Logistics and increasing the efficiency of the supply chain are becoming important in every area of business, even the media, where the rapid dissemination of data is a vital competitive element.
Firms just cannot compete without the new sophisticated Enterprise Resource Planning systems (ERP). These systems cut costs and increase efficiency by transferring data at the touch of a button.
More flexible than they used to be, ERP systems can provide organisations with a one-stop shop, cutting out the old-fashioned notion of using paper, and dishing out information by the truck load.
Even the BBC has been moving in this direction, not only introducing an ERP system, but looking at investing in an integrated, organisation-wide SAP system.
Since the introduction of its internal marketplace “Producers Choice”, BBC Resources in Wales has been using ERP systems to help it improve its internal processes.
The unit, which is like a microcosm of all the BBC offices in terms of television facilities provision, provides all regional broadcasters with any television resources they need for programme making.
The BBC’s aim, when it started the process four years ago, was to improve drive and efficiency and, of course, cut costs. It changed from a command structure to one with trading relationships.
The new strategy meant that management needed to make efficient commercial decisions, based on unduplicated, easily accessible information. And the BBC wanted ownership of the system.
Nigel Griffiths, commercial manager for BBC Resources in Wales, set up a beta-test basic ERP system, Tetra Client Server/3, with tailorable screens enabling the interface to be changed according to staff requirements.
The product was launched in 1996 as a mainly financial programme but today it is an integrated system serving many divisions, enabling users to manage the costs and resources of individual projects independently.
The system took three people 16 weeks to implement, and according to Griffiths significantly reduced departmental costs and programme making at BBC Resources in Wales. The total investment in the software was #47,000, it costs #10,000 to run each year and makes net savings of #150,000.
The previous bureau system cost #350,000 a year to maintain.
“The most important thing was to put together the departments and production in a more commercial structure, so we centralised administration, finance, and customer service,” says Griffiths. “The cost of management was significantly cheaper because we did not require lots of department heads – we delivered the same output with less people. We managed to absorb inflationary and investment costs. It is a low cost of ownership and was implemented very quickly.”
Griffiths believes the project is a prime example of how an integrated system can improve strategy. He says that it is a one-stop shop system, empowers people and is an easy way of introducing non-commercial systems users to a very flexible, business system. “It is very tailorable and people do not need lots of training,” he says.
While the process is not finished by any means, and new features will be added as Tetra updates them, the system has already improved time efficiency.
Over the last 15 months, the Tetra system has been connected to the Windows desktop, linking accounts and e-mail. Weekly accounts information is downloaded to Excel and information is sent out automatically to purchasers via e-mail, without any human intervention.
“Month-end used to take 14 days, now it takes five days; we’ve now got a very tight ship. We have created a virtually paperless office,” says Griffiths.
By March he hopes to have implemented the latest version of CS/3: client 2, which allows a more sophisticated database link-up to object-linked embedded software.
While some of the software, like the manufacturing suite, are not relevant to BBC Resources in Wales, the centre has set up a system to manage bulk buying on behalf of programme makers. The result is a much more clearly defined procurement system, run along commercial lines.
The BBC is also using some of the ERP bespoke software for project control at Television Centre and has chosen CS/3 to help it with its millennium problems.
However, under Medas – a joint venture between Coopers & Lybrand and EDS – which took over the management of all BBC financial software packages in April last year, it looks as if CS/3 will only be an interim solution.
The corporation has already set up a project team to look into using SAP in the future – the supplier will not bring out its ERP systems until 1999.
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