We have all seen lot of material available all over the internet in vendor white papers, research articles and independent blogs about the best practices on improving the ERP implementation cycle in terms of cost, cycle time and return on investment. Most of these articles stop at Go-Live and do not capture the challenges and the opportunities after Go-Live so that the envisaged benefits from ERP can be realized.
If you ask me, I would say that Going Live successfully with the application is the first milestone in the whole business transformation exercise and we still need to not only measure and benchmark the process efficiencies as well as automation levels at fixed intervals to continuously improve them, but also make sure that the changes that have been brought in the organization as a result of the ERP Application Implementation, have gone down well with the users and they also see long terms benefits in switching to this new ERP, leaving behind their favorite legacy systems.
I have tried to capture few challenges and opportunities that we stumble upon after Going Live with ERP that we all should consider so as to reap the benefits to the maximum. Let me first start with the challenges:
- The first and foremost challenge after Going Live is to stop running parallel systems. While few organizations have really matured on this part and wither switch off the entire legacy systems or those functionalities in them that are now available in the new ERP and users are expected to work on them only in ERP, but still a very large number of organizations still do not have a well charted process in this regard. This poses multiple issues, the biggest being division of data in 2 or more applications and the very objective of having one source of truth is defeated.
- Transition of Project Managers. While, all ERP projects have dedicated project managers who go well beyond the go-live to post production support period and make sure that the Live system is stable from bugs perspective before they off board, but often, role and responsibility clarity after that phase, dissolves and there are multiple owners (or shall I say Managers) and very less number of contributors that are needed to take it to the next level of change management, ongoing trainings, user access process, upgrade or enhancement decision processes etc.
Over dependence on support teams for knowledge management. It is often seen that after setting up a vendor team for providing post production support, organizations depend totally on their teams for preparing and updating the user manuals and other soft training material for users and new employees. Though they claim to review the documents before releasing to the business teams but I have my doubts on the review process. Again, not only the ERP documentation but defining the complete process of knowledge management for the process improvements using the application is a challenge.
Independent customizations in multi country rollouts. One of my friends, is working in an European company and they implemented ERP in 1999 and never upgraded after that. The implementation was done in 23 countries across the globe and finally when they thought of upgrading the ERP this year, they came to know that their ERP system is not a standard system any more. Every country has got done some or more country specific customizations in the ERP, making this a bunch of disparate systems that do not offer a standard process. The pain that they are going through now for upgrading the ERP is enormous and it has increased their costs multifold. The challenge here is to keep the standard system, standard enough so that future upgrades are done with minimum costs
ERP is not a magic wand. As soon as we go live with ERP we start expecting it to take over the organization and transform it to a world class organization. We want to be Best in Class as soon as possible, being done so much hard work during the implementation period. Keeping the expectations of business users to realistic levels is another challenge that needs to be addressed.
Likewise there are more Post Go-Live challenges that we all need to consider while making a strategy to realize maximum benefits from your ERP. I do not want to paint a gloomy picture by just highlighting the challenges here. It is not that you only have challenges after Go-Live and ours lives will revolve around them forever. Successful ERP implementation offers multiple opportunities to business beyond the expected benefits. Some of them are:
Standard and predictable process lets you plan future initiatives as well as further improve the process efficiencies
- Improve the KPIs. Now that the as-is values of the KPIs are known to you, it is easier to make desired KPI model by benchmakring with the Best in Class and charting a roadmap to reach there
Rationalize the staff. It provides you with an opportunity to relook at the staffing levels and use them in more productive areas as automation will free up some staffing hours/days
Flank it with Best in Breed Systems. ERP might not be there in its present role for eternity. While ERP will give a standard platform and one source of truth, there are chances that it is not the best system in all areas. It might be the best transaction system (or financial reporting system) but still might need to be complimented with best in breed systems for niche areas like service parts planning, demand driven supply chain planning, procurement auctions or product lifecycle management for that matter. Having an ERP system tells you where you are currently and what do you still miss to reach the pinnacle of success
I have not captured the direct benefits that an ERP will provide to an organization but I understand that these opportunities sometimes look like the benefits (due to a thin line difference between them) only but believe me, you will still need to do some good amount of work to explore these as against the direct benefits that you will get after implementing ERP successfully. Essentially, the challenges are required to be part of our overall Benefit Realization Strategy from ERP and opportunities are the areas which show the way for reaping the by product benefits from ERP.
Learning new tools and technologies has become part of daily chores of any IT professional. There is no way out. Or there is no good reason of why one should not learn new things. I personally am a tech savvy guy and always in lookout of learning new things. The interest is not just to learn things pertaining to data warehouse and BI but everything, which comes on way. The only thing that the new tools/technology I learn should have some fundamentals or concepts to take home.
During this last 6-7 years of being into IT, I have learned numerous theories, technologies, programming languages, tools etc. Most of them were through self-learning. But this self-learning was dependent on all my previous learnings, which I inculcated in the past and without which all this self learning would not have been possible. Today I just picked one more tool/technology to build some understanding on it. I don’t have the access to the software but just the documentation. This is one among few tools/technology I am trying to learn for which I don’t have the access of the software. Though I have hands on extensive hands-on experience on a similar kind of technology by another vendor.
This whole thing lead me to think of how can one approach taking up new tool/technology. Possibly three ways which came into my mind:
1. First hit the document.. get some background. and then come to the tool/hands-on and then again go back to the manuals/references. .. an then back to hands on.. May be over the period doing both things simultaneously.
2. First hit the tool ..let your intuition take over the wheel first.. play around stretch your understanding/intuition… and then come back to references/manual/docs/some text and then back to the tool. Over the period both doing both things simultaneously.
3. First attend some seminar ,some talk, some discussion ( as good as 1 but instead of text you are get into more live things) and then hit the tool may be then back to the manuals tools.. come back to tool/hands-on then go back to discussion and so forth. May be I call it Spaghetti approach. In this approach it could be that you start with Books first and then tools an then talks or any combination.
Which to choose?? Time and availability of resources can give the right call for this.. I keep trying all this approaches. Most of the times approach 2 is a good deal for me. Approach 1 is something we have been trying since the college days. First read about the “c” language, listen some lectures… and then get to the labs for some hands-on. And that was good since one didn’t had so many fundamentals/concepts built up, not so much of exposure to the tools/languages of similar kind. Again like all my postings, there is no need to reach to conclusion of which is better and which not. Depends like everything else. My idea here is just to bring out some points.
Back-to-Back Order is very useful functionality in Oracle Applications.
Key Business Drivers
Lower inventory cycle time
Lower inventory cost
Link supply to specific demand
Can offer a variety of product to customer
Used heavily in contract manufacturing environment where the product is standardized and the company plans to focus more on product design rather than manufacturing
Many times business suffers a loss when data is transferred between quotations, orders, purchase orders or invoices?
Damage to any business due to data loss or corruption is always very high. This can be due to a simple user error or data corruption. During the manual transfer of data, the input of incorrect information or staff errors are very real risks. This can have a profound impact as your business grows and staff are under more pressure to process orders in a market where the client expectation is no longer to have their order processed in days or hours but in real-time.
Back to Back order process allows you to process information and orders in very logical manner ensuring a simplistic and efficient process. The integration between quotations, order processing and stock management means that all orders can be processed in real time and you are no longer dependant on a manual process to be run.
e.g. When the PO is received, reservation gets applied automatically against the Sales Order. This prevents allocating material to some other demand.
The key behind the integration of a system is the ability to seamlessly integrate different pieces of information, this leads us to back-to-back order processing.
The key areas that are focused on as part of the back to back process are:-
Back to back order processing provides an integrated seamless link from the quotation stage, through to the purchasing of stock (or services), to dispatching, delivering and invoicing your client and the receipt and payment of invoices. It is also extended to invoicing (against PO/receipt) and payment to your supplier. All this process is done using Oracle Work-Flow, standard work flow is given by Oracle but if you want you can modify the same to fulfill business needs. Approval processes are also taken care by Work-Flow.
The entire process can be performed in the minimal amount of time without any redundancy. Each document has reference of some other document so it doesn’t get lost in between. Below are the steps in Back to Back order.
Quotations are created and sent to the client.
The client places the order and all required acknowledgements are sent.
Requisitions / Purchase Orders are automatically created for the required stock.
Management of awaiting stock from suppliers.
Tracking and managing supplier and customer communication.
Receiving of stock and handling of part deliveries.
Dispatching the order to your customer with management of delivery locations and methods.
Some of the important documents that gets created automatically through the different stages in this cycle include (automatic creation of document/s depends on setup).
Quotations, Order Acknowledgements and confirmations, Invoices and Proforma Invoices, Purchase Orders, Stock Receipt Slips, Stock Transfer Slips, Dispatch Notes, Packing to name a few.
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Posted in Oracle AR Functional, Oracle Functional, Oracle Receivables Technical, SME Contributions
Tagged 11i, back to bacck order, disptach notes, dropship, invoices, oracle process flow, oracle purchasing, order, order acknowledgements, order management, packing slip, procure to pay, proforma invoices, purchase order, quotations, r12, receive po, requisition, sales order cycle, ship order, shipment, shivmohan, stock receipt slips