ERP system implementation requires solid project management practices. We highlight ERP project management best practices suited to making sure you get the best out of your ERP system.
Enterprise resource planning (ERP) software products are designed to help companies control, monitor and co-ordinate activities in all of their departments in all of their locations. While they can make fantastic contributions towards efficiency and transparency in a business, they do tend to change how departments work, and any change often comes with resistance from human capital.
Says Dwight Harry of KPMG, Dallas USA: “Organisational culture either supports [ERP] change or creates a barrier. Yet, overall, it's win-win, because accounting and finance has visibility into project performance measurements. Suddenly, everybody is playing from the same sheet music. This provides tremendous productivity enhancements. From a cultural perspective, that can have an impact, but it's a positive one: now the engineer can do engineering and the accountant can do accounting. There's minimal reconciliation needed between the two, and what there is, is automated.”
ERP implementations, because of their far-reaching effects across the whole organisation, are big undertakings. And they have notoriously high failure rates. A successful implementation project management is absolutely key to ensuring an ERP system is successfully implemented and a business is able to enjoy the fruits of the integrated management system. Here are some of our tips to make sure your company can fully appreciate the benefits of successful ERP software implementation.
Set up a project team
It is essential to set up a cross-functional project team to lead, manage and also track the implementation. The leader should be someone with authority and broad knowledge of the business. Also required will be someone from the software provider or implementation consultancy, in charge of staff training and also bringing in-depth product knowledge. Often, a representative from each department is required to represent each department's unique needs and challenges and also to feed back data workflow to the various functions. This is one of the best ways to ensure the implementation of your new ERP system is driven effectively across all areas of the business.
Set realistic timelines
Because of the organisation-wide nature of an ERP implementation, it is easy to underestimate the time needed for successful implementation and migration. Time is very often money, and management teams, understandably, are under pressure to minimise costs and maximise efficiency. They are keen to see their new ERP investment paying dividends quickly and it is understandable that they would prefer to see it implemented and working sooner rather than later.
However, sooner and quicker is often not better when it comes to a successful ERP implementation. Not only does data need to be cleaned, migrated, inputted and then tested – but processes need to be updated, staff need to be trained on both new processes and the new software platform, new systems tested and ready for a smooth change-over. All of these stages take time, effort and training. If a company skimps on the preparation and training phase of an implementation, the start is likely to be rocky, the errors great, employee morale low and the business is unlikely to reap the benefits of its new ERP system for quite some time, if ever. It is critical also to remember that at the time of go-live for the project, it is a new process and system for all team members, and it is unlikely to be completely business as usual as errors crop up in both the users and also small snags in the data. It is paramount to plan this period of decreased productivity into the timelines, or if that is not an option to prepare employees early and constructively for the need for overtime and extra preparation. Constant monitoring of the ERP project is critical to keep abreast of timelines and notify the project team timeously of any delays.
Prepare for change management
Although finance and management are better equipped to see the benefits of an integrated and company-wide ERP system, other departments and those with more functional tunnel-vision are often less enthusiastic. People are by nature creatures of habit, and once comfortable in a role or process, are often unwilling to change the way they do things. Learning and changing and stretching are often uncomfortable, and your exciting and revolutionary new ERP project may not be received with as much joy as you would hope. Here it is critical to implement change management early. By educating and explaining the big picture to departments and employees, helping them to see the potential benefits for not only the whole company but also their functions, backed up by the necessary training, companies can do a lot to manage the resistance to change from within their own organisation. Effective change management can also save costs by decreasing resistance to tasks necessary for the change-over, ensuring the project is completed in the minimum time-frame required.
Training and education
Almost as important as the budget for the ERP product itself is the budget for the appropriate training. User adoption is critical to an ERP system being successful. Garbage in, garbage out, and if your users are not inputting the correct or good quality data, your ERP system cannot do its job. In order to input the correct data, your employees need to be properly trained and proficient on the new software. Training can be done in a few ways: e-learning, classroom-type training and on-the-job-training. Each method has its own advantages, but the best way to do it is to have a combination of all three.
It is recommended to start with e-learning and structured classroom type courses to act as a foundation of learning. Thereafter, function and industry-specific guidance is needed for employees, as well as continued and easily accessible guidance for staff after go-live. Another popular solution is to train proficient staff as “superusers” and this helps to provide long-term support within the company without having to continually call on external resources. However your business decides to deal with it, sufficient and quality training is needed to make sure that employees feel confident, proficient and positive about utilising the new ERP system – in that way, the probability for ERP implementation success is maximised!
Each company and industry is different, and so there is no one-size-fits-all project plan for ERP implementation management. Preparation, planning, staff training and change management, however, are some of the key factors for success for virtually any ERP implementation project. It is vital to manage all aspects of the implementation, technology, data and personnel alike. Each is a vital cog in the ERP wheel!
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