Implementing an ERP System – Part 1

With all the different ERP systems in the market, there is always going to be companies looking at other systems and deciding to make the change. Perhaps your company is at this stage. I decided to write this blog on what you should do to ensure a successful implementation. Especially when Panorama reported that in 2018, 95% of businesses improved some or all of their processes after an ERP implementation although 74% of ERP projects took longer than expected.

1.??????Project Team

Of course, some of you may argue that because I am a recruiter, I would put this first… however, I genuinely think it is an important first step. If you do not have the right team to do the job it will never be successful. The main roles you will need are:

·????????Project Manager

·????????Application Developer

·????????Application Analyst

·????????QA test engineer.

However, this is not the team alone. To make sure the implementation runs as smoothly as possible, you will need other people to ensure good communication between different departments e.g. accounting specialists, senior management in reporting and BI and shop floor workers to discuss document management, inventory and designs.

I would also always recommend that you hire an ERP implementation consultant as well. Although it is possible to have a successful implementation without one, they can also eradicate potential issues and problems through their experience which could have cost your company thousands.

2.??????Implementation Change Management Plan

Firstly, you will plan your ERP implementation and delegate each step to your implementation team.

Before starting your ERP implementation, you should have plans in place for:

·????????Calculating implementation costs and drawing up a budget

·????????Making an ERP implementation schedule

·????????Migrating data to the new ERP system

·????????Training your ERP users on the most efficient ways to use the system

·????????Testing your ERP and setting going live date

·????????Evaluating the success of your project.

However, throughout this phase, there should be a plan in place to keep the whole company invested and dedicated during the implementation. A change of ERP system can bring disruption to employee’s everyday tasks however this can be minimised by:

·????????Set the process for communication if there is any disruption or issues

·????????Scheduling sufficient time for user training

·????????Taking department needs into account – you will have made a good start on this if you have already included department representatives in your project team.

3.??????Forecasting the Costs and Draft a Budget

Panorama found that in 2018, 64% of ERP projects went over budget. This means that almost two thirds of ERP implementations run over budget, proving that the budget should be dealt with carefully and analysed fully.

These are some factors to consider to avoid being hit by hidden costs:

·????????Hardware/network upgrades: these upgrades will be considerably higher if you are implementing an on-premise system

·????????Paying staff overtime pay: most likely an ERP implementation will not be a 9 till 5 projects. This should be considered as an ERP implementation can involve tedious and stressful times and you cannot afford for important staff members to feel undervalued. You will need every member of the team giving it their all

·????????Vendor training, customization and consultancy fees: vendors can sometimes include this in the initial software price however this is not always for definite. It is recommended that you check this

·????????Data backups and storage: these are often included within cloud ERP costs, however similarly this should be checked beforehand.

Next month I will cover my opinion of what else should be considered in Implementing an ERP System – Part 2. I must note that all companies and ERP systems are different, and many different factors may affect what you can expect from an implementation process. This is just a general view of what I think should be considered.?

Thank you for reading!

Charlotte Wilson