Alexander Nazarov: ERP system implementation - a method quickly and effectively to make high-quality changes in the organization

TAdviser: Whether other ERP system was used at the enterprise earlier and what became a reason for its replacement?

Alexander Nazarov: From 1990th years on JSC Zvezda the solution BPCS was used. However, by 2005 there was already a number of arguments for benefit of ERP system change. First, that model of production planning which was implemented in a system was practically not used by us owing to its weak compliance of a real situation in the plant. Secondly, at that time the solution BPCS already morally also became physically outdated as it not only did not conform to modern requirements to the maintained technologies and the interface of ERP systems, but also worked on quite specific equipment (AS 400). Support of this system officially in Russia was not performed. At the same time and at the enterprise there is no specialist left who could support her. At last, the bad experience of implementation connected with the BPCS brand also played a role and, as a result, it was accepted decisions on complete change of a system.

TAdviser: How the IT service collected information on options of ERP systems and on integrators: through clubs of Chief information officers, analyzing information from the Internet and the press, having ordered a research, having purchased the analytical report or somehow differently?

Alexander Nazarov: We, of course, tried to cover the maximum number of information sources available to us, however the preliminary information about systems and the companies implementing them offered in the market, generally was public and arrived to our employees from the Internet and the press.

TAdviser: What else ERP systems, except SyteLine, were considered as possible options for use at the enterprise?

Alexander Nazarov: In the course of primary selection of software solutions which could be used at the plant we considered ERP systems: SAP ERP, Axapta (MS Dynamics AX), SyteLine ERP, the adapted option "1C: Management of industrial enterprise 8.0". But finally stopped the choice on the offer Frontstep and the ERP system of SyteLine.

TAdviser: What "weight" did functional requirements to a system have, at technical requirements and at cost? How did the ratio of these scales affect originally selected options of ERP systems?

Alexander Nazarov: Three criteria had the largest weight: functionality, cost, experience of implementation of the advanced solutions by the supplier. On a decision instant (summer of 2005) the SAP solution disappeared at cost, the Akharta system – due to the lack of sufficient experience, "1C: Manufacturing Enterprise Management 8.0" – owing to lack of sufficient experience and also functionality.

TAdviser: For what reasons the choice of the enterprise was stopped on Frontstep company?

Alexander Nazarov: If to speak about basic reasons, then when choosing supplier/integrator defining for us became existence of industry competence and experience of successfully implemented projects in mechanical engineering. Together with the solution proposed Frontstep which met our criteria these competitive advantages of the company also predetermined its choice as our partner in the project.

TAdviser: Whether the task to use at the APS enterprise was set initially? Whether means use of the module APS SyteLine ERP that the module MRPII is not used in general?

Alexander Nazarov: Yes, such task was set. Use of APS really means lack of need to use MRPII. It is explained by features of production "Stars". For intra shop planning in the nearest future of functionality there will be enough APS and so far we do not plan use of MES.

TAdviser: How well, in your opinion, the sheaf "1C: Accounting + with SyteLine ERP" works? Whether there are no problems with data exchange in real time or some other?

Alexander Nazarov: There is no data exchange in real time also it and is not necessary. Owing to specifics of work of accounting service of the plant there is no need to reflect in accounting data at the time of their emergence, these data arrive with a certain frequency. Problems with integration arise at the moments of change of NSI or the scheme of the movement of documents, but these are the normal working problems solved by setup.

TAdviser: What, in your opinion, strategic deposit of a consulting part of the project and actually implementation?

Alexander Nazarov: A deposit of a consulting part simple – at the time of the beginning of implementation people were not ready to perceive new technologies as knew about them very little. In this situation consultants helped to make to the staff of the plant a certain initial mental shift, to specify the direction of the movement. It in many respects helped to avoid "rejection reaction" of future system and to keep the project productively. Implementation of the ERP system helped the management of the enterprise to look in a new way at the project and to perceive it not just as deployment of a certain software solution, but as on a method quickly and rather effectively to make high-quality changes in the organization.

What practical results of the completed project? What changed in the qualitative plan that in quantitative and as far as?

Alexander Nazarov: Among qualitative results it is possible to select increase in balance of production planning. Besides, now purchase plans are analyzed regarding demand of the purchased nomenclature. In the quantitative plan reducing costs for purchases happening due to timely identification of above-standard stocks and their use in production is reached. Also, we managed to reduce answer time to clients concerning an opportunity and terms of accomplishment of their orders – systems capabilities of production planning allow to predict terms of accomplishment of orders with a high accuracy that, respectively, allows to work more surely and reliably with customers. We are not ready to estimate financial performance of the project yet though already now it is clear as it to make. I think, it will be possible to speak about specific financial results of the project at the beginning of the next year.