By Anil Rai, senior consultant for ERP with Wipro Technologies
It is a tall order implementing a complex ERP application that serves the needs of an entire organisation. ERP implementations have been plagued with huge failure rates just because of solution complexity, implementation models and the lack of ability to segregate ERP implementations from a normal IT solution implementation.
ERP solutions have evolved a lot over the last 10 to 15 years and the rewards of doing it right can help organizations achieve critical business benefits. However, these benefits come at a cost. ERP implementations can be very tedious and challenging. To overcome these problems, sound planning is required.
Organisations must conduct a detailed cost benefit analysis before deciding on implementing an ERP solution. In my experience, the most important factor for success is to have a strong business case for ERP. It should have a committed buy-in from management and steering committees as without it, there is no point in even thinking about ERP.
Change management and expectation management is the next big critical factor. Any ERP implementation would lead to major changes in business processes and the way people work. This can and often does cause a sense of insecurity and confusion for the company teams. Increased awareness and acceptance of an ERP initiative among end user groups and organisations can be helped by organising demos, road shows and competitions. It is also important to set up a dedicated internal team of the most qualified people from the various business functions. This core team, headed by a senior project manager, can act as effective agents of change in the organisation.
ERP implementations should be treated as a business initiative rather than an IT initiative. ERP is more about processes definition, improvement and optimization and business should be the driver for ERP implementations with Technology being the enabler.
Most of the delays in ERP projects have been due to lack of internal preparedness It is therefore important to align the technical team with the legacy data extraction plans and resources and train the core teams on the product before the project goes live. If its a complex implementation, it is advisable to partner with a professional consultancy or system integrator. Though this may cost little more, it can ensure the success of an implementation.
System integrators bring to the table an enormous knowledge repository that they have accumulated from their previous engagements. This includes their domain expertise, project management skills, as well as a deep understanding of the product, business and technology. Also system integrators can utilise their onsite-offshore model to help reduce the cost of ownership.
To ensure a successful ERP implementation requires a very straight forward strategy. A company needs to start by creating a project plan. This is one of the best tools to do a health check and enable a project to keep on track. It is often tempting to overlap the project phases to reduce time, however, this can lead to complications like confusion, redundant and overlapping tasks and extra effort in error corrections. Also setting aside sufficient time for an ERP product bug resolution is crucial.
A well established implementation methodology ensures everything that is needed for an implementation is addressed. Most product vendors, reputable system integrators and consulting companies have their own implementation methodology.
Team communications are extremely important. An organisation must continually discuss and update its core team on the projects progress and plans. The tasks should be assigned 3-4 weeks in advance on a rolling basis. Everyone in the team is critical to the success of the project and this must be communicated by making them aware of the importance and impact of their role in the plan. Also an organisations business process owners, sponsors and subject matter experts must get involved right from the beginning and be assigned total process ownership.
Project education and training is an on-going requirement. No amount of training is enough. Organisations sometimes fail to budget the right resource and time needed for their end user training.
Finally, my golden rule is always to celebrate the milestones with the entire team, sponsors and end user groups. Recognise the efforts made by internally as well as by the system integrators or consulting partners.