An ERP System is the Backbone of a Manufacturing Company
ERP is such a fundamental part of any business that companies are usually reluctant to make a change. In fact, the average manufacturing company operates with an ERP system that has been in place for 10 to 20 years, according to noted manufacturing expert Dave Turbide. Because of these long-term relationships, manufacturers and their ERP providers are as much business partners as they are customer and vendor.
In many industries, companies rely on their ERP system for little more than financials, but manufacturers have a much greater dependence. Manufacturers store the very essence of their business—their product structures and work instructions—in their ERP systems. They rely on ERP procedures as the backbone for certifications such as ISO9001, and parts of regulatory certifications such as FDA audits in life sciences center around consistent use of business systems. They customize their ERP solutions to create differentiating business processes that give them a competitive edge in tough markets. ERP systems function as both the conscience and memory of a company, storing the details of every sale and every shop order.
Changing its ERP system means that the company may need to go through an additional—probably unplanned—FDA or other compliance audit. They may need to rewrite and recertify their ISO procedures. They will need to retrain everybody who interacts with the system and spend days or weeks testing and verifying new procedures.
That’s why it’s such a shock when an ERP vendor discontinues a product and forces its customers to make changes they wouldn’t make otherwise. Changing an ERP system is disruptive. It adds to the workloads of the company’s most key people, pulling them away from their day-to-day activities to focus on the project. It affects every business process in every department, from finance to sales to the shop floor. For an ERP vendor to force customers to make a change in their ERP system for its own benefit feels like a betrayal of a trusted relationship.