Complex Industries Often Miss Out on Full Benefit of ERP – IFS Study Says
IFS, the global enterprise software company, has released a study illustrating that companies in complex industrial settings are not receiving the full benefit from enterprise resource planning (ERP) and other enterprise software.
While the promise of ERP is to consolidate business data and processes onto a centralized application for greater visibility and control, the diversification and complexity of some companies pushes the limits of what their enterprise software can deliver. According to the study results, some of the most demanding and complex business environments, where a company may be forced to run multiple software products are:
- Engineering, procurement, and construction contractors, including those serving the oil and gas industry.
- Engineer to order manufacturers.
- Process manufacturers.
The study is based on a survey of more than 200 executives with industrial and manufacturing companies in North America. Results were reviewed and interpreted by Cindy Jutras, principal analyst, Mint Jutras of Boston.
Among the key findings:
- Most manufacturers must deal with managing a variety of styles of manufacturing including multiple modes of “to order.”
- Batch process manufacturers, engineer to order manufacturers and engineering, procurement and construction contractors all are involved in multiple other business processes.
- This diversity creates a need for multiple enterprise applications; companies average 3.24 different types of applications but may run as many as seven. They may run more than one of a given type of software (multiple ERP products, for instance), so the total number of applications may be much higher.
- The better an enterprise software environment facilitates project management in an integrated way, the better it meets a variety of complex needs.
“We see these results as an indication that too many complex industries are running enterprise software that is just a poor fit for their business,” IFS North America Vice President of Marketing Steve Andrew said. “The management of these businesses is suffering because they are paying to license and maintain not one, not two, but as many as seven different types of enterprise software applications. They are suffering because they are missing out on the benefits of a unified enterprise software environment. These study results suggest they would be better served by selecting and implementing an enterprise software application designed for diversified, complex project and asset-intensive environments.”
The study is available for free download at: http://download.ifsworld.com/studies.
IFS is a public company (OMX STO: IFS) founded in 1983 that develops, supplies, and implements IFS Applications™, a component-based extended ERP suite built on SOA technology. IFS focuses on industries where any of four core processes are strategic: service & asset management, manufacturing, supply chain and projects. The company has 2,000 customers and is present in approximately 60 countries with 2,800 employees in total. For more information about IFS, please visit: www.IFSWORLD.com.