When it comes to implementing an ERP system, most companies require a business case demonstrating a positive ROI before corporate resources and funds are committed to an initiative – whether implementing a new ERP system for the first time, or updating or replacing a legacy ERP system.
The scope and complexity of many ERP projects will demand a business case that addresses the concerns and needs of all project’s stakeholders. A business case that anticipates potential problems or objections can also be a powerful tool to sell the project in the organization. Involving key stakeholders in the development of a business plan can also be a strong way to build organizational support for the new system.
A compelling business case will assess current system performance against expected post-implementation performance. Establishing key performance indicators (KPIs) allows quantifiable measurement of progress during implementation and ensures a tie to real changes in performance. These metrics can also be used to evaluate ERP software vendors and select which software modules match business requirements.
Here’s 8 things to keep in mind if an ERP implementation is on your horizon.
- Prioritizing business requirements is just as important as defining them. There is so much information available during the evaluation phase of implementation that it’s easy for companies to get lost in specifying lower-level processes, which can lead to analysis paralysis.
- A distinguishing trait of best-in-class ERP implementations is that they have the full support and commitment of the company’s executives. ERP initiatives often begin with the CIO or IT director, but the support of the CEO, CFO, and other C-level executives is critical. These people are responsible for setting corporate business strategy and direction, so they should be
making higher-level decisions about how the ERP system will be involved in running the business.
- Many companies concentrate more on the technical aspects of ERP software, rather than on what requirements are most important to the business. Software features or functionality that don’t align with the company’s business needs often lead to an unnecessary waste of implementation resources, time, and money that might be better spent on other activities such as software customization or training.
- The issue of whether customization is necessary to satisfy a new business requirement is often raised during the implementation process. A business case with a positive ROI allows the merits of customization to be considered on the same basis as the original implementation.
- The broad scope and duration of most ERP implementations can also cause changes in familiar workflows or business processes for people throughout the organization, whether they are directly involved in the implementation or not. For this reason, it is important to gain broad organizational support during all phases of an ERP implementation.
- Change management is crucial to the success of an ERP initiative. Employees need to be introduced to new processes and job roles over a period of time so that they can accept and internalize these developments.
- An attribute of successful ERP implementations is that data migration is put into the project plan as early as possible. A company’s data is one of its primary assets and issues with migrating data between legacy systems and a new ERP system can have a size-able negative impact on business operations, especially those that are exposed late in the process.
- Finally, defining business requirements is not a one-time activity, resulting in a static set of requirements. Instead, it should be viewed as an ongoing process that can be refined on a regular basis to reflect the changing needs of the organization.
Keep in mind, strong project controls and governance are also needed to implement an ERP system. A formal risk management and mitigation plan should be developed in advance. It should include ongoing reviews of project phases throughout implementation, with full participation of all inside and outside resources. A combination of project management skills, resources, and methodologies are vital to a successful ERP implementation.
CompuData brings extensive Epicor ERP implementation expertise to growing manufacturing operations and other progressive business environments leveraging Epicor ERP technologies to power business growth. Epicor solutions enable companies to drive increased efficiency and improve profitability. CompuData can show you the way!