Update the ERP automatically on production activities leveraging IoT (Internet of Things)

Lately, Internet of Things (IoT), have opened up an entirely new avenue for taking benefits using the existing ERP software implemented in the organizations. Though IoT will be beneficial in many areas and early movers in this field are healthcare/wellness and entertainment industry specially leveraging it with consumers, one of the hidden benefits it can provide is the field of running the business transactions in in your old ERP.
In one of the CIO conferences, we were talking on how can we leverage this in our respective organizations and some very exciting use cases have come up where in few CIOs have started taking actions specially in manufacturing sector.  Every organization is pushing the bar high every year for more productivity from employees and they are exploring all options whether non-technical like outsourcing to experts or technical like automating few operations or deploying IT solutions. IoT is another area which was found to be beneficial in addressing productivity concerns as below: 
  • Users need to perform production related activities also as well as have to enter data in ERP to record the activities
  • To ensure proper record of activities, either a strong process discipline is required or ERP will need to be customized to put checks and balances in place
  • Mistakes happen with new users and lot of time is wasted in running the ERP
  • Multiple times, data in ERP doesn’t match with actual physical data such as WIP inventory
  • Time lag between actual activity and activity performed in ERP which skews the actual performance of a machine or a resource
Fortunately, all above can be resolved using IoT technology in conjunction with ERP. You just have to make your machines internet enabled, put some sensors around which can read the data that you want to send to ERP and then can send the data to a middle layer where you do data massaging and filter it to ensure that you send only relevant data to ERP. As soon as it reaches the ERP and updates corresponding details in it, you are all set to view your analytics reports. It also will help you calculate better product costing as well as costing of all functions related to production. Another major benefit that you will get by deploying IoT, is that you will now have access to huge set of data from your machines which is ready to be analyzed in the middle layer and multiple improvement plans can be made around those identified areas. Since this data will be huge by any standards, big data solutions will be able to help the organization immensely here. This will be another step in increasing productivity of resources in the organization.
 
Since there is a cost involved in installing sensors as well as a feasibility study will have to be done for the machines whether they will be able to support sensors, it may take some time to gain pace in the manufacturing industry and I assume that everybody is watching for one good case study so that they can also go ahead use this new revolutionary concept that I highlighted in 2009 in my earlier post here.

Deskill roles by deploying smart Supply Chain solutions

We all have seen, observed and heard a lot about benefits of Supply Chain Systems when deployed in organizations in terms of inventory going down, lead-times getting reduced, driving deflation with vendors etc. but surprisingly lot of supply chain evangelists usually do not touch the subject of increased ability to deskill a role in the organization and save hard cash due to this.
With precision getting increased in the available supply chain solutions, the ease with which supply chain professional plan their chores have become less skill oriented. Whether it is predictive analysis based on the past performance of the vendor and visibility of its stock levels, production plan etc. or it is the accuracy of forecast, every nice feature of SCM solutions have reduced the need of professionals to think like a maverick and they just need to follow the process (I know I am oversimplifying it but the essence remains the same). Earlier they were required to keep a tab on how much material each division is buying from a vendor so that they can take advantage of volume discount by manually following up with people and taking inputs from multiple systems but today the state of art SCM Solutions automatically pick right information from multiple systems, uses fuzzy logic in consolidating vendor billings (in case same vendor is defined in system with slightly different names – a most common mistake across the globe) and throws recommendations to the SCM user after either taking cues from internet on prevailing prices (in case of commodities) or sending RFQs to vendor competitors.
It is not that the life of a SCM professional has become smoother, new technology removes older challenges and brings newer challenges and it will keep on going on but this is not the topic of discussion here so we will refrain from going in that area. The point here is that skills that we all look in the SCM professionals at a senior position can actually be downgraded now as some of those skills are actually not required now as applications have taken charge. Yes, new skills are required but those will anyway not be available in professionals off the shelf and will need to be developed. So, the existing skills set for a SCM professional can be downgraded and manager can be hired where a senior manager used to work earlier whenever you get the chance to replace. Similarly, a senior manager role can be given to a manager and the senior manager can be given responsibilities which were (till now) handled by their seniors and so on. The entire exercise will free up some time for the senior executives for innovation.
One of the few benefits that were not talked upon much earlier after a leading analyst highlighted this in their study a lot of focus is bound to go in this area in-spite of strong counter views coming in from various walks of professionals. The comments section is waiting for your opinion in this regard.  

Will the ERP Products and Vendors survive Mobility Onslaught?

As one of the key technology trends these days, Mobility is arguably moving at the fastest pace even in the developing world and it is predicted by almost all leading analyst firms across the globe that it will be very difficult for any application to survive if they are not available in Mobile Devices by 2016-17. This puts our old war horse ERP into danger of extinction. Though, it seems very difficult to replace ERP with smaller mobile friendly applications but it will put immense pressure on this bulky application that needs large compute, memory and bandwidth.
Though the two bigger players in ERP space have started taking steps in moving at least the analytics product around their ERP, to mobile devices but they are still sluggish in developing a mobile device friendly ERP product. I have observed that users are now more mobile than ever and they do not want to keep sticking to their seats or cubicals to make transactions but want the applications to be available on the tablets or even better if on mobile phones. This enables them save their time and increases their productivity. With WiFi becoming a norm even on shop-floors, there is no reason that the users will not want this natural extension to ease pressure on them.
 
Yes, some of the transactions will need the user to be in the manufacturing facility or office building such as receiving material at gate where user has to be present at the gate for proper entry but with geo-fencing coming in, these situations can also be handled very well. Infact, there are a lot of other benefits if an ERP becomes available on Mobile Devices but I would not go into that discussion in this post.
Due to the slow response from the ERP product vendors on making the product available on Mobile Devices, a lot of mobile application organizations have mushroomed who are helping the organizations to bring critical functions as an app on mobile which will talk to the ERP and will act as an extension to your ERP. Believe me, the ERP product heavyweights are losing heavily on licenses because of this – which is another reason for them to do something about it fast. Manufacturing activities like production booking, confirming raw material consumption or procurement related activities like material receipt at gate, inspection etc. can be easily done in mobile apps which will feed the data back to the ERP backbone so that single source of truth remains in system. Similarly, organizations especially in services sector have started extending applications on mobile for their customers as well as suppliers and have created a nice bridge between these complimenting entities and the entire data flows back and forth from ERP making it a one simple application for all entities involved. The ERP vendors are on the losing side here too.   
One of the major IT advisory consultants have already predicted that ERPs will become legacy by 2016 and with the onslaught of mobility into the entire game, this seems to be getting more and more difficult for the ERP product vendors to remain ahead in their field. I would not be surprised if we see a completely android or iOS based mobile ERP that works using 3G or WiFi (when available), is hosted on cloud and needs very little compute, in near future. Let us brace ourselves for exciting things happening in Mobility.