So often on ‘ask the expert’ websites such as Quora you’ll find questions such as “What’s the best ERP software for service organizations?” or IT Toolbox asking “Which ERP software is best for Midsized Manufacturers?“. Same with LinkedIN, I’m sure you could find similar queries on Twitter – probably even Facebook if you were to look hard enough.
Yes the internet is our number one research tool, and we can all find out quite a bit about almost anything – but we have to ask the right questions to get relevant answers.
(Oddly enough, almost all of the answers to the above questions will have at least one response…something like “Managesoft has the perfect ERP package for all manufacturers” – usually written by a junior Managesoft salesboy. Now there’s relevant research!)
So what’s wrong with starting a discussion thread with “What’s a good software…“?
Let’s imagine you’re asking a doctor, “Hey Doc, what’s a good medicine for a slightly overweight 40 year old man?
Hmmm – depends, what’s wrong with the slightly overweight 40 year old man.
Is he ‘slightly over’ his ideal weight, because, like your humble correspondent, he’s built up an overabundance of muscles in preparation for the senior NFL, which is sure to launch any day now?
Or are we talking about overweight of a different sort? Perhaps caused by an overly familiar relationship with Adolph and Augie – as in Adolph Coors and Augustus Busch?
The larger question, are we even talking about his weight altogether?
Perhaps it’s neither over-muscled or over-beered, perhaps he’s simply having trouble getting to sleep – the point is, the doctor cannot possibly know what’s best for the patient until he’s seen the patient, examined the patient, and determined what will actually benefit the patient.
The real answer to “What’s the Best Software…” is: You cannot prescribe to that which you have not first diagnosed.
Just like our differently bellied gentlemen in the above example, businesses have different strengths and weaknesses. Businesses have different competitive profiles, different customer mixes, different business models.
Let’s take our midsized manufacturer question – let’s also leap from the hypothetical into reality and discuss 3 different midsized manufacturers we’ve consulted in the past.
MFG #1 – Consumer Packaged Goods(CPG) with a multi-level distribution channel. They wanted better accounting and reports. Our diagnosis showed we could practically eliminate the #1 labor cost – a phone order placement room dealing with the multi-level distributors – with online order placement.
MFG #2 – Seasonings and Spice company. They were seeking better internal controls. Our diagnosis showed they could cut overtime and eliminate rush orders by using Demand Management to predict customer rush orders – and pre-manufacture partial shipments during production line downtimes.
MFG #3 – CPG manufacturer for big box stores. They were looking for better profitability tracking. Our diagnosis showed an inventory glut of raw materials, with no way for the design team to know what was on hand, so new raw materials were being ordered for each new design. The solution was an online inventory catalog so the sales and design team could create new finished goods using existing raw materials.
So – to review – three midsized manufacturers – their answers:
- Online Order Entry
- Demand Management
- Inventory Management
Each of these came from different software publishers that offered ERP for mid-sized manufacturers – but all were vastly different. Pricing ranged from $200k – $800k – and in each case, the software paid for itself within the first 18 months of go-live – in one case, within 3 months.
To backtrack further, MFG #1 actually found it made sense to expand their original software budget by 10x to get into a situation where they could save 22x in labor costs.
There’s two things to note in the final analysis.
First – while each of these programs had some form of all three of the features, the ultimate selection really excelled at the relevant feature, and went deeper in functionality within that particular feature.
Secondly – the feature that would ultimately “pay-off”, that is, generate the greatest ROI (Return On Investment) was not something that the manufacturer initially sought, nor even had any inkling that ERP could provide.
So I suppose the real answer to “What’s the Best Software” is, “It looks like what you really need is a Software Consultant.”
Darn. Promised not to end in a shameless plug.
Contact me at firstname.lastname@example.org if you need more information – We’ll be glad to personally attend to customers within our areas of expertise or refer you to relevant consulting firms otherwise.