WHY DOES MRP FAIL?by
Brian Willcox CFPIM
of
Action MRPII |
Perhaps the first
question to ask is; what is a success and what is a failure? My stock
answer to that is, is it doing what it was introduced to do? If it is,
then it is a success no matter what the experts think about it. A
different point is, is the company getting all the benefits it could be
getting? Usually the answer to that is no.
MRPII is a tool to manage the whole business
with, not just a system for the production control people to play with.
Meeting managers from all sorts of companies in the course of earning my
daily bread makes me only too aware of the various beliefs that different
companies have of MRPII, and that is separate to the thinking of how to
implement such a system. |
When we get called in to assist a company who
say their system is not helping them, we find a variety of reasons such
as; no management involvement, a total lack of discipline, little
understanding of the basic principles, an overloaded MPS, a low priority
status for the implementation and my old favourite low inventory accuracy.
You may think I'm trotting out all the standard quotes, perhaps I am , but
unfortunately we find them all too regularly. |
| Having got that little
lot off my chest, how can a company prevent it happening to them. How can
they ensure that after spending a tremendous amount of cash they have a
system that works and gives them the return and benefits they budgeted
for. |
| I'm afraid there is no
magic wand to ensure success, but there is most definitely a well proven
approach to follow. In simple terms, it is to do it properly the first
time and that is most definitely cheaper than having to do it a second
time. |
| There are ten essential
steps to follow in a set sequence, but they on their own will not be
enough. What is also needed is, the commitment of the whole company for
the implementation. If the determination and drive of the executive is not
there, at best you might get a good ordering and scheduling system if the
production control manager and his staff are determined to
succeed. |
TO MANAGE THE
PROJECT
Two
levels of management are required, the executive steering committee and
the project team. The steering committee usually consists of the key
members of the executive, chaired by the managing director. Their job is
to have overall control of the project, ensuring that the right things
happen when they were planned to. But further, they are responsible to
provide the funds, staff and facilities to support the needs of the
project. Just as important though is that they must be seen to be
supporting the project with all their might and enthusiasm, not just
paying lip service and the bills!
The project team consists of the
department heads; the boss men of the doers,chaired by the project
manager.It is important that this team is representative of the
departments who will be affected by the decisions made by this group. It
is their job to establish how the company will operate using the new
software. One thing is certain, the existing methods and procedures will
alter therefore it must be the person responsible for a department who
decides how that department will operate in the future. It is this team
who have to make the biggest commitment in time. They will be needed
several; hours a day to match the software to the way the company
operates. It usually means they have to off load some of their routine
work to their right hand assistant. |
THE TEN
STEPS
- Step 1 First Cut
Education
- It is essential that the executive
group fully understand what they are letting themselves in for and what
their responsibilities are to the project. The two day executive course
brings the group to a common understanding and enables them to make an
informed logical decision when it comes to approve the software to
purchase.
- Step 2 Project Team
Training
- This team goes through the five day
MRP course so that they understand the principles in more detail.It is
this group who have to define what the system must do and how it will do
it and choose the software that can best meet the company’s
needs.
- Step 3 Statement of User
Requirements
- It is essential that the company
establish the real needs of the business and do not try to computerise
their old bad habits. This is usually carried out jointly by the project
team and outsiders who are not restricted by the company politics or
existing practices.
- Step 4 System
Selection
- This is the job of finding a
package to meet the needs of the company as established in the statement
of user requirements. It is only at this point that hardware is
considered to run the software on.
- Step 5 Match Company to the
System
- This is the biggest task of the
implementation. It requires the project team to establish exactly how
each part of the system is to be used and how your existing practices
are to be accommodated or replaced. This process can take several months
of hard work.
- Step 6 Module
Training
- Once it is established how the new
software is to be used then the job of training all the users can be
started. Unfortunately there is no standard training material available
which covers the way you are going to use the system. The normal
approach to follow is to create "train the trainer" courses for your own
managers to train their own staff. They should include basic principles
and the details of how it has been agreed the system should be used.
They should also be totally customised to use your own products, terms
and part numbers.
- Step 7 Simulation
Training
- Once the classroom education
provided by the customised module courses is complete then it is time to
practice how to use the system. The concept of simulation training is to
create a copy of the system and to load one or two actual products. The
simulation system is then run for an hour a day just like a real
company. The major difference is that it is controlled from behind the
scenes, introducing simple activities to start with and gradually
getting more like the real world each day. After six weeks the
participants from each discipline in the company are capable of handling
the problems that arise in the real world as they occur. When the live
system is turned on they will be capable of working through the various
transactions and using the logic required to manage their job
competently.
- Step 8 Pilot
Run
- A small part of the company is put
on to the new system to prove out all the decisions and methods of
working are acceptable. If trouble is encountered then all the company
resources can be put on that 10% to sort it out. Ideally the pilot
products should where possible, be able to be separated from the rest of
the company.
- Step 9 Full
Conversion
- Once the pilot run has been
successful for a few weeks and a month end has been accomplished, then
it is time to implement the rest of the products. Usually a phased,
module by module approach is used when possible but so much depends on
how computerised the existing systems are.
- Step 10 Post Implementation
Audit
- The last task of the project team
is to establish if the benefits that justified the system those many
months before have actually been obtained. If the answer is no, then
their job has not finished as it is up to them to find out what has gone
wrong and correct the situation.
|
THE LESSONS
LEARNED
- If after the initial training the
senior and middle managers are not enthusiastic, cut your losses and
forget MRPII.
- If the project is not the most
important activity in the company except for staying profitable, it will
never be successful.
- If the steering committee cuts the
education and training budget as they think it is unnecessary, plan for
disaster.
- If all of the above apply, look for
another job! You may think I'm being flippant, well perhaps your are
right, but the facts of many failures support me.
- If none of the above apply, go for
it and I wish you all the luck in the world. You will need it
anyway.
April 1997 |