ERP is often the largest, most complex software system in a manufacturing operation. Managing all the modules that make up ERP -- from asset and warehouse management to financials and HR -- can be unwieldy, especially when they are running on separate systems. For small companies, moving to a Software as a Service (SaaS) model can be a way to both streamline the system and take a heavy burden off bare-bones IT departments.
Plymouth, Mich.-based Clips and Clamps Industries, a metal-forming company that services the automotive industry, realized the benefits of cloud ERP when it implemented the Plex Online ERP suite from Plex Systems. The manufacturer -- also known as CCI -- is a small, family-owned company with 50 employees and a one-person IT department. Prior to implementing Plex, CCI ran several independent software systems to fulfill its business needs. Its main ERP system was Canadian Manufacturing Systems, which was IBM AS/400-based and hosted on CCI's own servers.
When it came time to upgrade several systems, the company also began to explore ways to improve its use of IT, according to Jeffrey Aznavorian, vice president, general manager and chief operating officer.
"We needed to continue to advance all of our systems, including our machine technology, the skills base of our employees and our IT infrastructure," he said. "We knew we needed to be continuously improving those in order to stay competitive in the automotive market."
The company had been keeping an eye on advancements in cloud computing for some time, Aznavorian explained, and selected Plex's SaaS ERP system in 2008. But the implementation hit a snafu when the U.S. economic recession hit at around the time the project began. CCI saw its workforce cut by two-thirds and was forced to scale back its implementation timeline. The project was finally completed in December 2010, according to Aznavorian.
"Our implementation took a little longer than anticipated," he said. "We did it slow and steady at our own pace and did not use a third-party implementer, but it worked out really well," he said. Plex's project manager was involved at every step, he added.
The cloud came in handy right off the bat: By using Cisco WebEx conferencing to communicate with Plex, CCI only required two in-person site visits.
Plex SaaS ERP deployment leads to cost, labor savings
Streamlining CCI's collection of software systems was an immediate benefit to the company, Aznavorian said. "The real advantage that we saw in making a change to our ERP system was the fact that we would be able to integrate seven separate siloed software system that we were using into one integrated system," he said. "We had found that we had been taking critical manufacturing information and having to enter that information in several places in order to stay up to date with [International Organization for Standardization] or [technical specification] requirements and customer-specific requirements."
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Certain information requests -- including change requests and engineering changes -- had been particularly difficult to manage with the siloed systems, he added, because they would touch four or five pieces of software, and if just one data entry point was overlooked, it would disrupt the continuity of the requested changes.
"From an ROI perspective, we just looked at the fact that we could take all these standalone systems and the maintenance agreements associated with them and pull them all together," Aznavorian said. "That basically covered our lease cost for the Software as a Service model that Plex offers. We moved to a 21st century ERP system."
The SaaS ERP implementation eliminated the need to find more server space and perform server upgrades every few years, which had been a challenge for the company's IT person. "We knew that something that would be hosted outside our building was a smart move," Aznavorian said.
The new user interface that came with Plex Online was also an improvement for CCI, he added. Searching for data under specific processes is much more intuitive under the Plex menu screen than it was in the company's old AS/400 interface.
CCI gets employees on board with cloud ERP training
Employee training on Plex Online was done through multidepartment, simulated production runs, according to Aznavorian, where hypothetical material would be brought in, inspected, sent to production to become parts and shipped out using fake electronic data interchange messages and pallets. "We would bring in all the people who would actually be doing these things when [the system] was live, and they would understand how they would all be dependent on one another and see the other person's responsibilities," he said. "Giving them that exposure prior to going live with the system was tremendous."
Today, CCI's corporate and strategic goals are based on new cloud ERP modules available from Plex, and the majority of the company uses Plex in some way. "Of my 50 employees, I would bet that 40 of them are using Plex for at least part of their jobs," Aznavorian said.
CCI uses the core Plex Online ERP modules "every day, minute and second," including material requirements planning, inventory control, accounting, purchasing, quality and production control. The company is currently planning to adopt Plex's tooling functions to capture design and build cost of production tools, similar to the way it is capturing data on production pieces.
According to Aznavorian, CCI is hopeful that Plex will soon release cross-browser capabilities, which would be helpful in reaching its tooling goals. "With the small portable device realm that we all work in now, we've gotten rid of all our hard-copy paper prints, which is huge for a manufacturing facility," he said. "I want to do the same thing for the tooling department. I want to put tablets in [employees'] hands, so they can bring up the tooling print and scan it and zoom in on it."
"And for our executives on the road, being able to have any portable device they want and be able to access the Plex modules from wherever they are would really enhance the capabilities that we were originally sold on," he said.
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