- October 17, 2016
- Posted by: Tom Ryan
- Category: Thought Leadership
Author: Gary L. Burns, Principal, GLB Global
Abstract: If you are a grower processor looking for ERP you have already encountered the challenge of attempting to locate one fully integrated ERP system that fulfills all of your requirements; one that contains all the modules you need to run your business as a grower processor. This article discusses these challenges and introduces a process to help find the appropriate solution(s) and mentions several vendors that may be a part of that solution.
We define grower processors as any food company that operates closer to the farm than the fork, although, we recognize many food companies are vertically integrated and cover much of the farm to fork spectrum.
The challenge with ERP solutions is finding a system to support the farm side of the equation. If you are a dairy this includes but is not limited to producer payroll, USDA reporting, membership accounting, and other functions specific to dairy processors or co-ops. If you are a grower of fruits, vegetables, herbs, or spices this may include the actual growing process which covers field preparation, pre-emergent seeding, fertilization spray records, growth tracking, and other information which, with the added emphasis in the industry on food safety, is more important to track than ever.
If you are a meat processor/animal deconstructor, the complexities of tracking the grower environment, feed, nutritional supplements, inoculations, etc. can be a daunting. If you manage greenhouse operations then tracking seed lots, to plant lots into the ground, to harvest processing, and other activities that lead all the way “to the fork” is a complicated and difficult set of tasks which is a challenging proposition for any system.
Although yield monitoring, moisture content, soil treatment, and fertilization are typical functions of precision farming equipment, which can be incorporated with the equipment’s related spatial management systems, is considered more farm management than food process management, these systems can be expected to converge in the future. Even today, the ERP solutions are expected to help feed this information into food safety tracking and management solutions and the compliance reports that are a minimally required output.
Most of these requirements are not just for the enterprises which manage/operate a grower side within their company, they are also necessary if you are contracting with growers. This is true at least to the point of receiving the necessary data from the growers for the commodities you purchase from them. Many of our clients require their systems to help manage these complex activities. Seldom is the food processor relieved from the responsibility of tracing end products all the way back to the field it came from.
Meeting the Challenge
So it is not surprising that few of the ERP solution providers included in our comprehensive ecosystem for food and beverage manufacturers contain incorporate the deep functionality necessary to support these complex requirements of the grower or contracted grower activities of food processors.
It is this dilemma that has caused us to rethink the correct strategy for selecting an ERP system for these type of Farm to Fork companies. As previously mentioned within our ecosystem there are few vendors that can truly address the farm contracting side of this equation. With that said, we have come to the realization that although one of those solutions may be a good fit for some of our clients, the choices for such a full function solution from a single vendor are so few that it is also worth investigating the possibility of approaching these one program of two distinct projects with two separate but coordinated selections, one for the grower processor side and one for ERP side. What you may find is that by mandating grower processor functionality into the broader ERP system may limit your options and result in compromises which will ultimately fail to meet your overall requirements.
We call this the “tail wagging the dog” because by imposing all the complexities of grower and contract management into the ERP selection limits the choices so severely that you most likely will be disappointed with the result. This does not preclude the possibility that one of the grower processor focused solutions or one of the ERP solutions has enough of the required functionality covered so that it is a reasonable fit, if not an all-inclusive fit.
Our suggestion is to investigate both fully integrated grower processor systems and best-of-breed components/modules for the grower processor requirement. Such a hybrid solution set will typically result in a broader range of choices and potentially a much better overall solution.
In our Solution Ecosystem for Food and Beverage Manufacturers, we have listed some ERP systems in our ecosystem that contain true grower functionality (see the ERP bubble) as well as solutions that are more focused in this grower processor niche (see the producer grower bubble). These specialty solution providers include; LinkFresh, Famous, CAT2 (CAT Squared), RSM/Junction Solutions w/ MS AX, Infor Cloud Suite F&B, SAP and potentially Oracle e-business suite. There are also several best-of-breed systems which we call micro vertical components that integrate with several ERP’s and may provide much stronger functionality than can be found in the above. Those include for example Dairy.com for dairy operations, cat to for protein and meat processors, Grower.com for field growers, as well as other micro vertical focused best-of-breed applications.
These other articles published by GLB Global have content related to this topic. Please feel free to review them as well.
For many Food & Beverage Enterprises, technology solutions are not all just about ERP. In addition to the core roles played by ERP solutions, many other areas often are necessary to provide full support for the broad range of requirements that many F&B companies now face. This focus has led us to develop a different view of the solution providers from the traditional analyst view.