10 Ideas to Optimize ERP Systems

We offer you ten ways to improve the performance of your current and future ERP (Enterprise Resource Planning) systems

ERP systems are traditionally expensive applications. They are complicated to use and far less flexible as sometimes we want - especially once they are insisted and put to practical use. Properly implemented, they are extremely powerful tool for organization and optimization. So eventually they may become a leading element of business growth, the improvement of the organizational structure and operating efficiency.

Here are some ideas how here to optimize your current and future ERP systems, to be able to use them well and effectively and reduce the negatives that inevitably any application has.

1. Optimize licensing system. Regardless of what licensing model are - concurent or personal, too often user organization is not done well enough. User who left the company continue to be kept in the system, there is no system for optimization of user load on the server, there is no load monitoring on the system so that the proper number of licenses be purchased. The optimization of this parameter can give you major advantages in the investment you make for your application.

2. Optimize maintenance of your system. Any ERP system needs routine maintenance, as a rule, the larger the system, the more support is needed. Often, however, the companies have a large number of staff who deal with the maintenance of the already running system, but it may not need such amount of work any more. If implementation allows you can use external support instead of internal staff. If you have a really big project that justifies the existence of an internal team, you can look for a way to diversify the load on your internal team, monitor the system load and look for additional activities for your team - training of users, support for other systems, etc.

3. Seek professional assistance in planning, development and implementation of a system. If you have internal users who are well prepared and know the necessary detail of how to implement a system, it is best to use them for this purpose. In general however companies do not have a clear idea of how such a system should look amd how to implement or even how to choose software solution. The lack of these skills often leads to poor selection of systems, badly implementeds systems and in general - inefficient product use. Product price is not the biggest problem in these cases - the biggest problem is if you implement a system and it actually reduces your productivity, not increase it.

4. Internal Project management is extremely important. Customers often believe that when a pay system and its implementation, they get a working product. Our experience from a large number of implementations indicates that at least 60-65 % of the effort in the implementation is time spent from internal users, not by the implementing company. This makes targeting internal efforts and proper management of internal resources a major factor in the success of the project. Selecting the right team, ensuring proper system operation time and good internal planning are factor that should not be underestimated.

5. Often ERP systems are implemented as monolithic systems - covering all units, and this is usually the most direct and easy way to implement them, but not always the best. Explore the strengths and weaknesses of the system you are using, and check if you can possibly use other software for certain purposes. It may be that for managing your outlets it ismore meaningful to have independent POS solution. Perhaps your travelling sales people it is better to have a mobile solution for marketing. Maybe your production requires use of specialized software. These decisions can greatly improve the efficiency of work with your systems.

6. ERP systems are excellent base systems but unfortunately are not as good in some of the specific features that you need to use. One of the things that most systems do not do well is to generate complex data analysis. Most often there is no point trying to add more and more complex queries in your ERP, which have strictly defined structure and any needed new elements brings a process of application development, testing and launch of the new report. If your requirements are generally at a higher level, and this usually occurs several years after the start of an ERP system, perhaps a better option is to look for another solution for your problem - BI or other systems of this kind.

7. Decide what makes sense to expect from your ERP and what does not. Sometimes people seek to use the systems for things that are not necessarily suitable. It could be for example for entry of technical infromation for a production or for GPS coordinates of the movement of the fleet - or for any other purpose that the ERP system probably can not serve well. It is important if you have a requirement to keep such data to store them properly in appropriate for this applications. If necessary - make integration with your ERP, but it is often not the best idea to use the ERP as the primary place to store all data.

8. Often ERP systems are implemented in a scope too small or too inefficient for the company. Many companies implement systems only as Financial Accounting Software - Reporting to the parent company or the top management. Sometimes they implement systems alone when they can be integrated - e.g. a separate ERP system and a sperate system for warehouse management without links between them. When you can do integration between the two and it has business reasoning for what, it is good to do. This saves time and effort of your employees, spares them of trivial tasks - simple information entry, and enabling them to focus on the right tasks - how to develop your business.

9. Pay serious attention to what records and information are generated by your system. It is one thing to run the system in real conditions, but completely different - to extract all information you need from it. Of course this does not mean that we should not strive for operational work - it is clear that it is the first and perhaps the most difficult step of the process for effective implementation of an ERP system. However, if you stop there, you will not benefit fully from the possibilities that the system gives you. As a rule, the higher in the hierarchy users of a system are, the more information they use and the less data they enter. So it is good for you to try to provide the necessary tools at every level - good interface, settings and functionality in operational use for entering data on the one hand and on the other - possibilities for extracting information and reports for management.

10. Require people in your team and the implementation company to achieve real results from the implementation. The main purpose of an implementation is not to implement the system. The main goal is to achieve more work opportunities, higher efficiency, better control, better information, better planning. These are all ideas that are the main reason for the start of an implementation, but rarely followed after the implementation itself starts. Tt is good if you follow these during and after the implementation. When talking about the warehouse for example - set as your employees' task to optimize storage volume and value. In sales - you can give your sales team a task to analyze the structure of sales and margins, and seek a way to sell more with better profits. If you have home delivery or logistics - you could ask your employees to optimize the routing task or the volume of goods transported, so you can be more effective. In supplies - give as a task for people to try to make more exact deliveries, based on more accurate plans, stocks and sales. Overall recommendation - do not leave the implementation just as such.

If I can summarize in a sentence what was said, it would be as follows: ERP systems are often looked after from companies, but they should be seen more as a tool. This tool has some advantages and disadvantages, copes perfectly with some tasks and not so well with others. So find out what you can accomplish with your system, and then try and do it well.

Stefan Markov, Manager at Rinamar Ltd.
Source: CIO

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