0 ERP Best Practicesfinal

8/2/2019 0 ERP Best Practicesfinal

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Session Objectives Assess the performance of your ERP system

implementation

Learn how to improve the integration of your system

into the business

Examine how the application of ERP best practicescan improve the operation of your business


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Technology- Hardware

- Software

- Network

Skills- Managerial

- Process Knowledge

- Technical Matter

Organization

- Management Hierarchy- Business Process Design

- Feedback & Control Mechanisms

- Communication Systems

System Integration Factors


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Agenda

Assessing ERP Performance

Ensuring Data Integrity

Managing Variability

Protecting the Critical Path

Powering Decision-Making


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ERP Best Practices Chart

Process

Innovatio

n

Process Control

Level I

Level II

Level III

Level IV

Feedback and

control mechanisms

in place to ensure

data integrity

System detects

performance issues to

protect the critical path

and facilitate workflowthroughout the enterprise

Transforming data into

information to power

decision-making across

the extended enterprise

Capabilities established

to manage and control

sources of variability


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Agenda







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MonitorTransaction Reporting

Transaction Types inventory receipts, issues, transfers, and

adjustments

labor entries for operation reporting invoice and payment processing

Includes inaccurate, late and missing

transactions negative inventory balance locations

labor variances

production receipt and material issue


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Maintain Schedule Validity

Verify material and capacityavailability before releasing

orders into production

Update shop order date andquantity fields to reflect

variances from plan based on

actual production

Establish policy and procedures

to control schedule changes


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Verify Foundation Data

Foundation Data Sources Item Master BOM / Route Master

Work Center Master Customer Master Vendor Master

Knowledge repositories used as thebasis for orders and as a reference forcommunication throughout the

extended enterprise


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Agenda







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ERP Benefit

Busters

Material Usage Variability


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Change Management

Practices Establish the who, what, when, where, and how on:

Capturing engineering changes and errors andupdating the bill of material and routing on a timelybasis

Adjusting the schedule to reflect production quantityand lead time variances

Updating standard machine capacities as capabilities

and product mix change Revising the shop calendar with planned downtime,overtime, and / or extra shifts

Revising the production schedule for new orders or

changes to existing orders


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Responsiveness

Responsive companies have theability to quickly and efficientlyrespond to unexpected changes andvariability

Responsiveness can be improved bydeveloping:

Flexible processes Supply chain relationships

Contingency plans

alternate plans or business rules to handlecommon situations


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Closing the Loop

Feedback and control closes theloop between the plan andeverything that prevents

execution of the plan__


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Agenda


Ensuring Data Integrity Managing Variability




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Theory of Constraints Lessons

Solving local optima through processcontrol will not necessarily generatemore throughput, i.e. money for the

company Business processes involved to

complete a customer order consist of

a series of dependent steps referred toas the critical path

The critical path determines the rate

of throughput for the company


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Business Process Flow


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Manage System Constraints Identify bottleneck

Physical constraint or policy constraint Exploit it Improve capacity utilization Schedule the sequence of work

Remove resource contentions Reengineer policies and procedures

Subordinate all other resources to it

Match non-bottleneck output tobottleneck

Ensure support activities enhance ratherthan detract from bottleneck productivity

Elevate it


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Strengthen Linkages

Strengthen the linkages betweensteps in the critical path

Facilitate workflow along thesteps Analyze workflow

Design and evaluate solutions toimprove throughput and lower costs Rules-based routing

Event-based notification


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Supply Chain Facts

Youre only as strong as yourweakest link. Tight linkages with suppliers and

customers are just as important as tightlyintegrated internal operations

Information delays, inconsistent

and infrequent ordering, and poorcommunication in the supply chainresults in higher inventory and

lower customer service levels


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Supply Chain Best Practices Include supply chain partners in decision-making

process

Establish data exchange systems with supply chainpartners to ensure rapid dissemination of information

Streamline procurement process using online suppliers,trading communities, exchanges, and auction sites

Integrate business systems of supply chain partnersusing XML or other data format

BizTalkBizTalk -- WebPlanWebPlan

Extend workflow analysis, rules-based routing, andevent-based notification throughout the supply chain


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Agenda


Ensuring Data Integrity Managing Variability




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Facilitate Communication Breakdown barriers to access to

information Install LAN / WAN backbone

Provide data query and reporting tools

Use software collaboration tools email, video conferencing, FTP, workgroup

tools

Integrate front-office and back-office

systems


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Improve Data Mining

The ERP database serves as atransaction backbone--arepository of data that can be

accessed and manipulated to: evaluate strategic marketing or

financial opportunities

support process control andcontinuous improvement efforts

adjust tactical plan based on

unplanned events


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Enhance Analysis Tools Data becomes a valuable resource

only when knowledge workers canderive information from it to support

business decisions.

Rapidly fading are the days where theelectronic spreadsheet will suffice asthe stand-alone analysis tool for the

business manager

More advanced tools are needed tomanage the complexity and scale ofthe current business environment


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ERP Best Practices

Matrix

Level I:Level I:

Ensure Data Integrity Formalize Change Process

Improve Responsiveness

Control Process Variance

Process Control

P

rocessInnovation

Level II:Level II:

Manage Variability

Facilitate Communication

Improve DataMining

Enhance Analysis Tools

Level IV:Level IV:

Power Decision-Making

Manage Constraints

Strengthen Linkages

Integrate Supply Chain

Level III:Level III:

Protect Critical Path

Monitor Transactions

Maintain Schedule Validity

Verify Foundation Data


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Documents

0 ERP Best Practicesfinal