11 June 2020
For many organisations, implementing an ERP (Enterprise Resource Planning) system could be one of the most complex projects they encounter. There are numerous examples of companies experiencing complications and unforeseen operational bottlenecks with implementation which could have been avoided with better planning and project management.
According to Technology Evaluation Centre (TEC), over 74% of ERP implementation projects exceed budget, 67% run overtime and the vast majority fail to deliver proposed business benefits. It is therefore understandable why some organisations prefer to delay addressing their underlying IT infrastructure.
However, a modern ERP system is the first step towards improved productivity, enhanced performance and better decision making, making it essential for companies looking to maintain a competitive advantage.
Committing to an ERP implementation is a once in a decade event and not a decision which should be taken lightly. To help you choose, deploy and implement an ERP system, we have put together six key learnings from our experience assisting small businesses and global organisations through significant IT initiatives.
1. Requirements gathering
Implementing a new ERP system presents the opportunity to identify, address and improve your existing business processes. Carefully collating detailed requirements is a critical part of planning to identify issues and pain points with critical business processes to make necessary adjustments ahead of starting the migration.
2. System and vendor selection
Businesses often select a system based on a vendor demonstration and intuition for what they see as best, rather than careful evaluation of potential solutions and vendors. Independent evaluation of the requirements for selecting a system, along with finding a partner that specialises in your industry is critical. Having an experienced partner to assist in this process will also help with negotiations and scope definition, paying dividends during latter stages of the implementation.
3. Business engagement
Generating authentic senior stakeholder involvement with your project is crucial to communicate the value of undertaking such a wide-ranging transformation to the broader business and ensuring buy-in from all stakeholder groups. Paying close attention to include end-users and geographically disparate teams will greatly assist in maintaining interest and commitment to the project.
4. Team selection
Composition of your project team ultimately affects the level of success in an ERP implementation. Identifying the right individuals for key project roles is one of the most important activities when planning and leveraging the strengths of employees to align with specific needs of your project, i.e. decision-makers versus doers.
5. Change management
Too often, failure to recognise the people factor, one of the most critical elements in an organisation-wide implementation, leads to project capitulation. Effectively managing change across your people, processes and technology requires careful consideration and strategic planning – incorporating all stakeholders appropriately, communicating regularly and providing relevant training.
6. Project management and vendor management
Unclear scope changes, slow decision-making, poor data management and timeline delays can be consequences of poor internal project management. A dedicated internal project manager to manage your best interests with experience managing vendor(s) will help to ensure you achieve your outcomes whilst maintaining vendor partnerships and their competing interests.
If you want to learn more about ERP systems or how Findex can assist you with your ERP implementation journey, please contact the Performance Consulting team or speak to your Findex adviser.