pains and desires of the customer on the way to full automation

Why sometimes there are difficulties with the sale of ERP systems to enterprises, plants, factories? Why, it would seem, at first interested in complex automation, the CEO or the owner of the company suddenly back up and refuse to implement ERP? And how to deal with objections in this case? Let’s talk about this today.

“The use of ERP systems significantly improves the quality of organization management”, “the system is easily customizable for various business processes”, “ERP systems are simplicity, transparency of access to all data” – all these are excerpts from numerous publications about ERP. For many years, business leaders have been introducing themselves into the minds that ERP is effective, simple, easy and, in general, magical. Not only the press addresses them with such a message, but also representatives of the implementation companies come, many of whom (or even all) like to paint mountains of gold and draw perspectives on how great business will be when the enterprise has an ERP system. And yes, everything will be so or something like that, but an important point that should be honestly indicated to the client is that at first the enterprise will have to go through pain. And this pain will be either strong or very strong. Because the process of introducing ERP in the realities of Russian business is in many cases comparable to surgical transplantation, and then also to long-term rehabilitation therapy after it: first, you should cut off everything that does not function well and interfere with the vitality of the body, then establish vital processes, introduce high-tech a system that works like a clock, and only then learn to live with it and use it effectively.

Causes of pain in preparing for ERP implementation

The main reason is that business is conducted “on paper”, without well-built business processes, as they used to do for years. Much depends on the specific people on the ground, and if a person suddenly quits or falls ill, the system can collapse. For example, at the warehouses of enterprises (if the warehouse is not automated) there are often workers who just know from memory where they have what is “supposed”, and without the presence of such a responsible person, no one will ever find anything in this warehouse, or search for something necessary will take a lot of time and nerves.

And here are 3 more additional reasons, which, as a rule, follow from the main one:

1. Technological processes of production are not always clearly spelled out at enterprises to all the smallest details. Therefore, when automating production processes, you will have to refine the descriptions of everything that does not yet exist – to prescribe in detail the components of all products and think over everything that was somehow allowed to go by itself. For example, to determine how the production process of a large unit will unfold through all the necessary stages of production, by semi-finished products and by days, how much time should be spent on the manufacture of all the components that will eventually make up the finished product. It is such a detailed, descriptive and well-thought-out process that will allow you to effectively automate production planning and production processes using ERP.

If earlier it was possible to work in production approximately, approximately, then automation requires the clarity of the technological chain – and the creation of such a correct detailed diagram for a number of managers is a real pain.

2. Labor resources are an acute problem. Some employees cannot work in a new way due to low professionalism, due to age, psychological reasons, while others frankly do not want and even resist. A person, as a rule, is inclined towards stability, to maintaining the usual comfort zone, even if it is not very comfortable comfort, but this is what he is. And all those implementers, digital transformers who come to the enterprise and seek to change a lot on it, are perceived as outright enemies. And if this point of view is conveyed to the initiator of automation (for example, to the general director or the owner of a plant) from the side of his entourage, whom he trusts, then it is easier for the manager to refuse to implement ERP than to start a revolution against the employees of his own enterprise. Because wars, intrigues, undercover games are intense pain.

3. Lack of correctly spelled out (and not formally) job responsibilities and clearly defined work processes. When the head of an enterprise wants to divide according to technological operations what needs to be done, how many hours will be spent, with the possibility of entering performers into the ERP system so that you can see who “screwed up” or who does this or that product so well, then there is a great responsibility falls on the HR department, and for some HR managers it is a pain.

Due to these very common “causes of pain”, the CEO or the owner of the enterprise suddenly realizes from his own experience that, perhaps, the introduction of ERP will bring him many preferences, but somewhere in the distant future, and abandons this decision. Since now he is not ready to spend a lot of effort, energy, nerves to establish business processes, while being aware of his mistakes and omissions – after all, all this is very painful, and he was promised that it would be easy and simple.

What about ERP implementation in this case? How to deal with customer objections? How can you help them overcome pain?

“Through hardships to the stars” or what the business really wants from ERP implementation

Let’s start with the fact that when communicating with the leaders of the customer companies we will be honest, we will not promise them that automation is “easy and simple”, and together with them we will aim at serious work that will require the establishment or building almost from scratch of all necessary business processes in the enterprise. Otherwise, customers who succumbed to persuasion and believed that happiness is very close, and when implementing ERP, at the push of just one button, they will see a lot of useful analytical reports, agree to pre-project work, but soon they will inevitably face the pain that we are talking about above. told in detail, and will refuse to continue. Those. it is very important to initially say that the automation of the enterprise management system will require this very system to be seriously modified.

At the same time, the absence of well-built business processes and so every day brings pain to the director of the enterprise, which he knows about, and this is what we need to talk with him in his language – that his pain must be treated, otherwise it will lead to dire consequences. And yes, sometimes the doctor is forced to inflict some pain on the patient, but with a good purpose, so that he gets better and gets stronger. There are also business consultants who customize the business processes of the enterprise, and then only implement ERP.

What is important for the head of the enterprise to get from the implementation of ERP?

Of course, each director will have his own needs depending on the specifics of the business, but 5 main, so to speak, common desires of all managers can be distinguished:

1. Manage the cost of your products and form a fair selling price in order not to sell products at zero or at a loss, but only with a profit.

As one director of the plant told me, “We need the concept of cost to realize our own profitability, because, most often, we agree on the price of a product in advance, and we have clients to whom we have to ship our products in 6-10 months according to the already determined the price, but the most interesting thing is that now we do not have this product, and we do not know what its cost price will be at that moment, whether we will earn or burn out at the price ”. And if you can help the director solve this real pain of his by implementing ERP, he will be ready to both change his business processes and go towards automation.

2. To minimize losses, for which it is necessary to organize the optimal filling of labor and material resources. No manager wants his workforce to stand idle because of a shortage of parts or delays in deliveries, because workers still have to pay wages. The directors strive for an even workload of personnel, it should not be that all week at the production rush, and then two weeks of downtime. “I want to quickly know with the help of automation how many hours my employees work and how much they earn, because the amount of time spent only on calculating wages for my foremen takes 2-3 days!” – this is the real pain of one of the directors of the enterprises.

The ERP system allows you to deal with this problem – to correctly distribute employees to areas so that they do not stand and wait for work, immediately calculate their norm-hours, and effectively plan the flow of material resources into production. All this determines the production capacity of the enterprise, which can be systematically increased.

3. Effectively plan production processes. It is important for enterprise managers to know and understand when and which section should make this or that semi-finished product or some kind of production stage. Knowing this, they can plan production processes, understand what needs to be purchased and what the company can make on their own, comply with the terms of production of products and the production schedule. ERP is an abbreviation in English of the phrase Enterprise Resource Planning, which translates as enterprise resource planning, i.e. an ERP system can certainly help with this.

4. Plan orders and be able to competently reschedule them if necessary. As practice shows, re-planning in production happens – even in one day, information can change 2-3 times. It is important for the director to know under what options it will be possible to reschedule and how to do it most effectively. Dealing with this manually is difficult, time-consuming, and correct management decisions do not always come to mind. If the ERP system helps to see all this, issues analytical reports and allows the director to make competent effective management decisions, then the head’s pain is removed.

5. Manage work with suppliers, purchases and purchase prices that would not go beyond the planned cost estimate. Directors are often worried about the question, why did the target price rise? Has a specific supplier raised it, or, for example, has the price of metal increased in the entire market? Is the increase in purchase prices the negligence or malicious intent of a particular employee at his enterprise? Directors must and want to understand all this in order to draw conclusions – to change the supplier or increase the purchase price? They also want to motivate their purchasing staff, to set them a task – the lower the purchase price, the higher the premium. Automation allows you to track purchase prices online, as soon as a price higher than the planned cost estimate is entered into the system, this is immediately noted in the program, and the issue with the supplier can be resolved promptly.

These are the 5 main desires of business leaders that constantly bring pain to them in their daily manual work. Automation with the introduction of ERP systems allows you to establish all these processes and fulfill the wishes of the manager. This path is not easy, painful, but in the end it really will lead the company to increased productivity, increased profitability, making it competitive and profitable. And this is no longer pain, but joy – as they say, “through thorns to the stars.”

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