In many cases within this chapter the author implies that the whole idea of moving to an ERP system is to re-engineer business processes and to ‘break away from out dated rules’. Company’s that cannot match their business processes with a commercially available ERP are living back in the dark ages. Matching every business process to an ERP is not going to add any benefits to a company. ERP is implemented to improve and stream line business processes not to maintain the current ones. Without changing business processes when adopting an ERP company’s will miss out on gaining a valuable competitive edge in their market.
This chapter illustrates that ERP not only provides a competitive edge, but ERP also;
- reduces multi-step processes
- reduces product lead time
- reduces overall costs
- integrates databases
- allows management to provide timely decision making
- eliminates delays
- offers better inventory management
These are just some of the advantages an ERP offers to a business that re-engineers their business processes. Re-engineering is the key to improved productivity and reduced costs.
There are some challenges when a company decides to re-engineer their business processes. This is a timely and costly exercise, however the benefits far out way the costs. Re-designing jobs will also be a challenge, many employees will have extra workloads and be pulled away by management to help re-engineer particular business processes. This causes strain on employees and in turn could effect customer relations.
Some possible considerations that factor into reasoning for complying with re-engineering of business processes, is the consideration of IT. ERP systems relies heavily on Information Technology. A company implementing an ERP system should ensure their IT department is able to support the system and its processes. Thus if a company is trying to match business processes and is having doubts, they can always look to IT to see if the company has the IT capabilities to take on an ERP system. Then if they can, this should build managements confidence that a effective iimplementation can occur. The only in-decision they have then is purely a business process matching decision, and honestly, changing some business processes most of the time proves to be very beneficial.
The chapter explains that re-engineering in itself, the majority of the time it is successful, most reasons for failure is because management does not approve of software and company’s have failed to take a ‘clean slate approach’ and persistently held on to old processes. This stubborn mind set of not implementing ERP systems based on the fact that their business processes don’t match, will only cause the company to continually fall behind competitively in their industry’s, and end up spending more money to improve other components of their business to make up for lacking in a supportive ERP system.
