ERP Implementation Process in Apparel Industry

ERP is the acronym for enterprise resource planning. ERP is an information system that integrates all facets of business like R&D, sales and marketing, manufacturing, logistics, human resources, logistics, financials, and so on. ERP streamlines workflows, business processes, and methods followed by the organizations to attain the goals envisioned for supply chain management.

ERP implementation process in garment industry:
Many organizations do not have sufficient internal skills to implement an ERP system project. This results in many organizations offering consulting services for implementation. Typically, a consulting team is responsible for the entire ERP system implementation, see Fig.

Basic ERP system implementation process.
Fig: Basic ERP system implementation process.
ERP systems play an important role in the fashion and apparel industry. There are many cases of implementation globally. Also, there are many cases where the implementation is a huge challenge to the fashion companies.

For best business practices and successful business results, the ERP system application has to be completely implemented across all departments. The implementation of an ERP system will have a greater impact on the processes of the organization, functioning of the department, organization culture, employees, and the management.

ERP system implementation is a difficult task. Most of the implementation overshoots the implementation schedule, costs overrun budgets, under-delivers the business expectations, and delivers less business value. It involves huge financial implications, a lot of human resource at different levels with different frequencies, and it requires lots of technical expertise and a dedicated approach, which makes it more difficult for smooth implementation. In general, ERP system implementation in an existing industry is a transformation process. Any transformation in the industry has to go through its rough patches of resistance, conflict, setbacks, bottle necks, and time delays. This also leads to extensive delay in implementation, which most of the time is treated as a failure to deliver in time.

The apparel industry works with stringent time frames and involves many technical processes. As the product life cycle becomes shorter with less lead time to deliver, the industry moves in to automation of its processes with state-of-the-art technology. Automating the processes of the industry through implementing an ERP system application will be one of the major initiatives taken by the organization to keep up the pace of the industry’s growth.

Project planning:
The implementation of an ERP system is an initiative taken by an individual or group of individuals or management in an organization. An organization has to identify its objective and need for implementing the ERP systems in line with the organization’s goals. The ERP system implementation will not yield expected results if the objectives are not clearly defined. These objectives must be defined, keeping in mind parameters such as existing business needs, the processes, and future expansion plans. The organization must identify a team of technical experts who understand the business processes to define the requirements of the automation process. The expert team must study existing ERP system products available in the industry and the software used by peer groups.

Software selection:
Product selection plays a key role in ERP system implementation. Successful implementation is determined by the product selection that determines the future course of business. The technical team plays an anchor role in software selection, and it must be transparent, critical, and analytical and should function with complete freedom of expression. The software should be flexible to meet the changes in business, scalable to grow with the company, less complex, user friendly, affordable to the organization, and compatible with the internal culture of the organization. The software should use the latest technology used in the industry. Software selection should not be influenced by an individual or a group, popularity or brand name and should not be biased.

Vendor selection:
Vendor selection is also a key to successful project implementation. The technical team has to analyze the existence of the product in the market and the experience of the vendor by analyzing the number of successful installations, turnover, and experience in development and implementation. Technical expertise of the vendor’s implementation team or the implementation partner is an important key for implementing an ERP system in an organization. The ERP system implementation can fail due to poor vendor selection and lack of after-sales support.

Customization:
ERP system software are not ready-to-use products; these require minor changes to make them functional and to meet the complete requirements of the organization. The technical team in association with the experts of the external implementation team must determine the level of customization required, by keeping the parameters in mind such as these:

  • Ready to use features of the software by understanding existing business processes of the organization.
  • The technical team identifying the gaps that need to be bridged, so that the organization practice becomes akin to the ERP system environment; GAP analysis would determine the depth of restructuring required in an organization and provide necessary suggestions such as new reports, analysis, and better features; this process is inevitable even though it is expensive and time-consuming.
  • Reengineering needs organizational restructuring and change in the processes that will help in enhancing productivity and eliminate processes that are not required; reengineering the processes must be taken to suit the requirements of the software and for the better process controls.
  • The product must be user friendly; customization should not exceed 20% of the project scope.
Most of the implementation delays are caused by excessive time taken for customization. Misunderstanding the level of customization required or the clear-cut understanding of processes of the organization will result in unnecessary delay at the implementation stage.

Architectural design:
Technical requirements of the organization determine the architectural requirements. Technical requirements include the number of modules required, which includes e-business and e-commerce applications. Architectural design is the backbone of the ERP system implementation. The implementation team should identify the type of deployment required, such as on premise or host the application at a data center or cloud (private or public). Based on this the organization should determine the number of user locations, data capturing points, access points, and report centers and determine the architectural requirements such as hardware, software, network, firewall, and other infrastructure requirements. The security levels should be clearly defined at the time of preparing the software requirement specification (SRS). Any ambiguity in architecture design will complicate and delay the implementation.

Cost of the software:
A proper investment plan with clear-cut budget allocation is a key to the implementation success of ERP systems. Vendors never disclose the complete investment plan, which includes these points:

  • Product pricing
  • Hardware infrastructure
  • Technology
  • Training and implementation
  • Maintenance
Improper fund flow will lead to a delay in implementation. A service level agreement must be signed with a complete plan of action and scope for deviations such as delay in implementations and accountability factors on both sides.

Data management:
Capturing the right data at the right point is the key to scientific implementation, which includes elimination of duplicate and redundant data and capturing indirect data through data mining. The success of implementation is determined by the use of existing data stored in the organization in various formats using a data conversion method.

Preparing for the venture:
The ERP system implementation team must have participation from all stake holders such as technical experts, top- and middle-level management, end users, and finance. The implementation may fail due to improper implementation methodology, poor budget allocation, fund flow, and nonavailability of infrastructure. Failure to draw blue prints, SRS for implementation, or defining the responsibility and accountability will lead to implementation failure. Lack of awareness among the employees about ERP systems and its advantages will lead to resistance to change. Prior to the commencement of the implementation the organization must provide the right IT infrastructure prescribed by the implementation team. Nonavailability of infrastructure and technology may lead to unnecessary delays in project implementation.

The ERP system implementation may not yield expected results in time due to improper installation, configuration, customization, critical testing with real-time data, or training of trainers and end users. A conflict of interest between internal and external experts and resistance to change by employees will result in a delay of the implementation.

Failure to implement the ERP system application or delay in the process will affect the growth of the industry and result in a huge loss in terms of finance and time. In the long run, delay in implementation diverts the focus of the industry, thus challenging its basic existence. The ERP system implementation failure is not a threat to one organization; it is a threat to the apparel industry itself. It indirectly affects society and the growth of the nation. There is tremendous scope to study the difficulties faced by organizations in implementing the ERP system application in the apparel industry.


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References:
  1. Information Systems for the Fashion and Apparel Industry by Tsan-Ming Choi
  2. ERP for Textiles and Apparel Industry by R. Surjit, R. Rathinamoorthyand K. J. Vishnu Vardhini
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Editor-in-Chief:

Mazharul Islam Kiron is a textile consultant and researcher on online business promotion. He is working with one European textile machinery company as a country agent. He is also a contributor of Wikipedia.


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