With a favorable business climate, state-sponsored apprentice and employee training programs and growing industry clusters of aerospace, information technology, life sciences, automotive and logistics, South Carolina continues to attract industrial investment and manufacturing expansion from U.S. and foreign enterprises.
As these organizations grow and mature, they often seek technology solution upgrades and business improvement projects.
It is at this juncture that enterprises need a proven methodology, a road map to true business process transformation and ROI.
Creating a road map
Much like the core principals of lean manufacturing, business process improvement is about eliminating waste and improving productivity.
The regions manufacturers are wise to follow a road map that offers key guideposts for companies seeking continuous business process improvement, when embarking upon an ERP selection and implementation project.
Guidepost 1: Decide who is in the driver’s seat
As the enterprise is forming a team to lead a business process improvement project, who will serve as owner or Chief Process Officer?
When a process owner directs the initiative, ERP selection and implementation will go better, but process improvement doesn’t end with implementation.
It’s not just about how processes affect business technology systems; it’s also how effective the processes are in a manufacturing facility or in a business function, within logistics, shipping, quality and other functional areas. The business process owner leads the team in identifying all of the business processes in the enterprise impacted by a new solution.
Guidepost 2: Document the current state
In many manufacturing enterprises, business processes have evolved over time and have been passed from one person to another with minimal documentation or analysis. We find that an ERP implementation project is the perfect opportunity to dig deep into how the organization currently performs business processes.
This “current state” documentation helps teams determine ways to use best practices built into the ERP system to streamline their processes.
At a high level, it involves analyzing each business process, developing a process flow, documenting all inputs, processes and outputs, and looking for waste, redundancies, and unnecessary duplicate data entries.
The resulting process flow becomes the tool to identify waste. Moreover, a shared view of the current state may uncover problems that haven’t been identified before. An independent eye often makes the process much more effective.
Guidepost 3: Make the case for education
Following the review and documentation of the current state, the business process owners need to look next at what is possible.
Most users in a manufacturing enterprise are not well-versed in current business process best practices. It’s essential to educate business process owners on “what is possible,” relying on ERP vendors, industry analysts and implementation consultants.
Don’t be tempted to skip this education component and jump right from the current state to a future state. Instead, take the time to see where the documented current state uncovers waste, redundant data, manual workarounds and the like.
Guidepost 4: The future state and the “to be” process
Here’s where the journey gets exciting. This is the phase where the CPO leads the charge to develop improved business process flows.
In visioning workshops, the business process owner reviews waste in current processes, discusses best practices and future system requirements, and develops a “to be” map that represents the desired improved future state.
This phase takes the form of hands-on workshops, which are most effective when led by independent parties.
Guidepost 5: Build the business case
As the “future state” business process is crafted, the process owner asks “how does this new business process improve our company?”
The answer to this question becomes the basis for the business case.
At the end of the journey, the CPO and the process owners present their recommendations to management to prioritize the projects based on ROI, importance to the business plan, and availability of resources and capital. For South Carolina manufacturers, the journey to business transformation via this road map will be a smooth one.
About the Author: Jeff Carr is Founder and CEO of Ultra Consultants, an independent research and enterprise selection consultants firm serving the manufacturing and distribution industries. He is a leading independent voice in enterprise system technology. Jeff’s organizations have helped over 1,200 manufacturing companies transform their business operations. Visit Ultra Consultants to learn more about Jeff Carr and his team. www.ultraconsultants.com