Ace Metal Crafts Co., a stainless steel fabricator and contract manufacturer, is in the early stages of evaluating whether it should update its ERP software or look for a new ERP solution. The company’s first step: evaluate its business processes.
Ace Metal Crafts hired a consultant to do an operational audit to document current processes and how they could be improved if the company did an enterprise resource planning (ERP) upgrade, said Gary Rihani, chief financial officer of the Bensenville, Ill., company.
“That outside help really puts a different perspective on things,” Rihani said. “We weren’t using as much of the current ERP as we thought.” In fact, Ace was using less than half of the system’s capabilities.
Ace Metal Crafts has a little more than 100 employees and annual sales of about $17 million. The company uses Infor SyteLine ERP software, and has been using an ERP system since the early 1990s. The company’s last ERP upgrade was in 2006.
Ace needs an ERP upgrade because of its growth: a tripling of sales over the last 10 years, Rihani said. Also, the upgrade plans fit with Ace’s growth strategy to stay on top of technology and streamline processes as much as possible.
“We’ve been finding that we’ve been having a lot of doing work outside of SyteLine, in terms of people keeping different spreadsheets. We got to a point where we’re finding that we’re going out looking for the information and the data, rather than information and data coming to us,” he said.
For certain key performance indicators, for example, the data isn’t available from the ERP system, so employees have to use spreadsheets to do the workarounds “and figure it out the hard way,” Rihani said. Before even considering an ERP upgrade, Ace needed to re-evaluate its business processes and improve them, setting the stage for a smooth ERP implementation, Rihani said.
An example of a business process that could be improved has to do with writing customer price quotes. Engineers sometimes used separate spreadsheets for certain calculations in figuring the price, instead of using SyteLine for the process. If the quoting process stays in the ERP, then those calculations can be easily utilized for similar quotes in the future, and the numbers can be updated automatically, without the risk of going stale in a spreadsheet. Other potential errors are eliminated, Rihani said.
The company is now coming up with a timeline, working out when the implementation should start, then working backward to set milestones for specific business-process improvements. Generally, the company expects to have its ERP implemented around the middle of 2014.
The prospect of starting an ERP implementation isn’t intimidating, but the vast number of ERP system choices can be overwhelming, Rihani said.
“For me, it’s a fun process,” he said. “I enjoy it, knowing that doing this, going through this implementation, it’s a company-wide change for the benefit of the company and making the company move forward. It helps us better serve our customers as well.”
Ace Metal has its ERP software on onsite servers and doesn’t a plan to use cloud-based ERP, Rihani said. That’s because the company has some concern that it may lose control of its data, or lose rights to it, if it’s in the cloud, he said.
On the cost issue, SyteLine probably has an advantage because a low-cost upgrade is already included in the Ace’s maintenance agreement with the software vendor, he said. But the company is looking at other ERP software options — similar platforms that would make the data conversion easier.
“We don’t want to get a completely different platform where it’s a complete nightmare to convert our data over from our current platform over to this new platform,” Rihani said.
Ace Metal’s ERP team includes engineers and representatives from accounting, manufacturing, human resources and IT, and the team is led by Rihani and the vice president of manufacturing systems.
Rihani said the company culture is pretty open to change, which is important. “It does require a lot of require a lot of change, and we have to make sure that everyone is 100 percent on board with it.”
“When we have the employees involved going through that type of audit process, it kind of makes them feel like they’re being heard,” he said. “They know it’s not working the way it should be, so they’re expecting some kind of change to be coming out if. They’re more willing, since they’ve been involved in the audit process and they understand they have a say in it.”