ERP change management: an implementation best practice

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Selecting, purchasing and implementing an enterprise resource planning (ERP) solution is a huge undertaking. The potential rewards are significant, but just like any massive organizational initiative, the risks can be just as pressing. ERP change management is a key best practice for implementation.

Why?

You need your workforce to adopt the new technology in order to realize benefits as a business. Stumbling blocks along the way, and refusal to adopt, can lead to hiccups in your supply chain and wasted dollars.

A PricewaterhouseCoopers survey found that 29% of workers are most motivated to acquire new digital skills by the promise of "individual achievement within a predictable environment" as opposed to being motivated by being more efficient or by status and promotions. Of those 29%, less than half claimed their company did a good job at communicating why digital skills are central to the company's success.

Everybody at your company could benefit from having a more efficient, up to date ERP in place. While lots of people will be motivated to adopt new technology because of status or easily visualized efficiency gains, a large number of folks may need a bigger push.

ERP change management can help you meet implementation best practices.ERP change management can help you meet implementation best practices.

ERP change management

Change management is a vast, complicated and rich field of study. We'll focus on how two of its oft-cited strategies can help you adhere to ERP implementation best practices.

Plan-Do-Check-Act

Known by the initialism PDCA, this change management strategy can help you implement an ERP at your organization.

First, your company plans the change. Then, they launch a sort of pilot program based on the plan. For ERP implementation, you could sign up a small number of early adopters. Perhaps you can incentivize people who are motivated by status by putting them on an early adoption committee. After the pilot, the committee will get together to assess what they've learned. That's the "Check" stage. Finally, you "Act." That is, you roll out the ERP to a larger group of end users.

Those who may be reluctant to engage at first will see how it's worked so far, they'll have observed the system integrating successfully, and they'll be aware of benefits for previous users. The process of change management will now be a part of their routine, helping to ease the transition.

ADKAR

This acronym stands for "Awareness, Desire, Knowledge, Ability, Reinforcement."

Each letter in the acronym corresponds to a phase in the change management cycle. First, even before anybody adopts the ERP, they have to be aware of what it is. Once they become aware, the organization needs to cultivate their desire to participate. Surveys can gauge how close the company is to meeting everybody's reasons for wanting to adopt new technology.

Once users are invested, you give them the knowledge and then the ability they need to participate. You'd probably train them on the software before giving them access. A sandbox can be helpful for learning. Finally, you reinforce the use of the ERP in an ongoing manner.

Change management can help drive ERP adoption, making it an implementation best practice. Learn how we can help you find and implement an ERP today.

Prediction: Top 3 ERP trends to look for in 2020 [Video]

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Enterprise resource planning software, or ERP, has always had to evolve with the times. This year is no different. Here are the top three ERP trends to look for in 2020.

1) Blockchain.

Some software companies are just beginning to integrate blockchain technology into ERPs. We're excited to see how the transparency, efficiency and security of blockchain improves ERPs.

2) Additive manufacturing.

Additive manufacturing, which involves the commercial use of 3D-printing technology, is primed for expansion. That means a lot more data, and it means ERP capabilities will have to grow.

3) IoT.

The Internet of Things will provide more supply chain visibility in the future, and savvy managers will look for ways to efficiently feed this info directly into ERPs.

Keep checking back with us to find out what's on the horizon for ERP.

What’s the best way to improve order promising?

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Order promising is essential to a properly functioning supply chain.

When products or services are ordered by customers, an organization's ERP solution uses its order promising capabilities to inform them of shipment and delivery dates. Well-executed order promising lets companies provide accurate estimates to their customers, in turn supporting high levels of customer service and a general reputation for reliability.

However, order promising doesn't always go so smoothly.

Common problems in ERP order promising

For starters, effective order promising requires full visibility into how fluctuations in supply and demand are affecting expected deliveries.

Even orders that don't seem like major events at the time can have profound effects on a company's ability to ultimately make good on its promises to all buyers. The so-called "bullwhip effect" shows how this can happen.

For example, say a retailer saw lowered customer demand on a particular day, leading it to order less from the distributor, which in turn requested smaller shipments from the manufacturer. However, the lessened demand turned out to be an anomaly. Once it returned to normal levels, there was a shortage throughout the supply chain, and the manufacturer had to push out its order promising dates.

Doing so can cause reputational damage, especially in a world in which consumers already have high expectations for timely fulfillment, in part due to the rapid delivery available for many products ordered online (e.g., those bought via Amazon Prime).

"Effective order promising requires full visibility into supply and demand."

Indeed, a 2017 Supply Chain Management Review Survey found that "maintaining customer satisfaction" was the most-cited challenge among manufacturing, high-tech, and retail organizations. Order management complexity, inaccurate order promise dates, and rising costs across IT and the supply chain were not far behind.

These issues can coalesce in situations in which organizations order more than they forecasted, causing other buyers to see delays in their shipments. So what's the best solution to this common problem?

Solving order promising woes with ERP systems

Many workarounds for poor order promising — such as manual processing, using spreadsheets or dummy orders/reservations — aren't all that scalable or efficient. A better approach is to harness the power of a modern ERP such as Microsoft Dynamics 365 Business Central (formerly Microsoft Dynamics NAV).

Dynamics allows for careful monitoring of current supply and demand levels, with usage of basic concepts such as Available to Promise (ATP) and Capable of Promise (CTP). Whereas ATP makes calculations based on unreserved quantities in inventory, CTP assumes a scenario in which the requested item isn't ready yet and determines how long it would take to attain it.

In Dynamics, it's relatively straightforward to configure the ERP system for different order promising formulas that result in realistic delivery estimates for customers. Accent Software can help you get started with a Dynamics implementation that's right for you. Reach out to our team to learn more today.

ERP security checklist: How to defend against breaches

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Is your ERP system at risk of of a data breach? Such security incidents happen fairly frequently. According to an IDC poll of 430 IT decision-makers, almost two-thirds of respondents (64%) had suffered ERP data breaches involving some combination of their sales, HR, financial, and customer information, or of their intellectual property.

Since ERP systems are pivotal to the smooth functioning of everything from a supply chain to an accounting department, any security event can slow a company's operations to a crawl and cost it millions in missed opportunities and reputational damage. Such risks are more relevant than ever now that more ERP modules are becoming internet-connected and incorporated into the Internet of Things.

With these issues in mind, let's look at some steps for defending your ERP against breaches.

1. Require stronger passwords and MFA

Simple passwords, especially on sensitive admin accounts, are a major cause of cyberattacks. Verizon has estimated that stolen or otherwise compromised passwords factor into over 80% of all breaches. Superior security is possible by using unique, complex, and regularly updated passwords, which can be generated and stored by a secure password manager service. Adding multi-factor authentication provides even better protection by requiring an additional credential (like a one-time code) during login.

"Simple passwords are a major cause of cyberattacks."

2. Keep all ERP-related software up-to-date

Outdated software is a magnet for cyberattacks because it often contains known vulnerabilities that can be exploited during a breach. Accordingly, updates and security patches should be applied as soon as possible, assuming that they haven't been known to destabilize the applications and systems they apply to. If your ERP is outsourced, make sure that the vendor overseeing its management has a good track record when it comes to security.

3. Have a backup plan in place

The only thing worse than being breached is being breached and not having a workable backup of your ERP data. How you back up your information will vary based on the type and size of the ERP implementation. A cloud- or appliance-based solution might be most advisable, depending on the situation. Vendors may also manage backups in their data centers and assist with services for timely disaster recovery.

4. Work with ERP specialists

It's easier to stay on top of security issues with the assistance of ERP experts. The team at Accent Software can help you with the implementation of a secure, high-performance ERP for your organization. Learn more by contacting us today.

The biggest trends in manufacturing ERPs to keep an eye on in 2020

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Enterprise resource planning (ERP) systems have evolved significantly over the years.

The inventory control packages of the 1960s gave way to the materials requirement planning of the 1970s and then to the first versions of ERP as we now know it in the 1980s. Since then, ERP systems have gradually become more flexible, scalable and generally practical to use for companies of all sizes. Modern ERPs may offer multiple deployment options (e.g., in the cloud, on-premises or in a hybrid setup) and be tailored to the specific requirements of an industry like manufacturing.

As we look ahead to 2020, ERP change is ongoing. Let's look at a few of the major trends to pay attention to in the next year and beyond.

AI and machine learning will become more prominent in ERPs

Artificial intelligence (AI) and machine learning have already reshaped how people interact with their phones, tablets and PCs via voice-powered assistants. Now these technologies, which approximate human-like reasoning, are making inroads into ERPs.

Within an ERP system, AI and machine learning can help automate key workflows, improve information search and extract insights from large datasets. For example, AI algorithms might be able to pinpoint correlations between fluctuations in inventory and specific business function, in much less time than a human could.

AI and machine learning can help automate key workflows

Cloud ERP implementations will keep gathering momentum

Cloud computing has become a more popular deployment model for almost all types of business software, ERP included. Although a cloud-based setup might not be the ideal fit for every organization, for many it can deliver distinct benefits, including easier management, fewer upfront costs and continuous updates for functionality and security from the vendor. Overall, cloud ERPs can be highly flexible, scalable and cost-effective.

While most core company applications still run on-prem as of 2019, many IT decision-makers are at least considering a move toward cloud. There's risk involved, to be sure, since many existing ERPs are huge investments that can be tricky to migrate, but look for interest in cloud alternatives to keep rising. Note that "cloud ERP" may refer to software hosted in a service provider's public cloud, in a dedicated private cloud, or in a hybrid cloud that mixes different IT environments.

ERP adoption among SMBs will continue to grow

ERP systems were once associated primarily with larger enterprises, which were the only organizations that could reliably afford the costs of implementing an ERP solution, as well as the required ongoing maintenance. That's not the case anymore, as SMBs have implemented ERPs en masse and should continue to do so in 2020.

SaaS-based ERPs, which are managed entirely by the cloud service provider, are particularly popular among SMB organizations. IT research firm Forrester once estimated that most SaaS ERP adoption came from SMBs looking for an all-in-one solution, which SaaS can usually provide.

We've only scraped the surface of what the future of ERP will look like. To learn more about how to find the right ERP setup for your organization, reach out to the Accent Software team today.

4 strategies for empowering manufacturing ERP users [Video]

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ERP adoption cannot be taken for granted. It’s important to empower users, so that they understand what’s in for them. Here are four strategies to consider.

First, define the need for change and describe how the ERP will benefit everyone. Also discuss what might happen if the project fails, to show the stakes involved.

Second, enlist SMEs from across the company, and give those expert users the power to make decisions and direct teams.

Third, train teams from the beginning of the project, instead of waiting until the end. Ensure they can all influence the ERP’s design and feel like they have ownership of it.

Finally, build a user community that will continuously discuss issues and share ideas on how to improve the ERP over time.

3 ERP implementation issues manufacturers might encounter [Video]

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Implementing an ERP is a complex process with little margin for error. Here are some of the common implementation challenges to look out for.

First, setting up a project management team must be done carefully. Pick a project manager who can set and enforce clear deadlines, work well with a diverse team of employees and ensure proper communication between all stakeholders.

Second, legacy data can be tricky to integrate. Make data quality a priority, so you can identify and address discrepancies as older databases are integrated.

Finally, be sure to test thoroughly. Inadequate testing could put you at the mercy of incompatible apps, security vulnerabilities and permissions errors.

Why manufacturing ERP solutions are essential to production and supply chain forecasting

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Inaccurate supply chain forecasts can be costly. In 2002, Cisco was forced into a $2.2 billion inventory write-off after it had overestimated demand for network equipment during the dotcom bubble. While the typical manufacturing organization will never run the risk of such a huge write down, there's still the possibility of a missed forecast straining its finances.

Why missed forecasts are so painful

Inaccuracies can hurt manufacturers in multiple ways:

  • Overestimating demand will result in excessive inventory that consumes storage space and cuts into profit margins by necessitating big discounts to move.
  • Underestimating will lead to shortages, which will frustrate customers. These stockouts may also require increased spending on expedited replenishment.

Striking the right balance between overstocking and understocking isn't easy, or else no one would struggle with the above (very common) issues. However, there are steps that many manufacturers can take to reduce the risk of unexpected carrying costs and stockouts, including the implementation of modern ERP technology.

ERPS helps forecast manufacturing demand.ERP solutions help forecast manufacturing demand.

How ERP solutions support more accurate forecasting and production

Since many manufacturers operate within just-in-time or made-to-order paradigms, the impact of an inaccurate forecast is particularly severe. Fortunately, ERPs deliver much-needed protection by:

  • Integrating up-to-date information from back office applications like CRMs.
  • Estimating lead times and material availability.
  • Offering insight into projected income, spending and changes in costs.
  • Providing data that can inform tasks such as job scheduling.
  • Giving teams a consolidated interface for managing inventory.
  • Streamlining logistics with real-time information on distribution and transportation.
  • Flagging operational efficiencies in real time and performing cost accounting.

Overall, a modern manufacturing ERP offers a substantial upgrade over other methods used for this purpose, such as relying on spreadsheets or custom in-house applications. Both of those solutions require a lot of manual effort, which is as time-consuming as it is error-prone.

Plus, relying on discrete Excel sheets or apps has the potential to create data silos, meaning there's no single version of the truth that everyone can rely upon when making decisions about production. Silos increase the chances of a costly stockout or inventory excess. In contrast, ERP gives you a consistent flow of data from the shop floor to the back office.

As you consider ERP options for your manufacturing organization, reach out to the experienced team at Accent Software. We can help you find the solution that meets your exact requirements and ensures you can adequately forecast demand.

Understanding manufacturing ERP technology’s automation power

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Automation is the "secret sauce" that makes modern ERP solutions so beneficial. By consolidating, streamlining and automating a wide range of tasks including logistics and reporting, an ERP system can eliminate silos and reduce the amount of manual work required across a manufacturing organization. Contained within well-implemented and properly maintained solutions, ERP automation can yield productivity increases of more than 80% in some cases.

Many essential manufacturing functions can be automated within an ERP to keep production on track while avoiding costly delays and issues with quality. Let's dive into some of the specific areas in which automated ERP functionality can really pay dividends.

Logistics and supply chain management

Without ERP automation, it's difficult to keep up with customer orders while also avoiding excessive inventory and production related problems. Customers may be left waiting on backorders, which in turn contributes to the so-called bullwhip effect that distorts supply chain forecasts.

ERP automation helps by:

  • Recording exactly when buyers order and need components.
  • Integrating order and inventory data to avoid backorders.
  • Indicating when and where to move those items prior to production.
  • Incorporating data from wireless technologies, which can replace paper-based processes.
  • Signaling which dock to send a finished order to when it's ready for shipment.

AI-powered monitoring and reordering

Artificial intelligence (AI) refers to computer programs that reason in ways similar to a human. In a manufacturing context, AI can help with automation by analyzing datasets to make decisions without the need for time-consuming manual human intervention.

"An AI-powered program could track key performance indicators in real time."

An AI-powered program could track key performance indicators in real time so that it triggers reorders from suppliers as needed. This capability is helpful for reliably meeting demand by ensuring that supplies don't routinely run low and in turn fuel customer dissatisfaction.

Manufacturing specifications and parameters

Following manufacturing specs is essential in meeting quality expectations and controlling costs by avoiding errors. ERP automation provides pivotal support in getting the proper specifications for each job to the right spot.

For example, an automated ERP system could read a customer's specifications for a semiconductor from a purchase order and then relay them to the processing equipment in question so that the work is always done with the right die locations. Similar efficiency extends to jobs such as welding and lamination, both of which come with highly variable specifications that must be followed.

Chatbots and customer service

Chatbots are an important innovation in responding to customer service inquiries. They behave much like humans over chat, but are fully automated behind the scenes.

Using AI, they can comb through datasets such as customer interaction histories and orders to provide an accurate response. Chatbot interactions help free up more time for technical support teams, who get to spend much less of their days fielding routine requests that a chatbot could probably handle.

ERP automation has wide-reaching and transformative effects. To learn more about how to get started on the road to ERP success, contact the Accent Software team today.

How artificial intelligence could impact manufacturing ERP technology

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Artificial intelligence (AI) is one of the most promising frontiers in the future of manufacturing ERP technology. While AI itself has roots running back to the mid 20th century, only recently has it become sufficiently advanced to have practical applications in real-world ERP deployments.

As a quick refresher, AI refers to computer programs that can “think” (i.e., run) like humans, with the ability to interpret information in real-time and adapt to changing circumstances. Machine learning and deep learning, which refer to AI programs that can learn without human supervision, are both subsets of AI.

In the context of ERP systems for manufacturing, AI can support a variety of functions, ranging from uploading progress reports to assisting with customer service. Let’s look at a few examples of what AI-enhanced ERPs can do.

Streamlining the flow of information across systems

More than 90% of ERPs require manual intervention to share data between systems. That’s a recipe for duplicated work and wasted time.

With AI, it’s possible to assign many of the same tedious tasks that once fell to humans to programs instead. For example, rather than entering production data in an automotive plant by hand on a PC, AI-powered sensors can make their own readings and estimations, greatly simplifying and accelerating the flow of information between systems.

ERP functions better with AI.ERP functions better with AI.

Making customer service smarter and more responsive

ERP deployments are often intended to consolidate previously siloed operations such as customer service and sales. Implementing AI can further this goal by bringing consistent logic and automation to all of these functions.

For customer service, AI programs might efficiently pull data from multiple systems while also analyzing each customer’s history of interactions. The insights could then be fed to a chatbot that provides accurate and contextual responses.

Enhancing corrective maintenance of the ERP

ERP maintenance costs are significant, running up to 20% of the solution’s initial purchase price. AI may be able to better keep them under control.

An AI-powered digital assistant can give service technicians the information they need to quickly identify problems and make informed decisions about how to solve them. Like a chatbot, this assistant would have real-time access to historical records and other data while formulating its recommendations.

Want to learn more about how your manufacturing ERP can be optimized to deliver the best results for your business? Get started by contacting the Accent Software team today.