Tuesday, August 24, 2010

Can You Add New Life To an Old ERP System

Recently, TEC featured an article by Olin Thompson titled, "The 'Old ERP' Dilemma: Replace or Add-on" which discussed options available to companies who want to add business functionality to their "Old ERP" systems. Certainly, there are many options now available in new business functionality that run the gamut from Supply Chain Planning (SCP) to Customer Relationship Management (CRM). The pros and cons of replacing or adding on to your existing ERP system were set forward in Thompson's article. But before you look to new ERP functionality, you should see if you are getting the full benefit out of your existing system. If not, are there ways to add new life to your current ERP system without going into an extensive development project.

Whether you have an old or new ERP system you have probably learned that to maximize its value, you have to work hard at getting information from the ERP system to key users. According to Thompson, " the data checks in, but the information can't check out of many ERP systems". You also may be finding that as e-business strategies are emerging in your supply chains, you could need access to more externally generated information than your ERP system, in its current configuration, can handle. For an Information Technology manager, both situations are problematic. Many companies should take another look at data warehousing before deciding that what to do with the "old ERP" system.


*In Memoriam

Does Data Warehousing Really Work?

Bob Cramer, Director of IT for Appleton WI based Anchor Food Products has found that, " lots of the pain we have with our old ERP system is based on users not having access to information. We see data warehousing addressing most of the problems our users have with the old ERP system". Today, most reporting from older ERP systems is directly from the ERP transaction processing (OLTP) system. Typically, users take ERP transactional data and input it to an Access database or a spreadsheet to generate the reports they need to make business decisions. From a user perspective, the extraction and re-inputting of information is both time consuming and potentially error prone. From an IT perspective there are no opportunities to build in validation checks to ensure that the information is either reliable or the most current available.

Data warehousing provides another way of getting information from legacy systems. Many companies have found it necessary to "build around" their ERP system to some extent. For example, Advanced Planning and Scheduling (APS) systems have often been added after the ERP installation. Companies find that they can report from either their ERP or their APS systems, but have difficulty combining data from both systems without having to create new databases or spreadsheets. Once the data is extracted from the systems, it is very difficult to ensure its integrity. James F. Dowling pointed out in the TEC article, "Business Basics: Unscrubbed Data is Poisonous Data" data should be managed as a corporate asset that appreciates in value over time. Historical data must be addressed with as much care as current database content".

The Data Warehousing alternative uses a better approach. It "packages" the information in data cubes that are customized for each group of users. Once the information is packaged in a data cube, users can extract the information using an On Line Analytical Processing (OLAP) tool. Today, OLAP tools are available as client-server applications or can be operated from a Web browser.

The data warehouse also can include information that is not in your ERP system. By adding information from outside the ERP system, IT can provide users access to ALL the transaction information that the company collects as well as whatever information they might want to collect from OUTSIDE the company. This is a significant difference and a potentially powerful advantage. Pat Clifford, Director of Business Consulting at the Boise ID agri-business giant the J. R. Simplot Company, found after installing a data warehouse comprised of company information from their ERP and several legacy systems, " it not only gave more information to our employees, but allowed them to move from just reading reports to performing managerial analysis."

What is the Best Way to Integrate Your Old ERP with Data Warehousing?

There are two basic strategies that can be used to start a data warehousing project. For certain ERP systems third party providers have developed 'off the shelf" data warehousing solutions that are pre-built to the fit the features of your ERP system. If you have an old ERP system that is supported by a data warehousing "solution", you should seriously consider this option. Data warehouse solution products are usually based on the ERP modules you have installed. You can roll out the data warehouse to one module at a time making it easier for IT to manage. One major advantage of using a data warehousing solution is that it can be done in a significantly shorter timeframe than if you have to buy an entire data warehousing tool set.

If your old ERP system is not supported by a data warehousing solution product, you will need to "build your own" using a tool set provided by a data warehousing vendor. At Simplot, Clifford found there were advantages in defining the project by functional areas instead of trying to create one big project: "Different functional areas look at information in different ways, so it's important to work with each group as you build the data warehouse". The advantage of a data warehousing tool set is that it gives you total control over what kind of information you want to present to your users. The disadvantage is that it will take more time and internal resources to implement.

Conclusion

IT managers are under increasing pressure to deliver information that can be used to perform managerial analysis. Decision makers in companies are no longer content to read the simple reports that are generated by old ERP systems. They need to have access to multi-dimensional information based on transactions generated both inside and outside your company. A well thought out data warehousing project can address many of the user issues behind their perceived need for a new ERP system.

SOURCE:
http://www.technologyevaluation.com/research/articles/can-you-add-new-life-to-an-old-erp-system-16444/

ERP Getting a New Breath of Fresh Air in Europe

According to silicon.com, a leading European IT TV News Service, European companies began to realize the importance of customer oriented ERP applications and are set to dramatically increase their investment in related projects over the next two years. A report commissioned by Oracle and enterprise systems provider Bull claims European companies will increase ERP projects by 50 per cent, double the volume of business intelligence (BI) and data warehousing (DW) projects and treble the use of CRM applications in the next two years. Two out of three companies surveyed regarded integration of established ERP systems with new CRM solutions as a crucial business strategy. The survey, conducted by IDC, was based on the IT strategies of 1,000 enterprises throughout Europe.

According to Peter Reed, marketing manager for enterprise solutions at Bull, the drive towards customer focused applications is accelerating now as e-commerce takes off and as company resources are freed from developing Y2K solutions. He said while the results of the report were positive, it highlighted a worrying trend of European companies embracing CRM applications as a cost reduction exercise rather than copying the US trend of using it as a method of customer acquisition.

Market Impact

This is a confirmation of a trend we have long noticed in the global market rather than any kind of a surprise. All major business applications players realized the need to shift from an internal to an external focus some time ago, particularly after feeling the Y2K-induced pinch. Over the last few years, the main players have been actively developing internally or partnering in order to provide solutions that allow businesses to collaborate more effectively. Also, while the vast majority of vendors have distanced themselves from using the unpopular, outdated term ERP in their marketing campaigns, at the same time, they have tacitly been enhancing their traditional back office functionality and/or providing hooks to external 'killer' e-business applications.

The real reason for this lies in the fact that the boundaries between ERP, CRM, e-commerce, BI and Supply Chain Management (SCM) have been blurred. If the ultimate objective is to win and retain customers, one must consider the entire chain, which includes traditional ERP and SCM functions as well as the more remarkable CRM and e-commerce activity, with the inevitable need for extrapolating useful information for all management levels by using BI.

The ERP system remains the backbone of the supply chain. It sets the structure a company needs to do business and to communicate with other businesses. The combination of ERP, supply chains, and the Internet, or collaborative commerce, is an integration designed to offer faster and easier access to business transactions as well as customer and supplier data. This combination does not mean ERP systems become obsolete over night. While the traditional introverted mind-set of ERP becomes history, its functionality remains critical. The 'new economy' will not cause the obsolescence of general ledger and accounts payable & receivable for example. On the contrary, it may only emphasize the importance of their efficient use. Integration and interconnectivity are therefore the name of the game in the future.

We also concur with the above-mentioned opinion that implementing CRM and e-commerce only for cost cutting and process streamlining is a rather myopic strategic move. The much stronger demand for extended-ERP components than for a core ERP system are also not unexpected, mainly due to a large ERP market penetration and saturation compared to other much more recent markets.

SOURCE:
http://www.technologyevaluation.com/research/articles/erp-getting-a-new-breath-of-fresh-air-in-europe-16008/

ERP Showdown: Deltek Costpoint vs. Microsoft Dynamics AX vs. Oracle E-Business Suite

Rankings, either overall or by module, do not tell you everything you need to know. What they do provide is a basic, high-level view of vendors' general strengths and weaknesses right out of the box'. However, the fact is, few businesses, if any, can use an ERP solution right out of the box'. Businesses have special needs and priorities that need to be supported by any ERP solution they use.

For example, if your business requires an especially robust HR functionality, even though Oracle E-business finished first overall, Microsoft Dynamics AX ranked first in the HR area, and may therefore be a better choice for your organization than Oracle.

The same applies within individual modules, where the top ranking vendor may not necessarily be the right one for your organization's needs. Although Deltek was first overall in Purchasing Management, Microsoft was stronger in pricing, as shown in the chart below. If pricing is a critical area in your organization's business model, Microsoft may be a better choice than Deltek (the Purchasing Management winner), or even Oracle (the overall winner)

Conclusion

Given that out of the box' rankings rarely, if ever, reflect the real world needs of an organization, and that the rankings can shift depending on what area(s) of functionality you look at, how then do you determine which ERP solution is best suited for your business?

The fastest, simplest way is to do what we did to produce the results you see here: use TEC's ERP Evaluation Center. (We got our results in 20 minutes, versus weeks or even months of struggling with huge Excel spreadsheets.)

TEC's ERP evaluation center allows you to set priorities that reflect your organization's business model and special needs at every level of functionality. At the modular and sub-modular levels, even down to the individual criteria, you can tell the system which business processes are critical, important, or not important to your organization. The system then compares your priorities against the vendor responses to produce a shortlist of solutions. You get a custom comparison, one that ranks vendor solutions not on out of the box' functionality, but rather on how well that functionality matches the business requirements of your organization.

It's the best way we know of to evaluate ERP solutions, and we invite you to give it a run through. Simply click on the link below to visit our ERP Evaluation Center to conduct your fast, free custom ERP comparison. After all, there's no other organization quite like yours
SOURCE:
http://www.technologyevaluation.com/research/articles/erp-showdown-deltek-costpoint-vs-microsoft-dynamics-ax-vs-oracle-e-business-suite-18915/

Welcome to ERP Showdown

Results

As you can see above, straight out of the box, Infor ERP LN 6.1 ranked first overall, with Lawson M3 Discrete Manufacturing Solutions coming in second, and Epicor Vantage placing third. (Overall scores were based on the average level of support the vendor offers across the entire ERP spectrum.)

As the chart below shows, Infor finished first in five of the eight modules (although by some fairly small margins in a few cases), with Lawson finishing first in three modules (two of which were extremely close), and Epicor failing to finish first in any of the eight modules.

As you can also see in the chart below, thereĆ¢€™s an especially wide range of results in Human Resources. Infor ERP LN 6.1 is the only one of the three solutions that currently provides full HR functionality. Epicor Vantage requires third-party functionality, while Lawson M3 plans to offer full HR functionality in future releases. (It should be noted that clients do not always require an HR component in a new ERP system, as many prefer to retain their existing HR solution or add on a third-party solution.)
However, as with most aspects of enterprise software, it's not that simple or clear-cut.

Rankings, either overall or by module, do not tell you everything you need to know. What they do provide is a basic, high-level view of vendors' general strengths and weaknesses right out of the box. However, the fact is, few businesses, if any, can use an ERP solution right out of the box. Businesses have special needs and priorities that need to be supported by any ERP solution they use.

For example, if your business requires an especially robust quality management functionality, even though Infor finished first overall, Lawson scored higher in the Quality Management module, and may therefore be a better choice for your organization.

The same applies within individual modules, where the top-ranking vendor may not necessarily be the right one for your organization's needs. Although Infor placed first overall and in Product Technology, the chart below shows Lawson as stronger in both the Reporting and Workflow and Document Management submodules. If either of these functional areas is key to your organization's business model, Lawson may be a better choice than Infor.
Conclusion

Given that 'out of the box' rankings rarely, if ever, reflect the real-world needs of an organization, and that the rankings can shift depending on what area(s) of functionality you look at, how then do you determine which ERP solution is best suited for your business?

The fastest, simplest way is to do what we did to produce the results you see here: use TEC's ERP Evaluation Center. We got our results in less than 20 minutes, versus weeks—or even months—of struggling with huge Excel spreadsheets.

TEC's ERP Evaluation Center allows you to set priorities that reflect your organization's business model and special needs at every level of functionality. At the modular and submodular levels—even down to the individual criteria—you can tell the system which business processes are critical, important, or not important to your organization. The system then compares your priorities against the vendor responses to produce a shortlist of solutions. You get a custom comparison—one that ranks vendor solutions not on out-of-the-box functionality, but rather on how well that functionality matches the business requirements of your organization.

It's the best way we know of to evaluate ERP solutions, and we invite you to try it out. Simply click on the link below to visit our ERP Evaluation Center and conduct your fast, free custom ERP comparison. After all, there's no other organization quite like yours.


SOURCE:
http://www.technologyevaluation.com/research/articles/welcome-to-erp-showdown-infor-erp-ln-6-1-vs-epicor-vantage-vs-lawson-m3-discrete-manufacturing-solutions-19338/

Will That Wretched ERP Finally Die? Possibly, But Only the Acronym!

"The traditional ERP model is dead and collaborative commerce (c-commerce) is emerging to take its place." This was yet another ERP demise prediction, this time given by a speaker at a symposium in Europe at the beginning of April, which was hosted by a leading research house. He went on to predict that Customer Relationship Management (CRM) and Supply Chain Management (SCM) would become as important as ERP in the electronic economy by 2004. A prediction was given that ERP systems will only host 40 percent of business applications by 2004 due in part to the rise of collaborative commerce, or c-commerce.

With traditional ERP systems, attention is placed on internal productivity. What will happen to alter that model is the emergence of a more diverse enterprise framework. From now until 2004, a more dynamic online marketplace will emerge, where companies can collaborate with employees, customers, stockholders, sales channels and suppliers through a multi-enterprise framework. It was also predicted that due to a more dynamic marketplace, ERP vendors would have to focus on either 1) creating functionally stronger ERP components or 2) creating functional c-commerce frameworks.

Market Impact

There is nothing new in these statements that the market has not already been aware of. The currently infamous 'ERP' acronym may face extinction, but not its basic concept. All of the major ERP vendors realized the need to shift from an internal to an external focus a long time ago. Over the last few years, the main players have been actively partnering or finding other ways to provide solutions that allow businesses to collaborate more effectively. Also, the vast majority of vendors have recently stopped using the term ERP in their marketing campaigns, or have at least been downplaying it. Part of the reason for doing this lies in their attempts not to be branded as outdated by market requirements.

However, the real reason lies in the fact that the boundaries between ERP, CRM, e-commerce and SCM are blurred so much that this attempt to functionally separate them becomes pointless. If the ultimate objective is to win and retain customers, one must consider the entire chain, which includes traditional ERP and SCM functions as well as the more remarkable and supposedly more relevant CRM and e-commerce activity.

The cycle begins with the attraction of the customer through sales and marketing. This hopefully results in an order management and fulfillment process and ends with a customer service, which can involve anything from field installations through to enquiry and complaint management. All of these steps have to be executed well without exception. Otherwise, the customer will end up on a competitor's list of customers.

Therefore, the relative importance of CRM vs. ERP, ERP vs. SCM or of any other match-up is irrelevant. All of these functional areas are critical, except for some esoteric or autistic businesses. The 64,000-dollar question is how all business processes work together. In the electronic world, the degree of flexibility and efficiency of processes relating to the customer lifecycle, product development, and so on, to name but a few, will be a big determinant of losers and winners. Therefore, while the traditional introspective mind-set of ERP becomes history, its functionality remains critical. The 'new economy' will not cause the obsolescence of general ledger and accounts payable & receivable for example. Quite the contrary, it may only emphasize their importance.


SOURCE:
http://www.technologyevaluation.com/research/articles/will-that-wretched-erp-finally-die-possibly-but-only-the-acronym-15710/