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ERP Selection: Water Gremlin Case Study.

Water Gremlin Company Profile.

Water Gremlin Company was founded in 1949, in White Bear Lake, Minnesota as a supplier of innovative products to the recreational fishing markets.

Initial products included fishing lures and lead sinkers.

Their manufacturing scope broadened in the 1970s to include industry-leading terminals for lead-acid batteries. They currently have over 160,000 square feet of combined manufacturing and warehousing space in Minnesota. Leading supplier of battery terminals to the North and South American battery markets, as well as other markets throughout the world.

Backed with over 50 years of experience, and the 2005 acquisition of Okabe LTD., Water Gremlin Company has the global resources to provide you with the best in battery terminal parts and service.

Scott Schulz Individual Profile.

Current Job Profile: Vice President Finance at Water Gremlin Co. Past Experience: 1. CFO at Bite Tech, Inc. 2. Vice President of Finance at GE Security-Security & Life Safety Group. 3. Assistant Controller at Wilbert Plastic Services. 4. Auditor at PWC. Specialities: Financial reporting, management reporting, mergers and acquisitions; post-acquisition integration; ERP selection and implementation

With reference to this case, Scott Schulz spearheaded the nine months of Research & Assessment to choose new (ERP)Enterprise Resource Planning Software for his Incumbent Company Water Gremlin.

What is ERP.
Facilitates company-wide integrated information systems, covering all functional areas. Performs core Corporate activities and increases customer service augmenting Corporate Image

Integrates islands of information

Why there was a need for new erp

at water Gremlin

The problems with ERP for Water Gremlin.

Old system was extremely antiquated & inefficient, with in accessibility to information required for running the business efficiently. The old ERP was homegrown written by two employees of company (one already left ) so only one person in company knew about the system , which seems to be a big business risk.

Delays in manufacturing & gathering financial data. The old system required one to wait till end of month books closing to know financial standing.
Some department preferred creating own spreadsheet rather than entering data in ERP, reason being there was no place to enter the same on the system or a pseudo system was developed by the employees to bypass the current ERP. The ERP has been updated over the years with codes written by people who were not associated with Water Gremlin anymore. The result was a system that was cobbled with pieces of software that doesnt necessary integrate well with each other.

Challenges in Selecting the right solution.

Hundreds of ERPs available in the market with individual strengths and weakness. Proper due diligence was essential.

Considering the strategic nature of the selection and the budgetary commitments required. Management buy in was essential.

Need to convince managers of the company that the new system would make companys process more efficient Consensus was essential.

An unsuitable solution selected would have posed serious repercussion to both Water Gremlin and Scott Schulz. Caution was essential.

what was sCOtts apprOaCh fOr Erp selection

Scott Schulz Three Prong selection approach.

Internal research at Water Gremlin would help outline what each department needed.

A needs assessment using a software would help narrow down the ERP product choices.

Hiring a consultant would provide an objective guide through out the selection process.

ERP Product selection criterias.

Goal: To select the Most Suitable Software Package Solution
Functionality

5 Strategic Requirement Levels

Technology

Vendor

Support

Costs

Step 1: Selecting the Consultant.

Schulz interviewed four consultants familiar with ERP software and manufacturing process. Evaluation was based on: 1. Experience. 2. Capabilities. 3. Personality. Selected Minnesota Technologys consulting practice for their lean (centered on preserving value with less work) manufacturing philosophy. The central theme was elimination of waste.

Step 2 & 3: Internal research and needs assessment through software.

Step 2 and 3 was a composite step, where the internal needs were analyzed and iterated with the aid of softwares to short list the right solution.
The Accounting Software library Needs analysis program that helps short listing a solution based on answers to an extensive questionnaire. Evaluates more than 150 programs. Schulz worked with various people within the organisation to answer 4000 question posed by the software in areas such as cost analysis, procurement, CRM, work flow etc. Respondents need to rate their option s in the scale of 0 to 1. Outcome: shows how closely a programs attributes correspond to companys priorities.

SoftSelect
The software assess the ERP selection from a more strategic angle through use of surveys. Addresses macro level issues as opposed to questions about when and where certain fields shouls appear. Outcome: Printout showing not only options of which softwares could work but also a short explanation of why each system matched with companys criteria.

The Iterative short listing

Schulz research, needs assessment and working with consultants yielded 45 ERP possibilities. Using Software library and Softselect the list was further cutdown to 07 ERP systems. The selection committee comprising of Robert Neal (President of Water Gremlin), Schulz & VP of operations cut down the list further to 05 ERP systems by analysing profiles of the customer for each shortlisted vendor on basis of their sales volumes. RFP was sent to the 5 vendors along with the demonstration script describing typical company tasks. It also included special or oddball transactions the company experience to help the demonstration cover all aspects.

Final Shortlist of 3 Vendors

The Selection.
Winner: Epicor Software Corporation Winning Criterias: Schulz, Connor and Kent Myrhman (field consultants at Minnesota Technology) worked extensively on the demonstration given by the suppliers evaluating them on: 1. Ease of use Do I have to go through multiple screens for doing a task. 2. Service and dependability of the vendor training provided or not, after sales support, likelihood of the vendor being getting acquired by another firm etc. 3. Best match off the shelf The selected system should serve the purpose with off the shelf features leaving minimal room for customization, thereby saving cost, time and efforts. Cost: Selection process and consulting fees approx $10,000 + $100,000 for cost of the selected system.

Timelines: 9 months for research, consultations and demonstrations + 10 months for implementation and training

Critical Success Factors. The firm & optimistic approach of the Management - on adapting the ERP product driven methodologies
- on customization - on monetary commitments

The dedicated Team. Good Training Strict adherence to the Project schedules Right technical infra-structure & Change Management

Factors which may lead to wrong supplier selection. 1-Incomplete requirements .

2-Reliance on vendor demos.

3-Over-emphasis on system cost. 4-Selection bias. 5-Failure to use objective professional services. 6-Inability to understand offering by ERP vendor.

What can other Businesses LEARN from Water Gremlin Success ?

Key Take aways

Key take aways.

Intensive research required. Build up upfront planning to select correct ERP. Dont want too long to decide upon selecting ERP to avoid Analysis Paralysis

approach.
Seek external help if required in the form of consultant to bring objectivity to the selection. Keep users engaged at all levels of selection and implementation. Dont let vendors impact your selection decisions. Have collaborative approach, manage change in the organisation. Select product off the Shelf requiring minimum customisation to serve your

purpose thereby saving cost and time.

Look for post sales aspects like support, installation and training. Dont let software run your business, software should work for you.

Any Questions? THANK YOU