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What Makes a Leader? Study Shows Business Drivers that Impact ERP Strategies

Published on: Aug 18, 2016

An interesting study from the Aberdeen Group examined how Leaders, defined as companies “leading” the vanguard of innovation in manufacturing, are using and benefiting from ERP business strategies. Among the 81 companies who responded to the group’s survey, 90% of Leaders implemented ERP strategies while only 10% of Followers, or companies who lagged behind, had implemented it. It seems that knowledge is power, especially knowledge derived from ERP for manufacturing.

Key findings from the study include:

  • ERP is near-ubiquitous in discrete manufacturing: 80% of Leaders have ERP.
  • ERP strategies impact key business drivers by providing timely impactful information, managing growth expectations, reducing costs, and enabling operations across multiple facilities.
  • Leaders are 25% more likely to have ongoing initiatives tailoring their ERP for manufacturing solutions to address business challenges.
  • Leading companies value collaboration, visibility, and real-time data access.

Among the discrete manufacturers included in the study, the authors found that it wasn’t just having an ERP system in place that made them successful. It was also how well they used it. Companies who used their systems to plan, strategize, and improve across all business functions gained a competitive edge over others.

Laggards in the discrete manufacturing space continued to conduct business as usual. Their data solutions remained behind, so they could not swiftly address challenges that arose throughout their organizations. With ERP strategies in place, Leaders could address challenges and make smart decisions based on data.

The Benefits of ERP Strategies

Demand Planning and Forecasting

The ERP strategies for manufacturing adopted by Leaders included in the study seemed to help demand planning and forecasting. Because Leaders could better predict demand, they could avoid carrying excess inventory. They could also negotiate better prices on raw materials. Both tactics enhanced their ability to increase profits while decreasing costs.

Real-Time Visibility into Order Status

Another benefit derived from the ERP systems among the companies included in the study was greater visibility. The increased visibility into all aspects of the organization enhanced decision-making.

Agile Responses

The more information discrete manufacturers had at their disposal, the better. With increased visibility came a more agile response to problems, challenges, and customer demands. This added to each company’s competitive advantage. It also improved reaction time to orders and special requests.

Internal Collaboration Improved

ERP for manufacturing software also enhanced the internal collaboration among departments.

The Bottom Line

ERP business systems for discrete manufacturers improved processes and operations across the board. Among those surveyed, 44% cite the increased visibility derived from their ERP systems as contributing to the decision-making and more accurate demand forecasts. Companies with ERP systems could schedule maintenance tasks and reduce downtime due to equipment failure, another improvement in efficiencies. Lastly, real-time collaboration improved across divisions thanks to better access to data. It’s a marked improvement that Leaders credit with better businesses, higher profits, and more efficient operations.

Download Your Copy of the Study Today

At IWI, we know that time is money. We provide you with expert insights and resources such as the whitepaper from the Aberdeen Group. Download ERP in Discrete Manufacturing—It’s not what you have it’s how you use it here and start learning from your peers with expert best practices and insights that will help you gain a competitive edge.

IWI Consulting Group helps Canadian businesses and nonprofits find ERP solutions to fit their needs. We work with you to find the best data solutions for your company that can help boost productivity and profitability. Solutions such as Sage EM (formerly known as Sage X3) and Sage 300cloud (formerly known as Sage 300) can help your business thrive. Learn more on our website or call us at 1-866-916-3851.