We have narrowed down our 15 years of software implementation experience in just a few slides, so that you can avoid the most common mistakes that we have come across. It will take you about 10 minutes to read it and yet may save you 10's of thousands in wasted time and effort.

1. Common Pitfalls in Supply Chain System Implementations V.B-101
Common Pitfalls in
Supply Chain System
Implementations

2. Common Pitfalls in Supply Chain System Implementations
Most companies go in search of the supply chain holy-grail of improved
performance to customers, while improving efficiencies in manufacturing,
inventory turns, and profitability. Billions of dollars have been spent on software
and consulting services for improving demand planning, Inventory optimization,
Sales & Operations Planning, Available-to-Promise, etc. But why do so many
supply chain implementations fail?
It’s been so many years that we have been selling, implementing, and maintaining
Supply Chain Planning systems and all kind of related services around that. So we
thought it would be nice to put together a document to talk about the most common
mistakes companies make in implementing their SCP systems. Now, this is not a
catch-all document but hopefully it will help you avoid major pitfalls, save some
time, and money.
That being said, from both an operational or consulting perspective, there appears to
be a number of characteristics that can help you predict whether a project will be
successful or not. Let’s see…

3. Common Pitfalls in Supply Chain System Implementations
Leadership, Leadership, Leadership,
Plus a little teamwork
When two companies in the same industry implement the same piece of software, with the same
fundamental objectives and data, why can one do it in 4 months and the other in 18 months? It
comes down to leadership and teamwork.
Strong leaders usually have built strong functional teams. When purchasing software, they know
what to look for and have a roadmap developed on how to bring the organization, processes, and
tools together to deliver improvements. The vision and authority of upper management enables the
teams to execute and be successful in every step of the project which usually leads to a shorter
period of implementation time.
Almost all projects that affect the performance of
the supply chain processes affect the organization
Take the
globally (i.e. many stakeholders).
leadership out of the equation and the
common thread is gone. We have seen many
projects where the control of the project is left in
hands of an isolated few (usually with lower
organizational ranks) to determine what the
requirements are, locally. In that case, projects
usually take a long time because the team ends up
implementing to a different set of requirements
than when they started, and try to optimize every
little detail according to their own needs.
Naturally, leading to ridiculously long project time
frames.

4. Common Pitfalls in Supply Chain System Implementations
The software is not a panacea
The Pareto Principle trumps everything in determining supply chain
project success. Simply put, 80% of the value will be derived from
20% of the requirements. One characteristic of projects that take a
very long time is the expectation that the software will solve all
problems, including making up for some inefficient processes and
organizational structure. Remember, “software” enables the process
not the other way around.

5. Common Pitfalls in Supply Chain System Implementations
Data will not improve your supply chain,
In itself!
As the requirements list grows ever longer, the need to
create and maintain ever larger amounts of data grows,
accordingly. Most companies’ data quality is poor--
(No…you are not the only one!). So not having good
control over the scope, and lack of project focus, makes
the data gathering and cleaning task complex and time
consuming.

6. Common Pitfalls in Supply Chain System Implementations
What’s more Important:
Complete Data or Accurate Data?
Complete data is far more important than accurate data. For instance, if we strive to
have accurate data you will never implement a supply chain solution – accurate
data doesn’t exist! Complete data may not be accurate but it enables you
to execute a new process.
Link this with a continuous improvement
methodology and accuracy will improve, processes
will be sped-up, and organizational improvement
will occur. Data needs to be directionally correct to
support decision making – and that is what supply
chain disciplines are all about – risk mitigation
and decision making.

7. Common Pitfalls in Supply Chain System Implementations
Spreadsheets are not a planning system
Spreadsheets are a two dimensional calculator that lead people to
incorrect decision making. When a new system is in, look to eliminate the
spreadsheet-dependency wherever possible. We suggest setting up
continuous improvement forums with planners to understand what they
need and migrate it to the system.
The last thing you want to do is spend large capital dollars on software so
that you can download a result to a spreadsheet and allow planners to redo
the plan. You’ll never know if the system was giving a correct answer--and
your process speed will once again be dragged down.

8. Common Pitfalls in Supply Chain System Implementations
When it comes to models
more detail is not always better
The first impulse that most companies have is
to try and model, as closely as possible, the
manufacturing operations to the point of
individual seconds. Instead, what they
should be looking at is what is the level of
detail required to get to a good solution.
The point is that randomness
exists within processes which can not be
modeled through the planning system. For
example, why model the operation time to
the exact second when you don’t know when
the operator is going to take a break.
Keeping the models at a higher
level while accurately representing the
manufacturing process provides a cleaner
result, and sets the right expectations.

9. Common Pitfalls in Supply Chain System Implementations
Consistency, Consistency, Consistency…
Consistency of the
implementation team is
critical.
Implementations fail
when there is not a clear
view of the design, plan,
and objectives by all
members of the team
throughout the
implementation. In
many cases the team
make-up changes which
results in a loss of
knowledge and
confusion. This leads to
longer implementation
schedules and in
extreme cases full
solution rework.

10. Common Pitfalls in Supply Chain System Implementations
When Testing,
Small and Accurate is the key!
The true purpose of unit testing is often misunderstood. Unit tests should be
used to prove out expected model functionality in a controlled environment.
In many cases, the unit test data set contains a full download of all source data.
This is very difficult to work with, and understand, if all logic is working
correctly.
Instead, small controlled data sets
should be used along with
specific use-cases to examine
functionality results. This is the case
for both the model and the integration.
Once everything has been thoroughly tested
and accepted you should proceed to
integrated testing. This is where
progressively larger data sets should be
used. Take small steps and continue to
move forward; instead of taking a large step,
then three steps backwards.

11. Common Pitfalls in Supply Chain System Implementations
Big Bang Approach Can Explode!!!
When looking at supply chain management, many functions are needed (Demand Planning,
Inventory Optimization, Supply Chain Planning, Factory Planning, Available to Promise, etc.) to
create an integrated supply chain. However, when it comes to implementation a big bang
approach can usually lead to disaster--since this is a complex problem, having too many moving
pieces can be daunting.
A logical rollout in overlapping phases should be used.
For example, Demand Management to create the demand signal, Supply Chain Planning to create
demand sourcing and the statement of supply, Available to Promise to provide real time promise
dates, then fine tuning through the use of factory planning and inventory optimization.
This approach will keep the team focused, and
ensure the end users are not overwhelmed
with process changes that accompany the
software releases.

12. Common Pitfalls in Supply Chain System Implementations
Just because you can
It doesn’t mean you should!
Planning systems may have a number of functionalities that seem cool
at the time, but you need to ask the question are they really needed.
Just as adding too much detail in the models can lead to confusion and
false expectations, adding too much functionality can lead
to confusing results and loss of control. This is not to
say that you should not use enhanced functionality, but rather it should
be closely examined during the design phase to understand what is
needed to support it and how it affects the results.

13. Common Pitfalls in Supply Chain System Implementations
Time in design,
pay now or pay later!
Design is without a doubt the most critical phase of any implementation.
This is where the foundation is set and the plan developed to guide the
implementation effort. Just like building a house if you have a good blue
print execution is straight forward and the result is success, but if the
blue print is put together in a rushed manner you only have two outcomes,
either poor construction or increased schedule and cost due to rework.
The design effort should be well supported by both business and technical
users. In many cases the effort is driven by a technical team only. Where
this occurs, although the solution arrived at may be technically correct, it
may be of little use to the business users--and be seen as a failed attempt.

14. Common Pitfalls in Supply Chain System Implementations
There is no magic bullet here…
In conclusion, to cross the finish-line on a supply chain system
implementation as quickly and as successfully as possible,
remember to keep the scope small, the requirements tight, and
implement a continuous improvement methodology that expands
the software as the process and data matures. You’ll be up and
running in no time and on the path to real supply chain
improvement.

15. Common Pitfalls in Supply Chain System Implementations
Resources:
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