ERP: Get two lives from the cloud

Enterprise Resource Planning (ERP) system is not the most glorious history. In the 90 's, ERP vendors announced that the technology would announce the end of time-consuming processes in manufacturing enterprises. ERP commitment will make everything automated and integrated, up to order tracking, down to product distribution and production scheduling. But the technology often fails. Some angry customers will even sue their ERP suppliers.

However, innovation is making this technology more useful and cost-effective. ERP software can now be used on mobile phones from remote control ("in the Cloud"). It can help manufacturers cut costs, simplify operations, and spend much less than previous ERP systems.

DDB Unlimited, based in Oklahoma, USA, for example, invested 235,000 dollars in a traditional ERP system in April 2010. DDB is a manufacturer of outdoor chassis cabinets for electronic communications equipment that collects information from different sectors, such as finance, inventory and production, into a central database to get a real-time view of the production process. But it turns out that the system is slow and difficult to operate, and that employees spend "three times times as long to complete their work," recalls Dusty Mahorney, founder and chairman of the company, Dastie Mahoni.

Thus, in January this year, DDB changed to use a remote-control ERP system provided by another supplier, Acumatica, in effect renting an internet-based ERP system and not paying for expensive, costly servers. Acumatica is responsible for software upgrades, patches, and backups, and DDB's IT department frees up to focus on its own production facilities. Employees can use this system to track production costs, view accounts receivable, enter purchase orders, check inventory, and settle checks. The system helped DDB cut the order Processing cycle from 2 hours to 45 minutes. Employees can also access the system from a remote computer to get real-time information, such as viewing a customer's purchase history.

Other necessary steps to transfer data and implement this cloud computing technology ERP system cost DDB about 100,000 dollars and the system's service charge is 35,000 dollars a year. But Mahoney said the move would save the company 80,000 of dollars a year.

Even some big companies have stumbled on earlier versions of the ERP system. For example, HP (has) made a fool of itself in implementing the ERP system in 2004: it spent 160 million of dollars to deal with the backlog of orders, resulting in the cancellation of shipments and the loss of turnover. In 1999, Hershey said that ERP and other software issues prevented it from delivering Halloween candies worth 100 million of dollars.

A provider of ERP software maintenance support Rimini Street's CEO, Seth Ravin, said: "There are all these pieces of failure that have cost billions of dollars and sometimes even companies are going bankrupt," says Seiss Laven. None of these companies knew exactly how much it would cost to implement an ERP system. ”

Some enterprises are still unable to deal with the inherent complexity of ERP technology. However, a cloud-based ERP solution allows manufacturers to spend a lot of money without first coming up. Eric Kimberg, chairman of Panorama Consulting FX, an ERP consulting firm based in Colorado State, said: "Companies don't have to go out and spend dozens of of millions of dollars on software." It's like renting a car. ”

Mobile devices also make ERP look more attractive to manufacturers. Now, workers can use this system to approve purchase orders, track logistics information and mark production bottlenecks, even if they are not in the factory.

Another useful improvement for manufacturers is open source ERP; Unlike branding systems, open source ERP features a common code base that allows users to tailor products to their own needs. Open source solutions often include a specific developer community seeking technical support and collaboration.

However, while mobile and open source ERP systems are flexible, they are not for everyone. Configuring the Smart phone for field staff to configure ERP data access can pose a huge security risk. And for some companies, it's hard to make the most of Open-source software, Kimberg says, unless you're home to a mature it organization. ”