ERP systems “largely inadequate”: manufacturers people need to learn new behaviour

Software functionality in packaged ERP (enterprise resource planning) systems is “largely inadequate”, according to Andrew Purton, president of rejuvenated manufacturing business improvement consultancy Oliver Wight. Purton believes that, in general, ERP systems support only limited processes. He says clients “often” ask Oliver Wight consultants to help them find “a way around the software because it doesn’t provide what I need.” And he cites master scheduling as a particular problem, but implies there are plenty of others. “In the main, software companies chase technology advantage rather than functional advance. Then, when they add that technology back into their systems, they may be flawed because something fails.” It’s a surprising view. Few would dispute that no matter how good the functionality of any system, it’s unlikely to be enough because on its own it can’t address the business behavioural, cultural and process changes that are a prerequisite to getting best ROI. And hence the myriad failures, or at best imperfect implementations in manufacturing around the world. Indeed this has been Oliver Wight’s heartland for 25 years. And few would challenge the inadequacy of good old master scheduling, MRP and the rest: it was only ever inexact and it was built for a time of mostly make to stock, fixed lead time business – and when computing resource was slow and expensive. But things have moved on just a little on the technology side! Few vendors are offering just the functionality they did 20 years ago. Look at the range of advanced planning and scheduling (APS) offerings, fast MRP, templated systems and so forth. It’s all designed to deal more accurately with the real world, and get better systems up and running fast – what we’ve all demanded in fact. So to suggest such inadequacy is curious. What is much more likely than functional failure is that users, for a mass of mostly political, leadership and people reasons, are largely unable or unwilling to grasp the real nettle – and go for the scale of business, cultural and behavioural change they should to get the best out of any systems, no matter how good. And it’s fair to say that the vendor and consultancy community has largely supported this status quo. Few vendors or consultants are going to turn down lucrative contracts because they believe there’s a better way! They’ll fear risking too high a service price tag, too much effort, protracted timescales – and being rejected. So they’ll do what the client says he wants to do. And the same applies to going for newer technologies. We might all rail against MRP II, but better the devil you know… This is where Purton’s Oliver Wight and the likes of the Goldratt Institute come in. Both describe themselves as educationalists, mentors, confidantes, passers on of knowledge – and both can work alongside consultants and implementers, whether from the software vendor or independent. Most important, they see their role as fostering change in a structured, well defined manner to achieve measurable manufacturing and business improvements. And that means individual contracts for their services with manufacturers of all sorts, and public courses and seminars which are themselves cathartic for many. In Oliver Wight’s case it has always been about MRP and the achievement of ‘Class A’, and there are lists as long as your arm of mid size to massive organisations that have used the firm’s checklist, methods and mentors to get there, and to drive huge change for the better through their organisations. Caterpillar is a classic; Cadbury Schweppes is another. Latterly, OW has moved on to trumpet the value of Sales and Operations Planning. But Purton says Ollie Wight has moved on. “The Class A methodologies are still there, but we have evolved the business to provide Lean Manufacturing services and Six Sigma,” he says, and it’s all about bringing the spread of best practice into industry and making it work sustainably. Purton says OW now presents a more seamless face around the globe. The firm’s 66 consultants world-wide, all themselves senior practitioners from industry, are now versed in providing everything from grass roots manufacturing business reorganisation (eliminating ‘fire fighting’, wasted processes and the rest) to integrating business processes with technology all the way, and cascading it right through an organisation.