erp - make it happen ( good )
TRANSCRIPT
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Enterprise Resource Planning (ERP): Making It HappenTim MojonnierMojonnier & Associates Management Education & Consulting
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Many major companies are having difficulty achieving effective enterprise resource planning even after a full year of implementation, according to a report issued by The Conference Board.The report goes on to state that some 40% of participants in The Conference Board survey failed to achieve their business case even a year after having implemented enterprise resource planning (ERP).----(The Conference Board)
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Role of ERP Has Changed 20th Century ERP RoleToday Enterprise Optimization Supply Chain Optimization Tactical Cost of Doing Business Strategic Investment Reengineered processes for Survival Reengineered processes for Efficiency Computing in the Cloud ERP is the Next Wave
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SummaryERP and e-Business
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ERP, e-Business and Data Base AccuracyItem Master/Bill of Material/RoutingCustomer and Vendor MastersFinancial Account CodingInventory AccuracyTimothy M Mojonnier(708) 771-0027 (cell) [email protected]
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Data Accuracy at a Medical Products Distributor$40+ billion health care supply management company30+ North American distribution centersOne million order lines every work dayShort filled order can be a life threatening event
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Data AccuracyRecognized the impact of accurate records on both Customer service Financial reporting
Transformed the Enterprise by Deploying a proprietary warehouse management system Redesigning business processes to achieve high levels of data accuracyMedical Products Distributor
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Data Accuracy: Positive Change Early 90sToday 70 to 90% inventory accuracy 99.8+% inventory accuracy 90% of physical inventories eliminatedTwo physical inventories per year at each distribution center Use of more efficient process cycle counting Exclusive use of ABC cycle counting Medical Products Distributor
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Implementing ERP: The Three Elements
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The New Industrial EngineeringBusiness ProcessInformation Technology RedesignCapabilitiesHow can processes be redesigned using IT?
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Business Process Redesign
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Receipt is authority to payAutomatic AP entry and paymentAutomatic adjustment of contract POInternet release to vendorSwipe bar code to receive in stockReceive directly to point of useExternal KanbanBusiness Process Redesign at a Discrete Manufacturer---Redesigned Procurement Process
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Business Process Redesign at a Discrete Manufacturer---Redesigned Procurement Process 80%+ of items under Kanban control POs written reduced from 5,000 per month to 1,700 Self-billing invoicing routine eliminates supplier invoices Save over $20,000 per month using theself-billing invoicing routines in ERP software
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Reduced delivery lead-times 67%
Increased inventory turns 2.3X to 18X
Increased revenues by 250%
Business Process Redesign at a Discrete Manufacturer
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Strategic Project Management
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Module
Target
Control Method
Annual Savings
Production Planning
1. Reduce throughput time by 25%
From 8 to 6 working days
$500,000
2. Reduce inventory by 40%
Reduce inventory $s by 40% (value = $3 million)
$1,000,000
Improve labor utilization by 1%
Saving by better planning and scheduling system
$400,000
Finance
Reduce average payment terms by days
Reduction of days outstanding from 75 to 70 days
$580,000
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Risk ManagementIts the alligators that you dont see, that will bite you.
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ERP Risks
ERP Risk
Probability
Impact
Contingency Plan
Insufficient knowledge and training
High
High
Zero-based Internet training
Functional APICS education
External Consulting
Internal Training Plan (Train the Trainer)
Lack of resources
Medium
High
Obtain top management commitment for resources
Hire Subcontractors
Delay implementation date
Lack of 24/7 vendor software support
Low
Low
No Contingency Plan required
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Change Management
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Multiple Projects, Multiple Visions, Competing ResourcesSix SigmaCollaborative Product DesignERPEmpowermentVision
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The Essential Elements of Change Management
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The Ten Steps for a Successful ERP Project 1. Clearly defined Project Mission2. Leadership at the Top3. Realistic Project Schedule/Plan4. Client Consultation5. Personnel selection
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10 ERP Success Factors 6. Technical Tasks7. Client Acceptance8. Monitoring & Feedback9. Communication10. Trouble-shootingThe Ten Steps for a Successful ERP Project
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ERP: Making It HappenTim MojonnierMojonnier & AssociatesManagement Education & Consulting
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