Getting your company ready for ERP in 3 steps

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ERP deployments are not easy no matter how many vendors will tell you so. This is a change management initiative that will have a lasting impact on your business. In Sri Lanka this is a rather complex matter given the management structures that are in place and the general disregard that prevails for IT software solutions. In order to get the maximum value of your new system it is important to prepare your company for the upcoming ERP system.

Whatever you do, it is not up to your company’s IT department to deploy ERP alone and although it’s dealing with software this is not your average software package as it impacts the entire business and how it runs. The typical scenario in the Sri Lankan setting is to delegate a significant proportion of responsibility for ERP with the IT department. This unit might be composed of a handful of individuals with some networking and software experience, but may not meet the expectations of a consultative role required to assess business processes, which is what ERP is all about. ERP deals more with the company’s processes than it does with hardware configurations or infrastructure for that matter and is therefore a ‘whole of company’ effort.

Here are three steps that will help you understand the main points to get your company ready for ERP:

  1. Get an internal team together to steer the ERP project

ERPs are seldom successful when senior management are not involved. Remember this is not a simple Windows install and we know even that can be challenging! It is vital that a senior manager with authority and oversight has an overview of the ERP project and is genuinely interested in its success. If he or she sees this as an added and unwanted burden the project fail rate jumps up significantly. The person who is chosen must be an advocate for ERP for the company.

The project also requires the support of the IT staff for various technical reasons. In most cases these can be outsourced to the IT vendor your company uses too in which case some additional coordination will be required.

The other critical role is the internal project manager. Their role is to track the project progress and monitor the schedule of tasks, the budget for work being done and the quality at which work is carried out. He or she should have an overall view of the organization’s processes to be most effective; therefore newcomers to the company are not suitable. Project management is key to the success of ERP and all it takes for an internal PM to be on point is to track the progress according to the plan that was agreed by the vendor. The PM serves as a central contact point of contact for the vendor in coordinating the project deliverables.

The next core group are the key users of the system. The challenge in Sri Lanka is that everyone is generally very busy and possibly juggling multiple roles at once especially in SME settings. Users are coming from various departments of the company that will eventually be using the system once its in place. Their role is to guide the vendor in ensuring the system meets the requirement as agreed and participate in testing it. It is vital to incorporate the key users in the planning stage so their time is efficiently allocated for this purpose. They will also typically be the first to be trained on the system and may be in charge of training those under them moving forward.

 

  1. Have a plan for change

Leaving it all up to the vendor is not the correct way to bring an ERP into your company. This is a joint effort with the vendor’s team and yours. It is vital to have a plan of action for an ERP system coming into the company, as would any major change happening to your organization. ERP has a big impact on what happens to your company moving forward and is largely invisible as a new ‘resource’ in your company. Therefore it is vital to ensure that the company is on board with the change that’s coming and allocate time to plan. ERP requires time as such it has to be allocated to work with the vendor’s team, and at times, stop operations. In a manufacturing scenario its good during scheduled downtime for instance or an off-peak production period when the company is not so busy. ERP’s are not just for the good times as when business is slow a system plays a vital role in ensuring you are running efficiently as such don’t postpone your ERP decision if the market is not showing good signs as it might be just that time when you do need a good system in place and you have time to take it on! Time taken to plan allows your staff to rest-easy rather than get overwhelmed when an ‘erp meeting’ pops up on their calendar on top of their daily work. This planning activity is very effective in reducing the level of resistance to a new system in a company.

 

  1. How do you measure ROI?

It is important that your objectives in putting an ERP system are met in the end. A lot of companies go into ERP systems for the sake of it, but have no idea if they actually need one or even what they want to achieve with it. ERPs are very powerful and can deliver numerous advantages, however if you are not aware of how to tap that potential you will be lost implementing a system. This is not the vendor’s realm of expertise either to advise you on what your company objectives should be although they can offer insights. Examine at what you are trying to achieve with an ERP solution be it to ship faster, reduce order errors, more accurate set of accounts, or even better reporting. The more defined these objectives are the better you can measure them. The result is that you will feel better about your ERP implementation and what you bought! There is no point in implementing a system for the sake of it and having no tangible benefits in the end! Remember there are no warnings from vendors!

 

This is a snapshot of a few steps you can take when aiming for ERP success in your company. Call us today at 011 450 6904 to schedule an ERP workshop with your management team so you can be prepared from both a selection and readiness point of view.