“Ladies and Gentleman, Start Your Engines” and Get Your ERP Upgrade Moving Forward!
This Sunday, the 98th Running of the Indianapolis 500 will take place at the Indianapolis Motor Speedway. With enVista’s headquarters located in Indianapolis, it is impossible to ignore “The Greatest Spectacle in Racing.” So, of course it made sense to write a blog about the Indy 500 and ERP upgrades, right?
There are sure to be several green and yellow flags waved from the starter’s stand before the final chequered flag is waved signaling the end of the race on late Sunday afternoon. But there is one flag that a driver hopes not to see: a red flag. A red flag is displayed when conditions are too dangerous to continue the race, and drivers are typically directed to stop immediately where they are on the track. So, I have to ask, are there any “red flags” stopping you from starting your next ERP upgrade?
To help address some of the common “red flags” and objections to upgrading an ERP system, I spoke with Nigel Cox, Vice President of Microsoft Dynamics 365 Consulting Services at enVista, to share what he has learned throughout his 30+ years of managing ERP projects. He is an established expert in Lean Principles, Quality, Supply Chain Management, Manufacturing and Demand Planning. His experience spans a variety of industries and specialties that includes Engineer-to-order, Assemble-to-order, Semiconductor, Construction, Pulp and Paper, Textile and Apparel, Light Assembly and Fabrication. Cox is also Master Certified for Microsoft Dynamics AX and is a respected expert, especially in Product Builder and Lean Manufacturing.
The Three Red Flags Preventing Your ERP Upgrade from Starting
There are a multitude of reasons that companies will avoid starting down the path of an ERP upgrade. Below are three common “red flags” that Nigel and I discussed based on his experience with upgrade projects, including some advice on how to approach these objections.
Red Flag #1 – ERP upgrades cost too much
We won’t mince words here – of course ERP upgrades cost money! But, “cost” is a relative issue when discussing an upgrade. That is because there are a wide range of factors that can affect the cost of an upgrade such as the system and partner you choose to work with. More specifically, the cost of your upgrading your ERP system will depend on whether you will need to perform a full re-implementation or if you can upgrade to the newest version while keeping your existing system in place. This is also a good time to determine whether or not an upgrade makes sense with your current system. If your business processes have changed or your business has grown then it might be a good time to evaluate other ERP systems on the market that better suit your needs.
Consider this, too, “What is the cost of not upgrading to the most recent version?” New versions offer new enhancements, bug fixes, features, etc. that can increase the value of your ERP system and maximize your investment in it. Your ERP system should be a tool that moves your business forward, not one that holds your business back.
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Red Flag #2 – We don’t have the proper personnel, resources, or training
You’re not alone! A lot of companies don’t have the technical resources in-house prior to an upgrade or implementation project. Those that do are the exception, not the rule. Your first order of business would be to align yourself with a technical partner who can help with the development and customization of your ERP system. However, if your concern is around a lack of functional expertise, then you need to work with a partner that will train you and your employees on how to use the system. We consider it a best practice to not do the functional tasks for clients because in the end, you’ll be better off if you’ve taken ownership of the system.
Red Flag #3 – Our business processes are too complex to apply to a new upgrade
One of the great things about the business environment of today is the rapid advancement of technology. ERP systems have benefited from this innovation and have evolved in order to cope with changing business needs. The days of investing capital dollars, time and resources to develop a custom ERP solution have long since passed because this is neither practical nor cost-effective. Furthermore, with the range of businesses and industries that ERP systems support, it isn’t necessary to develop a custom solution. For example, Microsoft Dynamics AX supports a multitude of business/industry types, including retail, distribution, manufacturing, professional services, and government entities.
One other key thing to remember: you don’t have to optimize everything all at once. Sometimes a process doesn’t need to be automated or doesn’t benefit from being automated. The goal of an upgrade should be to streamline existing processes and eliminate wasted activity.
Wave the Green Flag and Get Your Upgrade Started
An ERP upgrade is a huge undertaking for any organization, so it is only natural that there would be some red flags, questions and objections. But with the right team in place, a qualified partner, and a well-supported ERP system, you can ensure that you’ll be prepared for whatever challenges you might face while upgrading your ERP system.
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