Does ERP integration make you competitive?

ERP (Enterprise Resource Planning) integration is often prescribed as the panacea for hospital HR and planning processes. ERP systems were originally developed to enable organizations to adapt to changes in the business environment. How well do they accomplish this task in hospitals today?ERP integration in hospitals faces two issues:

• Implementation problems
• Structural problems

Implementation issues may not be evident initially but can show up later on. Inability to upgrade to a new technology is an example. Inadequate customization to the hospital’s specific resources and processes often creates roadblocks in communications between specialized applications used by the hospital. Structural problems arise from mismatching organization structure of the hospital and the ERP system implemented. In order to be competitive, hospitals often use autonomous and non-ERP applications that pose issues of compatibility and coexistence. Integration solutions that require extensive programming are costly to implement. No single ERP system provides all required functions for all kinds of hospitals. An absolutely homogeneous platform is no longer an option in today’s complex and dynamic healthcare environment. The success of ERP integration thus depends on having a post-implementation support provider who can customize and optimize the system and reap benefits like:

• Hospital-wide operations planning (instead of department-level control)
• Practice-guidelines-based resource planning
• Planning freedom to accommodate unexpected events and fluctuations in demand
• Hospital-wide coordination of patients (instead of fixed routing) to shorten their length of stay

Off the shelf, ERP systems start with aggregate data and assume fixed processes and constant lead times. Re-engineering the system with a long-term support vendor can be the key to competitive success. For questions and further information please contact us