The Unbearable Lightness of ERP

Manufacturing Executive Road Trip by Mark Halper, September 2008 - In Prague last spring, Manufacturing Executive spotted a liberation movement aimed at unleashing the value of the enterprise software that has cost manufactures billinos of euros per year.

It’s Prague, it’s spring, and once again talk of freedom fills the air. This time, the radical thinkers in the Cyech Republic aren’t debunking the stultifying practices of Soviet-era communism as they were 40 years ago during the storied Prague Spring.

Rather, a rabble-rousing group of 24 European information technology enthusiasts is railing against the shortcomings of another monolithic force: ERP software. ERP, they say, is shortchanging the world’s corporations, which will spend roughly €14 billion on it this year, according to Gartner Inc.

The group’s rallying cry is „MES“ – short for manufacturing execution system. MES is the software that keeps a real-time log of what’s actually happening on a manufacturing floor – for example, how much paint a robot has sprayed, outage on line one, gasket leaking in the refinery, rivets running low on line three. With a little integration into ERP, they say, MES will elicit the benefits of ERP that many vendors have reputedly not fully delivered.

The ides is that by feeding ERP with up-to-the-minute factory floor information, executives can make smarter decisions about how much raw material and supplies to buy, how much to charge for finished goods, and how to adjust sales forecasts and strategies.

„ERP is nothing else but a big tool. It doesn’t solve problems. It masks problems,“ says Dominique Huver, head of Industy and Utility for Atos Conslting’s German and Central Europe operation. „It’s a read/write database, whereas an MES system is an interactive database.“

He gets no argument from comrade and ringleader Mike James, managing director at Dutch MES specialist ATS International. „A lot of manufactures have not gotten the benefit from their ERP system that they expected,“ he says. He tells of one that has: a carmaker that saved significantly when MES spotted robots applying too much paint to one side of the cars.

Like Alexander Dubcek and his Prague freedom movement, the James gang is fighting against stubborn thinking. Manufacturing executives don’t like to admit that their pricey ERP systems are underachieving. As Damir Hrastovic, general director of Zagreb, Croatia-based integrator Parodos Information Systems, says, „Senior managers say, „We have ERP, and that handles everything.“

Such ERP denial might explain the dearth of users at this gathering. The Prague 24 consists almost entirely of MES vendors and integrators, brought here from around Europe by James to advocate for MES in Central and Eastern Europe. James doubles as treasurer of the European branch of MESA International, the Manufacturing Enterprise Solutions Association, an MES backer. He’s plotting a bigger Prague rally, a two-day conference starting Nov. 3, where users may surface (see related article, p. 24).

OK, it might seem trite to compare the critics of enterprise softwre to a bold political movement that contributed to communism’s collapse in Central and Eastern Europe, and spawned films and fiction such as Milan Kundera’s The Unbearable Lightness of Being.

But the temptation to make historical comparisons in a fabled city like Prague is irresistible. Like the 1968 firebrands, the Prague 24 doesn’t advocate an outright overthrow. Dubcek wanted to preserve socialism, but brighten it up with individual and economic freedoms. MES proponents want to keep ERP but release its true value.

MES philosophy won’t take effect immediately. Former Soviet leader Mikhail Gorbachev, when asked in 1988 to describe the difference between his glasnost and the ideas of the Prague Spring, replied, „Twenty years.“ The MES school hopes it doesn’t take senior executives two decades to warm up in Central and Eastern Europe. If the Prague 24 prevails, it won’t. – Mark Halper

Further reading
- Can MES Play a Lead Role?
- Making Sense of MES

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