2013

9 STEPS FOR A SUCCESSFUL ERP SOFTWARE IMPLEMENTATIONPlan, Plan and Then Plan Some More

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9 STEPS FOR A SUCCESSFUL ERP SOFTWARE IMPLEMENTATION 1

ABSTRACTCongratulations! You have spent hundreds of hours selecting a new ERP system. Now you can rest

for a minute but only a minute! You may not want to hear this but this is just the beginning of

a timeconsuming software installation and implementation project. The key concept throughout

this process is management. The system you are about to implement must assist you in completing

specific tasks, but of far greater importance, the system must help you manage your business and

help you make sound business decisions.

9 STEPS FOR A SUCCESSFUL ERP SOFTWARE IMPLEMENTATION 2

WHO SHOULD LEAD THE PROJECT?Given the fact that many ERP selection projects fail to achieve their objectives or worse, fail altogether,

its critical that firms organize the process effectively, starting with the appointment of a project

leader. This person will be responsible for driving the entire selection and implementation project

forward. The implementation project leader will be a superb organizer, helping each person

understand what needs to be done and by when.

PLAN, ORGANIZE, CONTROL AND THEN PLAN SOME MOREThis ERP system will not operate by itself. It doesnt know who is supposed to do what. Its completely

empty of data and it has no idea what to do with any of the information you plan to input or extract.

Detailed planning increases your chances of real success by

mapping out a strategy,

specific preparatory and implementation steps,

and a timeline that takes into consideration what has to be done, how much time people have

to devote to this project and do their current jobs as well, and the identification of potential

bottlenecks.

Planning creates the basis for effective project management and a quality implementation. It forces

you and your implementation partner (typically a VAR or value added reseller) to determine the

most effective methods by which the system can be implemented. It forces you and your VAR to

agree upon a single unified approach. It identifies what steps must be performed by whom and in

what sequence. Planning also facilitates communication amongst all parties involved so that all

phases of the implementation can be effectively

monitored. Finally, it forces you and your VAR to

create documentation and training options and

materials specific to the people operating the system.

Please keep in mind the fact that without effective

control, planning is useless. Once the detailed

implementation plan has been completed and

the actual work begins, the project manager and

reseller need a means whereby this project can be

monitored and controlled to make sure the plan is

progressing satisfactorily.

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STAFF TRAINING AND EDUCATION

Training is the gateway to the efficient use of any software product, including ERP systems.

Two types of training should be considered.

1. General training would be conducted on some form

of demo software to help users become familiar

with the new ERP systems functionality.

2. Additional organization specific training would be

conducted once the new ERP system has been

implemented but before the go-live date. This will

enable users to become familiar with the actual

system they will be utilizing.

Training is defined as specific to a new ERP system, while the objective of education is an increase

in a persons basic knowledge- base in order to carry out their jobs more effectively. There is a

significant difference between the two. If the work habits of individual people are disorganized or

inefficient, some form of education might be required.

UPGRADE ORGANIZATIONAL STRUCTURE AND BUSINESS PROCESSES

It makes no sense for new ERP software to be installed when a firms organizational structure and/

or business processes are part of the problem that prompted the move to a new ERP system in

the first place. In some cases the new ERP system might require adjustments to the organizational

structure and business processes. These changes should be made prior to the installation of

the ERP system so that there is no impediment to productivity and effectiveness. If you are a

relatively small firm, the process improvement initiative could be fairly straight forward. Larger

firms or firms with fairly complex business processes might require a more formal analysis and

improvement initiative.

RESOURCE SCHEDULING

The transition to a new ERP system will require that people invest their most precious resource;

their time, in this project. Since people must carry out their normal job functions as well as invest

substantial time in the new system, scheduling will become a significant issue. Rather than imposing

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tasks and timetables, the project manager will act as the bridge between the reseller and

implementation tasks as well as each user and their existing work schedules. Flexibility is paramount.

MANAGE PEOPLE AND THEIR EXPECTATIONS

The key to business success rests within each of your employees. They have the ability to help you

exceed, and they have the ability to thwart your efforts to increase efficiency and effectiveness. Your

reseller will do his or her best to provide you with a highly

effective set of financial applications, but the success of

this entire process may lie in your ability to change the way

people utilize the system, work with each other as a team,

or support the objectives and strategies of the organization

itself.

The objective here is to make sure the installation and imple-

mentation process is carried out as efficiently as possible by

providing your employees with advanced knowledge of what

will be expected of them, when specific tasks will be carried

out, and the rationale behind specific tasks. This knowledge

will reduce conflicts and misunderstandings as the implemen-

tation moves forward.

DEVELOP DECISION SUPPORT SYSTEM

ERP functions help people complete specific tasks (e.g. sales order entry). The reporting system

presents relevant information in a timely manner that will help people make sound business decisions.

As such, the reporting system is the most critical element of any accounting or ERP system.

True decision support requires that the business model itself changes from one which is based upon

the accounting process to one based upon the needs of the organization. Rather than reviewing

results in the past, the business model must become more proactive by predicting results in the

future, thus allowing managers to react more quickly.

The business model must concentrate not on the Chart of Accounts, but on products, services and

projects as well as non-financial measurements such as revenue per employee and other forms of

performance metrics.

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Please keep in mind one critical realization. You cannot make a decision unless you have all three

elements that contribute to effective decision-making:

1. Wherehavewebeen?

2. Wheredoweseemtobegoing?

3. Whereshouldwebe?

Reports with rows and columns, bar charts and pie charts and any other single point business

metric present a snapshot of conditions at one instant in time and therefore do not support the

decision support process.

The decision support system must be created first

because it will drive the variables and data fields

that will be defined during implementation. Two

key decision support elements need to be analyzed.

(1) What information do people need and (2) how

will that information be delivered? There are many

delivery options: standard reports generated by

the system, reports created in report writers and

spreadsheets, data warehouses, ad hoc reports,

business intelligence, dashboards, and performance

metrics. Business information is actually far more

important than business functionality.

DEVELOP SYSTEM ENHANCEMENTS

While most accounting and ERP products are powerful and flexible, some modifications may be

required to meet your specific needs. Hopefully, these modifications will be minor. Whether they

are minor or major, there are several points you should try to keep in mind. Try to eliminate the

need for modifications in the first place by asking yourself Do we really need this specialized

functionality, or can we adjust our business processes to match the ERP system? If modifications

are required, look first to third party enhancements that have already been created and tested by

existing users of the ERP system you are purchasing. If modifications are required, try to create

these enhancements without having to touch source code. Finally, if modifications are required,

be prepared to accept full responsibility for their design.

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POST IMPLEMENTATION MANAGEMENT

Once the system has been installed, and is fully operational, your task as project manager will be

complete, but comprehensive system management will still be required. It s just the nature of

the management that changes. You and your VAR will need to establish an on-going relationship

to ensure this system continues to operate at peak efficiency. System here is defined as the software/

user combination. The software itself has to operate effectively, and it has to be used effectively

as well.

In addition, you have the responsibility of making sure the system delivers what you expect, if

not more. Thats where you and your VAR can form a management relationship to evaluate the

system on a continuous basis. User issues are quite easy to identify. You need to make sure people

have the tools, motivation, training, education and software in order to carry out their jobs efficiently

and effectively. Never assume the status quo is acceptable in the long term.

CONCLUSION

An ERP system is no more than a tool; a very powerful tool, but nevertheless an essential tool. Your

success isnt dependent upon what product you purchase. Your success is dependent upon how

each person in your organization uses this tool together with their knowledge and experience to

make sound business decisions and serve customers more effectively. You have an opportunity

to create a truly efficient and effective organization, but only if you take this one step further. Go

beyond the ERP applications. Help your employees excel individually, and they will help the organi-

zation excel. Thats the path to greatness; knowledgeable and motivated people acting as a single

powerful entity to create something which could only be imagined before.

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