Pause your ERP investment?

time coverTime magazine has a cover story on the bounce back of American manufacturing. Worth a proper read (sub required) but they outline several drivers:

a) Smarter products with sensors/software and supported with advanced analytics

b) 3D printing

c) Energy economics – the US is increasingly benefitting from shale oil and gas whereas global sourcing is being hurt by increased shipping costs

d) Smarter US worker – who is looking more competitive as labor costs for more basic offshore talent keeps rising

But they also raise a few caveats

“Manufacturing is coming back, but it’s evolving into a very different
type of animal than the one most people recognize today,”

“Designs will be altered in real time to reflect the knowledge.”

“Wanek says Ashley will reward workers who are adaptive. Part of that
involves acquiring new skills while on the job and taking responsibility
for devising and implementing improvements.”

So,  what does have to do with your ERP investment?

a) Can your ERP system help you effectively evaluate your product design, sensor generated data, shop floor design, global sourcing, logistics, talent management, energy efficiency and many other areas to help you decide how your manufacturing/supply chain  needs to evolve, and how much should be made in the US?

b) And can your ERP itself functionally support this next-gen manufacturing of smarter products, 3D printing etc?

If the answer to a and b is unclear, maybe you should reduce or redeploy the money going to ERP maintenance, hosting, upgrades and use towards higher payback – making your products smarter, reconfiguring your supply chain, retraining your factory workers, etc.

It is an exciting time for US manufacturing. But only if we do several things smarter.


(Cross-posted @ DealArchitect Full)

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CEO of Deal Architect, a top advisory boutique recognized in The Black Book of Outsourcing, author of a widely praised book on technology enabled innovation, The New Polymath, prolific blogger, writing about technology-enabled innovation at New Florence, New Renaissance and about waste in technology at Deal Architect.  Previously Analyst  at Gartner, Partner with PwC Consulting. Keynoted at many business and technology conferences and has been quoted in the Wall Street Journal, BusinessWeek, The Financial Times, CIO Magazine, and other executive and technology publications.