ERP implementation in a manufacturing SME rarely happens by chance. It is imposed by a group, required by a new owner, or decided in order to “finally get away from Excel”. The promises are well known: a single master data set, standardised processes, higher productivity, planning finally under control. The reality, a few months after go-live, is often more nuanced, especially for planning and forecasting.
We lived through this kind of project from the inside, first in purchasing and planning, then as S&OP key user, in an SME trading garden products where SAP was rolled out at the request of its multinational parent group. This article draws a framework from it: what an ERP really brings, what it will not do, what to keep alongside it, and how to scope the project before signing.
The promises of ERP implementation in a manufacturing SME
An enterprise resource planning (ERP) system covers purchasing, sales, stock, production and accounting in a single database. The promises that come with its roll-out are almost always the same:
- Standardisation and transparency: flows are documented, comparable from one site to another, and readable for a group, a banker or a buyer.
- A single master data set: items, bills of materials, routings, customers and suppliers in one place, without duplicates.
- The end of Excel files: everything is done in the system.
- Productivity gains, sometimes translated in advance into fewer administrative staff.
- Integrated planning: MRP, scheduling, forecasting, it is all “in the module”.
The first two are usually delivered. The other three deserve a closer look.
What we went through with SAP in a trading SME
The project was presented as a way to increase the value of the company ahead of a stock market listing; the real stakes went beyond that. SAP, known for its rigidity, gives a clear view of a company's structure: for a potential buyer, a business that is easier to understand and to split into smaller entities. The system separates management control from operations, which makes a restructuring ahead of a sale easier.
Standardisation: useful for the group, heavy for the site
In a multinational, the ERP requires flows to be standardised across entities so that they can be analysed and compared globally. This often means hiring management controllers to dissect costs. For a dynamic, commercially agile SME, the imposed mould becomes a brake: processes have to adapt to the system, not the other way round.
The myth of headcount reduction
The implementation required more resources, not fewer. Processes were adapted to fit the system, which created extra work. Above all, an ERP needs a constant supply of good-quality data: every movement, every receipt, every manufacturing order must be recorded correctly. This tedious task cancels out a good part of the expected productivity gain.
Custom developments
As S&OP key user, we first tried to optimise processes and drop Excel files in favour of the ERP. Custom developments are possible, but each one erodes the rigidity that gives the system its value, and each must be maintained at every version upgrade. Hence the importance of assessing from the outset whether the chosen ERP is the right one: once committed, the project becomes the main objective and has to be seen through.
Planning and forecasting: where the ERP stops
This is the point demonstrations show least. Out of the box, the ERP:
- calculates net requirements (MRP) at infinite capacity: it assumes the shop floor can produce everything on the requested dates and leaves the planner to discover the overloads. We explain this mechanism in our article on infinite capacity MRP planning ;
- treats the forecast as a field to fill in, item by month, with no baseline or promotions, no explainable seasonal coefficient and no change history;
- does not simulate: you cannot test “what if we moved this campaign by a week?” without touching live data;
- offers screens and reports designed for the group, not for the planner who has to decide this morning.
The result: the Excel files that were meant to disappear come back around the ERP, to do what it does not do. This is not a failure; it is a reality to organise rather than deny (see our article on the limits of ERP systems for planning).
What to keep alongside the ERP
The ERP should not become the master of operations. It must remain a tool that serves management, which requires an explicit division of roles:
| The ERP is the master of | The specialist tool provides |
|---|---|
| Item master, bills of materials, routings | Daily reading of that master data, without re-keying |
| Customer orders, purchase orders, manufacturing orders | Proposed manufacturing and purchase orders, approved before going back into the ERP |
| Stock and stock movements | Projected stock, stock cover, anticipated stock-outs |
| Accounting, management control | Load and capacity per work centre, scenarios, simulation |
| Sales history | Item-by-item forecasts, baseline and promotions, comments |
| Reporting of quantities produced | Time tracking per operation and per operator, actual versus standard time |
The principle: the ERP remains the source of truth; the specialist tools read, propose and explain. A disciplined Excel workbook can play this role for a while. A tool connected to the ERP (API, SFTP, flat files) plays it for the long term, with no copy-paste and no double entry.
Scoping the project in seven questions
- Why this ERP? Company valuation, group requirement, compliance, operational performance: the honest answer shapes everything else. An ERP rolled out to make the company readable will not make the shop floor more agile.
- Is it the right tool for this company? The question comes before, not after. An ERP designed for large groups imposes its mould; an SME must check that it can fit in without losing what makes it strong.
- What scope at go-live? Purchasing, sales, stock and accounting first; production and planning later, once the data is reliable.
- What data? Items, bills of materials, routings, standard times, stock: everything depends on their reliability. The time needed for data cleansing is always underestimated.
- Which processes to adapt, which to protect? Accept the standard wherever it costs no advantage; protect the few processes that make the commercial difference, outside the ERP if necessary.
- What resources? Key users for each area, freed from part of their job during and after go-live. No headcount reduction planned on the strength of a theoretical gain.
- What stays outside the ERP? Detailed planning, forecasting, shop floor tracking: decide at the scoping stage where they live, with which tool, and how they exchange data with the ERP.
What we see in the field: why some ERP projects go well
ERP projects that go well have one thing in common: management knows why it is doing it and does not ask the system for what it cannot do. Those that go badly promised the end of Excel and lower headcount, then discovered the data entry workload and the lack of finite capacity planning.
In the trading SME mentioned above, the outcome was mixed but clear. The ERP did not revolutionise planning; it added complexity and extra constraints. On the other hand, it brought transparency and an in-depth analysis of the business, a real strategic asset. Getting the most out of it meant pairing it with precise specialist tools, and seeing that as a sound architecture, not a workaround.
This experience shapes the way we implement Odoo: an open ERP whose MRP, manufacturing orders and purchasing remain the master, with forecasting, finite capacity planning and time tracking plugged in around it rather than forced into the standard.
Conclusion: an ERP standardises, it does not plan
ERP implementation in a manufacturing SME delivers on standardisation and transparency. It replaces neither detailed planning nor forecasting, and it takes more resources than it frees up in the first years. Scoping the why, the scope, the data and what lives outside the ERP before signing avoids most disappointments.
Planitools supports these projects from both sides: as an Odoo for manufacturing integrator (Odoo Learning Partner, certified on v19) to implement the ERP, and with Planiprod, Planiprev and Planitrack, which connect to any ERP to cover planning, forecasting and shop floor tracking. Our page on simple production management software for SMEs explains how the pieces fit together. Arrange a call with us.