NEWS RELEASE: Commercial HVAC Manufacturers Have Issues with ERP

When it comes to ERP systems, not all commercial HVAC/R manufacturers have chosen wisely. While 18% say their ERP systems exceed their expectations, 36% say it impairs their ability to react to market changes or to implement new business initiatives, and another 36% report that their ERP systems provide valuable information but also require frequent workarounds and customized data extracts.

When asked “What is the state of your current Enterprise Resource Planning (ERP) system?” 36% of HVAC/R manufacturers say it impairs their ability to react to market changes or to implement new business initiatives.

This is according to a 2009 research report by software maker Cincom Systems (http://www.cincom.com/erp) based on a national survey to sales and IT executives that sheds light on how these commercial HVAC/R (heating, ventilation, air conditioning and refrigeration) manufacturing organizations are managing their businesses for increased efficiency and effectiveness.

“HVAC is unique to other manufacturers,” says Lou Washington, co-author of the report. “The ability to react to changes in demand and changes in regulations as well as other dynamics make responsive ERP a requirement. Products for high-demand geographies have widely divergent characteristics. Products for India vary greatly from products designed for China and Western Europe, Brazil or Russia. Where that demand will occur over time is a real wild card when it comes to production planning.”

Mixed Mode Is Mostly Manual
Many commercial HVAC/R manufacturers manufacture products in a mixed mode, employing different production strategies for different product lines. Yet commercial HVAC/R manufacturers are not as advanced in managing these processes as their counterparts. Of those surveyed, 36% rely on a combination of manual processes and separate systems to manage mixed-mode manufacturing processes. This is 10% more than the composite benchmark of comparable industries. Manual mixed-mode processes often result in overtime and expediting as process workarounds.

When asked “How do you manage your mixed-mode processes?” 36% of HVAC/R manufacturers said they rely on a combination of manual processes and separate systems to manage mixed-mode manufacturing processes. This is 10% more than the composite benchmark of comparable industries.

Of the HVAC/R manufacturers surveyed, 18% have implemented an automated and integrated system to manage their mixed-mode manufacturing processes. That’s 5% below the composite benchmark.

“This market is becoming more and more sophisticated and complex,” continues Washington. “Green initiatives, ever-changing architectural elements in new construction and the increased preference for updating existing structures have placed a huge flexibility requirement on HVAC manufacturers. This is reflected in an increased need for nimble mixed-mode capability.”

For a copy of Cincom’s “2009 HVAC/R Equipment Industry Survey Report,” visit http://www.cincom.com/hvac.

About Cincom Systems
For over 40 years, Cincom’s problem-solving software, services and people have helped thousands of companies all over the world grow and manage their businesses. For more information about Cincom’s products and services, contact Cincom at 1-800-2CINCOM (USA only), send an e-mail to info@cincom.com or visit the company’s website at www.cincom.com.

Related Links:

Cincom Systems website
http://www.cincom.com

Cincom Acquire™ manufacturing website
http://www.cincomacquire.com

Cincom Enterprise manufacturing website
http://www.cincomerp.com

2009 HVAC/R Industry Survey Report
http://www.cincom.com/hvac