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Lessons Learned from Best-in-Class ERP Implementations

Eric Kimberling, President of Panorama Consulting Solutions, recently led an Epicor-sponsored webinar on enterprise resource planning (ERP) implementation best practices, sharing some of the lessons learned from years of specialized consulting in the ERP market, as well as results from the company’s recent 2012 ERP Report.

Common challenges among those implementing ERP systems are implementation time, cost and business benefits delivered. According to the Panorama report, 54% of ERP implementations take longer than expected, 56% cost more than expected, and 50% realize less than half of the anticipated business benefits.

Kimberling notes that while these numbers are not inspiring, the trend across the industry has been in the right direction:

 CHALLENGES

 2010

 2011

 

Implementation took longer than expected

 

 

61%

 

54%

 

Implementation cost
more than expected

 

 

74%

 

56%

 

Implementation delivered
more than half of expected benefits

 

 

48%

 

50%


“The problems are not in the software, but rather in the implementation and adaptation to change,” says Kimberling.

Companies would do well to note the eight traits that Panorama has identified as distinguishing best-in-class ERP implementations from less successful or troubled ones. These are as follows:

(1)  Focus on detailed business processes and requirements

  1. Understand how your business operates
  2. Define and prioritize key business requirements
  3. Define requirements during selection; refine them throughout the
    implementation
  4. Avoid overemphasis on technical capabilities, if they’re not aligned with business needs

(2)  Focus on achieving ROI from your ERP investment

  1. Develop a specific and comprehensive business case prior to committing to an ERP solution
  2. Make business benefits as tangible as defined solution costs
  3. Establish key performance indicators (KPI)
  4. Set baselines and targets for KPI
  5. Track post-implementation performance

(3)  Commit strong project management and full-time resources to the project

  1. Have a strong project manager to support and participate in the project
  2. Leverage experienced resources
  3. Develop strong project controls
  4. Implement a risk-management and mitigation plan
  5. Conduct ongoing phase reviews

(4)  Gain commitment from company executives because support from top management minimizes conflict with business needs

  1. Secure CIO or IT director support
  2. Make sure that the CEO and the entire C-Level are on board
  3. Establish regular project reviews with the executive team

(5)  Take time to plan up front

  1. Don’t just jump into a project; do it right
  2. Validate the software vendor’s understanding of business requirements and their project plan
  3. Budget time to thoroughly test new business processes, security roles, customizations, etc.
  4. Communicate to employees and stakeholders

(6)  Plan and begin data migration early

  1. Define the data scope up front, including the scope for transactional and master data
  2. Begin scrubbing and mapping data as early as possible
  3. Thoroughly test data during pilots and other testing
  4. Don’t forget about data history

(7)  Ensure adequate training and change management

  1. Training, change management and job design are crucial to ERP projects
  2. ERP training should focus on business workflows rather than on transactions
  3. Training the trainer is effective—and embeds knowledge in the organization

(8)  Understand the target benefits of ERP

  1. Clearly understand what you are trying to accomplish with ERP
  2. Have a well-defined purpose and goals
  3. Leverage the experience of those who have gone through prior ERP projects, but don’t blindly follow what others did in their implementations

Kimberling notes that however one sources an ERP implementation, keeping these eight traits in mind will be of significant benefit.

 

Posted by the Epicor Social Media Team

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