Flexible ERP packages to solve mid-manufacturers’ supply chain problems

That’s among the conclusions stemming from a study of 1,000 of the UK’s mid-manufacturers by the Economist Intelligence Unit (EIU), which looked at key growth challenges facing these companies. The EIU’s James Watson says its study shows that many mid-market firms’ challenges stem from the limits of their infrastructures – meaning management understanding, resources and technology. He adds that, with cost reduction a key driver, they need to look at modern ERP technology to improve internal operations and to enable closer relationships and slicker collaborative working with suppliers and customers. Speaking on a webinar to launch the EIU findings, SAP discrete manufacturing principal Simon Pollard (formerly with Oracle and before that a research director with analyst AMR), commented: “Manufacturers need to solve their pragmatic real-world challenges using today’s packaged [ERP] solutions so that the time and investment they make is as efficient as possible.” He believes the answer for manufacturers is to turn to specialist system implementers with industry knowledge sewn into their extensions of the main ERP packaged systems. “They need to leverage the experience built into solutions from industry specialists,” he says. Tim Mayes, solutions manager at SAP partner and industry specialist Ciber UK, warns that too many manufacturers feel themselves being driven to consider off-shoring manufacturing to overcome cost differentials and to attack emerging markets. But he warns that’s not an adequate solution to achieving competitiveness. “They’re exposing themselves to the inevitable lead time lag. UK companies are used to short supply chains where they can control and mange lead times, but production and transportation delays from overseas will cause problems.” He says he’s also concerned about the potential for quality issues over time and the potential for manufacturers to lose IP and to encounter problems around engineering change controls and local regulatory issues if they haven’t first addressed the common problem of “patchy, non-integrated or non-existent IT systems.” For him, unsurprisingly, the solution is in SAP’s ‘All in One’ templated ERP package, configured for what he describes as low risk, accelerated implementation and coming with Ciber’s industry specific knowledge. Mayes: “Ciber has developed a menu of strategies; fundamental building blocks with best practice approaches on top of SAP.” And he insists that those are flexible enough to enable companies to manage and control off-shoring, or whatever else they need to do with virtually out of the box SAP All in One. He cites a recent implementation for £160m aerospace tooling design and manufacturing company Hyde Group. “Hyde has a small is beautiful philosophy; they have more than 40 sites each with its own MD and management all working to Hyde’s lean approach with one ‘Hyde environment’. “In some cases group members compete for the same business, but in others they link to form a united business to win a contract. Airbus is a good example – Hyde won the contract for work on wing assembly of A380 by joining the threads of their various businesses into a seamless view for costing and pricing.” The point: SAP All in One ERP, extended with Ciber expertise, provided an ultra-flexible solution for business management and operations almost entirely without customising the software – something that might surprise many manufacturers.