The moment when a business chooses an ERP system may feel like the end of a journey. Considering that many businesses spend weeks or months in the ERP comparison and selection process, it is the end of a journey, in a sense. However, when it comes to implementing an ERP strategy, choosing the system is only the beginning.
In fact, the process of implementing new ERP software is every bit as important as the selection process. A smooth and well-planned ERP implementation is crucial for capturing the benefits (and avoiding the potential pitfalls) of ERP software. The following five steps will help businesses determine the best path forward for their ERP implementations.
Bring together stakeholders from across the organization and gather data on the needs of different departments.
First, most businesses will need a project team to coordinate ERP implementation. Typically, this includes personnel who worked on the ERP selection process, department leadership, executive sponsors, consultants, and employees with extensive institutional knowledge. The goal of this planning stage is to identify what various departments need from the ERP implementation.
Hopefully, your company has already incorporated data about departmental performance and pain points into its ERP selection process. This data should be the starting point for an implementation that takes everyone’s needs into account, but it also needs to be expanded with input from stakeholders throughout all levels and departments.
The project team is responsible for collating and analyzing these data, often in the form of requirements documentation that lays out the organization’s operational needs. This information will provide a guide for leadership as they steer the project through its next stages.
Create a framework for implementation.
In the next phase, the implementation team will work to develop an outline of how to implement the ERP system in various workplace departments. Again, input from all levels of the organization is crucial here, especially from everyday employees who will be working with the software in their daily duties.
Some of the most important processes to account for in an ERP implementation framework include:
- Accounts payable and receivable
- Customer relationship management
- Inventory management
- Materials sourcing and tracking
- Shipping and receiving
- Quality assurance and quality control
- HR and payroll
ERP solution implementations may vary significantly from one department to the next. The important thing is to have a clear knowledge of the specific needs of every department to present to the developers in the next stage.
Work with the software vendor to align the implementation with needs on the ground.
Almost all ERP solutions include some level of customization and software engineering support as core parts of the offering. Thus, in this stage, a business works with the vendor to customize the software and align its implementation with the needs of the business’s various departments.
Off-the-shelf ERP systems like SAP ERP software or NetSuite ERP tend to offer fewer options, but their solutions can be simpler to implement than highly customized software. For organizations that are committed to more extensive customization in their ERP builds, implementation often takes longer, especially when adding substantial and/or industry-specific features like manufacturing ERP capabilities.
Regardless of a solution’s customization level, these are some of the core questions that a business’s ERP rollout strategy will need to address:
- Will the rollout happen all at once, or gradually?
- For gradual rollouts, which processes, clients and/or departments will change over immediately and which will retain the old system?
- What data should be prioritized for migration, and can any data be safely left out of the process?
- Will the rollout be primarily SaaS-based, or will it require purchasing and installing significant amounts of new IT hardware?
- What obstacles are likely to present themselves during the transition, including challenges that affect specific departments?
Test the system and prepare employees for the go-live date.
Once the vendor and/or your IT department have installed the system, the testing process begins. An organization’s rollout strategy will determine the blueprint for its testing process. That process itself might involve any or all of the following:
- Phasing in the ERP solution on a limited number of accounts and/or in certain departments
- Conducting integration testing with other software products a business uses to ensure compatibility
- Recruiting user acceptance testing (UAT) groups from different departments to be sure that the implementation meets operational needs across the organization
- Testing for security, possibly with the assistance of security consultants
- Performance testing to ensure that the system can accommodate spikes in its traffic load
It’s also important to begin training employees on the new system before they’re expected to use it for daily activities. Tutorial videos may be sufficient for some employees, while others may need live one-on-one training sessions with an expert. Take advantage of the training resources that most ERP vendors offer to get employees up to speed with the new system.
Create and monitor support structures ( like employee training) to make the system rollout smoother throughout the organization.
The work doesn’t end when the system goes live. Instead, an organization’s focus should shift toward supporting users throughout the organization as they make the transition. Even in well-planned ERP implementations, there will inevitably be challenges and disruptions, so an organization’s best strategy is to expect the unexpected.
These are some of the most important ways that businesses can support their employees through the transition to a new ERP solution:
- Using the vendor’s customer support and training resources to reduce the workload of in-house IT staff
- Developing a set of KPIs to track implementation progress (such as number of support tickets from each department) and using them to identify areas where the rollout is struggling
- Identifying likely friction points in advance and providing extra guidance on how to navigate them
- Communicating openly and transparently with employees about challenges and opportunities in the implementation
- Create regular cross-department follow up meetings to discuss how the new system is going. Some regular opportunities feedback and shared strategy can go a long way to increasing acceptance and adoption of the new system.
- Make sure you have duplicate people trained on the system, to prevent any loss of system use should any given employee go on leave.
Ultimately, every business is different, as is every ERP system. The guiding principle of any ERP implementation should thus be to create an implementation strategy that addresses the unique qualities of both the business and the system while maintaining a commitment to industry best practices. Be patient, be proactive and be flexible enough to roll with the challenges as they arise.