Back in 2006, Supply Chain Digest put out a paper summarizing the 11 greatest supply chain disasters, which it revised in 2009. (Download from SCD.) They are summarized in the following table:
|Foxmeyer||Bankruptcy||ERP and Automation Failure|
|WebVan||Bankruptcy||ERP and Automation Failure|
|Adidas||Forecasts 80% off; market losses persist for years||ERP and Automation Failure|
|Denver Airport||Late opening; PR fiasco||Automation Failure|
|Toys R Us||1000s of orders unfulfilled; huge PR fiasco||Serious Understaffing|
|Hershey Foods||150M+ revenue loss; 19% profit loss; stock plummet||ERP and Warehouse failure|
|Cisco||2.2B inventory write-down; 50% stock plummet||ERP and Inventory Forecasting|
|Nike||100M Profit shortfall; 20% stock drop||ERP and Inventory Forecasting|
|Aris Isotoner||Fire Sale||Outsourcing Snafu|
|Apple||PR Black Eye and Major Market Share Loss||Conservative Inventory Strategy|
See a commonality? Six (6) of the Eleven (11) failures are directly or indirectly caused by an ERP fiasco. Three (3) are due to poor inventory planning and/or management and ERP (integration) failures, and three (3) are due to warehouse automation failures (and include an ERP integration failure or management component). Technology has been the leading cause of major supply chain disasters, and the technology has always been either the ERP, or dependent on the ERP.
If this does not convince you that ERP is NOT Enough and an over-reliance on your ERP system is just a supply chain disaster waiting to happen, I don’t think anything will and will advise that if you are religious and pray, start praying for a smooth supply chain today. (Not that the doctor thinks praying will help, but nothing will as long as your organization over relies on the ERP.)
As the doctor pointed out in his last post, not only does the paper address some critical ERP shortcomings in detail that you need to understand, but it also helps you understand why you need, depending on your business, ether a modern sourcing platform, a modern procurement platform, or, particularly in manufacturing, a modern supply chain communication and collaboration platform that handles all critical communications. And it does so without any reference to any particular platform and contains no marketing spiel, a rarity for a vendor white paper today.
So go ahead and download Why ERP is NOT Enough today and begin your journey to the adoption of a modern supply management platform so that your organization does not end up on the top 11 supply chain disasters list due to an inevitable ERP failure. (Like a natural disaster, it’s not a matter of asking “if” it will happen, it’s a matter of being prepared for “when” it will happen.)