and these new business models must be able to adjust themselves on a moments notice. Knowing the customer, service provider, manufacturer and end-customer is a big part of the key to success.

One Solution

Why not define the way you look at your business, instead of looking at the way your business is defined?

Of all the approaches used to conduct a re-implementation of ERP/SCM, the "Network Review" methodology appears to be the most successful. This encompasses a review of the new business requirements as compared to the current ERP environment as it compares to the Supply Chain and the Market Place. This additional factor is key.

Many ERP systems fail to deliver results. This is not because they can't support the business but rather that the business cannot support the Market Place. What I mean by that is this: Companies typically implement their old ways with new systems and ignore the fundamentals of their business. The biggest fundamental to pay attention to is the supply chain. This needs to be examined very carefully not only from the supply side but to the customer it serves.

Companies that are successful, adapt their business methods to accommodate the best ways they can serve their customers. Re-implementation of ERP is not really a re-implementation, but rather an exploration into the needs of the market place and an adaptation of those changes that are required to better serve the customers.

The true litmus test to ERP success is the ability to successfully deliver goods and services to the customer, while remaining profitable, growth oriented, and efficient. Most companies overlook the obvious ways to best adapt to the changes in the market place. They listen to the advice of some pundits who preach "industry best practices," when the best practice is most often what is best suited to the enterprise and its own customer base.

The best time to re-implement your ERP system is now. But, only after you have examined the ways in which your organization handles processes internally as well as externally. You need to ask not only how you do things but, more importantly, why you do things the way you do.

Asking why within your organization and in conjunction with your supply chain partners, can give you a lot of insight as to ways to optimize the entire process!

About the Author

Bill Cone is a thirty-year veteran of ERP and supply chain implementations. His background consists of twelve years as a senior consultant with J.D. Edwards and eight years with various other ERP vendors including System Software Associates. In addition he has held several, senior management positions for a number of Fortune 1000 companies.