CEO’s Guide to Implementing ERP for Manufacturing Expansion

The 2023 KPMG survey found that nearly three-fourths of global CEOs (73%) are confident of the global economy, compared to 71% in 2022. However, the same survey found that only 77% of CEOs are assured of their company’s growth. This figure is less than 85% at the beginning of the 2020 pandemic.

Besides geopolitical disruptions, CEOs are concerned about internal factors like operational issues, supply chains, and disruptive technologies. This is where ERP systems can address some of their concerns.

CEOs can leverage their ERP systems to gain complete visibility over their operations in the manufacturing industry. This visibility in modern manufacturing is critical to drive informed business decisions and strategies. According to 2024 statistics, 95% of businesses have improved their business processes by implementing ERP.

A CEO must thoroughly understand the benefits of an ERP solution. What is the CEO’s role in ERP deployment in any manufacturing company? Here’s a complete CEO’s guide to ERP technology adoption.

Benefits of Implementing ERP for Manufacturing Companies

First, let’s look at how CEOs can benefit by implementing an ERP system in manufacturing companies:

1. Process Automation

A recent survey by EY found that 63% of C-level executives in the manufacturing domain are concerned about the growing competitive threat originating from outside their industry.

This is why every CEO wants to automate manufacturing processes to gain a competitive advantage. They can achieve manufacturing efficiency with ERP solutions by reducing manual work and human errors. With real-time notifications, ERP systems can prevent manufacturing delays and cost escalation.

2. Immediate Approvals

Be it a vendor proposal or a sales order, CEOs can now approve (or reject) any request without having to be physically present to sign any paper at the manufacturing site. They can electronically sign the document from any location, thus saving both time and expenses.

3. Tracking Manufacturing KPIs

CEOs are responsible for effectively utilizing manufacturing resources and waste management to improve productivity. With an ERP system, CEOs have complete visibility of their critical KPIs involving inventory management, customer relationships, procurements, and equipment maintenance. Additionally, CEOs can generate customized reports (based on KPIs) to improve operational efficiency.

4. Effective Project Management

Effective project management is crucial for the implementation of any successful ERP system. With ERP project management for CEOs, they can ensure that every manufacturing project is completed on time and within budget. With ERP’s project management feature, CEOs can break down a major project into multiple stages, including planning, design, development, and testing.

Having understood the benefits of ERP, let’s next look at how CEOs can play a role in implementing an ERP solution.

CEO’s Guide to ERP Implementation

33% of CEOs in the manufacturing sector are opting for technology-driven innovation to implement business change over the next few years. With the right SAP B1 ERP implementation strategies, they can steer the company toward its business goals and strategy.

Here’s a 5-point guide to help CEOs implement a successful ERP system:

1. Create a Data-driven Business Culture

At the outset, CEOs can help highlight the importance of data in daily manufacturing activities. Highlight how real-time ERP data can benefit every operation and promote effective decision-making. This helps in creating a data-driven culture in the organization.

2. Define the Business Problems

Next, CEOs must define the business problems driving them to invest in ERP tools. Further, CEOs must understand how the selected ERP tool can address each of these problems from a business perspective. They must also communicate this information to their middle (or lower) management teams and employees to ensure the entire organization is on the same page.

3. Have Realistic Expectations from the ERP Implementation

Despite their extensive functionalities, ERP tools are not a “magic wand” that can streamline every manufacturing operation “overnight.” Depending on their existing IT ecosystem, CEOs must have realistic expectations from the ERP tool.

4. Implement Change Management

Every employee in the manufacturing company will not be comfortable with implementing a new ERP system, even if it simplifies their daily work. Through change management, CEOs must gradually highlight the benefits and necessity of ERP implementation. Additionally, they must invest in training tools and resources to enable employees to use the ERP modules more efficiently.

5. Build an Experienced ERP Implementation Team

For a successful ERP project, CEOs can work closely with stakeholders and users, who can be part of the ERP implementation team. Additionally, every team member must have a clearly defined role in the ERP project. If not available, CEOs can consider partnering with a technology company experienced in implementing ERP for manufacturing.

Conclusion

With its highly functional manufacturing module in ERP, SAP Business One can help CEOs streamline their business operations and reduce operational costs.

As a leading SAP Business One partner in India, Praxis Info Solutions has specialized in implementing ERP projects on time and under budget for India-based manufacturers. For our successful customer stories, click here. Contact us today if you are seeking the right manufacturing ERP solution for your company.