just-style management briefing: Planning to avoid ERP-PLM integration issues
3 October 2011 | Features & Interviews | Source: Ivan Castano Freeman
While many software vendors love to boast about the benefits of their products, few admit that they are rarely glitch-free and that implementing them into an organisation can take time and patience.
When the PLM market began taking off in 2008, many companies complained of "horrible" implementation delays that were sometimes so cumbersome employees were unwilling to work with the software, forcing apparel firms to spend heavily on training programmes.
PLM software vendors now say those delays have lessened as the both suppliers and users have understood how to best implement PLM into organisations' product planning processes.
But now that ERP and PLM integrations are becoming increasingly necessary, implementation headaches are surfacing once again, throwing vendors into a scramble to build robust interfaces that can allow PLM and ERP systems built by different software brands to communicate each other seamlessly.
This, however, isn't always possible, especially when an apparel company cannot hire one supplier to provide both PLM and ERP systems.
Like PLM, one way to avoid time-consuming and expensive integration nightmares is to understand exactly how your business can benefit from the software and to endeavour to hire both systems from the same vendor.
Obviously, buying a fully-integrated PLM and ERP suite from the same vendor is the best way to avoid implementation problems but many large apparel companies are currently unwilling to do this as their ERP systems work fine and they don't want to engage in the extra cost of an end-to-end solution.
Paul Magel of CGS software says its PLM and ERP systems were built from the ground up and share the same programming DNA, meaning they communicate efficiently at all times.
"The native integration will trump up a few extra bells and whistles," he says, "as both systems will use the same programming language so if the PLM product from a company's ERP vendor has the functionality that meets its business requirements," this is the best bet. However, a fully integrated version will bring much more productivity and visibility than an interfaced solution connecting individual PLM and ERP systems, he claims.
CGS offers an integrated PLM-ERP solution built from the ground up, something Magel says is essential for optimal functionality.
"Just because a single vendor offers both products does not mean they are well integrated. In fact they typically are not, having been added through an acquisition or built in a different technology."
Colin Marks, director and chief executive of DeSL, says he has so far encountered few integration problems as his team always ensures that a user will first do enough planning to pin-point the crucial part of the business where the integrations are necessary.
"We integrate PLM to many third-party ERP solutions and have an XML based integration platform," Marks says. "The key thing for companies is to define at what point of the business process they want it and when. The integration project has to be properly planned and executed otherwise it's a disaster."
Janet Suleski, a consultant at IT research firm Gartner who works on PLM-ERP integrations, agrees that planning is key.
"Planning how the software will fit into your business is crucial as is buying it from the same vendors," she says. "This isn´t always possible, however (as one of the systems may still not provide the functionality the company needs) so the user must find another a PLM system that meets its needs most closely."
Adds Suleski: "The rest is about working closely with PLM and ERP vendor experts to ensure the integration is successful. Hiring a very knowledgeable IT service provider [consultant] who has experience combining the two systems is also helpful though it can be expensive."
Synchronising and updating data between two different vendor systems can also be challenging, requiring more IT support - another reason why using the same vendors for the two systems is crucial.
To link ERP with PLM, companies need to set up an interface or "integration layer" to allow both systems to communicate. Both systems have to be maintained and updated every time you update one of them so you need staff to ensure the process goes smoothly.
Therefore, Suleski says buying an integrated platform may be cheaper and less complicated than integrating separate systems through an interface programme. This is especially recommended for apparel SMEs with less income to afford their own IT department.
"Apparel firms should be able to negotiate a better price for a combined purchase of PLM and ERP from a single vendor than if they purchase the two systems from separate companies," Suleski adds.
"Additionally, with the standard integrations between the two systems supported by a single software vendor, the total cost of ownership (TCO) will likely be lower, in part due to upgrade paths being better-synchronised."
However, she cautions that using the same vendor may not be advisable for large apparel producers that can afford to have more IT staff to manage separate systems that can be hedged for greater capabilities.
"It's more important to look at how their software capabilities are meeting their current business needs. By understanding that, the cost of integrating ERP and PLM can also be lower," Suleski says.
She adds: "We usually recommend that companies look at their ERP vendor's capabilities first, to see if they are adequate because if they are, then it would be better for them to buy the PLM software from the ERP vendor."
Apart from planning how the software can fit into their organisation, companies must also plan for the related business process change that will ensue from the installation of the new system. This includes training staff to learn how to use the new programmes, an effort that often requires an outside consultant to get involved.
Planning, therefore, is not just crucial to ensure the new systems talk to each other in the same language but that your staff is also properly trained to use them or any software installation will fail to yield the kind of benefits the organisation is seeking.