In-Depth

Network Printing and ERP: Key Issues to Consider When Implementing an Output Management System

• 10/01/2000

Imagine that your company has just spent millions of dollars implementing an ERP system. It appears to be functioning as planned and brings the selected and formatted data to the screen quickly. Then, you press the print button. The ERP system sends the job to the printer and assumes its task is done. But, the job does not print, and the ERP system fails to detect the problem, which may be as simple as a paper jam or a printer out of paper. Although printing documents is a crucial component of all ERP systems, managing the printing process is too often regarded as something that can be taken care of after the ERP system has been installed. As a result, after spending millions of dollars implementing an ERP system, a company may be forced to go back to its legacy systems to print checks, invoices and other business-critical documents and forms.

The success of an ERP implementation should be judged on the basis of its capability to deliver output when, where and in the form that its users need. Often, critical output management issues are overlooked when companies plan and implement ERP applications. In fact, according to figures released by SAP Inc., about 22 percent of the total cost of a typical ERP implementation is spent in fixing the ERP system to correctly and efficiently generate hardcopy reports and printouts.

Before beginning an ERP implementation, companies should consider the following issues:

• Is the ERP system compatible with existing output devices in that it can not only manage, but administer the devices?

• What is needed to ensure that output, such as invoices and shipping documents, are printed in the correct form at the right place and right time?

• Is the ERP system both flexible and scalable enough to meet the enterprise customer's current and future needs?

Ideally, the output management system should be able to track and monitor computer-generated output throughout the enterprise, all the way to the device level. The backbone for this objective is a reliable and simple infrastructure for administering output devices. By centralizing the location of drivers and software, the system administrator can provide users with support and solutions for document delivery.

A strong ERP output management strategy that meets the above objectives will assist companies in increasing efficiency and productivity throughout its offices. For example, according to consultants at Hewlett-Packard's HP Printing and Imaging Services, more than 50 percent of the calls to the help desk are printing related. A well-designed ERP output management system can thus dramatically reduce calls to the help desk, and increase overall office efficiency. Because of this, you will also need to provide the help desk with an efficient process for solving printing problems.

As you can see, output realization, or ensuring output gets to the user, is an integral issue that needs to be considered with any ERP system. When properly installed, the output management system ensures that the right forms and documents are generated for each user at the appropriate place and at the right time.

For example, the IT staff at one pharmaceutical company realized within six months of their ERP implementation that an output management solution would be needed to ensure the reliable delivery of business-critical documents throughout the enterprise.

The symptom of the problem was that management and accounting reports, shipping manifests and invoices were sometimes lost in the printing process due to recurring print spooler problems. When the print spooler hung, the system had to be rebooted and the output would be lost. There was also no way to track these important business documents to a specific user or job. The company urgently needed to address this problem before important business functions were crippled, and before employee confidence in the newly implemented ERP system was lost.

Another example can be found in the manufacturing sector where companies routinely take orders, then seek to print order fulfillment reports to their warehouses around the country. Ensuring that the order fulfillment report is printed and received at the appropriate warehouse is critical because a truck will arrive at the specified warehouse the following morning to load the shipment.

However, printing documents to the appropriate warehouse is only one hurdle. For example, the output management system should also ensure that the document arrives at the warehouse, and so even if the printer jams, the ERP system notifies the sender that a problem has occurred.

Other questions to be considered are: What options are provided to the company to ensure that the document is reliably delivered? Can the output management system deliver the document to another printer, fax machine or even a Web site? Is this failover functionality manual or an automated feature?

As a result of these complex output requirements, companies are increasingly turning to output management system vendors to address the need of reliably delivering documents to multiple devices that are no longer centrally located.

For example, one food producer implemented an ERP package to better automate its global financial operations. As part of this implementation, the company needed to ensure the delivery of multiple types of documents generated by the financial application to more than 600 destinations around the globe. This included critical information contained in the sales, accounting, checks, manuals and cost accounting reports.

Output management systems should also provide increased capabilities and controls that allow users to customize or enhance ERP-generated forms and documents when they are printed. For example, companies need to consider questions such as whether the ERP system allows them to format data so that the warehouse can efficiently pull the product type and amount of product for loading? In answer to this, an output management solution can visually group all of the same products sold to different destinations, or all products going to one destination.

Within such groupings, the company can bold or indent certain products for easy recognition. Other useful customizations include corporate logos and colors that can be added to documents, invoices or shipping labels that can include barcodes, MICR check printing, duplexed forms, binding and stapling.

Some output system management vendors possess these technologies, or have aligned with those who do, to deliver these increased customization capabilities and controls to build even further flexibility into ERP systems.

Another issue that companies should consider is that while most companies implement an ERP system for the use of specific documents, such as purchase orders, the reality is that companies may not be planning for the broader use of their ERP system. In the planning process, companies may not recognize the potential for use of the fax machine and/or the Web as an extension of their ERP system as printers are no longer the only "print-capable" destinations. Therefore, the output management solution should provide the customer with a full range of destination options.

In addition, such systems should be scalable as it can take years to fully implement an ERP system. Thus, companies must possess the foresight to envision their needs at the conclusion of the implementation process. Companies should also anticipate technological advances and how such new features might benefit business processes.

In addition to increased flexibility and productivity, the cost savings of developing an output management strategy at the onset of the ERP implementation can be substantial. On the average, a company will allocate up to 5 percent of its annual business revenue to implement an ERP system. Cost over-runs are not uncommon. Industry studies show that ERP implementations on the average are 240 percent over budget cost projections, 178 percent over time projections, and often provide only 50 percent of the planned functionality.

The most common failure in functionality is at the hardcopy output end of the system. The cost of fixing the installed ERP system so it can efficiently and correctly generate hardcopy reports and other printouts can be substantial -- up to one-quarter of the total cost of installing the ERP system, according to HP.

In summary, the three key output issues that need to be addressed with respect to an ERP system implementation are:

• System Compatibility

• Output Realization

• Flexibility and scalability

ERP output management begins with a thorough analysis of output needs and an evaluation of current output devices, followed by a detailed recommendation for the output management infrastructure and architecture. A company may assign these tasks to an internal management team, or it may decide to hire an outside service provider to plan and implement the output management solution.

About the Author: Craig Hallenberger is the Alliances Manager for Dazel Corporation, and HP Software Company. He can be reached at challenb@dazel.com.