Digital Business System

The AIMCH Digital Business System work package (WP4), often termed Enterprise Resource Planning (ERP), seeks to investigate how integrating digital business systems can lead to increased productivity, quality and a reduction in lead-time, downtime, and processing time in off site manufacturing (OSM) and the connected supply chain. While every business will have specific challenges, there are several potential benefits an integrated business system can bring.

summary

The AIMCH Digital Business System, suitable for large and small offsite manufacturing businesses, was developed by AIMCH partners Stewart Milne Group, Forster Group and the Manufacturing Technology Centre (MTC). The key objectives were:

To increase business efficiencies by eliminating multiple manual administration tasks through the development of a Digital Business System.

To reduce the level of on-premise hardware, thereby decreasing system downtime and improving system performance.

To improve customer service and provide closer integrations for both clients and supply chain.

To develop ERP system recommendations suitable for large and SME sized offsite MMC suppliers

Challenge

The offsite MMC construction supply chain sector has a hybrid design, manufacturing, logistics and sub-contractor construction installation business model. ERP digital business systems tend to favour either manufacturing or construction-related business models, with no generic ERP system meeting these hybrid needs. The AIMCH challenge was to develop the requirements and down-selection process that would develop a configurable ERP solution for the MMC supply chain.

This web page gives a summary of this part of the AIMCH project and a full downloadable report can be found at the bottom of this page.

Journey

A phased development approach was used to create the Digital Business System. The phased approach enabled different tools to be explored and developed. The focus was on a large scale digital business system (ERP) suitable for a mature MMC producer like Stewart Milne Group, with this work feeding into a scaled-down system solution for SMEs new to MMC and offsite construction components or systems, like Forster Group.

Digital Discovery
To understand how industry leading technology will affect the future of business and to appreciate how digital transformation can drive vision and goals. Digital discovery workshops were scheduled into three-hour sessions with each session concentrating on a specific capability.
This helped to:
- Enable project preconceptions to be re-evaluated.
- Allow project stakeholders to review the needs of the business and define a comprehensive digital business strategy.
- Capture and present the outcome of a session in real time, allowing for instant feedback.
This led to development of a Transformation Map to visually represent consolidated findings from all workshops. The map provides an overview of how transitioning from the current mode of operation to the desired future mode of operation can be achieved.
It also divided business operations into capabilities and transformation projects, that were mapped against each capability. It is essential to note that an improvement activity potentially affects multiple capability areas.
As outputs from the digital discovery workshops, spider diagrams provide a high-level visual representation of how the business perceives its current digital maturity, compared to where the business would want to target its future digital development.
Requirements Capture

requirement capture performs a detailed analysis of current processes and to capture the actual process requirements.
This will identify possible improvements and define pain points, bottlenecks and wasted effort within the current strategy.
This led to deconstructing each business process step-by-step, revealing an enormous amount of information, including pain points, duplication, and sub-optimal process design.
The ‘swimline’ mapping approach allowed the capturing of business processes in relation to a business project, enabling the mapping of connections and data flows between capabilities.
The business documentation generated to support each process provided a visual insight into the levels of manual intervention required to manage the business and the exercise allowed an outline business case and ROI analysis to be performed.
Identifying Vendors

To understand the overall ERP market, future trends and to develop a targeted list of potential vendors, suitable for MMC offsite manufacturing business, it is necessary to understand the opportunities and possibilities that the ERP system currently offers.

This will allow the selection of an appropriate vendor and ERP system.
A fundamental requirement included communicating the right message, which enabled the down-selection team to concentrate on pre-selected and potential vendors and not waste time with products that did not meet requirements.
Approaching Vendors

A select list of vendors were invited into the tendering process, allowing them to gain more information about the requirements and to learn more about the vendor’s capabilities.

This led to a comprehensive and robust down selection process allowing vendors to have a detailed representation of the company’s ERP requirements.
By providing a standard template for gathering vendor feedback, a quick and efficient comparison analysis could take place detailing how each vendor’s product could meet the business needs.
This allowed incompatible solutions to be quickly eliminated.
Establishing Fit

Vendors who meet and exceed the business requirements were invited to discuss their systems and provide a live demonstration of their product.

This allows the customer to match their expectations to the vendors capabilities.
By providing vendors with the company Capability Map, they were able to understand the business more fully.
The use of templates allowed for a quick analysis of responses. The evaluation of vendor responses demonstrated that smaller ERP providers may be capable of delivering almost all of the system requirements at a competitive cost.
Evaluation & Selection

The evaluation process ensures the business gets to know the vendor better including their system capabilities, implementation and support approach ensuring the best solution is selected.

The vendor(s) who demonstrated the best offering were offered a further in-depth opportunity to demonstrate their solution with the most impressive vendor being invited for a further demonstration to showcase their solution, in detail, using a simplified demonstration script.

Demonstrations were recorded so that they could be reviewed and shown to a wider audience following the demonstration day.

This resulted in the understanding that one single ERP system to manage Offsite MMC design, manufacturing, delivery, construction and project management is possible, but there are few vendors with targeted offerings in that market.

Principal OUTCOMES

The AIMCH Digital Business System provides the following outcomes:

1: Companies should allocate sufficient time and expertise to effectively manage an ERP down-selection process. Decision makers should be involved in all key stages.
2: A well designed and managed ERP down-selection process reveals detailed insights into a company, challenging existing mission statements and strategies.
3: Framing ERP down selection within a wider digital strategy provides companies with a significant opportunity to understand how they can transform their business to compete in a digital future.
4: Support provided by experienced ERP experts is invaluable. Companies gain significant awareness during the process and are equipped to approach vendors, knowing what questions to ask and how to select a product that will enhance their business performance.

5: It is critical for decision makers to be involved in the down selection process to avoid false assumptions and to increase understanding of the process and its common pitfalls.
6: Concentrating on large, well-known providers at the expense of smaller vendors may jeopardize a holistic down-selection process and may not result in the most appropriate system being selected.
7: Allowing all selected vendors an opportunity to present their products has benefits. Smaller companies are often capable of offering excellent support and delivering competitively-priced solutions.
8: Integrating several niche IT systems, as opposed to selecting one generalist product, to manage the intricacies of an OSM business could increase overall costs and complexity of an implementation but may greatly improve the quality of the resulting solution.

Resources

Download Digital Business System Guide

Conclusion

Costs of digital business systems can vary hugely, depending on the scale of solution you look to implement. Benefits will be dependent on both the current situation and future challenges you face.

It can be challenging to quantify all the benefits, and return on investment may change in relation to business growth. Working with vendors to understand what the system can do and using demonstrations to get a feel for usability will help.

Collating the potential benefits from expected improvements in a matrix enables impact scoring and can help ensure all areas are covered as well as highlighting where the biggest wins are likely to be found.

Given the opportunities that digital technologies provide, if the business case isn’t stacking up then perhaps the appropriate solution hasn’t been identified. It might be over-specified, or perhaps some of the benefits it can bring have been missed or under-quantified.

Outputs