30 May 2011

The Power of Enterprise Resource Planning In A Post-Recession World

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Recently, we’ve shared quite a bit of content pointing to manufacturing recovery. And while these signals are notable, from increases in manufacturing output to more consistent job growth, many manufacturers I work with still see these signals as fuzzy at best.

Below, I’ve turned to Bob Aronson, Industry Director – Microsoft Dynamics Manufacturing, to share his take on the still somewhat unclear manufacturing recovery outlook – and to offer his insight regarding how enterprise resource planning – and enterprise resource planning software – can help clarify this picture:

If you work in the Industrial Equipment Manufacturing (IEM) industry, you no doubt feel as though you live in a world of contraction:

- The recession is over.  And yet, difficult cost-cutting measures are still very much in effect.
- Increasing customer demands must be met with greater response than ever.  And yet, they must be met with lower headcount.
- Best-in-class Enterprise Resource Planning (ERP) software can help significantly reduce costs and improve efficiency.  And yet, it’s difficult to secure the cost approval necessary for upgrades.

Earlier this year, I was quoted in an article published by Manufacturing Business Technology titled The Effect of the Recession on IEMs, by Cindy Jutras, Vice-President, Research Fellow & Group Director, Aberdeen Group.

Along with representatives of several other ERP software providers, I commented as to how Microsoft Dynamics is paying close attention to the IEM industry – the industry perhaps hardest hit by the recession – through more cost-effective solutions designed specifically to meet the complex needs of manufacturers.

While costs incurred today will certainly be a factor behind any business decision made by IEMs (see my first bullet above), as a software provider, we know that a sole focus on costs would leave us offering far too short sighted a solution.  And for an industry that represents so much of the foundation of our economy, this is not a scenario we feel is acceptable.

As we prepare to roll-out Microsoft Dynamics 2012, our focus has been as much on future-proofing our ERP solution as it has been on making it affordable for companies operating in a post-recession world.  In doing so, we see our ERP software as helping to eliminate the three initial contradictions we lay out above:

Difficult cost measures are still in effect after the recession As noted, Microsoft Dynamics is designed to be a cost effective ERP software solution that can be implemented today for significantly less than most competing software.  For more on cost, download the Microsoft Dynamics video case study to the right, illustrating the success of global manufacturer Met-Pro, and showing how our ERP solution compares against eight figure competition.

Increasing customer demand must be met with lower head count Working with a smaller team – whether your operations stretch domestically or globally – means maximizing the efficiency of everyone on your team.  And efficiency doesn’t happen if more time is spent looking for project or customer information in disparate software systems than is spent on R&D or customer support.An investment in enterprise resource planning software is an investment in everything from global project visibility to seamless flow of information.  This can quickly transform into a more efficient team, smoother operations – and of course – faster time to market and correspondingly higher revenue potential.

Securing cost approval for an ERP investment is difficult despite the cost-saving benefits If you find yourself impacted by this contradiction – you are not alone.  A recent Forrester survey indicates that nearly 72% of current ERP customers do not plan upgrades in 2011.  If you are among this 72% – you are missing out on quantifiable benefits.  As enterprise resources planning software evolves, it scales to meet the needs of companies.  Just some of the recent enhancements to ERP software include enhanced ability to integrate with Product Lifecycle Management (PLM) systems and assimilation of consumer oriented technologies – from social to mobile. Better yet – most of these upgrades can be completed for low to minimal cost.In the interest of helping compel overall industry recovery, I would encourage any IEM leveraging an ERP software deployment to consult with their rep regarding upgrades. In the interest of the spirit of competition, I would encourage you to jump ahead of more than 70% of the competition in securing these upgrades this year.

Our recession and recovery represents perhaps the greatest struggle I have ever been witness to in my time working with manufacturers – and I am fully aware that software alone is not a magic pill.  But what the right ERP software will do is clarify the light we see at the end of the recovery tunnel – a light that can still be frustratingly fuzzy.

 

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Luciano Cunha,
Luciano Cunha,
Chief Executive Officer (CEO)

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