Most top-tier EAM/CMMS vendors offer integration products, services, and tool kits that link their products to ERP packages and other business systems. These interface solutions play a prominent role in their marketing literature, web sites, and sales pitches. Many companies start their EAM/CMMS selection process with the intent of tightly integrating their new maintenance package with ex...
Most top-tier EAM/CMMS vendors offer integration products, services, and tool kits that link their products to ERP packages and other business systems. These interface solutions play a prominent role in their marketing literature, web sites, and sales pitches. Many companies start their EAM/CMMS selection process with the intent of tightly integrating their new maintenance package with existing business systems. They believe that integration is synonymous with best practices.
How often do companies actually implement ERP/EAM interfaces? In my professional career, I have heard a lot of talk about the topic, but seen correspondingly little action. While many operations initially factor ERP integration into their EAM/CMMS plans, they end up backing off for a variety of reasons. For those companies that choose to pursue the ERP/EAM integration path, I have heard my share of both success and failure stories.
ERP/EAM integration is not cost-justifiable or practical for every company. However, there are many organizations that could benefit from it but avoid considering the topic. This hesitancy can be due to perceived price, overburdened IT resources, potential risks, skepticism about the benefits, and a low priority that is automatically given to every plant maintenance-oriented IT project. Whatever the reason, these organizations may be missing out on some big dividends. For a company using multiple systems to support maintenance supply activities, ERP/EAM integration may provide an extremely attractive return on investment.
The decision to pursue ERP/EAM integration needs to be driven by both functional and technical factors. Consequently, it cannot be ceded solely to IT. Maintenance must play a role. To do this effectively, maintenance must be able to articulate the benefits from its perspective as well as have a basic understanding of the concepts involved.
ERP/EAM integration automates the flow of information between systems. It eliminates the need to manually enter information already in one system into the other. Its specific benefits can vary from company to company. But they can be summarized into three categories: labor savings, timeliness, and information utilization.
Labor savings center around the elimination of the entry of the same data into two or more computer systems. Despite the promise of automation inherent in information technology, it is not hard to find situations in the workplace where people are keying information from a report generated by one system into another. These redundant efforts can be sporadic, or frequent and labor intensive.
Integration labor savings are usually quite apparent. They can be found by following the steps of an overall process from initiation through final action. Purchasing is a fairly easy process to trace from requisition to invoice matching and approval. Potential integration points are where information moves from one system to another. For example, an EAM/CMMS-generated purchase requisition is approved and then the information on the hard copy requisition is keyed into a purchasing system. The potential labor saving is the amount of time spent reentering data into the second computer system.
Integration can increase the timeliness of information. The potential benefits and savings involved in increased timeliness are more difficult to spot than labor savings. They revolve around the ability to make decisions more quickly and respond more expeditiously to changing conditions. Increased timeliness can also allow an organization to reduce contingency resources.
The value of timeliness can be illustrated by the effect of implementing ERP/EAM integration to support purchasing. For example, maintenance uses its EAM/CMMS to manage its MRO stock and purchasing uses the ERP's purchasing module to buy this stock.
Without integration, maintenance needs to keep more safety stock in the storeroom because of the time it takes from requisition to receipt to obtain parts. Integration can not only shrink the timeline but also reduce the amount of inventory that needs to be carried in the storeroom.
Increased information utilization is the integration benefit that is most difficult to spot and quantify. It centers on getting all relevant information into the right hands to support the decision-making process. Companies using multiple business systems may be capturing information in one system that can increase the effectiveness of a user of another system.
For example, a company that uses an ERP inventory or warehouse module to manage its maintenance storeroom might not reenter each material issue into its EAM/CMMS. These transactions might flow to the ERP accounting module to support user department charge backs. But they are invisible to anyone trying to analyze equipment history in the EAM/CMMS.
At the most elementary level, ERP/EAM integration is about using software to move data between different computer systems. Described in this manner, it seems like a straightforward proposition requiring only a little bit of programming. But in reality, there is much more involved. Its technical details and approach can vary from software package, computer platform and network, and corporate IT capabilities.
Business system integration can be broken into four steps: extraction, transport, transformation, and insertion. As their names imply, extraction and insertion are software services that retrieve data from one system and place it into another. Both steps must be triggered by either a manual or programmatic event, with the latter providing the most seamless, controlled interface. Insertion must also validate the input data from the other system. Incoming data must undergo the same checks and establish the same database relationships as information keyed into a data entry screen.
Transport provides services to move information between systems. Its exact nature depends on the computer platforms and network architectures involved. Exchanging data between systems on the same computer platform can have a different look and feel than transporting information between disparate systems.
Transformation is usually where most of the effort is invested in integration. Different systems have different database structures. Data from the sending system must be "mapped" into the database layout of the receiving system or some sort of intermediate file. This mapping must accommodate different field names and logical file structures. It can also manipulate and modify in-transit data so that functionality not inherent in the "raw" extracted data is added to the end result.
Top tier EAM/CMMS vendors generally provide application programming interfaces (APIs) to move data into and out of their packages. These APIs are intermediate file structures, externally callable subroutines, and triggering events that allow their system to communicate with the outside world in a predefined manner. Some vendors offer "standard" interfaces to the major ERP vendors. These standard interfaces basically hook up the EAM/CMMS vendor's APIs to the ERP vendor's standard API set through predefined transformation maps. EAM/CMMS vendors may also provide integration consulting services and documentation to address ERP packages not covered by their standard interfaces.
Those EAM/CMMS vendors that provide integration products generally price them as a percentage of the overall license fee. Integration implementation can also require additional consulting fees and internal IT resources. Companies aren't necessarily dependent on vendor integration products. They may be able to develop their own interfaces using third-party tools and programming languages. But this approach has its inherent risks and costs. It can require a detailed command of database structures and internal workings of both systems.
Since maintenance is a prime beneficiary of ERP/EAM integration, it must also be the principal advocate. But it must do so with the realization that ERP/EAM integration, like any other IT investment, must be based on a sound return on investment. It must support the investment decision-making process by being able to articulate the benefits from its perspective. It must also work with other departments so they can identify any potential gains for their operations.
Like any other software project, ERP/EAM integration has a certain amount of risk. Its costs, both in development and ongoing support, may be much greater than originally anticipated. Companies must do a thorough job in developing their integration approach and justification. They need to check out vendor integration references as meticulously as they do for the core application packages. But all this work can pay big dividends.
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Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.
There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.
But the year started with global economic turmoil, as a slowdown in Chinese manufacturing triggered a worldwide stock hiccup that sent values plummeting. The continued plunge in world oil prices has resulted in a slowdown in exploration and, by extension, the manufacture of exploration equipment.
Read more: 2015 Salary Survey