An ERP system is designed to integrate the disparate functions of a business. It can connect things like human resources, finance, manufacturing, stock management and project accounting into a centralised platform with rich automation and reporting/analytics features that increase productivity and efficiency.
The implementation of an ERP system involves the planning, configuring and deployment of ERP software, and it usually takes a few months or more if everything goes to plan. There are various complexities in integrating and automating many different business functions, particularly for larger organisations.
The implementation process is very important in order to get the most out of an ERP platform. Organisations must determine their requirements and how processes can be redesigned to leverage the system’s capabilities.
There must be rigorous testing and lots of fine-tuning to make sure everything works just right. There are many steps to a successful implementation, and it takes structure and planning to make it work.
What are some common reasons for ERP implementation failure?
ERP implementations don’t always go according to plan. Here are the most common reasons for failure when attempting to introduce an ERP platform into an organisation:
- Poor execution of change of management or ownership.
- The end product fails to yield the desired benefits.
- Business goals shift during the ongoing implementation project.
- Planning and project management are not up to standard.
- There are delays in deliveries from vendors.
The best way to avoid these issues is to work with the right ERP system and implementation partner. But this is just part of the battle – every ERP project is different, so a pre-planned, comprehensive approach is needed from the outset. Here are the steps to a successful ERP implementation when it is done the right way.
1. Discovery and Planning
This is the foundation of any ERP project. It involves conducting research to select a system, then establishing a project team and laying down the details of the system requirements.
The project team, which may involve an implementation partner, handles various roles relating to the implementation. They will create the project plan and identify target dates, ensure adequate allocation of resources, make decisions regarding design and handle the day-to-day project management.
Senior management needs to be involved in the ERP project team to ensure the necessary resources are available and the key decision-makers are available to implement change. It is also common to partner with a consultant or ERP implementation partner to access their expertise and experience in the designing and configuration of the system.
The team should also include an executive sponsor, a project manager and representatives from all departments that will utilise the system. A member of IT is always a useful member to have as well.
The team must set about identifying issues that need to be overcome by the ERP system. If an ERP business case exists, this can be harnessed to execute a more direct analysis of existing workflows and focus on the development of a new system. During this phase, an ERP system may be selected and acquired. The question of cloud versus on-premises is key.
If you’d like to learn more about the differences between cloud ERP and on-premise ERP, you can read our informative article Cloud ERP vs On-Premise ERP Comparison.
This step is built upon the detailed requirements identified in the discovery and planning phase. The ERP system must be designed to address the efficiency issues highlighted among existing workflows, developing new workflows that leverage the capabilities of the ERP system. Users should be involved in the design phase as their understanding of current business processes is likely to be the strongest. This will also help them to embrace the new system when it arrives.
Process intricacies can be identified via gap analysis, wherein opportunities to customise the ERP for your specific needs can be highlighted. It may also be necessary to make changes to operations so that they align more closely with the ERP functionality. Identified gaps can be presented to the implementation partner for assistance in finding potential solutions.
With the clear design at hand, it’s time to move on to the development process. This involves configuring the software and making custom modifications, where necessary, to support your processes. It may also be necessary to develop integrations with existing business applications that are not going to be replaced by the ERP. For an on-premises ERP solution, there will be hardware and software required to make this happen.
Alongside software development, the team should be working on developing training materials so that employees can transition smoothly to the new system. This is also the time to plan for data migration – this can become complex as it typically involves the extraction, transformation and loading of data from multiple systems based on different formats where duplicate and inconsistent information is common. The project team must determine the data to be migrated during this phase – much of the historical data is likely to be unnecessary.
Much of the testing will occur during the development phase. For example, specific features and modules may be tested in order to identify where fixes and adjustments are needed before retesting. Alternatively, one ERP module may be tested while another is being developed.
Basic functions should undergo initial testing before a more rigorous testing process of the system as a whole is undertaken. Some employees could be pulled in to see how the system works with their day-to-day activities. All migrated data should be tested thoroughly and introductory end-user training can be initiated.
Most vendors offer pre- and post-deployment resources for user training. But this vendor support should be supplemented by the training materials created during the development phase, as these cater to the daily responsibilities of your end-users.
This is the point at which the system goes live. Potential issues are likely as there will be many moving parts and employees will be getting used to the new system. The project team should be on hand to answer queries and assist users as they engage with the new system. Your implementation partner is usually available for troubleshooting as required and it may take a little time before the productivity gains of the new system are realised.
Some of the data migration will need to happen immediately before going live. You must also consider whether you want to deploy the entire ERP at once or focus first on high-priority modules before adding others further down the line. You may also wish to continue running older systems alongside the new ERP for a while for risk mitigation – this is up to you.
6. Support and Updates
Once live, the ERP implementation must be nurtured and maintained to keep achieving business benefits. The project team may retain responsibility, but their focus will not be on listening to feedback and making adjustments where required. It is likely that some additional configuration and development will be needed.
For on-premises ERP systems, periodic software updates will need to be installed manually. Cloud-based ERP systems usually update automatically as they are offered as Software-a-a-Service..
How long does ERP implementation take?
There is no single answer to this question. A basic ERP implementation could go live within a few months, while a more complex one could span a year or more. On average, you can expect the process to take around four to six months.
It’s prudent to revisit the start of this article and recap on the common reasons for ERP implementation failure. By committing to a project whole-heartedly, in partnership with a reputable ERP implementation partner, you should be able to reduce the implementation lead-time and avoid any pitfalls.
Am I ready for ERP implementation?
Remember that ERP implementation is a significant undertaking. The importance of planning cannot be overstated, so you must not rush into configuring and customising your system. You must also be prepared for training staff and have people on hand to offer support.
The implementation of an ERP is a big step, but it’s one that could quite simply revolutionise your business. You can wave goodbye to disparate systems and manual processes, and say hello to new efficiencies and greater visibility across your business.
Why choose Eventura for your ERP project?
Eventura has been providing robust business solutions to countless organizations for over two decades. We are ERP experts and can identify all of your business needs, and deliver a comprehensive ERP solution that works for you.
As Sage 200 Partners and NetSuite Solution Providers, we can help you identify which solution will fit your business needs the best. Our expert team of business analysts, developers, consultants, technicians and support staff can guide you through your entire project, from initial scoping through to implementation and on-going support.
We’re also managed IT service providers meaning we can help you identify your entire IT infrastructure requirements from day one. If you would like to speak to one of our ERP experts, you can request a free call back here.