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I read all the time that the “surveys show that ERP systems are the key to improved corporate performance.”

I have a slightly different opinion.

While I believe that standardizing, condensing, purging and streamlining can enhance business performance; I don’t think implementing an ERP system is the cause of all of these changes - and therefore improvements.  I think companies that chose to replace their legacy system with a modern ERP solution, are improving their business in many ways besides focusing on the ERP implementation.  Lets look at some other possible factors:

1. Companies that put in new ERP systems are probably already making money.  Most struggling companies don’t say “lets put in a new ERP, that is our key to turning this thing around.”

2. Companies that put in a new ERP system are improving many parts of their business and the support of a modern, consolidated solution helps in those improvements.

3.   This is just a hunch, but most people in leadership that choose to implement a new ERP system have done it before.  It happens, but I’ll bet it is rare to have the legacy leadership choose to move away from the legacy systems.  More often, there is a change in leadership, ownership, etc. that leads to these changes.

I believe modern systems can definitely have positive affects on the business.  However, I think the positive performance of these companies due to many factors.

Last week I met Scott Sorheim over the phone through a mutual friend.  He has a company called Lean Technologies, and his product is called “Thrive.”

I really appreciate guys like Scott because they have passion for manufacturing and they are willing to “hang it all out there” and work on solutions.

Scott’s Blog:  http://leantech.com/blog/

Lean Technologies Website:  http://www.leantech.com/

Last night at dinner, the topic of unions came up. We discussed how unions were required at the time they were created to achieve fairness and safety for those working in manufacturing.  However, today, fairness in wages, hours, and training are still issues, it seems the modern union exists for other reasons.  We were not really sure about those reasons, but acknowledged that everyone has to change in order the stay relevant and compete.

Our conversation also reminded me of the 2007 MESA Keynote Speaker - Peter Fingar.  Peter reminded us that there are 3 billion new capitalists in the world and if we did not do something everyday to improve, we would quickly be rendered obsolete.

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I grew up in Connersville, Indiana, where there was once a $1B Visteon plant.  This plant just closed its doors because the union and management did not work to make it one of the best plants in the Visteon fleet.  If the plant had been one of the best in the fleet, chances are, it would still be making automotive parts today…

Conclusion - whether we are in automotive manufacturing, healthcare, education, or farming, we all have to work to improve everyday.  If we don’t we might just end up being “mothballed” like the Visteon plant in Connersville.