If an innovative company like Under Armour is finding their ERP implementation challenging what can you do to ensure a smooth ERP ride? Back in 2016 Gartner predicted that “until 2018, 80 percent of enterprises will lack the capability to successfully deliver on their postmodern ERP strategy”*. If Gartner’s point is a valid one how do you ensure you are one of the 20 percent? Kathryn Butterfuss, ERP expert provides 9 key pointers to drive success.
1. The Why
Understand “WHY” you want to move to a new ERP platform. This is generally born around a compelling event such as a merger or acquisition, a dying platform or substantial growth, etc. The investment must be justified – that is the why.
2. Explain the “why” in your RFP
When you put out your request (formal or informal) for proposals or information, ensure you explain the “why” to provide context for those responding. When considering the responses pay close attention as to whether they are tailored to your “why”, or simply a generic “cut and paste” RFP churned out to multitudes of potential customers.
3. Ensure your scope is understood
It is vital that your service provider understands your scope. This doesn’t mean solely understanding your high-level business processes, but also the areas that are causing pain to your organization.
Now, this does NOT mean going through months of discovery and/or months of blueprint. Instead use a “pain chain approach” which discovers the pain-points your organization is experiencing, the root cause, as well as the impact of those pains. Here it’s key to ask the service provider to share their methodology or approach when determining the scope. The intent of using this approach is to bring value to your organization.
Each organization has a series of things they want to change, it could be a pain that is causing them to lose efficiency, or a limitation based on their current software which creates a gap that has to be fulfilled manually. All of these items end up costing your company money. The purpose of an investment like an ERP implementation is to have a return on your investment. This approach ensures that value drivers are defined and followed through the process as a checkpoint to keep the implementation adding value.
4. Change management within IT and the business
The internal resources (both IT and business) required for these projects need to have the bandwidth to focus on the project. Under estimating the time these people are required will inevitably cause problems.
You may be questioning whether this is really change management? Well, yes, it is. Change management is far from just training users, it should start early on in the project and be well managed. These team members will need assistance to fully grasp the objective of your project, how to change and how to look at things differently. Choose your resources wisely, they may not be the people that have been in your organization the longest but the people who truly are able to embrace change.
Once again, if using a service provider, make sure that they have an approach and methodology that can be measured.
5. Keep your value proposition updated
Start documenting the value proposition as early as possible in the project and remember that this is not a static document. This should be updated in each phase of the project in order to not only identify opportunities for value (cost reductions or increased revenue) but also to understand how to measure it. This is often overlooked when planning a project.
6. Don’t underestimate your data
This is a point that has caused the downfall of many an ERP implementation. The common mistake is to think it’s simply about data migration and conversion, however it is truly much more than that.
Transforming your data from a legacy system to a new system can require many things that you never even thought about. You will need people who have knowledge of the legacy data to explain the historical information and you will also need people who have a deep understanding of the processes in the new system so that the information can be available in the right places.
Again, this should start at the very beginning of the project and service providers should have an approach and/or methodology as to how data should be handled. As always - make sure it is measurable!
7. Hold everyone to account
Everyone needs to be accountable for their responsibilities from your service provider through to internal and external resources etc. A clear RACI is critical to ensure everyone appreciates what they need to be doing and what they will be held accountable for.
8. Get the software provider to do quality checks
SAP offers a service called “Value Assurance” (previously named Max Attention) that will provide high level input to ensure your overall implementation is a success, including checking all of your customizations to safeguard their validity in the next release.
9. Have a detailed knowledge of the software roadmap and relevant updates
When you are implementing a new technology it is essential that you make every effort to plan for new releases to avoid being in a position where updating your software will require another significant investment.
Implementing software is a huge investment to your organization, it should be seen as any other asset. When you purchase physical assets you take the time to plan for them and make sure they are maintained properly, software is no different.
Value needs to be determined and measured, this is especially true for those that must report to a board of directors. Do not cut corners in areas that you think may not be important, you will pay for it. You can either plan to pay for the appropriate resources and scope today, or you can pay double (or more) when things are not planned correctly, tomorrow.