Wednesday 26th Oct 2016 - Logistics Manager

ERP project delays cost manufacturers $1m a month

Enterprise resource planning (ERP) project delays caused by lack of business-to-business planning and integration could cost manufacturers more than $1 million (£600,000) a month, according to GXS.

The study, which focused on the tie between B2B e-commerce deployments and ERP systems upgrade, was carried out by AMR Research.

It discovered that nearly 85 per cent of companies surveyed had experienced delays in roll-outs as a result of B2B integration issues, which can cost over $45,000 (£28,000) a day.

The study included respondents from the food and beverage, high tech and consumer products industries, as well as from automotive suppliers and OEMs.

It found that 65 per cent of respondents performed inadequate testing of B2B prior to new ERP launches.

Almost half (47 per cent) of companies introduced new transaction sets or trading partners during ERP projects.

It was also discovered that 79 per cent of companies had a greater than one per cent error rate for B2B data, and 57 per cent experience a production outage because of lack of B2B connectivity.

The research also highlighted that 34 per cent of data in ERP systems originates from outside the enterprise, from customers, suppliers or 3PLs.

Steve Keifer, vice president of product and industry marketing at GXS, said: “The symbiotic nature of B2B and ERP is often overlooked, as many manufacturing companies tend to focus design, development and testing efforts on business processes within the four walls of their enterprise. 

“Project leaders often forget the critical supply chain links and external data flows needed to power ERP applications.

“Too many companies get half-way through a new ERP roll-out to discover that they are not staffed to support the massive mapping, testing and trading partner management activities necessary for ERP upgrades.

“Our goal is keep ERP projects on-schedule and under budget with a best-in-class approach to B2B integration.”