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Extracting Value from ERP

One of the first questions your customers are most likely to ask themselves when buying a new ERP system is “Is this good value?” Keeping costs down is critical to business, but with the advent of Industry 4.0 and the Internet of Things, the more important question perhaps is, at what price?

Comparing one ERP system with another, like a price comparison website, is one way of doing it. You can decide on the model you want, add in any extras and compare it with similar systems. But value is not so easily defined in terms of cold hard cash.

Of course at K3 Syspro, we are confident we give good value for money to our clients because we know it to be true. But look up the dictionary definition of value and you will see a number of options. The verb “value” is about estimating the monetary value of an object. The noun “value” talks about the usefulness of something, the importance or worth.

It’s the added value of our ERP systems which we believe is the real worth to our customers. As well as helping our customers to settle in with the new systems, our team are on hand to provide training. We also help your staff understand just how powerful ERP can be in terms of information and data collection.

Adding value to your business is what you want from any new purchase. It may well be the ROI (Return on Investment), although sometimes that isn’t apparent right away. Instead, the added value, we suggest, is more about the long term benefits and the changes and advances which can be made to your business.

Look at it like this. You are a manufacturer. You want better stock control. Your customers expect to know where their product is in your system at any time. You want to be able to tell them. The K3 Syspro ERP system can do just that. It is about developing and delivering excellent ERP systems for manufacturers and distribution companies and one aspect of that is about being in control.
The added value, of course, is knowing you are in control and will make your customers feel more confident in your services and products. They can relax knowing you have everything taken care of. Why? Because they can let their own customers know exactly what is happening, where and when. You don’t want to be the weak link in the supply chain who doesn’t know what is going on.
The result is you have now added value to your customer. They to theirs and on it goes…

Value Chains
Adding value all along the chain is just what Michael Porter was getting at in his best-selling book Competitive Advantage: Creating and Sustaining Superior Performance. He introduced the idea of a value chain, urging companies to see manufacturing as a system of activities or processes that are interconnected, influencing value individually and collectively. Processes all have an input (materials, labour, equipment and so on), a transformation step, such as machining and assembly, and a finished output – which is frequently the input to another link in the value chain.

But the concept extends far beyond the individual company, because its own system of processes is normally part of a whole supply chain, including anything from raw materials sourcing and logistics to end product distribution networks.

The key point here – and the reason that ERP software is so effective – is that studying value chains becomes a vital strategic business management tool, when information is readily available and analysed on all the elements in a value chain.

So let’s have a look at what adds value:
• Streamlining your information means you can enhance productivity. With stock control for example, you don’t want to either over order and let it sit in your warehouse or under order and have customers screaming out for parts or products you can’t supply. It minimises cash tied up in “dead” stock.

• Support for lean manufacturing allows factory scheduling to manage the supply chain and identify and correct potential problems. The K3 Syspro system provides full traceability through all transactions. Even niche manufacturers are having to embrace automation and big data. We can help you avoid being left behind by the competition.

• Data collection is vital, but using that information goes one step further towards Industry 4.0. By having real time data collection you can make faster and better decisions. No need to have to wait for a weekly report. Understanding costs and integrating your supply chain will help you and your customers and suppliers.

• Just in Time (JiT) manufacturing means you need to be able to move fast and accurately. You also need to identify any errors in the production process even more quickly than with the normal manufacturing procedure. ERP lets you find faults immediately through real time reporting. It also means you don’t have to throw away a whole batch because the accuracy of the report allows you to pinpoint the error.

• Integration into your current systems or a staged add on will add value to your business especially if you are at the start of your company’s journey. K3 Syspro’s ability to integrate its ERP on to your system means less disruption for staff and customers. Adding value while you continue what you do best – run your business.

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