The One Club of Creativity Special Section

Why our business processes are (probably) better than yours

When you buy an enterprise resource planning system, you're not buying software so much as business processes enabled by software. One of the fundamental changes which will - or should - happen with the introduction of ERP is that business processes which were formerly perhaps murky, perhaps poorly defined or perhaps not defined at all, will come tumbling out of the closet like so many skeletons.

They must then stand up to scrutiny and face comparison with what the ERP consultants and the ERP software recommends is the best way of doing it. The chances are good that your existing processes will be reengineered and changed to align with the processes driven by the ERP system.

Before howling in outrage, there is a definite caveat which must be mentioned immediately. There are and will remain some processes that may be unique to your business. These processes might even be what make your company different from the competition. Fine, those processes we are happy to leave be and to work around. In fact, good ERP consultants will recognise where unique processes add value and will recommend that the system is customised to make the appropriate allowances.

Pretty standard stuff

But the vast majority of processes are pretty standard stuff. We're talking about things such as procurement, sales orders, invoicing, the many processes related to human resources management and accounting. Through many years of experience covering just about every industry sector you can possibly imagine, the people who create ERP systems have boiled everything down to the lowest common denominator to find the most efficient, the most effective and the most reliable processes for these sorts of activities. In a phrase, this is what best practice is and best practice serves as the benchmark for doing a business activity right.

The reality is that many companies, especially those which start out small, develop processes more or less by the seat of their pants. As these companies grow to become the sort of businesses that find themselves needing an ERP solution, they may find that processes begin to fail.

Idiosyncrasies therefore are not a problem, so long as the business owner or manager is able to keep tabs on what is going on. It does become a problem when the business expands, when new branches open, when staff numbers increase and when responsibility must be delegated in order to keep a larger company functioning effectively. For example, work might be done but not billed for. Stock might be ordered but sit on a shelf in a warehouse beyond its expiry date. Staff might take advantage of poor HR record-keeping to enjoy more leave than is due. More sinister problems can also manifest, such as fraudulent transactions which are difficult to detect.

Surprise

Best practice processes may introduce additional steps or they might take out some unnecessary steps from the homegrown ones. Adding steps, in particular, may come as a surprise to the business owner. After all, a ‘longer' process is not likely to be more efficient, is it?

However, the steps in each process are included for good reason, and that reason is typically to introduce and maintain accountability. And it is very likely that one of the factors which influences the decision to implement an ERP solution is to improve accountability - while also driving better business efficiency and management.

About Kevin Clarke

Kevin Clarke is country manager at HansaWorld (www.hansaworld.com), which provides integrated enterprise resource planning (ERP) and customer relationship management (CRM) solutions, together with a wide selection of industry-specific tools, to 70 000 clients in around 90 countries. Contact Kevin on tel +27 (0)12 348 3065 or email him at .

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