Our ERP consultant teams has seen that first hand with a precision machining company’s ERP selection project.
One of the first stages in the selection process is always the “ERP discovery” stage, where we assess the business needs of the client and the key motivations to start such a strategically important project. Here are a few critical items we learned about our client in this ERP discovery session.
Why Start Now?
In this situation, the main reason to start a new ERP selection project was that the company’s software simply did not support the current needs and future aspirations of the company. In our on-site ERP discovery session, we defined several areas that would offer our client an opportunity for improving their business and becoming far more competitive and profitable:
- Materials Management: At the time, the company was suffering from a serious lack of capability in managing materials throughout the scope of their supply chain. Purchasing recommendations, order quantities, and overall inventory management were not being controlled due to a lack of best practice processes and software capabilities. The flow of material throughout the manufacturing process was also lacking in lean process efficiencies.
- Quoting: Providing a quote and quote revision in general was highly inefficient. The current software did not allow multiple versions of the quote, requiring each quote be generated from scratch and tracked on the sales person’s hard drive or in paper form.
- Machining: The ability to manage third party operations was in serious need of improvement, as all too often, products would be sent out for third party processing and fall off the radar. The ability to manage this process and track the progress was requiring intensive manual efforts.
- BOM Capability: Managing the Bill of Material was also a problematic exercise, as it required a significant amount of manual data entry, making the whole system prone to errors. Engineering Change Management and Customer Change Management were seriously lacking and in turn created a lack of customer satisfaction and inefficiency across the board.
Despite having all of these problems and many more, our client was surprisingly doing a good job working around the issues. However in the long run, issues with data accuracy and inconsistencies from manual intervention yielded an overall lacking in information accuracy, and inhibited the company from being able to make confident decisions, manage customer information, drive internal efficiencies, and manage margins and profitability.
Ultra is currently guiding this client in designing and implementing best practice processes enabled by a robust ERP software solution. So far, they are seeing substantial value to their bottom line in the early stages of this project.
To learn more about whether now is the right time for you to start a new ERP project, refer to our whitepaper “Five Considerations When Justifying an Investment in ERP.”