WHITE PAPER

THE 3 THINGS MISSING

FROM YOUR ERP
SYSTEM
November, 2015

By Rick Veague
Chief Technology Officer, IFS North America

HIGHLIGHTS

P1
A recent study identified three
types of modules most likely to
be missing from ERP systems:
project capabilities, preventive
maintenance and document
management.
P2
Almost all manufacturing
companies have the need to
manage individual projects to
some extent. It’s important to
ensure not only that an ERP
system has those capabilities,
but also that the solution has
the depth to handle tasks
beyond basic appointment
scheduling.
P3
Preventive maintenance
capabilities are critical to
success in the manufacturing
industry. A fully integrated
preventive maintenance
solution offers visibility to all
stakeholders without double
entry of data or complicated
interfaces.
CONTENT

PROJECT CAPABILITIES................................................................................................ 1

PREVENTIVE MAINTENANCE......................................................................................... 3

DOCUMENT MANAGEMENT .......................................................................................... 4

CONCLUSION............................................................................................................... 5

ABOUT IFS................................................................................................................... 6
 THE 3 THINGS MISSING FROM YOUR ERP SYSTEM

THE 3 THINGS MISSING FROM YOUR

ERP SYSTEM

ERP systems work best when they are designed to function as a single integrated
solution that serves the business needs of every department within a company. A recent study identified
While many ERP systems support the core functionality needed by most depart- three types of modules
ments, many don’t include components that later turn out to be crucial for a com- most likely to be missing
pany’s needs. It’s often not until a system is implemented that a company realizes from ERP systems: project
the hidden gaps in their solution. capabilities, preventive
maintenance and
document management.
In conjunction with Manufacturing Business Technology, IFS recently
conducted a survey to assess the types of modules most likely to be reported
missing from existing ERP systems. The three most common modules missing
were:

• Project capabilities. 53 percent of companies reported this module missing.

• Preventive maintenance. 48 percent reported this missing.

• Document management. 47 percent reported this missing.

When companies are able to utilize these functions as part of a fully integrated
ERP solution, they can achieve a higher ROI, recognize that ROI more quickly,
and gain the depth of visibility needed to make the best business decisions.

PROJECT CAPABILITIES
While the project capabilities needs of different manufacturing businesses can
vary widely, almost all companies have a need to manage individual projects to
some extent. Manufacturers that create one-of-a-kind items definitely have
that need. For example, a company may manufacture a complex valve assembly
that goes into a pipeline. It’s the only valve like it in the world, designed to
work inside a pipeline that’s the only one like it in the world. Its dimensions,
shape, connectors and specifications are going to be unique to this one project.
It’s going to have to be engineered and manufactured to a very specific set of
criteria.
There are a lot of steps that go into making this happen. A company first
gets its engineers involved, who might start by creating designs. Then someone
else decides what materials will be needed, then someone maps out which tooling

1
 THE 3 THINGS MISSING FROM YOUR ERP SYSTEM
You may think your
company doesn’t fall into
the “project manufacturing”
category. But even
repetitive manufacturers
would be wise to consider
an ERP system with project
capabilities.
2
is needed, and so on. Prototypes are often made, tested, and reviewed resulting
in engineering revisions. Customer specifications change. All of these steps
have costs and time associated with them, and each one impacts the delivery of
that valve assembly, on time and on budget or otherwise.
ERP systems with true project capabilities act as an umbrella that gathers
together all the details of these activities into one global, top-down view that
allows you to see all the different elements: time, cost, materials, labor and
contract compliance. By forecasting forward, they can also allow you to deter-
mine the possible implications on all the other projects going on. For example,
if management decides that additional employees need to be put on a project in
order to complete it on time, that decision has the potential to impact other
projects.
Excellent and comprehensive ERP solutions give all stakeholders involved
visibility into cause and effect and possible unintended consequences. They
allow you to see where you are and where you aren’t, and enable you to make
intelligent decisions about how to balance resources between projects. For
example, which project would it be safe to delay, which one has the larger
contract penalty, or which customer is more important.
You may think your company doesn’t fall into the “project manufacturing”
category. But even repetitive manufacturers would be wise to consider an ERP
system with project capabilities. Everyone does projects to some degree. Even
standard product manufacturers bring out new types of products and new
packaging, or they buy new tooling and invest in new manufacturing technology.
All of those initiatives would benefit from being handled as a project.
The businesses that benefit the most from project capabilities, however, are
the ones that focus on project-based work. If yours is a project-based organi-
zation and you don’t have project capability in your ERP solution, you’ll
never get the value that you should be getting out of your system. Somewhere
during the process of managing your different projects, you’ve got to track all
the details discussed above in order to run your business. If you’re not tracking
those details in your ERP system, and instead are relying on some other
piecemeal method to manage the project, you won’t be realizing all the bene-
fits you could.
It’s also important to think about the depth of the project capabilities in
any given ERP system. Some ERP systems offer project management function-
ality on a very limited basis; perhaps they can do some very basic project
scheduling or can interface with a different project management application.
Those may give you the illusion of having some project control, but if project
management functionality is not in the DNA of the application, you lose that
project-centric visibility you need to run your business successfully.
 THE 3 THINGS MISSING FROM YOUR ERP SYSTEM

PREVENTIVE MAINTENANCE
If you’re a manufacturer, you have machine tools, and those tools need to be A machine has to be
serviced, or they break. When they break, production stops, and when produc- serviced every three
tion stops, you stop making money. Preventive maintenance of tools and months or 500 hours. You
equipment is a critical factor in your business’s success. Unfortunately, many might know when three
ERP systems don’t provide routine maintenance functionality. Managers in months is up and service
companies whose systems don’t handle routine maintenance often track the it at that point, but what if,
information manually in spreadsheets or using a separate standalone package. just due to the nature of
However, unless you double enter a lot of data or build a lot of complicated the machine’s recent
interfaces, whatever information is input into those systems never connects workload, it had only been
with what your machines are actually doing. used half as much as
Here’s a simple example: A machine has to be serviced every three months
previously? That means
or 500 hours. You might know when three months is up and service it at that
you really might not have
point, but what if, just due to the nature of the machine’s recent workload, it
to service it for another six
had only been used half as much as previously? That means you really might
not have to service it for another six weeks, but that information isn’t connected
weeks, but that information
to your manual tracking system, so you go ahead and service it anyway, wasting isn’t connected to your
a bunch of money. manual tracking system, so
Another example of how a standalone or manual system may be doing you you go ahead and service
a disservice: A manager makes a decision to take a particular machine down it anyway, wasting a bunch
for service. If that information isn’t visible to the manufacturing solution, then of money.
it expects to have eight hours of capacity run, and will fully schedule the
machine. Now the schedule is inaccurate and production is behind.
A fully integrated preventive maintenance solution provides visibility into
the needs of all sides of the business without any double entry of data or
complicated interfaces. It knows what the maintenance schedule is, but it also
knows how much each asset is actually being used. Combining those two pieces
of information can help you make decisions about whether it’s OK to safely
defer maintenance. Systems with the ability to gather data directly from the
machine through the Internet of Things (IoT) take it a step further. For
instance, if a machine is able to communicate to your ERP system that it’s
been running harder than the duty cycle would normally call for, you can
make the decision to maintain that machine more often to avoid an unplanned
breakdown. Similarly, if the machine is only running at half its duty cycle, a
decision can be made to defer maintenance and save the money that would
have been wasted taking it down before it needs to be.
If preventive maintenance is part of the ERP solution, work orders to do
the maintenance become just another work order to be scheduled like any
normal production order. The preventive maintenance work consumes part of
the asset’s capacity so the manufacturing system knows that it only has four

3
 THE 3 THINGS MISSING FROM YOUR ERP SYSTEM
While it’s important to
consider document
controls, it’s also important
to look at how your
processes handle where a
document is used.
4
hours of availability on a certain day, because four hours is already blocked off
for the maintenance job. No one is caught unaware or is forced to deal with an
unexpected scheduling issue.
Bottom line, using a preventive maintenance function that’s part of the
same system as your manufacturing solution offers the potential for a much
higher return on investment than you’d get tracking maintenance activities on
a spreadsheet or using a standalone maintenance package.
DOCUMENT MANAGEMENT
At its core, document management is the ability to collect and control files.
Documents typically need controls around who is able to view, edit and create
them. Control also usually includes an approval process for a company’s docu-
ments that, depending on the document, can be fairly simple or very complex.
There’s also access control, so the document owner and others can see who
else has been looking at a document. Most document management packages
can handle the basics, but not all of them do it really well. Most ERP packages
have the ability to collect documents, but can be more limited when it comes
to the controls for authoring, approving, distributing and controlling access to
documents.
While it’s important to consider document controls, it’s also important to
look at how your processes handle where a document is used. For example,
say you have an engineering drawing of a part but if that drawing isn’t housed
in your ERP solution, then you have to leave the ERP system and go in to the
engineering system or standalone document management system and get it.
But what are the odds you got the right document? Or what are the odds you
got the wrong version of the right document? If you did, there’s a high
likelihood that you’ll end up making scrap.
When you have a document management solution that’s integrated with
your ERP, not only do you have a vaulting and control mechanism, but you
also have the possibility to logically connect a revision of a document to some-
thing else in the database like a bill of material or a part. You can access the
documents you need without having to set up a lot of complicated integrations,
rules, synchronizations and multiple copies. They’re just right there, when you
need them.
Document management becomes increasingly challenged when you start
talking about global solutions. With most document management packages, if
you check a document in, it goes into a database on the server. If you’re in a
remote location and want to see this document, and the server is located in a
different country, that document has to travel through the network and show
up on your local workstation before you can open it and begin working with
 THE 3 THINGS MISSING FROM YOUR ERP SYSTEM

it. If you’re in an office with a slower network connection, it could take a

significant amount of time for that document to travel through the global net- ERP systems can do some
work. Of course, while it’s doing that, it’s consuming all the bandwidth that amazing things, and when
people are trying to use for their other daily work. companies first start the
Some ERP systems use document visualization technologies that streamline process of evaluating new
and speed up access to needed documents. In those systems, when you open solutions, it’s easy to get
the document, it doesn’t actually move through the network onto your local wowed by new
workstation. Instead, it opens on a virtual window on the server so you can functionalities that you
see it, but you don’t have to move it through the network. If you don’t need may not have been aware
an actual copy of the document, and instead only need to access it for casual
even existed.
viewing or assessment, document visualization can conserve your bandwidth
and support global implementations much more readily than more simplistic
document management solutions.

CONCLUSION
ERP systems can do some amazing things, and when companies first start the
process of evaluating new solutions, it’s easy to get wowed by new functional-
ities that you may not have been aware even existed. Don’t lose sight of the
modules that have the potential to make a true difference in the way your
company does business. It’s important to keep in mind not only the tasks that
your company is engaged in right now, but also the types of projects your
team members may be handling in the future as a result of either growth or
changing business dynamics. Project capabilities, preventive maintenance and
document management are essential functions that should be included in any
ERP solution your company considers.

5
 ABOUT IFS
IFS is a globally recognized leader in developing and delivering
enterprise software for enterprise resource planning (ERP), enterprise
asset management (EAM) and enterprise service management (ESM).
IFS brings customers in targeted sectors closer to their business,
helps them be more agile and enables them to profit from change.
IFS is a public company (XSTO: IFS) that was founded in 1983 and
currently has over 2,700 employees. IFS supports more than 2,400
customers worldwide from local offices and through a growing ecosystem
of partners.

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