Last week, we talked with D4M COO Jean-Yves Durocher about their 60-in-60 method for rolling out multiple SAP rollouts in shorter time. However, since he was in the studio and has over 15 years of experience in the industry, we thought we would ask him a series of digital manufacturing related questions to gain some insights on improving efficiency within the industry.
In part 1 of this series, we will be discussing economic impatience preventing SAP rollouts from taking place, the importance of planning in ERP rollouts, and how to reduce the downtime of value through expertise.
Gene: I’m going to throw some observations your way and you tell me anything that any, whether or
not this insight is good or whether or not you have anything else to add to it.
Gene: I heard that when it comes to an SAP rollout, it usually takes three to nine months to see
value of said migration. Is there anything that you can comment in terms of that observation?
JY: When you’re talking about value, you’re talking about the return of investment?
Gene: Correct; because usually it’s there’s this economic impatience when it comes to SAP rollouts due
to the massive amounts of prep work involved.
Gene: There’s so much planning involved that when people get to the SAP roll phase, they just get
cold feet and don’t do it. But, I guess the question is more about short-term versus long-term value. People tend to see value after three, three to nine months after the migration.
Gene: Not anytime before.
JY: In regards to seeing the benefits of an SAP rollout, the three to six months benchmark is a realistic range.
JY: Some corporations are very quick to stabilize the operation because, obviously, after a rollout,
your employees are starting to learn and use the new system. There is some learning curve and it takes a while to get everything working perfectly.
JY: However, the 3 to 4 months timeframe is not absolute; sometimes, it could be a shorter time
period and, sometimes, it could take longer as well. Assuming, obviously, the system was designed correctly, I would say that the three to nine months is real.
JY: I think with the additional observation that it, the amount of time towards profitability after
an ERP rollout can also be reduced based on the team you have/how well they work together. It depends a lot of on how rigorous your operations are and how you stay on top of it with your management team. You need to stay focused after a rollout. Not everything will fall in place by themselves, so it requires some
JY:. But I think to say that after nine months you get the, for full benefits of the ERP system is
correct – as long as you have good discipline and fine tuning over time. If ever it goes beyond that, I would say you need to take a step back and see what exactly is happening in a postmortem, because typically I would say, five, six months, you’re now back in full operation with smooth operation, good productivity, and whatever benefits that you had anticipated.
JY: If things are done right, obviously.
Gene: Another good tidbit of information I received – talking to D4M employees – is that 70% of the
success of rollouts is preparation, and yet, ironically, 70% of a rollout is the cost of the execution.
JY: I think that, if I were to add some nuance to this, I would say when we say “70% of the success”,
we’re not measuring in dollars.
JY: I think if you’re looking at that statement from a risk factor, the statement is correct. From managing the risk to managing the potential roadblock along the way, and then take into consideration the global challenges of implementing an ERP, it is absolutely right that 70% of your success rely on a, having a very good plan upfront.
JY: So, it doesn’t mean you spend 70% of your dollar on the planning, it’s not the case. But planning is a short phase at the beginning. That needs to be extremely well done, but it doesn’t represent 70% of the cost. Where, if you look at the cost aspect, there are specific tasks like, just to pick an example, the data
JY: Data migration in any project could become costly. It depends on how you approach it. But I think
if you look at overall the success of the operation, I think that planning is at least 70% of your success depends on having a good planning; hell, I would even go higher because any project that you would attempt, SAP or non SAP, if you don’t have a good plan your chance of failure increased dramatically.
JY: Good planning is never a luxury at the end of the day.
D4M is a privately owned company specializing in leveraging digital technologies to accelerate manufacturing clients to their transition to Industry 4.0. With long tenure and hundreds or successful projects, we are confident that our approach and experience provides the roadmap to help bring clarity and efficiency to your manufacturing operation.
To find out how we can help with your SAP environment, or to learn more about how we rolled out SAP to 60 locations in 60 months, reach out to us today. Contact form and office numbers listed below.
We look forward to partnering with you!