Planning for a Successful ERP Implementation – Part 2 in a 6 part series
Companies justify moving to a standard enterprise resource planning (ERP) solution based on a number of compelling reasons. By supporting a single system rather than several smaller and disparate systems, they can enjoy economies of scale. Additionally, having single application architecture with fewer user interfaces creates lower integration costs. And through common tasks automation (as well as easier access to more information), best practice systems and procedures allow for efficiencies not available when using multiple systems. While the case for standardizing on a single ERP system can be relatively straightforward to make, the costs and impacts are sometimes easy to overlook. Cre8tive Technology (www.ctnd.com) will be posting a weekly six part series on how to ensure a successful implementation. Companies should take into consideration a number of factors:
- Build a cross-functional team
- Set proper expectations to manage change
- Create new business processes in sync with the new system
- Implement in a phased approach
- Make the necessary time and financial investment
- Putting It All Together for a Successful Go-Live
Addressing these areas early on in the process can be the deciding factor whether the ERP implementation is a success in the long run. This series will highlight the importance of each of these factors and provide recommendations on how to ensure a successful ERP implementation.
Set Proper Expectations to Manage Change
Now that the cross-functional team is in place, setting proper expectations both with this team and all employees is a very important next step. One area that needs to be addressed at the implementation onset is the time commitment required by key employees to participate on an implementation project team. Due to the disruptive nature of this project, many of the activities cannot be fully accomplished during normal working hours. There will be times when team members will need to perform their current job and then work on testing or file cleanup after-hours. In order to lessen the impact to those employees, it is recommended that they be able to log into the company’s network via VPN from anywhere. A company also should set proper expectations to help manage the change that all employees will experience, using change management techniques prior to the change happening. For example, people involved in a change often expect to go from A to B; whereas, perhaps they are actually going to C. Change Management is about getting them used to the idea that C is the real destination. If users are prepared prior to go-live that there may be some interruptions in their typical day, the less likely they are to reject the system if something does not go according to plan. On the other hand, telling staff that this is going to be a “great new system” with “no problems” can only lead to disappointment and possible rejection if challenges arise. Change management is measurable and a fairly straightforward process. If properly managed, a company can evaluate how its employees feel about the changes over a period of time, and how they shift in their expectations. There are a number of techniques designed to forecast and mitigate stakeholders’ resistance to the change. Some examples include:
- Defining project success criteria: This can include defining measurable goals and Key Performance Indicators (KPIs), many of which were used when creating the business case for moving to the new ERP solution.
- Performing an infrastructure analysis: This is done to determine all requisite human, technological, and other resources that should be available to the core team to ensure the project’s success. Once these are determined, the team should continue to monitor assumptions, risks, dependencies, costs, return on investment, and cultural issues affecting the progress of the associated work. As the project progresses, they can make the necessary changes to areas that can affect its outcome.
- Designing a communication plan for stakeholders: The communication pieces inform various stakeholders on the details and reasons for the change. They will also highlight the benefits stakeholders will enjoy as a result of the change. One good method is to e-mail newsletters or hold meetings for the implementation team and other stakeholders on a regular basis so they can get updates on the project’s progress.
- Developing a plan to create enthusiasm and gain project momentum: This can include fun or creative activities to motivate stakeholders, and an education and training plan to ensure stakeholders will have the support they need to be successful with this change.
- Leveraging executive sponsors: Having the executive sponsor highlight the project’s importance is key to overall project buy-in from the stakeholders. This can also help counter any resistance from employees and align them to the organization’s overall strategic direction. A strong implementation partner should be able to educate the company on possible implementation challenges, and develop proactive strategies to overcome resistance to the change and promote a quicker return on investment. Another dimension of the cultural change is the timeframe in which the change happens. It initially occurs over a few days during go-live, and moves the whole company to a more structured and rule-based environment. No matter how much training and preparation takes place, it cannot prepare everyone for that reality; there are always a few outliers who still do not feel ready for such a change. On the positive side, some people will take to the system like the proverbial “duck to water.” These people may see early on the benefits of a better system, and were most likely frustrated with the one they were previously using. They will jump at the chance to make use of the new technology, and may be recruited to become “super users” who can train others and potentially even win over the outliers as the project moves forward.
From an Epicor White Paper
Epicor Software Corporation is a global leader delivering business software solutions to the manufacturing, distribution, retail, and service industries. With more than 40 years of experience, Epicor has more than 20,000 customers in over 150 countries. Epicor solutions enable companies to drive increased efficiency and improve profitability. With a history of innovation, industry expertise, and passion for excellence, Epicor inspires customers to build lasting competitive advantage. Epicor provides the single point of accountability that local, regional, and global businesses demand. For more information, visit www.epicor.com.