Saturday, 01 October 2022 07:09

7 Critical Success Factors for Successful ERP Implementation

From our experience of over 1,000 implementations, we’ve found that there are 7 critical success factors for an ERP implementation.

From these critical factors, we can find that a successful implementation of the ERP system is not only set up technology support of the information system but also change the way of management work. Most companies view ERP implementation as simply a software system being added to their current organisation system to help their operation, but behind that, there is more meaningful connections between ERP system and it’s user.

PEOPLE PLAN PROCESS
  • Executive Vision
  • Employee Involvement
  • Project Manager
  • Realistic Budget & Timeline
  • Project Scope
  • Change Management, Communication & Training
  • Customisation

Executive Vision

If your C – suite supports the project, you will be able to secure internal resources you need. A business proposal has undergone a thorough study before it is decided by the executives. So, it is important that they will back you up entirely with your implementation plan and change management stated in your business proposal.

Employee Involvement

Remember, IT department will not work alone in this. Management has to stand by through all process to ensure fully support implementation phase. Managers can offer input and ensure that all staff members have the resources they need to ensure timely deliveries.

A handful of expert from each department will be a valuable resource to implementation process as they possessed hands – on knowledge of each business process the ERP will cover.

Project Manager

An experienced project manager from your provider is needed for the implementation. The PM marshals all the different resources at the right times, and provide clear, transparent and regular communication to keep all stakeholders updated.

Recommendations:

  • Meet regularly with provider PM to discuss project status and escalate important issues when needed
  • Contribute insights to all critical areas in your organisation
  • Make sure that all your resources are available when needed

Realistic Budget & Timeline

Now, we have gone through this experience before and trust us, this is probably the most simplistic challenge yet it gives the most headache.

Budget can include various cost that relate to ERP implementation. At Metisc, we believe every client should be empowered with proper budget and schedule for the implementation. Here are few elements in budgeting & scheduling that you may not missed:

  • Hardware
  • Software
  • Staff resources
  • Fit – gap analysis
  • Customisation and integration elements
  • Training and relevant change – management required for all personnel who directly related with the system
  • Do check on schedule conflicts, planned contributions, workloads and upfront vacation confirmation

Project Scope

Project scope can help narrow company’s focus. Example: the project scope may include information on how to enhance certain business requirements, like business intelligence and social media presence, in the future.

Also, think about other tailored solutions that satisfy different department needs. Start by creating a list of requirements and start the initial priorities that ties with primary business objectives. Furthermore, think about other systems and tools your organisation uses, and which ERP components could fit well. Fully detail what your project is going to include, and what might be in scope for future iterations.

Change Management, Communication & Training

The ERP project will not only result in system changes, but process and organizational changes too. A dedicated team or workstream focused only on change is a requirement for the organisation to deal with the volume of the impact / change; the size of the team will vary depending on the size of the project and number of changes.

Recommendations:

  • Develop consistently good communication between project team and organisation, using tools such as internal sites (SharePoint, CMS, Company Web), newsletters, lunch, company outing, etc.
  • Regular catch up with key users and nominate them as your product ambassador internally to pass on the skills on using the ERP system to their team
  • Consider getting full package that include software training and readiness assessment with your select provider / partner

Customisation

Last part, we have noticed that this is the integral part of every implementation that we do. Most ERP’s are built with embedded best practices / industry standards for good reason. Try to be open minded and try not to be constrained to comments such as ‘This is the way it’s done around here’ or ‘This has always been like this’, go back to business objectives and overall strategy to reflect back your process.

We conclude that every organisation must create a process by which a business case must be created for every customisation, perform gap – analysis based on your requirements and prioritise them (High, Medium to Low).

Then you are able to set expectations on company position regarding customisation and what is considered in scope for release 1, and what should be included in scope 2 and so on.

Lastly, be prepared to maintain these modifications as the software vendor releases new versions of the software.

Conclusion

Implementing an ERP system does not turn out to be that painful if carried out with proper preparation, planning, and execution. With above critical success factors, an ERP implementation can progress efficiently without any problems.

Choose the right ERP partner with experienced in implementing ERP system that specific to your industry. Your partner must understand your business and industry along with verticals under which you operate and your consumers.