The Secret to a Successful ERP Implementation
Posted by Russ Tickner
All too often you hear of ERP implementation failures or ERP projects with disastrous outcomes costing organizations millions of dollars and lost opportunities. This causes organizations to be very cautious when looking to invest in new ERP solutions. There are several ways to avoid ERP project failures which Find Accounting Software lays out in their recent blog post “How to make sure your ERP Vendor doesn’t drag your name through the mud.” However, it goes beyond the evaluation and selection process to achieve a successful outcome. As a project manager for over 17 years, I wanted to share my experience working with customers of what the secret is to a successful ERP implementation.
So, what is the secret? The key to a successful ERP implementation is a future-proof project management plan. Here are 10 tips to ensure your name stays out of the mud.
- Identify Business Objectives and Scope – Share your business objectives with all the stakeholders as soon as possible. It’s important to involve the ERP vendor team early on because if they know your goals and requirements up front, they can start preparing in advance and deliver results right away, reducing any surprises later on.
- Create a Project Sponsor and Steering Committee – You need buy in from all different roles of the organization and without them, your chances of a successful ERP implementation are very difficult. With strong support from management, they will help prioritize, make decisions, and escalate issues. Without strong leadership the entire project could drag on or worse, be put on hold.
- Dedicate a Core Project Team – The project team usually involves end users with the appropriate skillset and authority. Putting several people on the project will allow them to capture the knowledge and ensure it’s not trapped with one person. The project will also take up almost 100% of the project team’s time. Take daily responsibilities away from them by hiring contractors for a 6-month period or so and let the project be a fulltime focus for you and the team.
- Create a Comprehensive Project Schedule – It doesn’t mean anything if you “think” the schedule is achievable. Not only do you need to create a work breakdown structure and timeline, but you need to align resources with it. The comprehensive schedule should include tasks, effort to complete the tasks, who’s responsible, start and end dates, and the task completion timeframe. It is important for the resources on the project to align with the expectations set in the schedule to confirm it is achievable. Unrealistic expectations and unclear roles lead to risks down the road.
- Develop a Risk Matrix – Risks can both be positive and negative. It’s pretty simple; you’ll want to enhance the good and reduce the bad. Let’s say a person isn’t available for their scheduled part of the project or they don’t understand the requirements from the start. This could eventually put the project in the red. You’ll want to identify all the possible risks in a matrix as soon as possible and then put plans in place to mitigate the negative risks and increase the probability of positive risks. If you foresee positive risks, such as a less costly financial impact by putting more than one resource on the task, it will be important to outline the opportunities to increase the benefits and values of the investment.
- Have a Change Control Process – Change will happen and it’s ok. Whether it’s your requirements, an objective or even different resources needed in the middle of the project, whatever the case, new requirements or changes to the scope can happen throughout of the project. You’ll want to do an impact assessment of the change against the total solution, project timeline, project budget, resource availability, etc. to determine if the proposed change should be accepted or rejected.
- Hold Gateway Reviews and Approvals – At the end of each phase of the project, hold gateway reviews and approvals with the sponsor, steering committee, project and ERP vendor team. Review your timeline, budget, look at high risk situations, discuss priorities and make decisions. It’s important to check in and ask yourselves “did we do everything that we planned?” Reviewing and assessing across the board can refine and align the project back on track and help keep the budget in line so at the end there are no surprises or unhappy people.
- Ongoing Communication Plan – Have a proper communication plan in place and adhere to it. Hold meetings regularly, either online or face-to-face. The more you keep the communication lines open, the better. Also, decide what tools you’ll use to communicate. Email can sometimes be tricky as perspectives could get blurred. Phone might be an option but then you may exclude key members of the team. Collaboration software or project management tools that allow everyone to communicate in a private workspace is key. And always remember to document and archive your requirements and decisions.
- Ensure an Organizational Change Management Strategy – Think about how you’ll get the organization excited about the new ERP solution. People tend to avoid change or dislike it since it means learning new technology and changing their daily processes. Plan how you’ll communicate to everyone to get people to accept and work within the system.
- Plan the Post Go-Live Stabilization Period - This is a critical component that is often forgotten or not effectively planned out yet is key to a successful implementation. The post go-live stabilization period typically spans 90 days out from go-live. The project team or the just the key subject matter experts need to be available to help address any operational issues so that end users are not impacted as they learn and work in the new system while performing their jobs.
A proper project methodology coupled with a highly flexible ERP system will allow you and the team to be proactive rather than reactive to customer demands, market changes, and organizational changes. You’ll be able to take strategic actions, seize opportunities, prevent issues from escalating and communicate in a much more timely fashion ‒ guaranteeing confidence in your ERP solution.