Tips on Selecting the right ERP for your Business

Process Manufacturing is much different from discrete manufacturing. In case of discrete manufacturing, the company makes products on a shop floor, with the end products being easily identifiable. In simple terms, the discrete product can be broken down to retrieve its basic components.

Most common examples of discrete manufacturing would be automotive manufacturers, consumer electronics, the aerospace industry, and household appliances. Process manufacturing on the other hand deals with formulas and recipes and the end product cannot be broken down to get its original components. Common examples would be paints, chemicals, pharmaceuticals, and the food and beverage industry.

Most of the companies in these industries have sophisticated software applications to govern their business processes. Highly popular ERP systems like SAP and Oracle are commonly used in these firms. There are many local vendors as well providing custom made applications.

However, a lot of companies jump into purchasing an ERP system, without doing a thorough analysis of their business processes and what solution would fit them best. For example, even in case of manufacturing there are many styles from job-shop to highly complex automated systems like robotics.

The solution that is chosen must support the business processes, the style of manufacturing and the business model of the company. For instance the interfaces required for a highly configured machine cannot be the same as that of a high speed automation machine making a hundred pieces an hour. This is probably the reason why most companies fail or are unhappy with their ERP investments.

This makes it absolutely crucial for companies to identify their critical success factors (CSFs) or the processes that are critical to their businesses and need to be automated. Moreover, it is always important to document the requirements so an easy comparison can be made at a later stage.

Many companies do not do a comprehensive study of their existing business processes. For instance a company may be doing certain tasks in a unique way and steps could be taken to replace or improve them. Without a detailed analysis of requirements and business processes, it would be difficult to evaluate an ERP solution or to predict its potential to be a perfect fit for the company.

For example, a large cosmetics manufacturing company implemented an ERP system, however after a few years, it did not realize complete value as some of their existing processes still had to be done manually. Real time inventory tracking was not a robust feature of their ERP system. In fact the employees had to manually count the stock to ensure availability to fill open orders.

Purchasing planning and scheduling took a beating and the company began making mistakes on purchasing inventory, at times investing more than required, hence increasing the cost of inventories. Such requirements are specific in process manufacturing industries which the company failed to oversee. It also did not have robust capabilities in defining item and lot characteristics which was becoming a concern.

Eventually they had to re-invest in another ERP system. To avoid such pitfalls companies must be better prepared and should do extensive planning on key issues before evaluating a vendor for ERP selection. The anticipated ROI, ERP system functionality, pricing, vendor capabilities, technical issues like platforms and customization, need to be analyzed well before evaluation.

There are some good products in the market which are tailor-made or industry specific. For example BatchMaster specializes in process manufacturing. Industry specific applications would be a good option to consider as the customization required would be less and the ERP system would have evolved over a period of time with installations in different companies within the same industry.

Finally if a company is proactive and has a clear ERP vision, with the expectations in place, it would only be that much easier for the company to choose a right system to suit its business, and to be a right fit in the long run.

Written By :

Lawrence Gilbert

(Business Development Executive at Accent Consulting)

Manage your HR function better with an integrated HRMS solution

Human Resources management in different companies is viewed differently. Some companies view HR as an administrative task that needs to be done. In fact, till the 1960’s the personnel department was still viewed as a record keeping function that did the payroll tasks and organized the company picnic.

However due to ever increasing issues in managing workforce and the increasing complexities of Human Resource management, the top management soon realized that the function is not just important but critical to its business. Terms like organizational behaviour, complex psychometric tests, feedback forms, having policies and structures in place are becoming very important in today’s increasingly competitive business environment.

Hence most firms look at creating HR as a strategic business partner within the firm, having a definitive say in strategy meetings, adding value to business by suggesting changes in policies or the way employees are managed within a firm. Most companies now see HR as a potential game changer, having a definite role in strategic planning of a business.

For HR to take such a comprehensive role it must first identify the business needs, processes and both, short term and long term goals of the company. Hence companies find the need to more efficiently manage their day to day operational tasks more efficiently so they can channelize their resources in the more strategic aspects of HR.

This is when most firms look at implementing an HRMS software solution to help them better manage their daily complex processes. However companies must first do a rigorous assessment whether they really need an HRMS system. Issues like how much paperwork is becoming cumbersome to manage, record keeping and a growing need to quickly run reports, needs to be assessed.

Considering a web based HRMS solution would seem to be a good option, especially for SMEs who want an integrated and cost effective solution. Using this solution, employees can easily see their attendance, benefits, leaves pending, claims and many other features which advanced HRMS software’s provide.

Most HRMS systems also have the option of multiple user licenses which gives specific access to different users based on their role and function in the company. For example, an HR manager would have complete access of all the employee records, while employees would have restricted access to only their records, and every department manager would have access to only the records of his functional department.

Even if the company consists of only hundred employees, a web based HRMS system would be useful to streamline the entire HR lifecycle right from training to recruitment to payroll management. This helps in increasing efficiency of HR processes, and limits errors in payroll or ambiguity in record keeping. At the same time, it empowers employees to focus on the more strategic aspects of HR.

A good HRMS system would be one which is user friendly, secure, having wide range of modules covering the entire HR lifecycle, would be flexible in terms of implementation, and being compliant to open database platforms (ODBC) such as Oracle or Microsoft SQL Server. This would allow better integration capabilities with other applications as and when required.

Going for a comprehensive HRMS solution is becoming a must for large organizations and a great investment for SMEs to provide efficiency and add value to the HR function in their company. The time is soon when majority of companies would have HR as a strategic enabler and a business partner for contributing to the long term strategies and goals of a company.

Written By :

Lawrence Gilbert

(Business Development Executive at Accent Consulting)