Why your ERP is NOT delivering and HOW to FIX it - by Dr James A Robertson -- the ERP Doctor

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One hour conference presentation regarding the major factors that give rise to ERP investment failure and how to achieve success

Defines some fundamental principles that are of vital importance to any organization that is implementing or operating any Business Information System

See http://www.James-A-Robertson-and-Associates.com/ for more information

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  • NB remember to have a chair to stand onMake sure to take the CRITICAL FACTORS BOOK with you An engineer with a PhD in engineering
  • In considering what i have learned as an engineer with considerable experience of the practical application of information technology i eventually realized about ten years ago that ENGINEERS DO NOT DESIGN BRIDGES TO STAND UP – click
  • Who remembers this bridge collapse in Minneapolis in the middle of 2007? Within minutes it was front page news around the world – we do NOT expect bridges to fall down – if we did there would not have been anyone on that bridge that day!
  • There is a fundamental difference in approach when one designs a bridge NOT TO FALL DOWNContrast this with the IT paradigm which could be called “designed to fail”
  • KEEP SHORT AND SIMPLEMY FATHERHow did i get involved with computers? – my father was a visionary -- In 1981, having gathered over 7,000 pages of research data for my PhD the University mainframe did not have space to store even one page of data. My father purchased me one of the first desktop PC’s in the days of the Apple and Apricot and 123, etc – at a cost of R12,000 two and a half times my research grants! – I very quickly discovered that there was a HUGE gap between what the salesman told me the computer could do and getting it to do it – so, in that respect, NOTHING HAS CHANGED  -- I then put myself through a self taught computer science programme and learned to program, learned to type and finally wrote an award winning PhD thesis – at the same time I computerized my father’s investment consulting business and we were able to double turnover in twelve months and create an enduring revenue stream that lasted for over ten years because we were able to do things that much larger businesses were not able to do – it was then that I began to understand that the strategic application of information technology COULD deliver great value and one of my greatest frustrations is the extent to which few businesses achieve this potential – the rest of this presentation is about lessons I have learned that I hope will help YOU to make a difference in your business with IT
  • KEEP SHORT AND SIMPLEMY FATHERHow did i get involved with computers? – my father was a visionary -- In 1981, having gathered over 7,000 pages of research data for my PhD the University mainframe did not have space to store even one page of data. My father purchased me one of the first desktop PC’s in the days of the Apple and Apricot and 123, etc – at a cost of R12,000 two and a half times my research grants! – I very quickly discovered that there was a HUGE gap between what the salesman told me the computer could do and getting it to do it – so, in that respect, NOTHING HAS CHANGED  -- I then put myself through a self taught computer science programme and learned to program, learned to type and finally wrote an award winning PhD thesis – at the same time I computerized my father’s investment consulting business and we were able to double turnover in twelve months and create an enduring revenue stream that lasted for over ten years because we were able to do things that much larger businesses were not able to do – it was then that I began to understand that the strategic application of information technology COULD deliver great value and one of my greatest frustrations is the extent to which few businesses achieve this potential – the rest of this presentation is about lessons I have learned that I hope will help YOU to make a difference in your business with IT
  • An industry in Crisis -- Quote from Duncan McLeod, Financial Mail, 28 March 2008 -- Seven years and half a billion dollars -- Dow Chemicals Company -- $400 million – Nike -- Disney -- $878 million -- 70% of business IT projects fail outright – another 20% materially fail to meet the business expectation – 70% of BPR projects fail and 90% of strategic plans fail to deliver
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • There is a fundamental difference in approach when one designs a bridge NOT TO FALL DOWN
  • What is not an engineering approach? – Dramatically walk to chair – did this ever happen to you? –WHEN SLEEPING when i was a child i used to dream that i would stand on a chair and flap my arms and fly around the room --i have to say that that is NOT an engineering approach – as much as i may be convinced i can fly i have to say to you that were i to stand on top of a skyscraper and flap my arms and jump i would hit the ground at great speed and almost certainly die – that is NOT an engineering approach and yet many seem to think they can use software to do things magically – many are hypnotized and mesmerized by IT – are you? CLICK for rabbit out of the hat
  • What is not an engineering approach? – Dramatically walk to chair – did this ever happen to you? –WHEN SLEEPING when i was a child i used to dream that i would stand on a chair and flap my arms and fly around the room --i have to say that that is NOT an engineering approach – as much as i may be convinced i can fly i have to say to you that were i to stand on top of a skyscraper and flap my arms and jump i would hit the ground at great speed and almost certainly die – that is NOT an engineering approach and yet many seem to think they can use software to do things magically – many are hypnotized and mesmerized by IT – are you? CLICK for rabbit out of the hat
  • What is not an engineering approach? – Dramatically walk to chair – did this ever happen to you? –WHEN SLEEPING when i was a child i used to dream that i would stand on a chair and flap my arms and fly around the room --i have to say that that is NOT an engineering approach – as much as i may be convinced i can fly i have to say to you that were i to stand on top of a skyscraper and flap my arms and jump i would hit the ground at great speed and almost certainly die – that is NOT an engineering approach and yet many seem to think they can use software to do things magically – many are hypnotized and mesmerized by IT – are you? CLICK for rabbit out of the hat
  • Professor Richard Nolan states that "I.T. is the next corporate disaster waiting to happen”And postulates that soon there will be an Enron level corporate failureDo you remember Fedsure Health – tell the story SHORT
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • Analyze all the parameters and attributes that associate business knowledge and intelligence with each item and structure these codes and logicAdd additional fields (columns) to the item master table if necessary to classify items for Fraser Alexander’s unique requirementsSpecify custom software that encapsulates the logic of the coding scheme, business rules around the scheme, default attributes at each level of the hierarchy and other facilities to ensure high precision in adding item codesAppoint a part time Information Manager with a professional qualification to exercise quality control over the data
  • DHL, Prochem,
  • KEEP SHORT AND SIMPLEMY FATHERHow did i get involved with computers? – my father was a visionary -- In 1981, having gathered over 7,000 pages of research data for my PhD the University mainframe did not have space to store even one page of data. My father purchased me one of the first desktop PC’s in the days of the Apple and Apricot and 123, etc – at a cost of R12,000 two and a half times my research grants! – I very quickly discovered that there was a HUGE gap between what the salesman told me the computer could do and getting it to do it – so, in that respect, NOTHING HAS CHANGED  -- I then put myself through a self taught computer science programme and learned to program, learned to type and finally wrote an award winning PhD thesis – at the same time I computerized my father’s investment consulting business and we were able to double turnover in twelve months and create an enduring revenue stream that lasted for over ten years because we were able to do things that much larger businesses were not able to do – it was then that I began to understand that the strategic application of information technology COULD deliver great value and one of my greatest frustrations is the extent to which few businesses achieve this potential – the rest of this presentation is about lessons I have learned that I hope will help YOU to make a difference in your business with IT
  • You understand the technology well enough to manage itVERSUS ABDICATION / DISEMPOWERMENTFASTComputers are simply adding machines or switches that switch left or right – 0 or 1 – on or off – called binary – they just do things very quickly, everything you see is a pattern of 0’s and 1’s – a very fast Abacus – the content is always the same – binary code -- source code is simply instructions for the bricklayerWordprocessors are typewriters -- The typing story – so why do you want to spend thousands of Rands upgrading your typewriter every few years? -- Databases are filing cabinets or warehouses -- General ledgers are large books that book keepers write in – networks are postal systems – large frame pictures cost a lot and take up lots of space
  • You understand the technology well enough to manage itVERSUS ABDICATION / DISEMPOWERMENTFASTComputers are simply adding machines or switches that switch left or right – 0 or 1 – on or off – called binary – they just do things very quickly, everything you see is a pattern of 0’s and 1’s – a very fast Abacus – the content is always the same – binary code -- source code is simply instructions for the bricklayerWordprocessors are typewriters -- The typing story – so why do you want to spend thousands of Rands upgrading your typewriter every few years? -- Databases are filing cabinets or warehouses -- General ledgers are large books that book keepers write in – networks are postal systems – large frame pictures cost a lot and take up lots of space
  • You understand the technology well enough to manage itVERSUS ABDICATION / DISEMPOWERMENTFASTComputers are simply adding machines or switches that switch left or right – 0 or 1 – on or off – called binary – they just do things very quickly, everything you see is a pattern of 0’s and 1’s – a very fast Abacus – the content is always the same – binary code -- source code is simply instructions for the bricklayerWordprocessors are typewriters -- The typing story – so why do you want to spend thousands of Rands upgrading your typewriter every few years? -- Databases are filing cabinets or warehouses -- General ledgers are large books that book keepers write in – networks are postal systems – large frame pictures cost a lot and take up lots of space
  • You understand the technology well enough to manage itVERSUS ABDICATION / DISEMPOWERMENTFASTComputers are simply adding machines or switches that switch left or right – 0 or 1 – on or off – called binary – they just do things very quickly, everything you see is a pattern of 0’s and 1’s – a very fast Abacus – the content is always the same – binary code -- source code is simply instructions for the bricklayerWordprocessors are typewriters -- The typing story – so why do you want to spend thousands of Rands upgrading your typewriter every few years? -- Databases are filing cabinets or warehouses -- General ledgers are large books that book keepers write in – networks are postal systems – large frame pictures cost a lot and take up lots of space
  • You understand the technology well enough to manage itVERSUS ABDICATION / DISEMPOWERMENTFASTComputers are simply adding machines or switches that switch left or right – 0 or 1 – on or off – called binary – they just do things very quickly, everything you see is a pattern of 0’s and 1’s – a very fast Abacus – the content is always the same – binary code -- source code is simply instructions for the bricklayerWordprocessors are typewriters -- The typing story – so why do you want to spend thousands of Rands upgrading your typewriter every few years? -- Databases are filing cabinets or warehouses -- General ledgers are large books that book keepers write in – networks are postal systems – large frame pictures cost a lot and take up lots of space
  • You understand the technology well enough to manage itVERSUS ABDICATION / DISEMPOWERMENTFASTComputers are simply adding machines or switches that switch left or right – 0 or 1 – on or off – called binary – they just do things very quickly, everything you see is a pattern of 0’s and 1’s – a very fast Abacus – the content is always the same – binary code -- source code is simply instructions for the bricklayerWordprocessors are typewriters -- The typing story – so why do you want to spend thousands of Rands upgrading your typewriter every few years? -- Databases are filing cabinets or warehouses -- General ledgers are large books that book keepers write in – networks are postal systems – large frame pictures cost a lot and take up lots of space
  • You understand the technology well enough to manage itVERSUS ABDICATION / DISEMPOWERMENTFASTComputers are simply adding machines or switches that switch left or right – 0 or 1 – on or off – called binary – they just do things very quickly, everything you see is a pattern of 0’s and 1’s – a very fast Abacus – the content is always the same – binary code -- source code is simply instructions for the bricklayerWordprocessors are typewriters -- The typing story – so why do you want to spend thousands of Rands upgrading your typewriter every few years? -- Databases are filing cabinets or warehouses -- General ledgers are large books that book keepers write in – networks are postal systems – large frame pictures cost a lot and take up lots of space
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • DHL, Prochem,
  • Lancaster 1941 – 1 still flying 2008 747 1969 – still flying and new models still being madeConcorde 1969 – 2006 ? Last flightYou CAN keep up with technologyMake technology slow down to the pace that suits your businessRelevant technology that worksGESTURESDo you remember the Concorde? – Johannesburg to London in three hours? – BUT the people on the ground were not prepared to tolerate the BOOMMMMMMMMMMM as the plane travelled at supersonic speed so it never took off commercially, only 20 were built and one crashed owing to a design flaw and the last planes today are sitting in museumsThen there was the Boeing 747 – designed almost by accident – tell the storySo, is IT moving so fast – not really – the big question is whether Windows Vista is the Concorde of IT
  • Lancaster 1941 – 1 still flying 2008 747 1969 – still flying and new models still being madeConcorde 1969 – 2006 ? Last flightYou CAN keep up with technologyMake technology slow down to the pace that suits your businessRelevant technology that worksGESTURESDo you remember the Concorde? – Johannesburg to London in three hours? – BUT the people on the ground were not prepared to tolerate the BOOMMMMMMMMMMM as the plane travelled at supersonic speed so it never took off commercially, only 20 were built and one crashed owing to a design flaw and the last planes today are sitting in museumsThen there was the Boeing 747 – designed almost by accident – tell the storySo, is IT moving so fast – not really – the big question is whether Windows Vista is the Concorde of IT
  • Lancaster 1941 – 1 still flying 2008 747 1969 – still flying and new models still being madeConcorde 1969 – 2006 ? Last flightYou CAN keep up with technologyMake technology slow down to the pace that suits your businessRelevant technology that worksGESTURESDo you remember the Concorde? – Johannesburg to London in three hours? – BUT the people on the ground were not prepared to tolerate the BOOMMMMMMMMMMM as the plane travelled at supersonic speed so it never took off commercially, only 20 were built and one crashed owing to a design flaw and the last planes today are sitting in museumsThen there was the Boeing 747 – designed almost by accident – tell the storySo, is IT moving so fast – not really – the big question is whether Windows Vista is the Concorde of IT
  • A gun is neither good nor badIf it is held by a person you regard as good and pointed at a person you regard as bad the gun is goodBUT if it is pointed at YOU it is always BAD!
  • A gun is neither good nor badIf it is held by a person you regard as good and pointed at a person you regard as bad the gun is goodBUT if it is pointed at YOU it is always BAD!
  • A gun is neither good nor badIf it is held by a person you regard as good and pointed at a person you regard as bad the gun is goodBUT if it is pointed at YOU it is always BAD!
  • A gun is neither good nor badIf it is held by a person you regard as good and pointed at a person you regard as bad the gun is goodBUT if it is pointed at YOU it is always BAD!
  • A gun is neither good nor badIf it is held by a person you regard as good and pointed at a person you regard as bad the gun is goodBUT if it is pointed at YOU it is always BAD!
  • KEEP SHORT AND SIMPLEMY FATHERHow did i get involved with computers? – my father was a visionary -- In 1981, having gathered over 7,000 pages of research data for my PhD the University mainframe did not have space to store even one page of data. My father purchased me one of the first desktop PC’s in the days of the Apple and Apricot and 123, etc – at a cost of R12,000 two and a half times my research grants! – I very quickly discovered that there was a HUGE gap between what the salesman told me the computer could do and getting it to do it – so, in that respect, NOTHING HAS CHANGED  -- I then put myself through a self taught computer science programme and learned to program, learned to type and finally wrote an award winning PhD thesis – at the same time I computerized my father’s investment consulting business and we were able to double turnover in twelve months and create an enduring revenue stream that lasted for over ten years because we were able to do things that much larger businesses were not able to do – it was then that I began to understand that the strategic application of information technology COULD deliver great value and one of my greatest frustrations is the extent to which few businesses achieve this potential – the rest of this presentation is about lessons I have learned that I hope will help YOU to make a difference in your business with IT
  • DHL, Prochem,
  • Make it work It is all in a name
  • Make it work It is all in a name
  • KEEP SHORT AND SIMPLEMY FATHERHow did i get involved with computers? – my father was a visionary -- In 1981, having gathered over 7,000 pages of research data for my PhD the University mainframe did not have space to store even one page of data. My father purchased me one of the first desktop PC’s in the days of the Apple and Apricot and 123, etc – at a cost of R12,000 two and a half times my research grants! – I very quickly discovered that there was a HUGE gap between what the salesman told me the computer could do and getting it to do it – so, in that respect, NOTHING HAS CHANGED  -- I then put myself through a self taught computer science programme and learned to program, learned to type and finally wrote an award winning PhD thesis – at the same time I computerized my father’s investment consulting business and we were able to double turnover in twelve months and create an enduring revenue stream that lasted for over ten years because we were able to do things that much larger businesses were not able to do – it was then that I began to understand that the strategic application of information technology COULD deliver great value and one of my greatest frustrations is the extent to which few businesses achieve this potential – the rest of this presentation is about lessons I have learned that I hope will help YOU to make a difference in your business with IT
  • Why your ERP is NOT delivering and HOW to FIX it - by Dr James A Robertson -- the ERP Doctor

    1. 1. Why your ERP is not deliveringand how to fix it ICTM Conference February 2010 Dr James A Robertson PrEng
    2. 2. I.T. versus bridges
    3. 3. Engineers do NOT design bridges tostand up
    4. 4. Engineers design bridges NOT tofall down
    5. 5. Vision Angus Struan Robertson
    6. 6. Experiencing failure
    7. 7. Experiencing failure
    8. 8. Experiencing failure
    9. 9. What is strategy? Tactics – Doing things right  Strategy – Doing the right things 
    10. 10. What is strategy? Thrive Tactics – Doing things right  Strategy – Doing the right things 
    11. 11. What is strategy? Thrive Tactics – Doing things right  Survive Strategy – Doing the right things 
    12. 12. What is strategy? Die fast Thrive Tactics – Doing things right  Die slowly Survive Strategy – Doing the right things 
    13. 13. What is strategy?The right things done rightThe essence of why an organization exists and how it thrives
    14. 14. Information technology
    15. 15. An industry in crisis “19 out of 20 ERP (integrated business information system) implementations do NOT deliver what was promised”
    16. 16. Extreme failures 1. Seven years and half a billion dollars -- international chemicals company 2. $400 million -- multinational shoe corporation 3. Multinational entertainment giant -- $878 million 4. Major supermarket chain -- $195 million Professor Rossouw von Solms
    17. 17. Deleting a building
    18. 18. Deleting a building
    19. 19. Deleting a building
    20. 20. Deleting a building
    21. 21. Deleting a building
    22. 22. An industry characterized by failure"Attendees of Gartners Business Intelligence Summit in Londonlast month were not surprised to hear that most enterprises arestill failing to use business intelligence (BI) strategically.Gartners survey of over 1300 CIOs returned some unimpressivefindings about the state of BI implementations: Gartners vice:president of research summed up the situation nicely by saying:“Most organisations are not making better decisions than theydid five years ago” BUSINESS INTELLIGENCE Article published in Computer Business Review Africa.
    23. 23. There is a need for a new approach
    24. 24. What is NOT an engineeringapproach?
    25. 25. What is NOT an engineeringapproach?
    26. 26. What is NOT an engineeringapproach?
    27. 27. There IS great opportunityERP can and should add value
    28. 28. Different view of ERP / IBIS(Integrated business information systems) Common view of best practice 10 0
    29. 29. Different view of ERP / IBIS(Integrated business information systems) Real potential of ERP software – with high quality taxonomies 10 Common view of best practice 10 0 0
    30. 30. Different view of ERP / IBIS(Integrated business information systems) Real potential of 10 ERP software – The REAL with high quality opportunity taxonomies – 10 strategic configuration Common view of best practice 10 0 0 0
    31. 31. Different view of ERP / IBIS(Integrated business information systems) Real potential of 10 ERP software – The REAL with high quality opportunity taxonomies – 10 7 X strategic configuration Common view of best practice 10 3 X 0 0 0
    32. 32. What is a taxonomy? World Asia • Logical word (semantic) structure Africa Europe Germany • Conveys understanding of a particular ... subject area ... • From one human being to another • In a structured hierarchical form • Essential to conveying information through computer systems • Human beings experience as valuable, meaningful and informative • Essential element of effective decision making supported by I.T.
    33. 33. Data engineering defined The definition of information content in a way that is structurally (taxonomically) fundamentally meaningful to human beings who understand the business and the translation of this content into structured codes which faithfully and accurately reflect human understanding in a way that the computer can manipulate with minimal human intervention so that the computer system appears to be intelligent drives configuration and integration Strategically focussed, top down, fundamental first principles, precise, models the business and the real world
    34. 34. What is ERP?
    35. 35. What is IT?REALLY?
    36. 36. What is IT?REALLY?
    37. 37. What is IT?REALLY?
    38. 38. What is IT?REALLY?
    39. 39. What is IT?REALLY? $
    40. 40. What is IT?REALLY? $
    41. 41. What is IT?REALLY? $
    42. 42. What is an ERP?Data tables
    43. 43. Entry screens
    44. 44. Executable software programs
    45. 45. Reports
    46. 46. Integration
    47. 47. Example of faulty integration“The system lost my data”
    48. 48. So….What is an ERP?REALLY?
    49. 49. Delete (scrap) or refurbish?
    50. 50. Is IT moving so fast you cannotkeep up?
    51. 51. Is IT moving so fast you cannotkeep up?
    52. 52. Is IT moving so fast you cannotkeep up?
    53. 53. Factors causing ERP failure 1. Mythology, hype & tradition -- 30% 6% 3% 2. Lack of executive custody, inappropriate governance and policies -- 19% 12% 30% 3. Lack of strategic architecture, alignment, etc -- 16%14% 4. Lack of data engineering and poor configuration -- 14% 19% 16% 5. Soft issues and change impacts -- 12% 6. Lack of an engineering approach, lack of precisioin, etc -- 6% 7. Technology issues -- 3%
    54. 54. Factors causing ERP failure 1. Mythology, hype & tradition -- 30% 6% 3% 2. Lack of executive custody, inappropriate governance and policies -- 19% 12% 30% 3. Lack of strategic architecture, alignment, etc -- 16%14% 4. Lack of data engineering and poor configuration -- 14% 19% 16% 5. Soft issues and change impacts -- 12% 6. Lack of an engineering approach, lack of precisioin, etc -- 6% 7. Technology issues -- 3%
    55. 55. Factors causing ERP failure 1. Mythology, hype & tradition -- 30% 6% 3% 2. Lack of executive custody, inappropriate governance and policies -- 19% 12% 30% 3. Lack of strategic architecture, alignment, etc -- 16%14% 4. Lack of data engineering and poor configuration -- 14% 19% 16% 5. Soft issues and change impacts -- 12% 6. Lack of an engineering approach, lack of precisioin, etc -- 6% 7. Technology issues -- 3%
    56. 56. Factors causing ERP failure 1. Mythology, hype & tradition -- 30% 6% 3% 2. Lack of executive custody, inappropriate governance and policies -- 19% 12% 30% 3. Lack of strategic architecture, alignment, etc -- 16%14% 4. Lack of data engineering and poor configuration -- 14% 19% 16% 5. Soft issues and change impacts -- 12% 6. Lack of an engineering approach, lack of precisioin, etc -- 6% 7. Technology issues -- 3%
    57. 57. Factors causing ERP failure 1. Mythology, hype & tradition -- 30% 6% 3% 2. Lack of executive custody, inappropriate governance and policies -- 19% 12% 30% 3. Lack of strategic architecture, alignment, etc -- 16%14% 4. Lack of data engineering and poor configuration -- 14% 19% 16% 5. Soft issues and change impacts -- 12% 6. Lack of an engineering approach, lack of precisioin, etc -- 6% 7. Technology issues -- 3%
    58. 58. Factors causing ERP failure 1. Mythology, hype & tradition -- 30% 6% 3% 2. Lack of executive custody, inappropriate governance and policies -- 19% 12% 30% 3. Lack of strategic architecture, alignment, etc -- 16%14% 4. Lack of data engineering and poor configuration -- 14% 19% 16% 5. Soft issues and change impacts -- 12% 6. Lack of an engineering approach, lack of precisioin, etc -- 6% 7. Technology issues -- 3%
    59. 59. Factors causing ERP failure 1. Mythology, hype & tradition -- 30% 6% 3% 2. Lack of executive custody, inappropriate governance and policies -- 19% 12% 30% 3. Lack of strategic architecture, alignment, etc -- 16%14% 4. Lack of data engineering and poor configuration -- 14% 19% 16% 5. Soft issues and change impacts -- 12% 6. Lack of an engineering approach, lack of precisioin, etc -- 6% 7. Technology issues -- 3%
    60. 60. The value of technology is determinedby the person using the technology
    61. 61. Technology is only 5% of what causesfailure
    62. 62. Technology is only 5% of what causesfailure
    63. 63. Technology is only 5% of what causesfailure
    64. 64. Technology is only 5% of what causesfailureSoftware defects CAN be preventedTake a stand
    65. 65. IT people who lie
    66. 66. Badly designed coding in Chart ofAccounts 500528 Waste Material Consumed 500530 Loss from valuation of external materials 500540 Loss from valuation of own materials 500550 Losses - inventory variance -consignment sale 500560 Safety Clothing 500565 Safety Equipment 500570 Sand & Stone 500575 Scraper Rope 500580 Scrapers 500585 Services 500590 Signs 500595 Skips & Cages 500600 Finished Goods Inventory Offset 500605 Smelting & Refining 500610 Production Order Settlement - Variance 500615 Steel Other 500620 Steel Sections 500625 Steel Sheets & Plates
    67. 67. Badly designed coding in Chart of Accounts 500528 Waste Material ConsumedHuge impact on 500530 Loss from valuation of external materialsintegration, reporting, etc 500540 Loss from valuation of own materials 500550 Losses - inventory variance -consignment sale 500560 Safety Clothing 500565 Safety Equipment 500570 Sand & Stone 500575 Scraper Rope 500580 Scrapers 500585 Services 500590 Signs 500595 Skips & Cages 500600 Finished Goods Inventory Offset 500605 Smelting & Refining 500610 Production Order Settlement - Variance 500615 Steel Other 500620 Steel Sections 500625 Steel Sheets & Plates
    68. 68. Badly designed coding in Chart of Accounts 500528 Waste Material ConsumedHuge impact on 500530 Loss from valuation of external materialsintegration, reporting, etc 500540 Loss from valuation of own materials 500550 Losses - inventory variance -consignment sale 500560 Safety Clothing 500565 Safety Equipment 500570 Sand & Stone 500575 Scraper Rope 500580 Scrapers 500585 Services 500590 Signs 500595 Skips & Cages 500600 Finished Goods Inventory Offset 500605 Smelting & Refining 500610 Production Order Settlement - Variance 500615 Steel Other 500620 Steel Sections 500625 Steel Sheets & Plates
    69. 69. Jumbled data
    70. 70. Jumbled data
    71. 71. From chaos to order Example of simple hierarchically structured data table
    72. 72. From chaos to order
    73. 73. Structure of strategically alignedChart of Accounts Assets Investment Assets owned MOBILE PLANT Assets leased ... E... Dep’n assets owned LHD’s Dep’n assets leased ... D.. Dump trucks Liabilities ... operation Income Drill rigs Expenses R&M assets Processing Finance and insurance Other off road assets ... Marketing and sales LDV’s Plant Maintenance Operational support etc Materials Management Administration Provide for foreseeable growth Dividends, taxes, etc
    74. 74. Mapping between modules Badly structured500528 Waste Material Consumed500530 Loss from valuation of external materials MOBILE PLANT500540 Loss from valuation of own materials500550 Losses - inventory variance -consignment Loader’s sale500560 Safety Clothing Dump trucks500565 Safety Equipment500570 Sand & Stone Drill rigs500575 Scraper Rope500580 Scrapers Other off road500585 Services500590 Signs LDV’s500595 Skips & Cages500600 Finished Goods Inventory Offset etc500605 Smelting & Refining500610 Production Order Settlement - Variance Lack of consistency in detail in Chart500615 Steel Other of Accounts, random mapping, difficult and costly to500620 Steel Sections maintain, VERY DIFFICULT to report500625 Steel Sheets & Plates on strategically
    75. 75. Mapping between modulesWell structuredGeneral Ledger Materials MasterRepair and Maintenance Plant spares MOBILE PLANT MOBILE PLANT Loaders Loaders Dump trucks Dump trucks Drill rigs Drill rigs Other off road Other off road LDV’s LDV’s etc etc
    76. 76. Examples of failed ERPimplementations 1. Medical insurance company 2. Contract secretarial employment company 3. Mining company 4. Wholesale chemical distribution company When problems with your ERP cause you to lose customers your ERP has just become more expensive than you can afford
    77. 77. Factors for ERP implementationsuccess
    78. 78. Factors for ERP implementationsuccess
    79. 79. Factors for ERP implementationsuccess
    80. 80. Factors for ERP implementationsuccess 1.Executive custody, strategic solution architect, accountability -- 22% 6% 2% 2. Effective change facilitation -- 20% 22% 14% 3. Strategic architecture, alignment, etc -- 19%17% 20% 4. Data engineering and configuration -- 17% 19% 5. Engineering approach, design against failure, precision, etc -- 14% 6. Business integration, training, processes, CBT -- 6% 7. Technology -- 2%
    81. 81. Factors for ERP implementationsuccess
    82. 82. Factors for ERP implementationsuccess
    83. 83. Factors for ERP implementationsuccess
    84. 84. People and technology alignment P Performance improvement e o p l e TechnologyAfter Dr Fritz Hölscher
    85. 85. People and technology alignment P Performance improvement e o p l e High risk Technology Methods Strategic objectivesAfter Dr Fritz Hölscher Systems Structures and processes
    86. 86. People and technology alignment High frustrationEmpowerment Performance PCommitment improvement eOwnership oExperience pKnowledge lParticipation eConsultationInformation High risk Technology Methods Strategic objectives After Dr Fritz Hölscher Systems Structures and processes
    87. 87. People and technology alignment High frustrationEmpowerment Performance PCommitment improvement eOwnership oExperience pKnowledge lParticipation eConsultationInformation High risk Technology Methods Strategic objectives After Dr Fritz Hölscher Systems Structures and processes
    88. 88. LaboratoryA location where the real world issimulated on a statistically validrepresentative basisALL possible scenarios thoroughly tested
    89. 89. Leadership
    90. 90. Leadership1. Executive custody is critical -- 50% leadership2. “Business systems department” instead of “IT department”
    91. 91. Data engineering principlesCase study 1. Presented with the client at a public conference – most powerful form of testimonial 2. Dramatic increase in management information 3. Reduction in head count 4. Dramatic reduction in audit time and cost 5. Unqualified balance sheet first time in 15 years
    92. 92. Remediating failed and sub-optimalERP projects 1. Critical examination – investigate all factors causing failure 2. Plan a project which takes account of all factors for success 3. Precision strategic data engineering / taxonomies, configuration, integration are critical – plan accordingly 4. Design new taxonomies 5. Create mappings from old to new data 6. Either map new taxonomies outside the existing installation in a business intelligence tool Or 7. Clean slate re-implementation
    93. 93. Characteristics of a successful team1. Design against failure -- constantly top of mind – 22%2. Know and apply the critical factors for success, manage againstthe factors causing failure, manage principles for success, stages,critical human foundation, etc -- 20%3. Strategy is the foundation on which the solution is built – strategic leadership, right things well, coupled to CEO leadership – custodian of the integrated vision -- 18%4. Change facilitation and other soft issue services, competence modeling, psychometrics, etc -- 14%
    94. 94. Characteristics of a successful team5. Precision data engineering, cubic business model as basis forintegration, associated software and code maintenance services --12%6. People -- critical issues methods, disciplines, engineeringrigour, multi-disciplinary, hard and soft components, high focus, highenergy, motivated, loyal, quick attack approach -- 10%7. Standards, documented methods, tools, standard operatingprocedures, reference documents, standard practices, policies, etc --4%
    95. 95. Strategic alignment
    96. 96. Strategic alignment1. Essence of why the business exists and how it thrives2. Model the business in the configuration from a precise, real world, strategic perspective
    97. 97. Summing up1. Precision
    98. 98. Summing up1. Precision2. Real world, practical modelling of the organization
    99. 99. Summing up1. Precision2. Real world, practical modelling of the organization3. ERP is NOT magic do NOT abdicate your intellect
    100. 100. Summing up1. Precision2. Real world, practical modelling of the organization3. ERP is NOT magic do NOT abdicate your intellect4. Design AGAINST failure
    101. 101. Summing up1. Precision2. Real world, practical modelling of the organization3. ERP is NOT magic do NOT abdicate your intellect4. Design AGAINST failure5. You DO understand ERP slow ERP down to your speed!
    102. 102. Summing up1. Precision2. Real world, practical modelling of the organization3. ERP is NOT magic do NOT abdicate your intellect4. Design AGAINST failure5. You DO understand ERP slow ERP down to your speed!6. Align ERP with the essence of your business (strategy)
    103. 103. Summing up1. Precision2. Real world, practical modelling of the organization3. ERP is NOT magic do NOT abdicate your intellect4. Design AGAINST failure5. You DO understand ERP slow ERP down to your speed!6. Align ERP with the essence of your business (strategy)7. There is a great opportunity to make a difference
    104. 104. If you do not act within 48 hours you probably never will – act TODAY! What is your single most important insight from this presentation?What is the single most practical action that you can take tomorrow toapply ERP more effectively?
    105. 105. If you do not act within 48 hours you probably never will – act TODAY! What is your single most important insight from this presentation?What is the single most practical action that you can take tomorrow toapply ERP more effectively?
    106. 106. Design ERP solutions like bridges ...To last and not fall down
    107. 107. Questions? Dr James Robertson PrEng Finding the missing pieces of your I.T. and strategy puzzles Thrive through strategic use of ERPEmail: James@JamesARobertson.com

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