Implementing your new ERP, best practices
Not everyone does it in the same way, but there is an optimal way to do it. It’s about ERP implementation – and we have had the opportunity to experiment how different company cultures and regional habits influence it. Nevertheless, there are procedures that, when respected, make sure the process goes as smoothly as possible.
We found an article that summarizes the timeline and essential steps involved into the adoption of a new ERP by an organization – see our highlights below. It’s about a lot of planning, understanding the risks and finally being able to judge the success rate, when going live.
The 1st step in ERP implementation consists of appointing the project team
We brushed this topic in a different post, but the basics remain the same – you need a core team to manage the inherent changes, challenges and tasks. Since we are software solutions providers, we are familiar with mixed project teams, where the beneficiary combines its representative(s) with our own specialists, to work together seeing the implementation through. This team needs to contain:
- A project manager – a person who understands the project, who can be one of your own employees, or may come from your implementation provider – or you can double by having both
- An ERP implementation consultant – from your software partner, to “circumnavigate problems before they arise”
- An application analyst – “responsible for data migration and cleansing”
- An application developer – which usually comes from your software partner
- A QA test engineer – also usually from your software partner
*Depending on the company, on which your key stakeholders and implemented functionalities are, your team may include, from case to case: a member of your senior management panel, someone from accounting or engineers & shop floor staff/warehouse staff.
The 2nd step: creating an implementation management plan
Having a well-structured plan brings out a middle ground for all the different needs, work styles, ways of approaching certain details. The source article even provides a schedule template in view of such a plan:
- Draw an estimate of the implementation costs and subsequently a budget
- Draft an ERP implementation schedule
- Consider that you will have to migrate the data to the new system (and allot time for it)
- Consider that you will have to train your ERP user base (and allot time for it)
- Include testing your ERP and going live
- Include time for project evaluation
Making use of a professional collaboration tool is well advised, as it eases traceability and allows to check what went wrong so as to remedy it quickly. As your implementation partner most likely already has its own procedures, this common tool provides an image on how they cooperate with your representatives, as well as allows visible inputs from those you’ve appointed as change managers.
To that avail, the disruptions triggered by such a major change as adopting a new ERP can be minimized by taking care to act with:
- Clear, transparent, and traceable communication means
- The understanding that you need adequate time for user training
- Initial consideration for the needs of your staff that will later on reflect in the everyday use of your new system
The 3rd step involves the forecast of your ERP implementation costs
You need this in order to draft an actionable budget. Your software implementation partner should be able to give you a fair estimate, as well as provide an idea of how fixed or relative this is, in their experience.
As independent research goes, according to a recent Softwarethinktank analysis:
- 35% of ERP implementations surpassed the initial budget by 0%-25%
- 15% went only as high as a plus 26%-50%
- 6% went over budget by more than 50%
“A good starting point is to assume cost of an ERP implementation will require at least 1% of an enterprise’s annual gross revenue at a minimum”.
To avoid the shock of hidden costs, it is recommended for you to consider these:
- Hardware/network upgrades
- Staff overtime pay
- Software partner fees, like the training, customization and consultancy fees
- Data backups and storage costs
- Productivity loss costs
You may continue reading about the other steps directly in the source article – here. Nevertheless, remember that having an experienced, top implementation partner such as we are makes the process much easier for your organization, from processes to staff tasks. Call us to find out more about the way we approach SAP implementations!
*Just as for you to have an idea, the next ERP implementation stages are:
- Starting your data migration
- Training your users to use your ERP
- What to do during your ERP go-live
- Evaluating whether your ERP project was a success