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Simplifying ERP: Reducing Complexity And Improving Responsiveness To Succeed

To remove barriers to growth, manufacturers must turn the explosion of data they have into intelligence and insights to support real-time decision making, at every level and across every function in the organization — and throughout the extended supply chain.

Change is constant and the manufacturing industry is proof of it as the sector is poised to enter a new era with additive manufacturing, cluster manufacturing and near-shoring. Add to the fact the continued digitization of the shop floor creating new connections and new data streams, the need for responsiveness is more critical than ever for profitable growth.

To remove barriers to growth, manufacturers must turn the explosion of data they have into intelligence and insights to support real-time decision making, at every level and across every function in the organization — and throughout the extended supply chain. They need to be able to “see the forest through the trees.” While this sounds simple enough, many manufacturers struggle in this area, burdened by legacy ERP systems which add complexity and inefficiency rather than streamlining and simplifying the business of manufacturing.

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Complexity Creep

Saddled with legacy systems built a decade ago to meet the needs of a very different generation of users, many manufacturers have followed a path of bolting on new technology to meet new requirements with the end result of “complexity creep.” This complexity exacts a high toll on the organization. Invisible to the eye, it’s akin to a virus that penetrates the DNA of the organization, impeding responsiveness, decision-making, and agility. It’s pervasive and it becomes more evident as companies grow and attempt to address new and emerging requirements.

As more new and emerging digital technologies become part of the manufacturing landscape, we build more connections. And as we become more connected, we generate more data, necessitating new and faster means to drive insight and action, and easier ways to access information to support decision making. This need for responsiveness is placing new and different demands on ERP systems.

Manufacturers must have the right ERP systems in place to move confidently forward in the new manufacturing era, and simplicity is paramount — key to increasing the reach of ERP to every part of an organization, making it as useful and usable on the shop floor as it is in the executive boardroom.

Simplifying ERP

It’s a misconception that to gain simplicity, ERP must be “dumbed down”. To the contrary, simplicity doesn’t mean scaling back on functionality; it means finding new ways to make ERP easy and intuitive to use, deploy and manage. It’s not just about ditching clunky interfaces, it’s about redefining the relationship people have with ERP. It means removing the barriers to accessing information and minimizing steps in the flow. And it means leveraging new means of visualizing, interacting and consuming information to provide actionable insights to the whole organization.

Below are four key tenants of simplifying ERP:

  • Strategically, it’s about supporting a management team’s ability to access information and respond to changes in the business and the market that allows them to be in greater control. Doing so requires getting the right information, in the context of the decisions that need to be made in a form that can be quickly digested and with the ability to take immediate action.
  • Operationally, it means being able to react to day to day requirements and changes, dynamically managing business activity, automating and optimizing processes and dealing with exceptions as they happen, where they happen. This is the backbone of any business and it demands comprehensive, workflow-enabled, industry-specific, globally-compliant and integrated ERP.
  • Externally, it’s about supporting an ongoing collaborative exchange with customers and partners. It’s about providing differentiated service levels through every touch point with the organization, and being able to identify problems and opportunities, then empowering the business to act quickly and decisively.
  • Personally, it’s about valuing peoples’ time, leveraging their knowledge and experience, empowering them to manage exceptions in the moment while embedding and automating best practice processes wherever possible. It’s about supporting productivity, ease and simplicity of use.

ERP is Changing

Manufacturers are having to respond faster, deal with more complexity, and make better decisions faster. In response to these new requirements and business imperatives, more change has occurred in the ERP market in the past 5 years than in the past 20; this is not your father’s ERP. New technologies being incorporated into ERP are helping to support greater agility and responsiveness for manufacturers and their supply chains, bringing them closer to the customer and making them better able to respond to changing customer needs.

Responsiveness demands simplicity and mobility with tools designed to meet the specific needs of specific users. It demands new levels of collaboration throughout the supply chain, inside and outside the enterprise. It demands choice in the way information is presented, applications are accessed and solutions are deployed. Individually, these principles drive the development of new tools and applications; together they enable completely new approaches to resolving the challenges faces by all manufacturing companies today.

Take, for example, ERP and social collaboration. Social collaboration tools are changing the way we communicate. We consume and share information in very different ways today then we did only a few short years ago. We can ask for help, give help, participate in special interest groups, follow experts, become experts, acquire information, share information, filter our results, and follow our interests. This new social collaboration paradigm in ERP supports the ability for organizations to leverage the collective knowledge and experience of their networks whenever and wherever it is needed, with an ease and speed never before experienced. Key to successful enterprise adoption of social collaboration is ease of learning and self-evident functionality. Making to the tool simple to use eliminates barriers and empowers the user.

Another example is data analytics. We can never have too much information; the key is being able to get that information quickly and analyze it to support smart, agile decision making. Embedded in ERP, business intelligence and analytics are being made more approachable and accessible to everyone in the manufacturing enterprise to access information on tap and, in a self-service manner, to support improved collaboration, better insights and decision making.

Simplifying Deployment

Simplification is also about new and improved ways of deploying ERP. Many manufacturers are moving to a cloud-based model as more and more companies see the benefits of a single global deployment in providing greater visibility and control, and/or the advantages of moving specific workloads to the cloud. The cloud removes the onus of system upkeep and maintenance, removing a heavy IT burden and freeing up resources to focus on other areas of innovation.

Cloud ERP supports today’s most pressing technology imperatives: the desire to accelerate speed-to-value through cloud delivery models; the need to reduce IT complexity and simplify integration; and the responsibility to address data security and compliance mandates.

It’s ERP, But Not as We Have Known It

As the manufacturing sector is poised to enter a new era, the age-old need for responsiveness is more crucial than ever. This responsiveness will be much more elusive for manufacturers without a next-generation ERP platform in place to capture and automate best practice processes, and integrate data to reveal key insights for better faster decision making at every level in the organization. Leaders will be those who find ways to leverage new technologies such as mobile and social to close the gap between the boardroom and the shop floor, between company and customers.

It’s ERP — but not as we have known it — and it is the answer to removing barriers to greater performance and agility to enable greater responsiveness to new disruptive forces, opportunities and threats, so organizations can grow and manifest their manufacturing destiny.

Malcolm Fox is vice president of product marketing for Epicor.

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