Planning a successful and secure ERP implementation
It is important to avoid a failed ERP implementation process not just because of the waste of money and resources but also because of the high risk of disruption to your customers, employees and supply chain management.
Key phases of ERP implementation
- Discovery and scoping.
This key step includes information gathering and specifying the functional scope of the software soution. The data migration strategy is started with auditing all current data sets, their structure and purpose. Functional and technical teams of consultants from the ERP provider work closely with the cross functional ERP project team to cover all the business aspects of the organization. - Design.
The information audit is followed by formalization and revision of business processes and management rules. The data migration strategy is set to determine how and what legacy data will be carried over to the new ERP. This is where functional gaps and additional requirements come to the surface when reviewing the new ERP and the needs of the business; alternatively this is where legacy business processes will be overruled in favour of new workflows of a more streamlined and agile system. - Development.
Software is configured according to business requirements, documentation is written (including User Guides and training plan). Data import tests begin.
- Testing.
Preparation and execution of tests (integration, load and data) in a progressive manner; fine-tuning development as the impact of testing becomes evident. - Training.
Starting with key users, a robust user training program is implemented prior to go-live with full documentation and support signposted for ongoing help. This process helps support the various teams involved. - Deployment and Go-Live.
Once configuration, testing and data migration is completed; new production environment is deployed. - Support and maintenance.
The project team and the ERP provider work together (with SLAs) to ensure the users have the support, fix bugs, manage change requests, and work to a roadmap for future configuration and feature releases. Ensure you specify the ERP system maintenance and support requirements from your ERP partner in advance depending on the in-house support available and your business requirements (e.g. self-service portal or Knowledgebase).
Shape your strategy
Whether you choose cloud ERP or on-premise ERP, the core phases remain similar, yet the specifics and tasks within those implementation phases vary. For example, in the initial stages of an on-premise deployment, your focus will be on specifying and acquiring hardware, upskilling your team to configure or update your infrastructure, or potentially considering outsourcing.
It is important to be aware of your resource including hardware and infrastructure as well as employee resource (project manager, infrastructure engineers, process management, etc.) and how this affects your ERP implementation stages.
The importance of ERP integration
Our new ERP may not cover all business and supply chain processes and will need to connect to other relevant systems ensuring that information flows seamlessly, to create a single source of truth. Key areas of ERP integration include: centralizing data; workflows and automation; inter-functional and cross-functional visualization .
The most common vendor systems and scenarios that are integrated with an ERP include:
- CRM (customer relationship management)
- HRM (human resources management)
- Project management
- eCommerce
- EDI
- Manufacturing
ERP integrations come from different methods
- Custom integrations – with technical resources, an organization would develop and build its own core integration, using API code to the ERP.
- Vendor-built or native integrations – specific applications come with pre-built out-of-the-box integrations to connect with other specific applications, based on commonly requested business scenarios.
- Integration Platform as a Service (iPaaS) – a cloud-based solution that builds and deploys integrations with other cloud-based applications, with no need for hardware installation but based on workflows.
Explore more ERP implementation
Approaches to ERP deployment
There are several methodologies for implementing ERP, we’ve picked out the main four ERP implementation strategies:
Big bang deployment
In other words, all users in your business migrate to the new ERP in one go, at the same time. Because Go Live is at one point in time, all business functions (finance, operations, sales, manufacturing, warehouse etc.), processes and teams should have undergone configuration, training and testing by that time.
Benefits: The sooner the business starts using the ERP, the quicker the promised advantages will be realized. Having a shorter deployment tail should have an overall reduction in cost and disruption.
Risks: The chance of errors and bugs is spread throughout the business and your team / service provider will need to provide adequate resources and processes to proactively deal with the possibility. There may be impacts on productivity within the business and your supply chain as user adoption of a new system gets underway. If this approach is adopted, a business will need to provide more time in planning and training and process management.
Phased rollouts
ERP deployments with this approach are carried out over time (weeks or months) sequentially. The sequence of the phases depends on the business itself, its structure and attitude to risk. Organizations may choose this option as part of a pilot and learning approach, so that any issues are contained in the first phase, addressed and not repeated in future phases. Another reason for a phased implementation may be connected with a geographical nature of a company or indeed be phased by job function where the ERP is implemented team by team.
Benefits: This strategy is more fitting for risk-averse organizations but also for those who wish to see quick wins and are more comfortable with milestones in short to medium term.
Risks: Because of the extended nature of the ERP deployment, it will take longer to see the full potential of ROI. There may be disruptions, costs and doubling up of data where some parts of the company are using different systems in some cases.
Phased rollouts
Parallel strategy
This ERP deployment approach is where employees are using the legacy systems and the new ERP at the same time for a set period. This is used when an organization wants the “safety net” of reverting back to a legacy system without interruption or roll-back. This approach can also be confined to certain business-critical teams or users rather than the entire organization. It is also a common approach when businesses merge.
Benefits: This provides breathing space for users to adjust to a new ERP, whilst containing any disruption in business-as-usual. It can also be a quicker approach than a phased rollout strategy in the long run due to the higher costs associated.
Risks: Parallel adoption of ERP may delay true user adoption, with users preferring to stay in the comfort zone of the legacy system or indeed forget to enter data into both systems. On that note, there are direct and overhead related costs of maintaining and running two systems at the same time.
Hybrid strategy
This option may be selected for organizations with multiple sites, business units or strategies across its Group; where the ERP implementation strategy may vary and include more than one of the above approaches. It can also be adopted in more complex ERP systems, where organizations may for example go “big bang” with core modules and then a phased or parallel approach with other modules for specific teams.
