20 years ago only the largest manufacturers utilized ERP solutions, but as the technology has advanced and as the market has grown, ERP has become a viable solution for manufacturers of all shapes and sizes. Today, 74% of companies are using ERP for manufacturing according to Aberdeen Research. If you’re among the 26% of manufacturers who are yet to implement ERP for manufacturing or if you’re on an older system, here are four of the top reasons to consider beginning a modern ERP system implementation.
According to Aberdeen, manufacturers with a best-in-class ERP implementations stand to recognize benefits such as:
- 22% reduction in inventory levels because you will be better able to coordinate manufacturing with customer service, logistics, and delivery which translates to lower inventory in reserve, reduced inventory carrying costs, and more cash to support other areas of your business
- Improved internal processes. 95% of manufacturers with a best-in-class implementation meet manufacturing schedules because modern ERP solutions automatically notify decision makers and managers when scheduled activities fail to occur so proactive steps can be taken to correct the issue and still get things done on time.
- Enhanced customer experiences: 98% of manufacturers deliver shipments complete and on time to customers as the system enables cross functional teams such as management, sales, and manufacturing to continually improve operations and provide outstanding customer experiences.
- Reduce operating costs by nearly 20% through the ability to streamline and accelerate processes to improve efficiency and productivity
How do you achieve a best-in-class ERP implementation?
While most organizations rely on enterprise resource planning systems, relatively few are able to truly optimize the capabilities and functionality the software products can deliver. In fact, statistics show that more than 60% of ERP implementations fail to meet expectations. What constitutes failure?
- Not realizing the anticipated return on investment.
- Extending the implementation schedule and go live date far beyond planned.
- Going over budget by a large amount.
- Interrupting the organization so much that business suffers.
- Stopping production and/or not delivering products to customers are the major issues.
While ERP implemenation failures are more common than anyone would like to admit, this doesn’t mean your project is doomed from the start! Understanding the factors that can interfere with the project as well as what items can lead to success is extremely important. Here are a few helpful resources to help you ensure you’re manufacturing ERP implementation is a success and helps you attain benefits similar to those listed above.
- Selection is the very first challenge of a successful ERP implementation project, avoid these “6 Common Mistakes Businesses Make When Selecting ERP Software“
- As you begin to plan and carry out your implementation, keep your eyes peeled for signs of potential failure. Here’s “How to Spot ERP Implementation Failure Before its Too Late“
- Why do some companies struggle to reap the benefits of a well selected and implemented system? Here are “The Top 4 Causes of ERP Failure” and how to avoid them with the help of an ERP consultant.