For those non-techie readers that remember the classic 1966 Clint Eastwood movie might easily read over the first three letters of the title of the blog in hopes of hearing any insights into Blondie, Angel Eyes and Tuco. To those readers, I offer an apology, you will be sorely disappointed. To the other readers that only see the first three letters of the title and expect to capture a host of information or insights about Enterprise Resource Planning (ERP) they too will be disappointed.
So, then, who do I believe needs to read this article? Any business owner or manager that has heard of ERP that is looking to “make their life easier” by replacing their Line-of-Business software with an ERP solution. Whether or not they are Clint Eastwood fans is not real important but does tell me they are entertained by more than just Ethernet switches, quad core processors or what development language is in vogue. This article is more concerned with the business side of ERP implementations, not just the tool itself.
So, to stay consistent with the title, we must look at three aspects of ERP systems.
The Good
Enterprise Resource Planning (ERP), to those new to the software game, is a tool (application) used to integrate the data and processes of an organization into one single system. The many-times elusive “good” is apparent in the definition; its ability to integrate many processes into one single system. This is the most attractive aspect of ERP systems, hence the use of “enterprise”. Management experiences multiple applications on a daily basis that seemingly do not speak to one another and the notion of integration seems not only efficient, but financially sound.
The Bad
However, many times an ERP system may not be the best solution for an organization and could have many disadvantages. First, ERP systems are generally very expensive on account they include software, hardware, training, implementation, license, maintenance, consulting and other expenses that raise the cost of implementing an ERP System. Second, it is difficult to ascertain the success of implementing an ERP system with no tools or techniques available to exactly measure the return on investment. It is alarming to note the amount of time that is invested to implement an ERP system in an organization. In addition, workers have to shun their regular jobs and undertake training, which disturbs the regular functioning of the organization. Finally, the greatest impediment to successfully implementing an ERP project is the resistance of end users. Since the operators are used to using the legacy system they do not accept the new system easily, which could result in failure of the system and project.
The Ugly
Probably the main reason ERP systems fail is that the features and functionality of the system offers very limited customization and are often too rigid and too difficult to adopt the specific workflow and business process of many organizations. Re-engineering of business processes to fit the “industry standard” prescribed by the ERP system may lead to a loss of competitive advantage. Furthermore, the “industry standard” process prescribed by the vendor may not be the best practice followed by the company and could yield limited benefits. Many organizations cast away their “Line of Business” software, that brings them the features and functionality they need to remain competitive, only to waste substantial time, money and resources on pursuing a path, the ERP path, that rarely satisfies what organizations really need.
Based on the above, does this mean that ERP systems do not have a place in corporate America? No, there are specific organizations that such systems might benefit. However, over the years I have experienced multiple ERP implementations, in both small and large organizations, none of which were successful and were a drain on the company. It is important that every organization weigh the benefits and other alternatives carefully before deciding to implement an ERP system. It is never as easy as vendors make it sound.
Alpine Technology Corporation has been serving the waste industry for over 35 years with waste and route management software for both the office and the trucks. Their office software,Visual RAMS-Pro, provides billing, work orders, container inventory, route management, customer and account management and much, much more. Their industry-leading truck solution, Visual On-Route, is far more than a mere routing software and allows the driver to be connected real-time to the office. Visual On-Route keeps the drivers accountable while allowing haulers the ability to generate additional revenue streams and cut expenses through efficiencies.