How do you track the success of your ERP system?

I always tell my clients to take a 'snap shot' of where they are on go-live day (inventory levels, debtor days, OTIF performance etc) so that they have something to measure against. Almost none of them take my advice: I can only imagine that they fear that some of the improvements that they based their ROI calculations on will not actually result.

In this "innovation by the minute" era, goal post might be changing by the time we are completing the ERP implementation project. Use of interconnected ERP and non ERP systems make it more challenging to track the success of the ERP systems. In addition to this, I believe that, everyone at every level in the organization have their own goal post in addition to the goal post set by the organization for the ERP implementations. -Clearly define tangible and intangible benefits -Metrics to rate/track intangible benefits -Metrics of how ERP is impacting the performance of connected systems -Focus on tracking of growth achieved by use of ERP along with other KPIs -Clarity in Company v/s ERP system objectives -Focus on reports/data needed

Most articles about ROI of ERP stay general and vague, like "design KPIs specific to your business". None go into detail. There is a good reason. You can't find KPIs that measure only the ERP system. They can also be attributed to something else. More sales? The Sales Director can claim that they had a good year. Less cost? Less inventory? Other teams claim the positive news. Bonuses await. Only for negative news, the ERP system is a welcome scapegoat. In my view, the question is wrong. Don't try to measure the ERP project ROI in isolation. Measure your entire business, look at time trends, and see if the ERP implementation period shows an inflection. If not, focus on business processes until it does.

A lot of us are trained as economists, and as everybody knows, they always have explanations and metrics afterwards. I read a lot of interesting things here, but this is the easiest part. Quite more complex is to make the business case before because it is almost impossible to forecast the same metrics before an implementation.

Make sure you know what you want and how to measure it. When you implement a new ERP system, you're getting a tool that should help your business grow and work better. But if you don't have a plan, you won't know where you're going. By setting clear goals and targets, like making fewer order mistakes or processing invoices faster, you can see what you need to do and celebrate when you achieve it.

For a company planning to implement an ERP system - whether first-time or replacing an obsolete or too-small solution - it can be difficult to identify valid before-and-after improvements. But here are a few that I have seen firsthand: 1. Days/Hours required to perform month-end accounting activities. 2. Operational downtime required by a full physical inventory. (presuming that a new ERP enables the company to replace full physical count with continuous cycle counting) 3. Perfect order index - % of orders delivered with the right product, at the right time, in the right condition, with the right quantity. 4. Other metrics that can be reproduced from historical data: customer RMAs ( in $$$), time required to conduct a mock recall, etc.

As stated above, we apply a special check-up process for PirCloud. We cross-check whether check-up notes are missing/over/wrongly selected by talking one by one about what they have written and comparing with the packages and modules they have selected in the user need document. We also compare the part where they score their processes with the packages and modules they have selected. This is the 2nd cross-check. In this way, we both question what they have told to us and update it with corrections while tallking int the meeting. By this way, customer both expresses himself better and has his misunderstandings corrected, and a successful matching is made with the solution contents we offer by clarifying his hidden and explicit needs.

One key mistake businesses make when setting benchmark and baselines, they try to replicate previous software and practices, this can often become a hurdle to establish new standards and improvements.

Trust but verify! Benchmarks serve as the foundation against which you are going to measure future performance. Don't just rely on anecdotal information and measurements when data is available. For example: It takes an average of 5 minutes to enter a customer order. - It actually takes 10-15, but we don't want to say that because we think it makes us look bad. It's really a fault of the existing system/process.

Dashboards and reports help you understand your business. They show you what's going on in your ERP system and let you make changes. Without them, you're like a driver without a dashboard. You won't know how fast you're going or if there's a problem.

Unlock the power of an ERP system – a gateway to real-time precision and insights. Visualize your business's pulse through customizable dashboards, presenting key metrics in an engaging, graphical format. Delve deeper with reports, encapsulating findings into structured documents that illuminate trends, patterns, and opportunities. With this dynamic duo, you gain a robust framework to track success, make informed decisions, and steer your business towards excellence. Embrace the future of data-driven precision with ERP systems.

ERP solutions can provide some great insights into your business and typically rely on tools to present that data in a visual way. I have 2 things to say on this issue: 1) Make sure that your BI people understand the difference between data and information. They are not the same. BI people use data, business people use information. 2) Take the time to fully understand how the information you are providing to the business through reports, BI, dashboards etc. is being used. Understand the context as this will help you create better outputs.

The best sign of a successful ERP is that employees actually use it. Management's obsession with ERP reporting might be more of a red flag than a good indicator. Dashboards and reports are often useful tools for gaining insights into various aspects of a company and thus taking action. However, placing excessive emphasis on them may carry the risk of assuming that every prior stage of the ERP implementation process has been fully fulfilled. Aside from the superficial aspects, the main challenge you will face is having crucial company data out of the system. That stems from demotivated workers who notice that some software features or policies are designed by individuals lacking a deep understanding of specific domains.

Dashboards, graphical illustration of data, or showing some strategic data (like some KPIs, Metrics,...) is nowadays crucial way of treating and outputting the bulk data. But forward-backward direction of using these dashboards or graphics or pivot reports is helpful for the manager-level users. What I mean; *Forward-direction is from raw-data to summary-data. *Backward-direction is from summary-data to raw-data. What summary-data means? it is the data which is managemet-level data on dashboards or graphics.

Feedback is important to see how your ERP system is working. Hard data is good, but you also need to know how people feel about it. Ask your team and customers to give you feedback. You'll learn what's working, what's not, and what needs to change.

Think this is the most valuable metric. Ask to relevant users the way their work changed after adoption, in terms of time spent for tasks, quality of data and so on....

According to Kübler-Ross; some employees show a resistance to change during the commissioning of the project. If you can't break this resistance your project may poteantially fail, you shouldn't give up and manage this together with customer side managers. This resistance cause might be sometimes phsyclogical or sometimes affects their status in the company, or sometimes affects their causes them to suffer material or moral losses. In these last 2 cases, feed backs or surveys mislead you. In any other ways feedbacks and surveys are good and preferred way of measuring the effect, because you should measure that.

Connecting with your audience is the key to delivering a successful ERP project, and this should happen at all levels, it is not only IT departments responsibility to implement ERP, feedback should be gathered and must be made part of requirements.

Keep your ERP system up-to-date. Your business is always changing, and your system needs to change too. Check how it's working and make changes if you need to. That way, your system will always be useful.

This is endless process and in some companies like wholesale or retail, improvement is "good morning" every day. New ERP technologies are better and better every day and there are giving us good tools to use them and to handle B2B and B2C users, so the companies can compete with each other on open market.

start form expectations and goals, use (KPIs) and keep updating them, collect baseline data for comparison, use feedback and satisfaction of users, continuous improvement and adaptation ***Before during and after the GO-LIVE***

In addition to continuing activities for ERP success :- Ensuring that your ERP system users receive adequate training and support is essential. Regularly assess the user experience, gather feedback, and provide ongoing training to address any skill gaps or usability issues. Effective user training and support contribute significantly to system adoption and overall success. Continuously monitor the security of your ERP system to protect sensitive data and comply with relevant regulations and industry standards. Regular security audits, vulnerability assessments, and compliance checks should be integrated into your ERP system management strategy to safeguard your business from potential risks and legal implications.

"Review & Improve" is a very good couple, we should apply to anything in our business processes. Not only in ERP projects, but also in processes or abilities, skills,.... Continious Imporevement is also a Kaizen principle. I also believe that "if your 2 days is equal, then you're in loss. Your new day should be better than the previous day." Plus, I might add that "Today, you should say and act new and better thing"

In almost every ERP project I have seen, especially small medium enterprises the client does not properly budget for “the day after”. understanding that an ERP project is not over at go live is critical to unleashing the true potential of the investment and Inadequate budgeting for post go live can be a road block. Similarity qualifying internal resources to be able to not only support but also extend the solution is often overlooked by the client which can slow down progress to success. In short, clients should be looking at the ERP project as an initial investments and plan to have the budget and resources to support and extend it well beyond

"Listen" to end users needs. B2B and B2C customers are good source of "what to" and "what not" to do. Not all ideas has to be implemented, but some of them, can and should be analyzed and considered to put on to do list. At the end, don't invent "hot water" if someone did that before you. Just get the best of it.

Stay up-to-date on the latest ERP news. Join forums, go to conferences, and get training from your provider. You might learn something new that can help you use your system better. Remember that success isn't just getting a new ERP system. It's changing and growing with your business.

Software development is a problem-solving skill. Be sure to listen to users problems. Always improve your system with feedback. If you can, strengthen the erp system with artificial intelligence. Don't say we can't. Remember that nothing is impossible. Everything has a solution...

Just because you can, does not mean you should. We don't have chocolate coffee pots for a reason! NEVER optimize a process that shouldn't exist. ERP projects fail due to a lack of buy-in, usually from the senior management level. If you don't have the buy-in, don't start the project. If you don't involve the users, listen to their opinions, and seek their input then you are asking for trouble. ERP projects are not easy, I don't care what the salespeople tell us. They are not going to right every wrong, fix every wayward process and suddenly take an underperforming company to the FTSE 100. Don't reinvent the wheel. Reach out to others because the likelihood is someone has already done exactly what you are trying to do.