Why Do Manufacturers Use Less Than 30% Of Their ERP Capabilities?

While two thirds of manufactures report choosing their ERP systems based on functionally, in reality they use only 26.6% of the available features and functions. The study, "The ERP In Manufacturing Benchmark," produced by Boston based Aberdeen Group, surveyed more than 1000 companies, including Johnson Controls, Delphi, Schlumberger, Tyco Electronics, Ford and Lockheed Martin.

"The chief ERP implementation challenges were associated with the alignment of business processes and software capabilities. Companies struggle to balance customization related issues with business process re-design amidst costs associated with upgrades, replacements, consolidation and latent integration costs," said Cindy Jutras, vice president, manufacturing & ERP research at the Aberdeen Group.

Jutras offers manufacturers recommendations for ERP strategies:

  • Balance aligning business processes to software capabilities against aligning software capabilities to business processes. This maximizes benefit and allows for business evolution.
  • Consolidation decisions must carefully weigh the business value brought to the enterprise.
  • Resist replacement strategies that simply duplicate business processes currently in place.
  • Don't fall into the trap of believing an ERP implementation is ever completely done.

To obtain a copy of the report, visit: http://www.aberdeen.com/summary/report/benchmark/RA_ERP_CJ_3361.asp

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