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(Technical) ERP Go-live Readiness Checklist

(Technical) ERP Go-live Readiness Checklist

After many months of meticulous planning, building and testing you may come to a point where you think to yourself, “We’re ready for ERP go-live!”

While it’s easy to get caught up in the excitement of completing major milestones, it’s important to be completely prepared before flipping the switch.

2019 ERP Report

This year's report delves deep into the data to analyze what ERP industry trends mean for organizations now and in the future.

We recommend using an ERP go-live readiness checklist to help you decide whether your company is truly ready for go-live. While the following checklist is not exhaustive, it does cover the technical aspects of go-live readiness:

ERP Go-live Checklist​

1. All Test Cases are Executed and Passed​

There’s a reason why ERP project plans contain several iterations and types of testing. Unit testing, process testing, systems integration testing and user acceptance testing are all designed to ensure your customizations, configurations and integrations are ready for production. Having a high pass rate on all these tests is a good indicator that you may be ready for go-live.

It’s not just the number of test cases passed that’s important – it’s also the quality and coverage. For unit testing, usually an ERP consultant or developer can create the test cases, but for the other types of tests, test cases should be approved by the business. This ensures that no surprise scenarios come up after end-users get their hands on the new ERP system.

2. There are no Remaining Severity 1 or 2 Bugs Outstanding​

If your team decides to wait until all bugs lower than severity 2 are addressed, you’ll never go live. It’s OK if you still have a few lingering bugs out there, as long as they are not severity 1 (showstopper) or severity 2 (high business impact). Even if workarounds are in place to continue executing business processes, leaving a severity 1 or 2 bug in production can create a mess of data.

For example, let’s imagine a severity 2 bug exists for advanced shipping notices (ASN). In this case, a QA tester notices that some ASNs are being rejected and not finding their way into the ERP system. As a result, a workaround is recommended to monitor the queue of rejected ASNs and trigger a resend of the failures.

Even if this workaround allows ASNs to be imported, the real issue could be that the delay in processing these ASNs is causing the financial receipt date to be off by a day or more. At month or quarter end, this could create a mess for the finance team.

That being said, you must have a plan to address any severity 1 or 2 bugs that crop up close to your go-live date. Without a mitigation plan for these types of last-minute bugs, you risk significantly delaying your go-live date.

3. Data Migration and Cutover Activities Have Been Practiced

In theater, a production never dives right into opening night without a few dress rehearsals. These are common practice because they help actors become comfortable with their lines while in costume and full stage lighting. During a dress rehearsal, issues may become apparent, which gives directors the opportunity to address issues while there’s still time.

Practicing ERP data migration and cutover activities on a pre-production environment is like a dress rehearsal.  The actors are your project team, the lines are the business processes and the costumes and lighting are the production data and environment.

While practicing data migration, you might find corrupt or duplicate data that, if it had been imported directly into production, would have contaminated the pristine environment.

4. Production Data is Staged and Ready to be Migrated

Data doesn’t always play nice. Even if you’ve practiced the migration from legacy to the new ERP software several times, it’s best not to wait until the night before go-live to perform the actual migration.

We recommend defining a cutoff date and time for when legacy transactions will no longer be considered for migration. Any new transactions past the cutoff date can be migrated over in a separate wave.

5. Your Production Environment is Ready

This one sounds like a no-brainer, but you’d be surprised how many different definitions of “ready” you’ll find amongst a project team.

The best definition of “ready” is:  the infrastructure for the production environment is in place and tuned to maximum performance. This means configurations are enabled, users are loaded and security roles are turned on. It also means integration points are defined and checked for responses.

In some cases, “ready” may also entail the purchase and configuration of any required hardware, like printers, scanners, scales, registers or payment readers.

6. The Rollout Strategy is Defined, Scheduled and Communicated

For phased rollouts, the schedule should be communicated to the impacted business units. It should never come as a surprise to users when they can no longer access their legacy tools.

For example, imagine you’re a retailer with a hundred stores across four time zones. The schedule for the first phase of your rollout might look something like this: East Coast stores are delivered new hardware on Saturday night, the hardware is configured and installed on Sunday night and they are live with the new software on Monday morning. Then, after a week in production, feedback is gathered and analyzed before the next phase.

If your East Coast stores are aware of this schedule, they will be more prepared for go-live.

7. The Support Team is Prepared

When incidents come up (and they will), you’ll need a support team equipped with all the necessary resources. This team should have access to ERP experts, business analysts, process specialists and change management champions. This ensures that whatever ticket comes through the help desk can be addressed without scrambling to find the right resource.

The process for creating and managing incoming tickets is also important to define before go-live. You don’t want added stress during post go-live because this is already a busy time.

Are You Ready for Go-live?

In addition to the above checklist, you’ll need a checklist of the people and process aspects of your project. We have seen projects fail even with a fully functioning enterprise system.

If you’re curious how our clients determine the readiness of their people and business processes, give us a call. Our ERP consultants can speak with you about our experience guiding companies through business process reengineering and organizational change management. We understand all the components of go-live success.

How to Achieve ERP Business Benefits

How to Achieve ERP Business Benefits

During ERP selection, companies typically see limitless possibilities in terms of potential improvements for their businesses. However, somewhere along the way, many projects fall short of expectations and ERP business benefits underwhelm executive expectations.

In fact, in our 2019 ERP Report many companies reported low benefits realization for benefits related to reporting, competitive advantage and technology enhancements.

2019 ERP Report

This year's report delves deep into the data to analyze what ERP industry trends mean for organizations now and in the future.

In our experience, low benefits realization is often due to a failure to define expected benefits and align the company around common goals early in the project. In other words, organizational alignment is not a priority for many companies during software selection. More often, companies are desperate to quickly find a new ERP system that addresses their pain points, so they lose sight of their business goals.

While staying focused on benefits realization is not easy, we’ve found several strategies that help companies realize significant benefits from their ERP projects. These strategies are most effective when initiated before or during ERP selection.


8 Strategies for Realizing Business Benefits

1. Understand Your Current State

You can realize many business benefits by addressing pain points in your current processes. This is why we help clients map their current state before beginning ERP selection.

During process mapping, it’s important to capture the right amount of detail. For example, you’ll need to document how long a current process takes in order to measure improvements post go-live.

As you identify pain points, you’ll find opportunities for improvement. This is the time to start thinking about how to both fix broken processes and innovate mediocre processes.

2. Outline Expected Benefits and ROI

When embarking on ERP projects with clients, we typically help them clarify their overall business goals, so they can determine how ERP software can support these goals. This leads to a discussion about business benefits – what benefits can technology deliver that support the company’s big picture strategy?

The only way you can answer this question with any specificity is by designing future state processes based on the improvement opportunities you identified while mapping your current state. We recommend designing future state processes based on both your business goals and your pain points.

While business process reengineering is a time- and resource-intensive undertaking, it enables you to quantify expected business benefits. For example, it enables you to quantify the time and cost difference between a current state process and a future state process.

Once you’ve estimated all expected business benefits, it’s time to document your findings. One of the most effective tools for documenting business benefits is an ERP business case. This tool is more than just a means to justify the project to executives. It also is used for setting key performance indicators (KPIs) and tracking them throughout the project and post go-live.

The first step in successful use of KPIs is to understand one core concept: every KPI is a metric but not every metric is a KPI. Essentially, KPIs are the metrics which best define the success of a process or function.

For example, we had a client that defined preventative maintenance on their critical equipment as the percentage of the following ratio: (Number of preventative hours performed per machine) / (Number of hours recommended by the manufacturer of the machine). They were shooting for a score above 95%, and they crafted a concise and meaningful KPI that would help them predict the future performance of critical machinery.

In addition to KPIs, a business case also should focus on estimated costs as well as expected ROI. While you can estimate ROI without focusing on a particular ERP vendor, many companies will re-calculate expected ROI once they’ve evaluated several enterprise systems. Ultimately, though, your ROI will depend more on your project execution than your choice of ERP vendor.

In fact, your ROI depends most heavily on the quality of your business case. The most effective business cases outline specific, measurable ways a new system will improve the business.

In contrast, we see many companies justifying their ERP purchase by pointing to issues with their legacy system, such as a lack of scalability or a decrease in vendor viability.

While these are legitimate reasons to implement a new system, they must be accompanied by more ambitious goals. You don’t just want to maintain the status quo – you want to innovate!

3. Ensure Organizational Alignment

Your company not only needs clearly defined business goals and project goals but also an understanding of how they tie together. Everyone in the company needs this understanding, especially executives.

To achieve this understanding, we recommend using your business case to gain executive buy-in, and then forming an executive steering committee. This committee should be highly involved in the project, especially when it comes to communicating project goals across the company and holding process owners accountable for achieving these goals.

When executives communicate how project goals tie into business goals, business benefits become more achievable. For example, a common, business-related reason that companies implement ERP software is to improve their data insights. When executives explain how technology can enable this business goal, your team is more likely to select the right software and migrate the right data. In addition, your employees are more likely to follow procedures that promote data accuracy.

4. Develop a Realistic Project Plan

One of the key lessons from our dozens of software expert witness cases is that unrealistic expectations often is one of the main causes of low benefits realization and ERP failure.

Many companies inaccurately estimate the time, budget and resources required to effectively implement an ERP system – and so do their ERP consultants, system integrators and VARs.

The best way to avoid this pitfall is to leverage an independent consultant, such as Panorama, to help define a realistic project plan. One of the ways we help clients develop realistic project plans is by benchmarking against other companies similar to theirs.

We also ensure companies include overlooked activities in their project plans, such as change management and business process management. These activities help companies realize more business benefits.

5. Focus on Change Management

You can’t realize business benefits if end-users aren’t prepared to use the new software. This is why it’s essential to communicate with and train employees as early as possible.

We use organizational readiness assessments to help clients identify resistance to change early in the project, so they can proactively address it. The organizational readiness assessment leads to the development of a change management plan that reduces change resistance and helps employees understand how their individual processes support project goals.

6. Think Twice About Changing Your Goals

Every change order, request for customization or scope adjustment must be viewed through the lens of your project goals. If it can’t be justified within the parameters of those goals, either the goals or the request must be adjusted. In most cases, you should adjust the request.

For example, you wouldn’t want to change a goal from “Standardize all accounting and finance functions across all sites,” to “Make sure A/P can access the approved vendor lists.” After all, with all the time, money and effort that goes into implementing an ERP system, you should at least try to maximize your ROI.

When you start getting internal pressure to customize your system, let your business case and ERP project plan be your guide.

7. Continually Measure Benefits Realization

Identifying gaps between projected benefits and actual benefits throughout the project helps managers understand what they are doing well and how they can improve.

Root cause analyses can identify the causes of these benefit gaps. A common root cause is end-users using workarounds because they don’t understand the importance of using the new technology. In cases like this, follow-up end-user training and enhanced communication can bridge benefit gaps.

Many companies designate KPI owners as the people responsible for measuring benefits, identifying root causes and implementing corrective action. The ideal KPI owner is familiar with the processes being measured, has a stake in their success and has the leverage to address lagging performance. In general, department managers are the ideal candidates for overseeing performance metrics for their respective departments. 

In addition to ownership at the functional level, executive ownership of aggregated KPIs at the organizational level is necessary to achieve a holistic view of performance and drive accountability.

It’s also important to measure benefits post go-live. While the ERP project team will most likely be tired and ready to move on with their lives, successful ERP projects never end.

8. Continually Improve

If your company is focusing on business process management as part of your ERP project, you likely understand the importance of continuous improvement.

Business process management is an ongoing process that continues after go-live, so your ERP system should continue to evolve, as well. This ensures long-term alignment between your people, processes and technology.

If you’ve implemented a scalable ERP solution, then long-term alignment should be achievable. However, it is not easy.

One of the ways we help clients ensure long-term alignment is by creating an ERP center of excellence focused on continuous improvement.


Now that you know how to maximize benefits realization, you’re probably wondering what type of benefits you should expect. The remainder of this post will discuss some common ERP business benefits and provide advice on how to achieve them.

How ERP Software Improves Process Integration

Within any company, there are bound to be organizational silos. Whether your company has data silos or cultural silos, implementing ERP software may be one of the best ways to break through these isolating barriers. In fact, many companies pursue ERP projects to better integrate siloed functions like customer service, production, accounting and sales.

Silos often are created is when different departments and job sites use different technology and processes for inputting and analyzing data. This inconsistency creates silos of unstandardized, unreliable data.

However, implementing an integrated ERP system enables shared data from any department to be immediately synchronized across all departments and locations. For example, if the sales department signs a contract to sell 500 units, ERP software can communicate this to manufacturing ensuring inventory can be checked and the job can be scheduled.

Silos are not just a problem in terms of data, but they can also slow down an ERP project. If your company is siloed, then different departments, workgroups and locations likely will struggle with key activities, like outlining business benefits that make sense for the whole company.

Therefore, it is essential to begin breaking down organizational siloes before ERP selection. While ERP software will help further break down silos, the foundation you lay during business process management is critical.

Following are three tips for beginning to break down organizational silos:

1. Standardize Your Processes

Your company’s different locations will have different business processes, some of which will need to be standardized. Other processes should be localized to fit the needs of each separate entity.

Striking the right balance between standardized and localized processes is crucial when a company wants to maintain its competitive advantage, which may differ slightly depending on the geographic location.

In general, though, standardization is beneficial for many business processes, especially financial processes.

2. Integrate Your Processes

We recommend an approach to business process management, called value stream mapping. This approach helps our clients depict the interaction between functions and eliminate non-value-added processes.

When improving your processes, you should involve employees from across departments to gain an understanding of the upstream and downstream interdependencies between processes.

3. Ensure Employee Buy-in

Employees are more likely to adopt processes that eliminate silos when they understand how these processes benefit them personally and the company overall.

Therefore, it is important to communicate to employees the value of cross-departmental collaboration. This ERP communication should be informed by a comprehensive organizational change management plan.

How ERP Software Improves Your Competitive Advantage

Most modern ERP software has innovative functionality in areas such as manufacturing, business intelligence and analytics. However, this functionality is likely to get watered down if your primary goal is to simply replace your current system.

How can you ensure you’re gaining competitive advantage from your ERP software? The answer is business process reengineering.

Business process reengineering is most effective when conducted before ERP selection. This ensures you don’t blindly adopt an ERP vendor’s industry best practices but only adopt them where they improve your competitive advantage.

In many cases, industry best practices may decrease your competitive advantage because your competitors who’ve implemented a similar system may be using the same best practices.

While improving your processes, it’s important to look for inefficiencies in your customer- and revenue-related business processes to identify opportunities to improve your competitive advantage.

Once you’ve documented your future state and gathered your ERP requirements, you can begin contacting ERP vendors. When helping clients evaluate vendors, we ensure clients have clear goals and priorities, so they know what to look for in a system.

For example, if a client knows that customer experience transformation is a priority, they’ll know to focus on ERP vendors’ CRM and advanced demand planning functionality.

If you’re hoping to improve your competitive advantage through ERP software, then it’s important to focus on CRM functionality and other functionality related to the customer experience. In fact, competitive advantage is a high-level business benefit that is typically achieved through more specific business benefits, like improving the customer experience.

How ERP Software Improves the Customer Experience

Good customer relationships don’t just happen. They are a byproduct of strategic processes at several stages of the engagement continuum. Each of these processes should be managed by an integrated ERP system.

Here are five ways an ERP system can improve the customer experience:

1. Customer Management

Managing customer relationships is a vital component of the order-to-cash process. The best way to handle customer relationships, especially for mid-size and large companies, is to look for an ERP vendor that incorporates master data management (MDM) and customer relationship management (CRM).

While the MDM and CRM can be used together, they could also be two different modules with two distinct purposes.

An MDM module can ensure consistent and reliable customer information is gathered, housed and retrievable by internal stakeholders. That information can include key pieces of data such as order history, company history, credit information, locations, key contacts, annual revenue and more. It can be thought of as a catalog of all relevant data about that customer.

The challenge many companies have when implementing an MDM module is compiling all necessary data from each customer. The information may already exist in some form but could be scattered in various locations and formats.

If information is scattered, then identifying and consolidating that information into a single resource is necessary. Once consolidated, that information is available to all internal stakeholders and modules through integration.

While MDM compiles overall data about a customer, a CRM solution enables sales staff to track prospect and customer interactions in order to identify opportunities. For companies that have more than a handful of customers, manually tracking of every interaction is nearly impossible.

Only a CRM system can consolidate trends, opportunities, preferences and financial data. This allows companies to better plan revenue projections and budgets.

Many of our clients are seeking better data insights that they can use to improve the customer experience. We often walk these clients through business process reengineering to ensure their processes are aligned with their digital strategy.

2. Order Management and Fulfillment

An order management system (OMS) allows companies to track the status of every customer order at every stage. By understanding when orders are being entered as well as how and when they will be fulfilled, a company can better manage customer relationships.

An OMS can also help a company manage different shipping options, warehousing and multiple currencies. During ERP selection, be sure to look for a system that can . . .

  • Improve customer relationships – The customer experience can be greatly enhanced by enabling a better ordering process, faster delivery and more accurate invoicing. The more enhanced the experience, the more confidence customers will have when placing an order. If an issue with an order does occur, an OMS allows staff to quickly identify and correct the problem.
  • Maximize working capital and cash flow – An OMS reduces errors, increases the speed of order fulfillment and enables more accurate billing. As a result, a company can experience improved cash flow and greater working capital.
  • Enhance supply chain efficiency – An OMS can provide valuable insight into inventory, workflow, pricing and market trends. This can lead to greater organizational efficiency and facilitate proactive decision making. From a supply chain perspective, an OMS may help reduce costs due to leaner inventories and an understanding that products and materials can always be sourced quickly from other reliable providers.
  • Improve staff management – By allowing customers to place orders online in a way that is connected to an ERP solution, the company can better manage its staff. Automating the ordering process will funnel customer requests into the operation where resources are then allocated to ensure the operation is properly staffed. Handling orders this way enables companies to better meet customer expectations.

3. Credit Management

Incorporating a credit management component into your ERP system allows for transparency, helping you adhere to an approved set of terms for each customer. Without such a credit management policy and overall credit philosophy incorporated into an integrated ERP solution, companies put themselves at greater risk by possibly extending credit terms to customers that may be unable to pay.

While many companies mistakenly place the responsibility solely on customers for unpaid debts, quite the opposite should be true. It is often the lack of a clear credit policy within a company that results in late or unpaid invoices.

In the same way that fences make for better neighbors, a clear and actionable credit policy incorporated into an ERP system makes for better customer engagements.

4. Invoicing and Accounts Receivable

When submitting invoices to customers, leveraging technology and incorporating some form of automation is preferred over manual submission. Automation allows for better tracking and helps companies get paid more efficiently.

A robust ERP solution should incorporate some form of invoice automation, ideally via a method that submits the invoice directly into the ERP software. This helps eliminate errors and delayed payments.

ERP solutions can provide comprehensive accounts receivable reporting, tracking the progress by which invoices are submitted and ultimately paid. This capability can help companies identify and eliminate possible invoicing errors well before they get to the customer.

5. Payment and Cash Application

Almost no other segment of the order-to-cash process requires more attention than customer payment and cash application. These two processes are vital to the health of every business. Leveraging ERP software that can manage these two areas will go a long way in ensuring on-time customer payment and accurate application of that payment to a customer’s account.

While the payment process may sound straightforward, it’s a challenge for many companies. Even after a new system is implemented, optimized processes may be difficult to maintain. This is because employees often resist new processes and cling to the old way of doing things. We employ change management techniques to help clients mitigate this challenge.


Here are three ways to ensure your new ERP software improves the customer experience:

1. Understand How Data is Shared Across the Company

If the sales and marketing departments are “out of the loop,” they are missing key metrics that can be used to engage customers and drive sales.

We recommend collaborating with key stakeholders to ensure they provide input on the data they need and can devise ways to make the most of this data.

2. Ensure Data is not Just Focused on Existing Customers but Also Potential Ones

Modern ERP systems allow you to track how potential customers are engaging with your company across a variety of platforms. Using this information, you can deduce how that engagement is leading to sales.

In an ideal world, this information wouldn’t be trapped in the marketing department but available across the company via an integrated ERP system. This data visibility would allow your company to improve processes to best meet customer needs.

3. Track and Communicate Metrics That Differentiate Your Company

It’s important to look at metrics not just in terms of how they impact your company but how they impact customers.

For example, metrics like time and cost of production or customer service response times directly impact customers. Communicating these metrics to customers should be a priority for your marketing, sales and customer service teams.

How ERP Software Improves Operational Efficiency

Many companies have a hodgepodge of inefficient business processes and legacy systems. New ERP software can often fix these problems, but only if you define and improve your processes before ERP selection.

Defining your future state – along with performance metrics and transition plans – will ensure you realize business benefits related to operational efficiency.

Here are just a few examples of areas where companies often increase efficiency as a result of their ERP project:

1. Data Entry

ERP software can automate data entry. This is beneficial because manually entering data not only takes copious amounts of time, but it puts companies at risk for several other inefficiencies. These include data inconsistencies, data silos and difficulty providing timely compliance reports.

2. Inventory Cycle Times

If you’re holding too much inventory, ERP software can help you more accurately predict demand. This can help maximize resources and cash flow.

3. Customer Relationship Management

When you implement an integrated ERP system, many functions are combined into one platform. This means employees spend less time researching questions for clients, less time switching between systems and less time tracking down invoices and payments.


Overall, the automation of manual tasks and the improvement of inefficient processes can result in significant labor cost savings.

In addition, efficiency can increase employee morale. While this seems ironic considering employees’ fears that they will be automated out of their jobs, it actually makes a lot of sense.

In fact, instead of reducing headcount as a result of automation, many companies reallocate employees to higher-level tasks. In other words, mundane tasks become faster and easier giving employees more time to focus on more engaging work.

While employee morale may be a bit tougher to measure than most business benefits, you can always measure your turnover rate and absentee rate to get an idea of employees’ work satisfaction. A reduction in both of these areas equals cost savings. This is not to mention that happy employees are more productive, leading to additional efficiency gains.

How ERP Software Improves Regulatory Compliance

While Sarbanes-Oxley (SOX) and regulatory compliance are often one of the last things on the minds of CIOs, it becomes very important when it’s time for that first audit of your business operations and systems. For this reason, it is important to design processes that promote compliance, and find an ERP system that can support these processes.

Fortunately, most ERP systems are pre-configured with best practices for the regulatory needs of a variety of industries. However, an ERP system alone will not ensure compliance. Your company also needs to focus on business process management.

Here are three tips for ensuring your ERP system meets your compliance needs:

1. Consider Compliance When Mapping Your Processes

Business processes need to be defined in a way that ensures that financial oversight, segregation of duties and other compliance needs are addressed.

We’ve seen too many companies treat SOX and regulatory compliance like an afterthought, only to have their auditors raise red flags after the system is already in production.

This challenge is further magnified by the fact that most modern ERP software solutions are very flexible and can perform business functions several different ways. Some of those processes are going to be compliant with your compliance needs, while others are not.

2. Focus on Change Management

Contrary to popular belief, ERP systems can’t always force compliance. While they can make it easier to enforce segregation of duties, financial oversight and approval workflows, they can’t close off every possible loophole.

Fortunately, there are several change management activities that can help employees understand the need for compliance and help enforce new processes.

Our clients have found their business processes to be much more efficient and compliant as a result of the change management guidance we provide.

3. Involve Your Auditors Throughout the Project

Just as executives and employees need to support the project, your internal and external auditors also need to have buy-in.

For example, auditors should validate key process controls during the testing and user acceptance phases of the project. In addition, auditors should perform a formalized compliance audit as part of a post-live benefits realization audit.

How ERP Software Improves Business Intelligence

Many ERP systems provide business intelligence by gathering data and organizing it into actionable analytics. This business intelligence can provide better insights into your company’s financial position and help you make informed decisions. Not only does this result in increased capital, but it can create a company culture of visibility and trust.

We recommend looking for business intelligence functionality that ensures data integrity and increases data visibility between departments.

How do you make the most of business intelligence? Following are five tips:

1. Develop a Data Migration Strategy

Many companies focus on simply migrating old data from their legacy systems to the new ERP system. However, it’s important to ensure that the data in the new system supports new business intelligence capabilities. This is not possible without a strong ERP data migration strategy.

Developing a data migration strategy helps you identify and locate essential data that doesn’t exist in your legacy system. For example, your legacy system may not have the historic sales information in the format required to support advanced demand planning.

2. Understand What Insights Different Stakeholders Need

When deciding what data to migrate from old systems, we recommend focusing on both business- and technology-related data.

This is important because CIOs often have a very different vision of business intelligence than other executives. While CIOs focus more on internal support types of metrics, such as average system downtime, CFOs and COOs are more concerned with inventory levels and other more business-driven metrics.

3. Focus on Business Process Reengineering

Just because business intelligence capabilities deliver more possibilities doesn’t mean the capabilities themselves will deliver the actual results. In fact, business process reengineering is the real key to driving data insights.

Business process reengineering is important because it ensures processes are designed to ensure the right data is being captured and utilized. 

While real-time data can help you optimize your supply chain management, it can only do so if the right data is flowing to the right people.

4. Focus on Change Management (Again)

This bears repeating a third time because it’s that important. When it comes to business intelligence, change management is important because employees need to adopt new processes to enable new data insights.

For example, if you want data to drive better customer insights, then employees touching the customer experience need to be equipped to take advantage of these insights.

5. Carefully Evaluate ERP Vendors

It is important to understand whether your ERP system has robust business intelligence capabilities.

Some ERP vendors have light reporting capabilities that they oversell as true business intelligence tools. Other vendors have strong capabilities enabled by bolt-ons. Still, others have built-in business intelligence.

What Benefits are You Expecting From New ERP Software?

Most of our clients pursue ERP projects to address inefficient business processes, ineffective technologies and subpar customer service. These challenges are especially ubiquitous in companies that have experienced organic growth or growth through acquisition.

Whatever challenges your company is facing, it’s important to determine if these challenges warrant an ERP implementation. In other words, you should quantify your expected business benefits to determine if they outweigh the costs. You also should set KPIs and measure business benefits throughout the project to continually ensure the project will deliver a high ROI.

Panorama’s ERP consultants can help you develop a business case, align your company around expected benefits and measure benefits realization. We’ll help you maximize your ROI by ensuring a strong focus on benefits realization early in the project.

5 Customer Experience Transformation Tips

5 Customer Experience Transformation Tips

A great customer experience is not something that magically happens. It’s a mindset that’s built and reinforced by optimized processes and easy-to-use systems.

In terms of optimized processes, we’re not just talking about customer-facing processes, as customer-facing employees don’t spend all their time speaking with customers. We’re also talking about the transactional processes that happen behind the scenes.

These processes should be optimized, too. This is essential because when employees are frustrated with poorly designed processes and technology, customers notice. In addition, customers experience this frustration themselves when self-service portals are not optimized.

The Beginner’s Guide to Digital Transformation

What are the 6 secrets to digital transformation that are helping organizations build competitive advantage?

The key to customer experience transformation is designing optimized business processes and implementing digital technology that supports these processes. More specifically, here are five tips for improving the customer experience at your company:

5 Ways to Improve the Customer Experience

1. Streamline the Processes of Customer-facing Employees

In many companies, customer-facing employees interact with a bevy of different enterprise systems, some of which are decades old or cobbled together. As you can imagine, trying to navigate through legacy software with inflexible options can cause significant frustration.

Many companies also have inefficient processes. While employees often become complacent with these processes, frustration inevitably arises during busy periods. For example, if a task takes days instead of hours, this inefficiency becomes more noticeable with a heavy workload.

Inefficiency is a problem that can be solved by focusing on business process management and allowing employees to provide input. This shows employees that you care about their pain points, and that organizational changes are meant to make their lives easier.

Giving employees the opportunity to suggest improvements is important not just for morale but for successful process improvement. After all, the employees who complete processes day-to-day are more familiar with the pain points than their manager is.

2. Eliminate Organizational Silos

The dream of many business owners is to lead a company that works together to achieve the same goals. The sad reality is that many companies have departments that operate in silos.

Silos generally manifest as companies create new teams around critical business functions. This effort often neglects the customer experience in favor of achieving a financial goal. As a result, different teams have different goals and benchmarks.

Ironically, when the customer experience at a company begins to suffer, the company often creates a new team called the “Customer Experience Team.” This team is just another silo.

What’s a better approach? Instead of making an individual team responsible for the entire company’s customer experience, consider making customer experience a priority for all business units. We recommend creating customer-focused metrics for every department and designating process owners to hold people accountable. This is the first step towards abolishing silos that damage the customer experience.

Abolishing silos improves trust and increases employees’ willingness to share important information. As a result, you will uncover more opportunities to improve the customer experience.

3. Empower Customer-facing Employees

A frustration that many employees have is the feeling that they must ask permission before acting. To address this frustration, it’s important to create a culture that encourages decision-making and process improvements at an individual level.

One of the best ways to empower employees to be proactive is to create incentives. In other words, consider rewarding employees for actionable suggestions.

In addition, your company should encourage employees to troubleshoot errors and solve inefficiencies on their own. Overtime, hundreds of incremental process improvements can result in significant cost savings.

While employees have many insights that mangers don’t have, they are bound to make mistakes. Not every improvement will be beneficial. It’s important not to punish these mistakes or you may dissuade employees from being innovative.

Instead of punishing the employee, make it a learning experience. Analyze what happened, why the problem occurred and what safeguards can be put in place to prevent a similar issue from happening.

Another reason to empower employees to suggest or make changes is that they hear the most customer feedback. This feedback is especially valuable when it comes to improving customer experience online.

In particular, it’s important to listen for feedback pertaining to the ease-of-use of the various channels customers use to interact with you. In addition, you should seek to understand the types of channels customers prefer to use.

4. Improve Employee Training​

When was the last time your company’s new employee training book was updated? While it may not be feasible to update this resource in real-time, it is feasible to review and update your end-user training on a quarterly or annual basis.

During these reviews, you should assess what employees are doing in the field versus what they are being taught. This is important because there could be better processes being used in the field. When new employees understand these better processes, they are more likely to exceed customer expectations.  

You should consider updating not just the content of your training but your training methods. One especially effective method is facilitating mock sessions with fake customers. This creates a safe environment where new employees can practice answering questions or running through scenarios.

5. Leverage Analytics

One of the most important aspects of providing a positive customer experience is ensuring employees have access to accurate data. In fact, analyzing customer data gives you the opportunity to provide customers with a more personalized digital customer experience.

For example, understanding the services most valuable to customers can give you a reason to expand upon a particular service offering. In other instances, you can use customer data to craft more successful promotions and better-targeted advertisements.

Accurate data is also useful to managers, as it allows them to monitor the performance of their employees. If one employee routinely belittles clients, then removing them can prevent poor reviews and the loss of customers. On the other hand, if one employee is consistently outperforming their peers, then it’s important to understand what they’re doing, so you can improve your processes.

Obtaining accurate, real-time data can be difficult without a modern ERP system. We recommend carefully evaluating ERP vendors’ customer relationship management (CRM) functionality to find the system that best supports your needs.

Optimized Processes can Improve the Customer Experience​

Positive customer experiences are the result of integrated, optimized business processes. This means processes that make both employees’ and customers’ lives easier.

While business process reengineering is an arduous project, the good news is that employees can help suggest solutions. Customer data and feedback also is helpful when improving processes.

Panorama’s digital transformation consultants regularly use their process improvement expertise to enable companies to anticipate customer needs faster than their competitors. We take the time to understand customer journeys, and we can help your company create a customer experience that is memorable – for the right reasons.

5 Change Management Communication Tips

5 Change Management Communication Tips

How do you define business transformation success? Does it mean your project was on-time and on-budget, or does it mean more than that?

Just because you adhered to a budget and timeline doesn’t mean your project succeeded. If everyone was working toward the same goal during the project and continues to do so, this is more characteristic of a successful project. In other words, organizational alignment both enables and signifies success.

2019 ERP Report

This year's report delves deep into the data to analyze what ERP industry trends mean for organizations now and in the future.

Organizational alignment is a topic we often mention in our blogs. Today, we’ll discuss one key strategy for achieving this alignment: change management communication.

How to Communicate With Employees to Ensure Business Transformation Success

1. Build a Project Team

When it comes to large-scale projects that involve many stakeholders, it’s essential to form a project team. Part of this project team should include an organizational change management team responsible for determining employees’ change readiness and developing a change management plan.

We recommend designating change agents as key influencers within the change management team responsible for executing many of the communication activities of the change management plan.

2. Communicate Early​

It’s far easier to obtain employee buy-in when they understand that the project is an opportunity to improve the company and their individual jobs. As such, your change management team and executives should communicate the nature of change long before it happens.

For example, how significant is the change, and how will employees be impacted? Why is the change necessary, and what improvements stand to be gained?

3. Listen to Employees’ Concerns

We have found that both top-down and bottom-up communication help ensure organizational alignment prior to an ERP implementation or business transformation.

Bottom-up communication is especially important because end-users may have insights that senior leaders don’t have. End-users have this insight as they are the ones performing the business processes.

In addition to insights, end-users will also have concerns. These should not be taken lightly, as employees respond much more positively to change when they know their concerns are seriously considered.

Every client we’ve worked with has had several employees who initially resisted change but became supportive of the project once they had the opportunity to communicate their concerns. This communication often took place one-on-one, but sometimes was facilitated through “town hall” meetings.

4. Manage Issue Escalation During the Project

Once the project is underway, bottom-up communication should not stop. In fact, projects without a communication hierarchy can get derailed by an inconsequential problem if end-users don’t understand how to communicate issues and to whom.

For example, let’s say that during a software upgrade for a system at an asset management firm, a calculation error is discovered in a test environment. End-users escalate the issue to the Chief Risk Officer (CRO). However, the CRO is not tech savvy, so he misinterprets the bug as something that affects live operations. He then shuts down trading operations to investigate the issue. This decision could potentially cost a firm millions of dollars.

5. Share Key Information During the Project​

Just as bottom-up communication should continue after the project commences, so should top-down communication.

Relevant information to communicate might include details about upcoming milestones or findings from previous milestones. For example, what business benefits did the company realize from the first phase of the project?

Continuous communication about project goals also is essential for maintaining employee engagement. As project challenges arise, buy-in naturally fluctuates, so it’s important to repeat key messaging to convey why the gain is worth the temporary pain.

How do Employees Perceive Change?

Effective communication requires an understanding of employee perceptions. In general, employees perceive change as something negative.

If your change management approach is to succeed, they must put themselves in the shoes of a typical end-user. From this perspective, change may seem like a cost-cutting measure aimed at eliminating staff. Additionally, new responsibilities may seem intimidating and cause you to feel inadequate.

Considering these fears, it’s important to develop a comprehensive change management plan with a strong focus on employee communication. We have found that poor communication only serves to increase employees’ fears.

Panorama’s ERP consultants understand that employee buy-in is essential to business transformation success. We can help your company align employees around common goals by building a communication-savvy change management team.

8 ERP Software Selection Process Best Practices

8 ERP Software Selection Process Best Practices

Selecting the right ERP software for your company can lead to numerous business benefits. However, achieving these benefits entails an awareness of software selection process best practices.

According to our 2019 ERP Report, only 8% of respondents were dissatisfied with their choice of ERP vendor. Vendor satisfaction typically indicates that a company chose a system that resulted in measurable ERP business benefits.

2019 ERP Report

This year's report delves deep into the data to analyze what ERP industry trends mean for organizations now and in the future.

Clearly, the secrets to successful selection are spreading like wildfire. If you haven’t heard them, we’ve outlined them for you here.


Here are eight best practices from our experience evaluating hundreds of ERP systems for our clients:

1. Don’t Assume You Need A New ERP System

If your business strategies or business processes are flawed, even the most advanced ERP system will be useless.

For example, if you want to improve your customer experience, you don’t necessarily need a new ERP system. In fact, there may be more cost-effective and lower-risk options, such as improving processes, redesigning your organizational structure or consolidating your global supply chain.

When you don’t assume you need new ERP software, you’re more likely to look for specific justifications for ERP since you’re not assuming it’s an obvious choice. Specific justifications are exactly what executives need when deciding to invest in ERP.

So, consider ERP as an option, not a mandate. Then, you will be motivated to outline specific benefits you hope to attain. In other words, you will be well on your way to developing a compelling business case.

A business case should not only outline business benefits but costs, as well. These might include hidden costs, such as internal project resources, data conversion and lost productivity immediately following go-live.

While you may want to contain costs, it’s more important to be realistic as this will ensure an on-time, on-budget project. A business transformation is one of those situations where you get what you pay for, so you should defend what you need to spend and not feel guilty about it.


2. Don’t Forget About Your Incumbent ERP Vendor

We regularly work with clients who want nothing more to do with their current ERP solution. In many cases, end users have an overwhelming impression that the old system doesn’t work. 

The reasons for this perception often have little to do with the software itself. More often, discontent is related to the fact that the system was poorly implemented, employees were not adequately trained or the business processes are broken.

Before end users convince you to invest in a new system, you may want to consider some reasons to stick with your incumbent ERP vendor:

Upgrading your ERP software can provide immediate business improvements.

Most ERP vendors make several enhancements throughout any given year, so if you are even just a year behind on upgrades, you may be missing out on key functionality that may address your current pain points.

Several software vendors have acquired other enterprise or point solutions.

ERP vendors have achieved growth through acquisitions over the years, so your current vendor may have products in their portfolio that you are not aware of. In addition to core ERP software offerings, many vendors are acquiring and integrating advanced point solutions that could extend the functionality of your current enterprise system.

An upgrade can yield more cost savings compared to a replacement.

The cost of keeping a customer is lower than losing a customer, so your vendor may be willing to make many concessions on the cost of software licenses, maintenance and upgrades. Another reason upgrades can be less expensive is because your employees are familiar with the current system, so you will likely save on training costs.

Considering your current ERP vendor as a viable option provides more negotiating leverage.

Other vendors competing for your business will know that you don’t have to switch solutions to benefit from a modern ERP system. Therefore, they are more likely to reduce their costs to compete with a viable incumbent. They also understand that the potential cost savings of staying with your current vendor are enticing, so they may offer cost savings, as well.

3. Focus on Business Process Management

Some companies select the vendor with the slickest ERP demo and the coolest features. However, when they begin implementation, they quickly realize that the solution doesn’t meet their business needs.

Then, one of two things usually happens: 1) the company changes the way it does business so their processes work within the ERP system – which often means losing the processes that give them competitive advantage, or 2) the company customizes the software to fit its processes, which is extremely expensive and time-consuming – not to mention these processes may be flawed to begin with.

Preserving competitive advantage and minimizing customization are two reasons many companies begin selection by defining business goals, aligning stakeholders and mapping business processes.

Process mapping also is an opportunity to improve your operations and determine business requirements for a new ERP system.

What is a business requirement? Here are some examples:

  • The ability to handle multi-currency
  • The ability to track work in progress
  • The ability to define discounts based on a contract assigned by a client

Software requirements gathering can be time-consuming, especially if you have multiple business units and multiple global locations. We recommend gathering ERP requirements for each location, while identifying which requirements can be consistent across locations and which should be unique.

Business process management not only entails requirements gathering but also requirements prioritization. It’s important to prioritize requirements because no ERP system can address every business requirement.

When prioritizing requirements, you should involve employees from all departments to determine the most important requirements based on business value:


  • Must-have – Provides significant business improvements in terms of revenue, strategy and compliance and maintains basic functions of the business that “keep the lights on.”
  • Value-added – Beneficial to improving business processes but not critical.
  • Nice-to-have – Makes employees’ jobs easier but won’t necessarily provide significant business process improvement.

4. Consider Multiple Criteria

There are several other criteria besides business requirements, that you should consider in your selection project:

Organizational Alignment

The main reason you should be considering a new ERP system is to help you achieve your business goals. This should be the central focus of your selection process.

Technical Fit

It’s important to understand what servers, databases, PCs, etc. will be required to support any potential ERP solution.

IT Strategy

How does the technology of the potential ERP system align with the technology and infrastructure within your IT department?


While it’s in vendor sales reps’ best interests to downplay costs, it’s your job to validate their estimate. Does it include annual support fees and implementation costs?

Vendor Viability vs. Level of Service

On one hand, it is good to do business with an established vendor that you know will be around to support you in the future. On the other hand, there is value to doing business with a less established ERP vendor that may provide better service than a larger firm.


A vendor’s customers can serve as great references for evaluating the vendor’s products, support and services. Be sure to do your due diligence, read case studies and ask for references from customers with business needs similar to your own.

5. Set Realistic Expectations​

Your new ERP system should support your company for up to a decade, so it’s important to mitigate risk by setting realistic expectations.

In terms of timeline, remember that ERP projects rarely take as little time as software sales reps say. To get a more realistic estimate, we recommend developing an ERP project plan that includes activities beyond what vendors typically deliver. These activities might include overlooked items, such as business process design, configuration and customized end user training.

ERP implementation plans should always include training, communication and other organizational aspects critical to a successful project. For example, conducting an organizational readiness assessment prior to ERP selection will help you identify pockets of resistance and determine necessary change management activities.

Another aspect of setting realistic expectations is mitigating risk. We’ve all heard of the technical glitches that shut down shipping at Fortune 500 companies for weeks. This happens all the time at companies of all sizes. In addition, time and cost overruns are a common occurrence, as seen in our 2019 ERP Report.

In light of this grim reality, it’s important to develop a risk management plan that includes contingencies for ERP failure.

Being realistic about vendor sales hype also can help you avoid ERP failure. For example, how many times have you heard one of the following statements when researching ERP solutions?

  • “We have the largest market share in your industry, so we are the right fit for you.”
  • “Our software is cheaper and easier to implement than other ERP solutions.”
  • “The whole industry is moving toward our type of solution, so you should, too.”

While some of these statements may be true in some cases, relying too much on broad generalizations is risky. Your company is too unique for any of these statements to have any bearing on your decision.

Panorama helps clients manage sales hype. We ask clients questions, such as . . .

  • How are your business requirements different from those of your peers or competitors?
  • How much time and money is it really going to take to fully implement ERP as a business solution, not just a piece of software?
  • What are you trying to accomplish with your ERP solution?

These questions help clients delineate between sales hype and reality. This is important because we know how powerful sales hype can be. In fact, gut instinct is a common decision-making mechanism for most humans.

For example, some executives select software based on what competitors have chosen. Other executives have had a previous experience with a particular vendor and are partial toward that vendor.

Separating fact from fiction and business rationale from emotion often requires an independent assessment from a third party, like Panorama.

6. Don’t Forget About Your Millennial Employees

Have you ever considered which of your employees (non-decision makers) will have the greatest influence your ERP software selection? It may not be who you expect.

The largest generation in the American workforce is the Millennial generation. Depending on your industry, they likely comprise about 35% of your workforce. Naturally, this generation’s preferences and propensities will significantly influence your ERP software selection – if you put any weight on user experience when making IT decisions.

User experience is an important consideration during ERP selection as end-users across departments and across generations will use the new software. You have a lot of people to please.

While people pleasing isn’t generally a fruitful pastime, the rules change when it comes to ERP software. Your evaluation criteria should consider user experience as a factor equally as important as functional requirements and total cost of ownership (TCO). The risks of not considering user experience include low employee morale, low system usage and process inefficiencies.

The influence of the Millennial generation isn’t relegated to its size – its unique characteristics also contribute to its power. Millennials are “digital natives,” meaning they’ve never known life without digital technology. This unique characteristic makes them critical of technology that doesn’t meet their expectations.

For example, Millennials expect software to be intuitive, much like their favorite social media platforms. Their familiarity with social media also primes them to expect software features that promote collaboration.

They also expect accessibility – your ERP software better be mobile-friendly. If it takes more than two clicks to navigate somewhere, they may throw their laptop across the room.

If you want to gauge the more specific needs of your workforce, you can conduct anonymous surveys, encouraging employees to provide honest answers.

Many ERP vendors have accommodated Millennials by building user interfaces that resemble social media platforms, adding social collaboration features, improving their mobile-compatibility and reducing users’ click-fatigue.

Deciding to implement modern ERP software is the first step to meeting the needs of your Millennial employees. However, many companies avoid ERP projects because their legacy applications are “fit-for-purpose,” and seem too expensive to migrate.

Some of these companies resort to time-consuming workarounds to please Millennials. They’ve built new front-end applications to improve the usability of their software, while overlooking inefficiencies throughout the ERP software solution.

Meeting the needs of Millennial employees not only requires careful software selection, but it requires a focus on organizational change management. This should start during the selection process in the form of communication.

Even if you select the best ERP system for Millennials, they will still be resistant to it unless you communicate with them before implementation. This ERP communication should include details about project goals and potential process changes.

7. Carefully Manage ERP Vendors

Don’t let vendors control the selection process. If your vendor is exhibiting any of the following behaviors, consider it a red flag:

  • Insists on conducting the demo and evaluation process their way, rather than your company’s preferred way
  • Controls the tempo and pace of the evaluation process by requesting that they demo last or at a later date
  • Bypasses working with your selection team, and tries to work directly with executives
  • Creates doubt by criticizing your project team’s approach
  • Cries foul by expressing concern that they don’t have enough time to prep or don’t agree with the selection process

These patterns are generally more common when the ERP vendor feels they are at a competitive disadvantage.

The following methods can be very effective in diffusing vendors’ attempts to control the selection process:

Ensure Vendors Understand Your Business

We recommend sending a request for information (RFI) to all the vendors on your long list. You should also provide vendors with a demo script to ensure they focus their demo on how their solution meets your company’s requirements.

Allow Vendors Access to Your Company’s Key Employees

While many sales reps prefer to build strong relationships with your executive team, they should also interact with your subject matter experts. Without this relationship building, key employees may refuse to participate in the selection process.

Evaluate Vendor Responsiveness

The ERP software you select should come from a vendor that listens and responds to your company’s needs. If a vendor is responsive during the sales process, they are likely to be responsive during implementation, and this is where engagement is especially important.

Remember That You Are the Customer, Not Them​

Whatever heartache a sales rep expresses, it is important to remain firm, have confidence in your evaluation process and demand that they earn your business on merit. You are not expecting too much by asking a vendor to demo their ERP system against your business needs rather than simply presenting their canned sales demos.

Coach Executives to Deal With Vendors

It is very likely that at least one vendor will bypass you at some point in the process and go straight to someone higher in the company. Your executive team should be coached on how to handle reps when they call. This might mean redirecting inquires to the ERP project team.

Let a Vendor Walk if Necessary

If a vendor thinks their chances of success are slim, they may walk away from the deal. Your company should allow vendors to self-disqualify. After all, it’s a bad sign if a vendor doesn’t have confidence in their product’s ability to compete.

Negotiate Aggressively

Some vendors will tout their discount rates when first showing you price tags. Don’t be fooled! There are always ways to negotiate even lower license fees and even better maintenance terms. Focus your ERP negotiations not just on short-term costs, but also on longer-term costs, such as future licenses, additional modules and long-term maintenance.

Clearly Define Scope

Make sure you understand what the vendor is and is not responsible for during implementation. For example, who is responsible for ERP data migration and end user training?

Find the Best Implementer

As strange as it sounds, software companies aren’t always the best implementers of their own software. In fact, you can often find better implementers at a lower cost by hiring a value-added reseller (VAR).

8. Hire an Independent ERP Consultant

Unfortunately, many ERP consultants are too quick to make recommendations based on biases, kickbacks from ERP vendors and lack of knowledge of various software solutions.

Independent ERP consultants, on the other hand, bring a neutral point-of-view to the selection process.

In addition to being independent, consultants should have experience in your industry. Industry-specific experience has many benefits for your company. For example, it enables consultants to determine which of your processes should be standardized and which should be differentiated.

An independent ERP consultant, like Panorama, will help you follow all the best practices outlined in this post. We’ll help you find an ERP system that aligns with your business goals.

5 ERP Post Go-live Optimization Tips

5 ERP Post Go-live Optimization Tips

Your ERP project team has crossed the finish line – you’ve gone live! All that’s left to do is support the production environment, right?

Not quite. Post go-live optimization is a phase that should be included in your ERP project plan and is often overlooked. During this phase, you should be supporting users in the production environment with training, communication and issue resolution via your support team.

This phase is essential because the first impression of a new ERP system and your IT department’s ability to support it set the tone for user adoption.

The Beginner’s Guide to Digital Transformation

What are the 6 secrets to digital transformation that are helping organizations build competitive advantage?

While there is no “one size fits all” approach to post go-live optimization, we’ve compiled five tips and tricks from our experience that can maintain your momentum after go-live:

5 Tips for Post Go-live Optimization

1. Be Proactive, Not Reactive

Even if users are not reporting system slowness, we recommend measuring system performance anyway.

Your IT department may find performance issues before users begin to notice. Fixing these issues in a timely manner can lead to better user adoption in the long run.

In addition, early detection of performance problems allows you more time to investigate the root cause and fine tune your infrastructure. It’s better to find these issues before more transactions bog down the system and more users come online.

Another way to be proactive is to monitor interface and batch job error logs. Again, the key is to identify any issues before an end user does. For example, by monitoring error logs, you may realize that purchase orders are not being updated with delivery information before a buyer notices and opens a ticket.

During implementation, interfaces may have passed all rounds of testing, but with live data and a multitude of new users in the system, there are likely scenarios that were not tested and could be causing issues in production.

Taking proactive measures to keep the system stabilized leads to better user adoption and presents an opportunity to train your support team on what to monitor and how.

Having a strong post go-live support team is critical in optimizing your live ERP system, which leads to our next tip.

2. Assemble Your Team and Streamline Their Processes

Prior to go-live, your support team should have been ramping up to prepare for the post go-live phase. However, once the system is live, this training shouldn’t stop. We recommend arming your team with any and all available resources, such as additional training materials, sandbox environments and top-level support.

Ensure your support team has a good mix of ERP experts, business analysts, process specialists and change management champions. When you have a wide range of expertise, whatever ticket comes through the help desk can be addressed without scrambling to find the appropriate resource.

For example, you could have a security or access issue bucket where users can report an incorrect security assignment that prevents them from accessing the ERP system. These issues can then be routed to the security team without having to pass through the eyes of a business analyst.

Another example is a training bucket for when users open a ticket for a process that is working as designed but users were not properly trained on it. These can be directed to the organizational change management team who can train users on correct protocol.

Categorizing tickets is just one trick for streamlining the resolution process. Anything you can do to optimize their process will help you more quickly stabilize the ERP software.

3. Dig Into the Data

Just like monitoring error logs, keeping an eye on production data can help identify issues before they become a bigger problem.

For example, let’s say during ERP implementation you assumed that order entry clerks would create a system record for a new customer before placing an order for them. You even defined this in a business process flow and recorded this in the training documentation.

However, now that your ERP system is live, you’re starting to see several sales orders with no customer name. The assumption made during the ERP project impacted downstream processes, such as customer retention and marketing campaigns. Without customer records, these downstream processes will have no data to act upon.

Identifying and addressing data issues can optimize your ERP solution a few different ways: it can identify process changes that employees prefer over what was implemented, it can reveal which users or business groups are not properly trained, and it can help identify configuration problems that allow users to enter invalid data.

In our experience, data issues can be minimized by developing a data migration strategy early in the project. Our clients have found that this not only minimizes post go-live data issues, but it makes these issues easier to address.

4. Communicate, Reiterate, Repeat

Your change management team should ensure end users know the key dates of when to stop transacting in one system and when to start in the other. This team is also responsible for ensuring that training documentation and additional help information (such as the process of opening a support ticket) is easy to find.

Communication lets end users know they are not alone. Key messages should be repeated as needed to reach the widest audience because, when it comes to organization-wide changes, there is no such thing as over-communicating.

5. Listen for Feedback

When users call into the support desk, they likely will have some insight into how they thought the enterprise system would work versus how it was implemented. Your support team should listen to these users and capture their feedback. This feedback provides insight into how to optimize the ERP software.

Visiting with the user base can also prove enlightening. For example, in the retail industry, imagine leaving the headquarters (where the majority of the ERP project took place) and visiting the stores that are live with the new system.

You might witness an employee and customer interaction where the employee checks the inventory for an item and finds it’s not available at the current location. The customer asks if it’s available at another location, but the employee says that the system doesn’t show that information. Frustrated, the customer leaves.

It’s easy to see that inventory visibility across stores was not a top priority during implementation. However, this first-hand account has made it clear that it should be a priority moving forward.

Analyzing and acting on feedback is an important step in realizing more business benefits from your ERP system. Capturing feedback systemically and converting comments into requirements is a good first step to optimizing your new ERP system in a subsequent phase.

Continuous Improvement

Has your ERP vendor and ERP consultants left you stranded after go-live? Panorama’s ERP consultants can pick up where they left off and equip your team to proactively address technical and process issues. We’ll also empower end users to report issues and identify opportunities for improvement. Contact us to learn how we can help your company realize long term ERP benefits.

8 Tips for End User Training

8 Tips for End User Training

Most people dislike change. This makes implementing organizational changes difficult.

If your company is about to undergo significant organizational changes, then preparing employees is the best way to mitigate change resistance. In fact, a comprehensive end user training strategy is an essential component of an effective organizational change management plan.

Unfortunately, less than half of companies in our 2019 ERP Report included customized training as one of their project activities.

2019 ERP Report

This year's report delves deep into the data to analyze what ERP industry trends mean for organizations now and in the future.

So, how do you develop a training strategy to prepare team members for an ERP implementation or business transformation? We’ve compiled eight tips that can help you:

1. Ensure Executives are on Board.

Executives should understand the importance of change management and understand what activities are necessary for change management success. It’s especially important to set realistic expectations around employee training in terms of budget, timeline and resources.

2. Assume You Have Underinvested in Training.

We have yet to be involved in a project where the company spent too much time on training. Rather than looking for ways to save money by cutting change management activities, you should look for ways to help employees feel comfortable with change. This will actually decrease your overall costs and increase your ROI in the long-term.

3. Start With Business Processes.

Before designing a training program, we recommend documenting business process changes. Only then can you determine the impact of change on employees and the knowledge gaps that need to be filled.

We use change impact assessments to help our clients connect the dots for their employees in terms of the way things work now and how they will work in the future.

4. Begin Training Early.

There is a common assumption among project managers that employee training should be conducted a few weeks before changes are rolled out. Instead, employees should receive multiple rounds of training well before they are expected to adopt new processes and/or technology.

While it is tempting to train employees in one session, this is never a productive practice. Regular training sessions ensure employees retain information and learn to use new software functionality as it is rolled out over time.

5. Customize Employee Training.

Everyone learns differently, and a one-size-fits all approach leads to broad skillsets with holes in understanding. The ideal solution is to offer individualized training. This helps you address individual roles and skill levels.

One tool you can use is a change impact assessment. This helps you identify how change will affect each employee and guides you in developing individuated training plans.

6. Use Employees as Trainers.

As business owners, you may not always know the details of every employee’s job. This is why it’s a good idea for a managers and subject matter experts to take on the role of trainer.

This peer-to-peer learning technique is especially effective in large organizations. Employees can each be assigned a coach who understands their role and provides personalized feedback.

At Panorama, we design train-the-trainer programs for many of our clients implementing new ERP software. This helps them efficiently train employees on new business processes and technology.

7. Use Mobile Technology.

Much of today’s workforce works remotely. Training these employees can present a challenge.

However, incorporating mobile technology in your training strategy ensures remote employees receive effective training.

Popular apps, like Slack, can improve training through gamification. In other words, you can test employees’ knowledge via quizzes and games. This leads to higher engagement and memory retention.

Microlearning is another mobile-friendly technique that breaks training content into a smaller, more manageable pieces. This often includes short videos that employees can watch at their own pace.

Geo-fencing is one mobile technology you can use for microlearning. It is a location-based service where mobile phones use GPS, Wi-Fi or cellular data to trigger a programmed action when an individual enters or exits a virtual geographical boundary.

While traditionally used by companies for marketing purposes, some companies are using geo-fencing for microlearning. For example, field employees who work with compliance-related issues can be sent push notifications reminding them to conduct specific checks.

8. Combine In-person and Online Training.

While many employees find that in-person training is the best way to learn, it can be difficult to hold employees’ attention without incorporating online training materials.

Using multiple teaching methods, such as pre-recorded videos and demonstrations, can keep employees engaged during in-person training sessions.

When employees inevitably forget concepts over time, online resources, again, become useful. Many ERP vendors have user communities that provide ongoing support to end users.

Online training is especially effective for Millennial employees. Traditional classroom-based training alone won’t cut it with this group.


Effective Training Programs

Developing an effective training strategy will ensure the success of your ERP project or change initiative. In fact, we have found that employee adoption is one of the main drivers of benefits realization.

This is why Panorama’s ERP consultants design comprehensive change management plans for companies and prioritize training early in the project. If you are planning for major changes at your company, let Panorama help you develop a strategy for success.

ERP vs. CRM: What’s the Difference?

ERP vs. CRM: What’s the Difference?

In a time where businesses are undergoing major business transformations to stay competitive in a modern marketplace, companies are looking to ERP software and CRM software to make that dream a reality.

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The two software suites are often discussed concurrently, making it difficult to understand the difference between them. If your business is trying to decide whether to implement a standalone customer relationship management system or a full ERP system, it’s important to understand some of the main differences.


ERP vs. CRM: A Real-world Analogy

A simple, non-technical analogy to describe the difference between ERP and CRM software is the contrast between a cruise and a traditional vacation. Let’s say you want to take a vacation to the Galapagos Islands.

On a cruise vacation, transportation to and from the Galapagos is provided. Your lodging, food and entertainment are all included as well. The cruise line is aware of your itinerary while on the boat and informed of the scheduled times onshore. You could say your vacation plans are managed end-to-end by the cruise line with all activities and timelines seamlessly integrated – just like an ERP software solution.

While your plans are easily managed by a single entity, you may feel like you’re not getting the most out of the onshore excursions. Instead, a traditional destination-based vacation may be what you’re looking for.

Like a CRM system, specific tourist sights allow you to get the most out of your vacation. If you spend a good portion of your trip in the Galapagos, you may want to seek out the best attractions and tour companies. This is similar to the specificity of a CRM system.

Some people’s ideal vacation would be a mix of both options. Here you have the best of both worlds – a specific destination where you can take extensive tours and a cruise line to show you multiple destinations for a single price.

What is a CRM System?

CRM software’s core functionalities involve managing potential and current customer relationships. Powerful marketing tools like social media management, online promotional campaigns and automated emails are part of the CRM suite that fuels lead generation.

Once leads become customers, CRM software also manages the sales order creation and support processes, like help desk and call center. Business analytics, such as purchasing trends and loyalty metrics, are other out-of-the-box features.

At a high-level, most CRM systems contain the following feature sets:


  • Marketing
    • Automated marketing emails
    • Online campaign management
    • Social media management
  • Lead management
  • Sales support
    • Call center
    • Order confirmation
    • Fulfillment inquiries
  • Purchasing trends and analytics
  • Loyalty management

What is an ERP System?

In contrast to CRM software, ERP software has a wide-ranging set of capabilities across all business operations. From managing payroll for your company’s employees, to creating a bill of materials for the goods you sell, an ERP system is designed to run your business from end to end without additional software packages.

ERP software is often used for its financial capabilities, including accounts receivable and payable as well as month, quarter and year-end reporting. ERP systems typically have the following modules:

  • Accounts receivable
  • Accounts payable
  • Sales and marketing
  • Purchasing
  • Human resources
  • Inventory management
  • Warehouse and transportation management
  • Product management
  • Planning and production

Some ERP software is more specialized for specific industries, such as manufacturing or retail, and may have richer capabilities in those areas. A thorough comparison of several ERP vendors is necessary during ERP selection as each ERP system has its own strengths and weaknesses.

We advise our clients that their ERP software of choice must meet the majority of their ERP requirements to minimize the amount of custom code.

Overlapping Features Between ERP and CRM

Because ERP systems also contain customer management and sales functionality, there are a few areas in which the two software suites overlap.

Most ERP software allows a business to maintain customer data, create marketing campaigns, build quotations and generate sales orders. However, when it comes to supporting the marketing campaigns or tracking sales trends, CRM software has much richer capabilities.

Should You Select ERP or CRM?

This answer depends on two factors: what are your current business requirements and IT capacity, and what are your needs in the future?

If you are looking to streamline all your processes and replace an existing suite of non-integrated applications, an ERP system might be the solution for you. On the other hand, if you need focused capabilities to handle marketing and customer management, a CRM system is probably your best bet. For example, many CRM systems enable sales reps to use real time data to personalize customer interactions.

If neither of these scenarios describe your company, and you’re considering overhauling your entire IT landscape, then you may need both an ERP and CRM system with an integration between the two.

To help you decide, ask yourself the following questions:

1. Where could you find the most benefit: operational efficiency or greater sales volume?

The primary way an ERP system increases your profits is by improving efficiency. It does this by streamlining business processes and cutting overhead costs.

Compared to ERP systems, CRM systems are not as concerned with lean process improvement. Instead, the primary way a CRM system increases your profits is by increasing your sales volume. It does this by empowering employees with the tools to improve customer service and make bigger sales.

Could your company achieve a higher ROI by making your business processes more efficient than by increasing your sales volume? Then an ERP system may be a good choice for you – and vice versa.

2. Do you need a new financial system?

If your answer is yes, you probably need an ERP system. Unless your company is entirely made up of a sales and marketing model where all your requirements can be fulfilled by a CRM system, you likely need a financial system of record.

3. Does the ERP’s sales and customer management functionality meet your business needs?

If not, a deeper dive into your requirements is needed to determine which CRM vendor is best for you. If there is not a CRM vendor that seems to check all the boxes, an integration between both ERP and CRM may help bridge the gap.

4. Is your business ready to tackle an ERP implementation?

While an ERP implementation is a massive undertaking compared to a CRM implementation, ERP business benefits are significant. If your IT department has the resources and your business has the funding for an ERP project, it’s likely worth the investment.

5. Does your IT department have the capacity to develop integrations?

Having a CRM system isolated from your ERP defeats the purpose of having both. Luckily, many ERP vendors are starting to ship product with almost “plug and play” configurations to integrate with popular CRM suites. While this definitely helps expedite your ERP to CRM integration project, custom code often will be required to seamlessly integrate the two.

6. Is your project a digital transformation?

This is a good question to regularly ask yourself as it not only relates to the choice between ERP and CRM but your overall digital strategy.

Companies pursuing digital transformation intend to create new business models. These companies need a scalable ERP solution with a promising product roadmap. If this describes your company, it’s important to evaluate vendors’ product and company trajectory.

However, if you’re not pursing digital transformation, then a full ERP system with a significant number of modules may be overkill for your company. Instead, a CRM system may be a better fit. It might provide you with all the functionality you need, and you won’t have to pay for unused modules.

CRM Implementation Tips

CRM implementations entail the same level of organizational change, operational complexity, business risk and technical risk as traditional ERP implementations. There are several factors that can increase this level of risk, including integration with existing systems, data cleansing and migration, system stability, demand on hardware and networks, system compatibility and deployment options. 

Following are five tips for mitigating risk during a CRM implementation:

1.  Focus on Organizational Change Management

Most CRM implementation challenges are related to process and organizational change management issues. As such, your company should ensure that sales reps are committed to project goals and clearly understand new business processes.

In our experience, salespeople can be among the most change-resistant employees because of the extra work a CRM implementation creates and the temporary pull from their commission-generating activities. A change management plan is critical to mitigating this resistance.

2.  Consider Your IT Strategy

Your CRM implementation should be part of a comprehensive IT strategy. In other words, consider how your CRM system will integrate with other systems now and in the future.

For example, it’s important to determine how the CRM system will interact with inventory management, financials, product configuration, manufacturing and other functional areas.

3.  Remember That Your CRM System Doesn’t Need to Come From Your ERP Vendor

Many of our clients begin their software evaluation process with the expectation that one single ERP vendor will provide most or all the functionality they need. 

However, if CRM is critical to your business model and a source of competitive advantage, it may behoove you to consider a standalone CRM system to augment your core ERP software. 

4.  Understand the Integration Capabilities of Your CRM System

Simply because two systems integrate doesn’t mean they will integrate the way you want them to. For example, we have found that certain product configuration details desired by some sales teams do not integrate well without extensive customization and changes to CRM system architecture.

It’s important to understand how your CRM will integrate with other software, such as business intelligence, product lifecycle management, quality assurance and other point solutions.

5.  Don’t Bite Off More Than You Can Chew

Even though you’ll want to make a decision that’s best for your long-term enterprise solution, you don’t necessarily need to implement or even purchase various solutions all at once.

For example, one of our clients worked with us to procure and implement a CRM system in a separate phase well before they began planning their ERP implementation. We were able to implement and integrate their chosen ERP system in a later phase because we had previously helped them define a long-term IT strategy.

Selecting the Right Technology

Deciding between ERP and CRM software (or some combination of the two) can lead to some interesting discussions among executives and ERP project team members. It can be difficult to reach a consensus, or you may not feel confident in your decision.

Panorama’s expertise lies in understanding a company’s unique needs. Our ERP consultants will help you determine what type of technology aligns best with your business goals and digital strategy.

How to Develop an ERP Project Plan

How to Develop an ERP Project Plan

When companies decide to implement ERP software, they often jump right into ERP selection without taking the time to prepare. However, it’s important to first develop an ERP project plan based on realistic expectations.

Most vendors aren’t equipped to develop a realistic project plan because they don’t account for all the components of ERP success.

2019 ERP Report

This year's report delves deep into the data to analyze what ERP industry trends mean for organizations now and in the future.

This post will help you set realistic expectations for ERP selection and implementation, so you can develop an effective project plan.


The Importance of Realistic Expectations

We’ve found one of the most common causes of ERP failure is unrealistic expectations. Let’s look at a case study from an ERP lawsuit where legal counsel from one of the parties hired us to serve as a software expert witness:

The multi-billion-dollar company was sold a bill of goods that included software licenses and an implementation across more than 20 sites. They were told by their ERP vendor that by using industry pre-configurations, they could easily get their entire order-to-cash and procure-to-pay operations running on the new software in 18 months.

Even without knowing anything else about the company, you can guess that 18 months is extremely aggressive, unlikely and fraught with risk. So, how did their implementation pan out? Soon after the project commenced, the company found that many of its business requirements weren’t addressed by the off-the-shelf solution.

As a result, most of their processes required software re-configuration or customization. These activities weren’t accounted for in the original project plan. Less than a month or two into the project, it was already behind schedule.

The systems integrator also didn’t realize how significant the organizational change management needs were. This was a multi-site, multi-national company with different operations, cultures and business processes, so change management would have been essential. However, the systems integrator simply planned for a few employee newsletters and some end-user training a few weeks before each go live.

As the project wore on, milestones and expectations were missed, leading the executive steering committee to fire multiple project managers and team members. They put more pressure on the new team to complete the project on time, but they couldn’t succeed either.

In the end, the company was only able to get one pilot location live in three years (50-percent longer than expected). The processes were so broken, and employees were so poorly prepared that the company eventually abandoned the project and reverted to its legacy system.

Many companies, including this one, begin ERP implementation with the goal of selecting software that will deliver a high ROI. They soon realize the project is much more complex than they expected, and the benefits are much more elusive.

Why do Companies Have Unrealistic Expectations?

One reason for unrealistic expectations is that many companies are mainly focused on the technical aspects of implementation. If you want to achieve expected ERP business benefits, you must account for not only the technical aspects but the people and process aspects.

It’s important to watch out for a technology-focused mindset and other mindsets that lead to unrealistic expectations. For example, how many of the following statements sound familiar?

“We’ll get this implementation done in no time.”

Software vendors are notorious for over-simplifying the implementation process. Most sales reps don’t know what it takes to successfully implement software, but they do know they want to make the sale. As a result, they downplay the time, costs and risks of the project.

Make sure you’re not basing your timeline and budget on overly optimistic estimates. Instead, use benchmarks of what other companies similar to yours have achieved, which you can find in our 2019 ERP Report.

“This is going to change our whole business.”

Our research shows that only 19% of the companies that expected to realize benefits related to competitive advantage actually realized these benefits.

Realizing business benefits requires more than expecting them. They also need to be measured with metrics closely aligned with business processes.

Realistic ERP Selection Expectations

As you begin ERP selection, you’re probably wondering how long the process takes. In our experience, selection takes a minimum of fourteen weeks. Larger companies with multiple locations typically need at least sixteen weeks to select the right system.

You also may be wondering about the total cost of ownership of new ERP software. This depends on several factors, such as the number of licenses purchased and the chosen deployment model.

It’s important to note that the total cost of ownership doesn’t just refer to the cost of the software. It also includes the cost of implementation. According to our 2019 ERP Report, which included companies of all sizes, the average cost of an ERP project is about $1.3 million.

The key to setting realistic expectations for selection is understanding the activities that should happen before you even start contacting ERP vendors:

1. Ensuring Organizational Alignment

The key to a successful ERP selection is ensuring that stakeholders across your company understand and agree with the company’s strategic goals. Once you have organizational alignment, you can then consider how you might use technology to achieve business goals.

This isn’t the time to focus on specific technologies. Instead, you should focus on establishing a foundation to help you evaluate vendors based on their ability to enable your strategy.

You also need alignment around why you’re implementing new ERP software. Many companies decide to evaluate ERP systems because their current system cannot scale to support the company’s growth. However, this reason alone doesn’t justify an ERP investment. You must be able to articulate how a new ERP solution aligns with your business goals.

In many cases, ERP software will not solve your business problems. If your business processes are flawed, even the most advanced enterprise system isn’t going to help.

If you find that ERP is not the best path forward, there may be more cost-effective and lower-risk options. Consider improving your processes, redesigning your organizational structure or consolidating your global supply chain.

2. Developing a Business Case

What business benefits do you expect to realize from new ERP software? What are the expected costs? Knowing the answers to these questions is critical to justifying an ERP investment when executives ask about ROI. (You can use our ROI Calculator for a rough estimate).

To really win over executives, your business case should outline exactly how new technology will enable your company’s strategic goals. Armed with this powerful tool, you can convince executives that new technology is a wise investment.

3. Building a Selection Team

More than a quarter of respondents in our 2019 ERP Report cited resource constraints as a reason why their projects took longer than expected. In addition, more than a quarter cited these constraints as a root cause of their budget overruns. It’s likely that many companies beginning selection aren’t dedicating adequate resources to the selection process.

At this early stage, you don’t have a statement of work from a vendor, so you can’t determine all the resources you’ll need on your ERP project team. However, you do know some of the resources you’ll need. These are your selection team members. They are involved in all the activities that precede ERP selection, all the activities during selection and many of the activities throughout implementation.

4. Mitigating Change Resistance

As soon as you’ve made the decision to implement new ERP software, you need to inform employees. You may not know what specific technologies will be involved, but it’s never too soon to start communicating the goals of the upcoming project.

As simple as this sounds, all ERP communication should be strategic, so we recommend beginning to develop a change management plan before selection. By evaluating your organizational culture and employees’ openness to change, you can develop a change management plan that guides your communication.

Our clients have found that strategic communication increases employee buy in throughout the project. This is especially critical before selection. It enables employees to provide useful input, which further increases buy in.

Employee buy-in also is critical during and after implementation. In fact, companies that experience “software issues” after implementation are often just experiencing the effects of low employee buy in. Starting change management early can maximize system usage after go live, ensuring the software brings the expected business benefits.

5. Mapping Your Current State

Many companies do not have clearly defined processes, but as they begin an ERP project, they realize the necessity of business process mapping.

It’s important to map your business processes before selection because of the dangers of out-of-the-box functionality. While out-of-the-box functionality can bring efficiency, it can only do so in areas that don’t already bring your company competitive advantage.

For example, if your company has figured out a way to ensure every widget comes off the line 25 minutes before your competitor’s widgets, you should make the software fit that process.

Mapping current state processes helps you preserve your competitive advantage by documenting specific ERP requirements. While no ERP system will address every requirement, process mapping helps you prioritize these requirements.

Process mapping also helps you determine who owns processes and data, so you know who to involve in the selection process. We recommend involving stakeholders from all departments. This collaborative approach results in process improvements that align with your business goals.

6. Improving Business Processes

While some processes may only need incremental improvements, others may need a complete overhaul. In other words, they need business process reengineering.

This is an approach to business design that focuses on breaking down functional silos and providing end-to-end process understanding. It involves thinking about the purpose of each process and the hand-offs between functions.

Ultimately, this approach builds process efficiencies that will guide your ERP selection. If a system can’t support your optimized processes, then it’s not right for your company.

While business process reengineering can increase your selection timeframe, saving this activity for the implementation phase will be more time-consuming and costly.

7. Understanding Deployment Options

Lately, ERP vendors have increased their investments in cloud and SaaS ERP. As a result, many companies who’ve been partial to on-premise software are now considering moving to the cloud.

While vendors may claim they will only support cloud solutions in the future, we have found this is purely a sales tactic. Cloud ERP is more profitable for vendors, so they provide higher compensation to sales reps who successfully sell cloud technology.

The truth is, on-premise software isn’t dead. We work with several VARs and system integrators that still sell and support on-premise solutions. These solutions are viable. In fact, some have ten- to twenty-year roadmaps, which is great news for their large install bases.

If you’re considering on-premise software, it’s important to note that you don’t necessarily have to host it on premise. In fact, you can host it in the cloud, which is convenient for many resource-constrained companies that require less IT control. In contrast, complex companies that need heavy IT control, generally gravitate toward on-premise hosting.

Some companies choose cloud hosting for some but not all their business functions. This is called hybrid hosting. In these situations, companies keep their back-office functions on-premise and host functions like sales and marketing in the cloud.

Different deployment options each have their risks and benefits. Your decision should depend on your company’s unique goals.

8. Developing an IT Strategy

In addition to deployment options, there are several other IT strategy decisions to make before ERP selection.

For example, you’ll need to determine an integration strategy – do you want a single enterprise system or several best-of-breed systems? While best-of-breed ERP systems can help you build competitive advantage, they also can create technical complexities, integration challenges and data issues.

Many companies implement single ERP software solutions because they enable standardization, which can reduce change resistance. However, single ERP systems don’t allow you the flexibility to choose the best software for each of your functional areas. This means you might need more software customization, which is costly.

Before developing an IT strategy, you need to understand your company’s strategic goals. This gives you a lens through which to evaluate your current IT systems and infrastructure. Understanding your current state is essential as you’ll need to determine how new ERP software will integrate with your current IT infrastructure.

While assessing your current state, you should ask stakeholders from across the company what needs to change to enable business goals.

Focusing on strategic goals keeps you focused on the big picture. For example, when selecting best-of-breed software, one mistake many companies make is looking for software for one particular functional area without considering other areas.

While all your business functions may not be in need of improvement at this current juncture, they likely will require new technology in the future. The functional area you’re focusing on now needs technology that will align with technology you implement in the future. If you define your long-term IT strategy, you will know what to look for in a standalone CRM system or HCM system.

9. Developing a Data Migration Strategy

ERP data migration is often put off until the end of the project. After all, how hard can it be once the system is designed and tested?

Actually, it can be quite difficult. Data doesn’t always map correctly, and the system doesn’t always handle the volumes of data it needs to. In addition, decision makers aren’t always clear-headed enough at the end of a project to decide what data to move to the new system.

This is why it’s essential to develop a data migration strategy before software selection.

Realistic ERP Implementation Expectations

The first step to setting realistic expectations for an ERP implementation project is understanding the scope of change. You also should determine the role technology will play in your project.

At one end of the change spectrum, technology is used to support existing processes. At the other end of the spectrum, technology enables process redesign and supports changes to your company’s business model. In the latter case, technology is not the focus of the project. Instead, the ERP project team focuses on transitioning people and processes.

Many of our clients pursue projects focused on people and processes. Before they select ERP software, we help them define a corporate strategy. We also help them design new business processes to support this strategy.

Reengineered business processes mean new roles and responsibilities for employees. Companies at this end of the change spectrum should expect to spend a significant amount of time and money on business process management and change management.

If you’re not sure what level of change your project entails, ask yourself why you’re implementing new technology in the first place. Maybe you’re changing your business model or expanding into new markets. If so, your ERP project could be more aptly called a business transformation – an initiative that entails significant changes to people and processes.

Once you’ve determined the scope of change, how can you ensure your expectations are realistic? Following are eight best practices we use with clients:

1. Develop a Business Case

Companies use business cases to justify their ERP investments by estimating their return on investment.

If you’ve already defined your strategic goals and identified opportunities for improvement, you have a good starting point for developing a business case. Based on this information, you can estimate the cost savings you’ll see from automating a manual process and tie this back to one of your business goals. This is the type of information executives like to see when evaluating a business case.

While committing to a precise dollar amount can be risky, you can have confidence your estimates are achievable by benchmarking against projects at similar companies. Objective project audits from an independent third-party, like Panorama, also can give you confidence that your estimates are achievable.

So, what performance metrics are important to your business? These should be included in your business case and used as key performance indicators throughout the project.

2. Communicate With Executives

Presenting a business case to executives should not be the only communication you have with them throughout the project. Executives should be involved in other project activities, especially areas like change management.

Executive involvement not only increases employee buy in, but it ensures executives maintain realistic expectations. We recommend regularly meeting with executives to update them on issues that might affect expected results.

3. Don’t Believe Sales Hype

Vendor sales reps are notorious for giving anecdotal examples of the one in a hundred customers that implement in a short period of time. However, those examples are rarely relevant to your organization.

Vendors are only providing one data point out of thousands of ERP projects each year. This is hardly the type of statistically significant data you want to bet your ERP investment (and career) on.

4. Consider Internal Staffing Needs

While internal resources are critical to help with process design, system testing and a host of other activities, few vendors fully understand how many internal resources you’ll need.

As you’re building your own implementation plan, it will become clear what internal resources you need for each project phase.

5. Ensure Strong Project Governance

Implementations often take longer than expected because the implementation team isn’t leveraging effective project controls or instituting the appropriate project governance.

Customization requests, scope increases and other unexpected scenarios can cause your timeline to slip. However, project governance enables your team to quickly analyze and approve/disapprove requests.

6. Account for all Essential Activities

Many companies overlook essential activities, like business process testing. We recommend testing your business processes early to ensure they have been clearly defined in the new system.

Another activity that many companies don’t account for upfront is reviewing vendors’ statements of work. It requires time and resources to ensure estimates include essentials, such as support and maintenance fees. Analyzing estimates to ensure you’re comparing apples to apples is also time intensive. Many companies hire an independent ERP consultant to compare statements of work and negotiate with vendors.

Other activities you might overlook include:


  • Distributing workshop guides to prepare employees for requirements gathering workshops
  • Working with functional leads to validate requirements and schedule ERP demos
  • Meeting with your vendor for an organizational design session
  • Reskilling employees whose jobs will become automated
  • Designing and conducting customized end-user training
  • Conducting multiple iterations of conference room pilots

7. Regularly Adjust Expectations

While you may have defined initial time and cost estimates during ERP selection, these will need to be refined once you begin implementation.

As mentioned above, you will likely be faced with scope changes and other requests throughout implementation. In addition, your company will undergo normal organizational changes unrelated to the project, such as staff turnover.

Our clients often find that they need to reevaluate goals, adjust timelines or alter resource allocation to ensure future milestones are not adversely affected.

8. Don’t Forget About Post Go Live

Many implementation activities are actually ongoing activities that continue after go live. For example, the need for training does not disappear after go live. Employees often change roles and turnover is inevitable, so new employees and reassigned employees will need training.

Another reason that ongoing training is essential is that software functionality often is rolled out in phases. Many of our clients – for a variety of reasons – implement basic functionality right away and save more advanced functionality for later.

Measuring benefits realization is another activity that should continue after go live, as many benefits are not fully realized until years after implementation. It’s also important to continuously look for new ways to realize business benefits from your ERP system, even after the project is “over.”

It’s Never Too Early to Begin Developing a Project Plan

Before you begin ERP selection, you should take the time to set realistic expectations and begin developing a project plan. Panorama’s ERP consultants can help you account for all the essential activities required for a successful project.
5 Roles of a Business Process Owner

5 Roles of a Business Process Owner

One of the most challenging aspects of managing a company is assigning roles and responsibilities around business processes. This is challenging because processes often span multiple departments.

When a process spans multiple departments, this often means that individual departments only understand a small portion of the process. Without knowledge of how a process fits into the bigger picture, it can be difficult to identify opportunities for improvement. It’s also difficult to suggest process improvements when it requires approval from multiple departments.

Fortunately, assigning ownership of certain business processes to key employees can enable process improvement without creating cross-departmental friction. These key employees are called process owners.

A process owner is responsible for managing a process from end-to-end. Their responsibility includes implementation, maintenance and improvement of this process. Process owners are most effective when they understand how their process interacts with upstream and downstream processes.

Assigning process ownership is a business process management best practice that many consultants recommend. Unfortunately, according to our 2019 ERP Report, less than half of companies use consultants for business process management services.

2019 ERP Report

This year's report delves deep into the data to analyze what ERP industry trends mean for organizations now and in the future.

If your company is about to begin a process improvement initiative or an ERP implementation, it’s important to understand the roles and responsibilities of a process owner:

5 Roles of a Business Process Owner

1. Be Data Driven

To help your process owners become more data-driven, we recommend implementing technology with strong business intelligence functionality. This is important because process owners don’t have time to manually gather process performance data.

Many modern ERP solutions have business intelligence powered by artificial intelligence, which enables predictive analytics. This can warn of early failures or declining performance. It allows process owners to quickly identify bottlenecks and opportunities for improvement.

Once your process owners have access to data insights, you can hold them accountable for suggesting process improvements, determining key performance indicators and measuring business benefits.

2. Create and Maintain Documentation

The “bus factor” is a risk metric that measures the impact on a business if an essential person disappears. In other words, what happens if they get hit by a bus?

If a process owner disappears, can the company still function? While a process may still be able to be executed, there will be no one to monitor performance or resolve issues.

Process documentation can mitigate the bus factor. Effective documentation allows anybody to manage, troubleshoot and complete a process without asking the process owner for guidance.

When we work with clients, we ensure that process owners are tasked with developing clear and simple documentation. In addition, we ensure this documentation is updated as processes evolve.

3. Understand the Big Picture

Process owners need to understand how their processes fit into the grand scheme of the business. This is especially important when it comes to process improvement because it gives the process owner insight into what outputs are commonly used downstream. Reengineering a process around a rarely used output is not a good use of time.

Process owners should always be asking themselves:

  • What processes feed into my process?
  • What downstream processes rely on my process?
  • What is strategically important about my process?
  • What part of the business does my process contribute to?

No individual process operates in a silo. In fact, process changes often disrupt systems and processes downstream. When process owners understand this, they can help the company develop a change management plan that ensures a smooth transition for affected employees.

4. Provide Visibility

Process owners should work with other stakeholders to develop a process map of how processes feed into each other and what inputs or outputs are involved. This provides visibility into how processes operate, what groups are affected and who should be alerted of problems.

Process maps are useful in many scenarios. For example, if an employee sees a failure in a process and understands the downstream processes that are affected, they can warn the process owner in charge of those systems. This gives the process owner time to fix the problem, work around it or push back timelines.

Process maps are also useful when a company is gathering ERP requirements. Requirements gathering sessions are essential for a successful ERP selection.

5. Empower End Users

An excellent example of this mindset is illustrated in the Japanese phrase, Kaizen, meaning continuous improvement. Toyota is a company that embraces Kaizen principles. This means employees at every level of the company can make process improvements. While these improvements may only be tiny changes on a shop floor that save seconds, many small tweaks combine to make a noticeable impact.

Empowering employees to make small changes can result in significant business benefits. After all, end users are the closest to the work they do. In fact, no amount of management expertise can replace the knowledge that day-to-day experience creates.

Finding Effective Business Process Owners

Whether your company is implementing a new ERP system or focusing on business process reengineering independent of technology, process owners are essential.

Panorama’s ERP consultants can help you identify effective process owners and provide them with the tools and expertise to improve your processes and competitive advantage.

An Overview of Software Requirements Gathering

An Overview of Software Requirements Gathering

Baseball great Yogi Berra used to say, “If you don’t know where you’re going, you might not get there.” This quote has survived through the years because it holds an undeniable truth: you need to have a goal in mind, or you’re likely to miss your target.

This saying can be applied to countless circumstances in life, and an ERP implementation is no exception: before you commit your time, resources and money to an ERP project, you need to have a clear picture of where you want your business to be in the future.

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The first step in determining where you want to be is to understand where you are. This necessitates the documentation of ERP requirements.


8 Benefits of Software Requirements Gathering

1. Risk Mitigation

Some companies expect that implementing an ERP solution out of the box will transform their business. However, our experience and research show that a contributing factor to ERP failure is a lack of focus on business process management.

In fact, according to our 2019 ERP Report, more than half of companies don’t use ERP consultants for business process management guidance, and many of these companies don’t realize the ERP business benefits they expected:

Click to Enlarge

2. Process Improvement

While many companies implement software systems with the intent of improving business processes, they often end up with an ERP software solution that replicates their legacy system’s inefficiencies.

When we work with clients to improve their processes, we emphasize the importance of understanding employees’ pain points. We also help clients identify inefficiencies by using Six Sigma, value stream mapping and other business process management tools and methodologies.

3. Documentation and Clarity

Another advantage of requirements gathering is process documentation. Many companies have little to no process documentation – no statistics, no process flows, not even job descriptions for the roles in each department.

This often happens as a result of having a highly tenured workforce. While a tenured workforce can be an overall asset, it can be difficult to document processes because everyone works from what’s in their brains.

Process documentation of current and desired state processes reduces the amount of time needed to train employees. We recommend documenting processes in a way that defines who is impacted and how, so you can define a training strategy and ERP communication plan.

Process documentation also can help you propose new processes to executives and end users. This helps you achieve organizational alignment around project goals.

4. Employee buy in

When employees start hearing about an upcoming ERP project, they generally become fearful. While resistance to change is a common phenomenon, you can mitigate it by involving employees in requirements gathering workshops. This can mitigate change resistance because employees are less likely to resist changes when they are allowed input into process changes.

Requirements gathering workshops also are an opportunity to document change impacts for specific departments and roles, so you can prepare employees for change, thus reducing their fear. We help clients document change impacts, so they can develop a comprehensive change management plan.

5. Competitive Advantage

While some processes, such as general ledger, are not sources of competitive advantage, other core functions may differentiate your organization from competitors. For this reason, it is not always advisable to adopt out of the box functionality that easily can be replicated by others in your industry.

Requirements gathering identifies processes that need to be maintained and protected from standardization. This is important information to have when headed into an ERP selection.

6. Successful ERP Selection

Many vendors oversell their software’s industry best practices. While their software may improve business processes, they still need to be defined in the context of your company’s operations.

Let’s say your company has found that the most efficient and cost-effective pick, pack and ship method is to print labels for customer orders, pick according to the labels and load shipments directly onto the truck.

However, the software you’re considering employs a “best practice” for pick, pack and ship that is quite different. Instead of being a best practice, this method would be a step backward for your organization.

The problem with gathering software requirements after purchasing software is you’re faced with a tough decision when the software can’t meet a must-have requirement:

1) Invest millions of dollars in reconfiguring your company to account for the vendor’s best practice


2) Spend considerable time and money customizing the software to accommodate your requirements

To avoid this dilemma, we recommend gathering requirements before software selection and using those requirements to write ERP demo scripts.

7. Faster Implementation

Most modern enterprise systems are flexible, so even a simple workflow is likely to have multiple variations. In cases like this, it’s not enough to say you’re simply going to adopt the software’s processes.

If you do this, technical consultants or the software development team will have to make decisions for you, which is costly and time-consuming. It’s more cost-effective to make process decisions on your own dime.

8. Understanding of ERP Success

Requirements gathering is an opportunity to define key performance indicators that allow you to track your achievement of business benefits. This is important for tracking benefits during implementation, determining your ROI after implementation and continuing to realize benefits for years to come.

9 Tips for Requirements Gathering

1. Understand Your Business Goals

These often include goals regarding real-time data or the customer experience. All stakeholders should be aligned around these goals, so you can determine what process changes are necessary to achieve them.

2. Involve the Right People

The people involved in requirements gathering should be subject matter experts (SMEs) with an in-depth understanding of the processes within their own departments.

It’s important to remember that the SME is not always the manager. While a manager might tell you how a process should be done, an employee who has actually performed the process might have insight into what actually works best. 

We recommend including SMEs from every functional area, so you can understand pain points and inefficiencies across the organization. A cross-functional group will ensure you don’t record repetitive requirements. This also helps you garner the perspective of different people with the same inherent issues.

Your requirements gathering team is an important part of your ERP project team and ideally will be involved in other implementation activities, so it’s important to choose a team with the right personalities and skillsets.

3. Develop Workshop Guides

Prepared participants result in productive meetings. As such, it’s important to create and deliver workshop guides that tell participants what to expect during the workshop and provide questions for them to mull over beforehand.

We use workshop guides with clients because they help establish a common goal and keep participants focused.

4. Start With Process Mapping

A process map for a particular process might look like this: “Receive order from website EDI > transfer order to picking > deliver product.”

Requirements, on the other hand, look like this: “The ability to integrate with third-party website EDI; the ability to display a list of products that need to be picked from the warehouse; the ability to mark products as picked; etc.

As you can see, the ERP requirements flow from the process map. You can’t document ERP requirements without first mapping your processes.

5. Don’t Forget About Process Improvement

As mentioned earlier, business process reengineering is an essential step before software selection. This is because ERP software is simply a tool used to enable process improvements, not force them.

While ERP vendors provide best practices for your particular industry, you also should look at best practices from other industries to find unique insights.

We recommend using Six Sigma tools to define your own best practices and competitive advantages that you don’t want replicated by industry peers.

6. Prioritize Requirements

No ERP system will address all your requirements, so you must determine which are most important to your business.

There are many ways to prioritize ERP requirements, as described in an earlier blog post, but here are three useful categories:


  • Must-have Requirement: This will provide significant business improvements.
  • Value-added Requirement: This will be beneficial to improving processes but not critical.
  • Nice-to-have Requirement: This will make employees’ jobs easier, but it won’t provide significant process improvement.

7. Allocate Adequate Time and Don’t Waste it

Requirements gathering can bring additional responsibility to already overworked employees. As such, it’s important to stay focused on the goal. There’s a fine line between being thorough and allowing a free-for-all discussion that wastes time.

Requirements gathering workshops typically take between two to three hours per functional area. It’s better to over-estimate the time necessary in order to eliminate the need for a follow-up session.

Follow-up sessions tend to break the flow of thinking and collaboration. This can result in weaker requirements. The exception is follow-up sessions conducted after all requirements have been gathered. These follow-up sessions are actually useful as they can bring more clarity to any confusing requirements.

8. Ensure the Right Level of Detail

Take a simple task, such as order entry, and ask questions about it to identify who will execute the work, what’s the expected outcome, etc.

Sample Questions to Ask About an Order Entry Process

  1. How do we receive orders (EDI, fax, hard copy, phone)? What percentages does each account for?
  2. How many orders do we receive every day?
  3. Who receives the orders?
  4. Are the orders edited?
  5. How many active customers do we have?
  6. How many orders do we receive from new customers?
  7. How many orders fail in EDI?
  8. How many orders cannot be entered without further research?
  9. How long does it take to enter an order?
  10. How many orders fail credit checks, and how long are they on credit hold?
  11. What is our processing time from receipt to shipment?
  12. How many orders have multiple lines?
  13. How many orders can be filled complete on the first pass?
  14. Can we promise ship dates at order entry time?
  15. Can we verify pricing at order entry time and match to the price the customer sent?

Essentially, you want to document the end-to-end processes, including all the handoffs and touchpoints. We recommend organizing processes into swim lanes according to the responsible employee or department.

9. Follow-up

A follow-up session need not be a lengthy session, but it should go through every technical and functional requirement to verify that each was understood correctly. All the same stakeholders should be included, so they can validate that what you put on paper is what they meant.

Business Requirements = Business Benefits

Companies that take the time to define their business requirements before ERP selection are more likely to realize measurable business benefits from their ERP projects.

However, requirements gathering is complex and time-consuming, so many companies forgo it to accelerate their selection. Still, some companies take the time to gather requirements and often hire ERP consultants to ensure a more seamless requirements gathering experience.

Panorama’s ERP consultants take the time to understand your company’s competitive advantages and business goals. We assist in mapping your current state and future state, and we make recommendations from not only your industry’s best practices but also other industries’ best practices.

Most importantly, we ensure ERP vendors understand your list of requirements and ensure they deliver ERP demos that help you select the best solution.

How to Handle ERP Negotiations and Find a Negotiation Expert

How to Handle ERP Negotiations and Find a Negotiation Expert

ERP software can be a multi-million-dollar investment, but companies often don’t invest the same time, expertise and resources into negotiating these deals as they do negotiating other major capital outlays.

This is not to say that companies aren’t concerned about the cost of ERP software or of implementing ERP software, but they do tend to overlook certain cost variables. Companies, often, are most concerned about the obvious variables: software costs, maintenance costs, hourly rates and scope of services.

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While these are all important, they typically are not the things with the most impact on total cost of ownership. Instead, it’s the things lurking beneath the surface that make a difference.


9 Tips for ERP Negotiation

Below are nine tips for identifying hidden costs and negotiating with ERP vendors:

1. Understand Roles and Responsibilities

Some of our clients go into vendor negotiations ready to beat up their vendor on cost. However, negotiating a contract with your software vendor isn’t just about minimizing cost. It’s also about managing risk and clarifying roles and responsibilities.

A low-cost deal isn’t going to do you much good if the vendor has shifted all the risk to you to help get to the desired number. Fortunately, most vendors are willing to negotiate roles and responsibilities.

Here are some questions to ask yourself as you’re reviewing the vendor contract and statement of work:


  • Who is responsible for training end users?
  • Who is responsible for data cleansing and migration? How much historical data will be converted?
  • Who will handle overall project management of internal and external resources?
  • What are the assumptions surrounding changes to the configuration of the software? This is especially pertinent if you have been sold an “industry pre-configured” solution.
  • How many internal resources does the vendor assume you will dedicate to the project?
  • Who is responsible for system testing, business process testing and integration?
  • Who will create system and security profiles in the system?
  • Who will handle Sarbanes-Oxley, FDA, system validation and other regulatory compliance requirements?

2. Understand the Scope of Modules and Functionality

Constant updates to software versions, multiple variations of available modules and disconnects between the demo and proposal cycle can create ambiguities.

For example, not all ERP vendors group functionality within the same modules. While a customer relationship management (CRM) module for one system may include a robust way to convert a lead into a customer with a corresponding order, other systems may require use of an order entry module.

Companies also may experience confusion when sales teams demo one version of a product, while the proposal team assumes a different version of the software without explaining the difference.

3. Consider Annual Maintenance Costs

This is where vendors make their real profit. As such, vendors will usually hold the line on this annual fee, especially if you’ve negotiated an aggressive deal on software licenses.

At the very least, you should remember to include a maximum amount that vendors can raise their annual maintenance fee. Asking if the vendor can hold the price steady for at least three years is a good way to control costs.

4. Don’t Assume the First Offer is the Best Offer

As with any negotiation, vendors typically start by offering software at their list price and reducing from there.

Don’t be afraid to ask your vendor to reduce their software pricing, particularly as it relates to license costs. Vendors typically are flexible in their software pricing because they have several other ways to make money, whether it be through ongoing maintenance, professional services or training.

5. Review the Contract Terms and Conditions

Some common things to look for include payment terms (you don’t want to pay for everything up front), and what happens if you don’t like the vendor’s technical implementation resources.

In general, you want to look for other conditions that can be more advantageous to the vendor than to your company.

6. Don’t Buy More Software Than You Need

One common pitfall is purchasing more software than you need, whether it be in terms of unnecessary modules or too many users. For example, we recently worked with a mid-size manufacturing company that estimated it had purchased $600,000 of licenses that were not going to be used by the company anytime in the near future.

It’s always easier to add to your purchase over time, but nearly impossible to scale back on licenses you’ve already committed to. Even if your ERP vendor is offering you a “once-in-a-lifetime” deal on software licenses, you likely are going to overcompensate for the cost savings by purchasing software you don’t need.

Don’t let these “time-sensitive” discounts create a sense of urgency. Most sales reps will continue to honor discounted pricing after the discount period.

We recommend purchasing what you need when you need it and pre-negotiating the price on future purchases to avoid license cost increases. When we negotiate deals for clients, they’re able to purchase additional licenses, modules or users at pre-defined costs for three years or more.

7. Distinguish Between FUD (Fear, Uncertainty, Doubt) and Reality

One of the most common sales tactics in any industry is to create fear, uncertainty and doubt in the minds of potential buyers. Buyers of ERP solutions face similar tactics, whether it’s being told that only the vendor’s direct professional services group is able to handle the implementation, or that the maintenance contract will be void if a non-certified consultant installs and configures the software.

The key is to understand which messages are real versus FUD. This is a skill that comes with extensive knowledge and experience in the industry.

8. Benchmark Against Other Deals

Here are some questions you can ask yourself to help identify points of negotiating leverage:

  • What is the vendor offering companies that are similar to yours?
  • What are competing vendors offering?
  • Does your incumbent vendor provide some additional leverage via upgrade or migration credits that may put cost pressure on other vendors?

We see too many companies zero in on one vendor without receiving proposals from and conducting an evaluation of other vendors. If you have competing offers, you can ask your preferred vendor to meet the pricing offered by a lower-cost vendor. You also can make concessions based on any functionality gaps or concerns.

9. Consider People and Processes

It’s amazing how often vendors’ project plans do not assign critical project activities to either the vendor or customer but completely omit them.

For example, most change management activities are not included in the project plan, aside from basic end-user training. In addition, business process management is oversimplified to entail the adoption of the software workflows out of the box with no modifications.

We recommend improving and documenting your processes before issuing a request for proposal (RFP). This ensures the vendor understands your unique processes and doesn’t assume you’ll implement everything out of the box.

While this tip may seem unrelated to traditional contract negotiations designed to pinch project costs, the long-term cost savings of realistic expectations can be just as significant as the direct cost savings you negotiate.

You don’t want to come out of negotiations thinking you’ve scored a great deal only to find you’ve merely shifted your costs to other budget categories, incurred greater costs in the future or elevated your implementation risk.

With that said, companies should not enter into fixed-cost contracts without completely understanding them . . .

The Unintended Consequences of Fixed-cost Contracts

On paper, it’s a brilliant idea: 100-percent cost predictability and shifting the risk from your own company to your ERP vendor. However, fixed-bid contracts have some potentially disastrous consequences that are even more destructive than the problems they were intended to address.

In our experience serving as software expert witnesses for many failed ERP projects, we have found that fixed-bid contracts are often the root cause of ERP failure. It’s never a good idea to enter into a fixed-cost contract without fully understanding the costs and risks.

Here are three consequences of entering into a fixed-bid contract with your ERP vendor or systems integrator:

1. Incentives are Misaligned

In fixed-bid arrangements, you know exactly what you’re going to pay, but you’re not always getting what you need to make the project successful. In fact, the vendor is financially incentivized to provide a bare-bones scope and provide cheaper, less experienced resources.

2. Your Company Takes no Responsibility for the Project’s Success

Executives typically don’t understand the complexity and magnitude of a successful ERP project, so they lean on their ERP vendor to guide them. However, only internal executives and management team members can provide the direction, resources, operational decisions and oversight required to make an ERP project successful.

In fact, the way the non-technical aspects are managed will ultimately determine the success of your project. These non-technical aspects include activities such as business process reengineering and organizational change management. No vendor is going to magically improve your processes and gain employee buy in without involvement from your executive team.

3. The Fixed-bid Buffer can be More Costly Than Managing Time and Materials

When we advise clients in their ERP software selection initiatives and contract negotiations, it is rare to see vendors fix-bid a proposal without including a buffer – often ranging from 30- to 40-percent. In other words, they will take their estimated time and hourly rates and add a buffer to insulate them from the risk of overruns.

In addition, as noted in point #1, they will at the same time reduce their scope, leaving more the more costly and time-consuming activities for the client to manage.

At the end of the day, this doesn’t reduce cost, it simply shifts costs from the vendor to the implementing company. To add insult to injury, most companies don’t fully understand the magnitude of the costs being shifted from one party to the other, so they end up having extremely unrealistic expectations.

Are Fixed-bid Contracts Always Bad?

You can definitely leverage the potential benefits of fixed-cost contracts without running into the challenges outlined above. Here are some tips for making the most of fixed-bid contracts:

1. Ensure You Have a Solid Contract Review and Negotiation Process

The fine print and details around scope and responsibilities of each party in the contract can be the silent killers of an ERP project, so make sure you have an experienced team helping you. Investing in this due diligence early on ensures you have realistic expectations of what it takes to get your ERP project done right, rather than cheaply and quickly.

2. Invest in Project Auditing

Independent ERP consultants, like Panorama, can ensure you are tightly managing scope, milestones, budget and vendor activities. Our project auditing services will help you maintain an on-time and on-budget project.

3. Don’t Forget About the Non-technical Aspects of Your Project

This is true of any ERP project, but it is especially true for fixed-bid engagements. Make sure you’ve designated enough time and resources for business process management and organizational change management. Odds are your vendor will not include these in their scope.

Qualities to Look for in a Software Sales Rep

The overwhelming majority of ERP vendor sales reps are good people. In fact, it’s in their best interest to give you a good rate because the idea behind making a sale is to turn you into a long-term customer. Vendors want long-term revenue streams that are predictable.

How do you tell if your sales rep is one of the good ones? Look for the following signs:


  • Sells you the modules you absolutely need and never encourages you to purchase everything at once
  • Includes hardware costs, project resources, integration, customization and other hidden costs in the total cost of ownership
  • Includes all critical project activities in proposal and contract
  • Estimates a deployment time based on the scope of all critical project activities
  • Knows how to differentiate between processes that add value and competitive edge to your company and those that don’t

What is Your ERP Consultant’s ERP Contract Negotiation Methodology?

During the ERP selection process, many companies struggle to understand and compare vendors’ statements of work. Some of these companies hire ERP consultants to help them navigate the cost variables and negotiate favorable terms.

However, choosing the right ERP consultant can be just as confusing as selecting an ERP system. Any ERP consultant can claim to deliver vendor negotiation services, but not all consultants have an effective methodology. When evaluating an ERP consultant’s vendor negotiation methodology, consider whether it includes these four activities and deliverables:

1. Strategy Development

An ERP consultant should collaborate with you to develop an ERP contract negotiation strategy. Ideally, they’ll ask you about your goals and priorities. For example, is it more important for you to reduce operational expenses or reduce capital expenditures?

They’ll also help you determine which contract terms are most important to you. These may include terms, such as:



  • Licensing payments should be spread over deliverables.
  • Organization will spend x amount per year.
  • Subscription costs will not be increased for x years.

2. In-depth Price Comparisons

You may have found that vendors’ quotes are not easy to compare. As such, the most valuable deliverable an ERP consultant can provide is a negotiation workbook showing apples-to-apples comparisons of your top contenders.

This is valuable because there is no universal standard for how ERP software solutions should be priced. For example, some vendors price their software with named users, while others price with concurrent users.

Apples-to-apples comparisons are also helpful due to the fact that vendors’ statements of work make various assumptions, such as:

  • You’ll use all software functionality right away
  • You’ll use x amount of out-of-the-box functionality
  • You’ll need x amount of customization
  • You’ll take x implementation approach
  • You’ll use mostly internal resources
  • You’ll be responsible for all ERP data migration

A negotiation workbook helps you understand statements of work based on your unique requirements and digital strategies instead of vendors’ assumptions. Your ERP consultant should help you understand your requirements by facilitating activities, such as:

  • Determining an ideal level of software customization, and ensuring you’re only customizing when absolutely necessary (i.e., to improve your competitive advantage)
  • Understanding how many internal full-time resources you can reasonably dedicate to the project and how many vendor resources you’ll need
  • Understanding how long it takes to automate workflows in the system and how complicated it is, as well as who will be configuring workflows
  • Determining which activities should be included in each project phase

Below is a sample negotiation workbook. The spreadsheet allows “what if” scenarios (i.e., what if you get a 30% discount):

3. Total Cost of Ownership Analysis

A long-term view of cost is just as important as a short-term view. The ideal ERP consultant will provide a three-year total cost of ownership analysis – or use whatever timeframe makes sense for the length of your ERP implementation.

This analysis should be included as part of the negotiation workbook. The analysis considers factors, such as:


  • Payback Period – Panorama clients typically recoup the cost of their ERP project within three years.
  • Benefits Realization Timeframe – Panorama clients typically realize full ERP business benefits from out-of-the-box functionality within 9-12 months of go-live.
  • Deployment Model – Most ERP vendors encourage a cloud-hosting model and a SaaS licensing model. If you’re considering SaaS licensing, you may incur escalating annual charges for additional functionality, data or transactions.
  • Licensing Structure – The number of users and types of users will affect your cost if you choose a user-based pricing model. Many ERP vendors underestimate the number of users to make their system seem less expensive.
  • Implementation Approach – Will you use a phased, big bang or hybrid approach? If phased, will you phase per function or per module? Make sure your ERP vendor doesn’t expect you to buy all licenses upfront.
  • Software Costs vs. Service Costs – You should aim for a ratio of 2:3 for software costs to service costs.
  • Software Configuration – How long will it take you to configure each of your business processes? Are there any process dependencies (processes that need to be set up before other processes)?
  • Resource Rates – Panorama clients typically pay $175-225 per vendor resource. If you negotiate this too low, you may end up with rookies on your ERP project team.

4. ERP Negotiation Guidance and Coaching

Your team has made large purchases in the past, and you don’t want ERP consultants taking control. The ideal ERP consultant will take a collaborative approach and be flexible enough to respond to your unique needs: they can negotiate on your behalf, prepare you for negotiating with ERP vendors yourself or attend calls with you.

Whichever method you choose, you should aim for cost savings of 30-60%. Your savings will vary depending on your organization size and your chosen ERP vendor. Some vendors don’t go below a 20% discount. You can achieve additional cost savings overtime by ensuring maintenance costs are based on purchase price rather than list price.

Panorama clients typically go through three to four rounds of negotiation, which can last anywhere from three weeks to several months.


It’s not easy finding an ERP consultant that focuses on all four of these activities. Panorama is one of the few that does.

If you’re not convinced these activities will save you money, take a look at these case studies:

  • Panorama recently negotiated more than $15 million in savings on licensing costs alone for a large, multi-national client.
  • Panorama negotiated cost savings for a client that could not afford their top-choice vendor and was about to settle for their second choice.
  • Panorama saved a city government more than $500,000 in negotiations. The vendor was able to provide a lower price due to well-defined ERP requirements and expectations.

Typically, Panorama clients achieve cost savings that are ten times the cost of the negotiation services. And Panorama’s performance warranty ensures every client gets a significant discount on their software purchase or they don’t pay us a dime for our time spent negotiating on their behalf.

Engaging Panorama to assist with vendor negotiations will help you lower your total cost of ownership and mitigate risk.

Ensuring ERP Demos Address Your Company’s Unique Processes

Ensuring ERP Demos Address Your Company’s Unique Processes

At a glance, organizing ERP demos can seem like a simple task – find a system that seems to fit your needs, call the vendor and have a representative conduct a demo. By following this method, you are guaranteed to see several impressive software solutions, but you are not likely to find one that truly fits your needs.

While ERP vendors may genuinely believe they have the best ERP solution for your company, it is the responsibility of the ERP project team to read between the lines. In addition, your employees should provide input as to which ERP systems best fit your company’s processes and digital strategy.

The best way for employees to provide this input is by attending software demos and providing quantitative and qualitative feedback. Your company should schedule a demo for each of the enterprise resource planning systems on your vendor shortlist and invite employees from every affected department.

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SAP and Oracle both invest heavily in cloud technology. However, our client was skeptical about cloud scalability and unsure if the products were mature and proven.

With the right methodology and independent guidance, you can organize ERP demos that help your company narrow down its vendor shortlist. Based on our client experience, we have provided several tips for preparing for and conducting effective software demos:

How to Prepare for an ERP Demo

Like most things in life, the more prepared you are for something, the better the outcome. That same principle applies to conducting a successful ERP software demo.

1. Prepare Your Processes

Reengineer Your Processes

Conducting business process reengineering prior to scheduling software demos will help you maximize ERP business benefits. You don’t want to simply pave the cow paths of what has worked in the past.

For example, if your company needs access to real time data to improve the customer experience, you’ll want to design processes to support this. These new processes then translate into business requirements, which help you evaluate the business intelligence functionality of various ERP systems.

Prioritize Your Business Requirements

Determine which processes give your company competitive advantage. These processes determine your highest priority ERP requirements and should not be standardized. While standardization in areas such as financials is usually advisable, areas like customer service should be protected from standardization.

High-priority requirements should meet two criteria: 1) They provide competitive advantage, and 2) They represent functionality that differentiates between different ERP systems.

While most organizations have a decent sense of what requirements meet the first criterion, they don’t have the internal knowledge base to address the second criterion. This is where independent ERP consultants are useful, as consultants like Panorama have extensive experience with a variety of ERP systems.

For example, many of our clients want to understand the difference between different systems’ inventory management and supply chain management functionality. We help them understand some of the differentiating factors, such as artificial intelligence and IoT.

2. Prepare the ERP Vendor

Explain Your Company’s Business Requirements

ERP demos are the finale of the requirements gathering process. You spent countless hours gathering business requirements, so make sure the ERP vendor understands them. This is important because an ERP vendor can’t demo what they don’t understand.

A vendor shouldn’t have to ask clarifying questions during the demo, so be sure they have access to subject matter experts long before the demo.

You should also create detailed business scenarios and ask vendors to run through the same processes in the same amount of time. This allows for apples-to-apples comparisons.

Provide a Demo Script

We’ve all attended software demos that are more generic sales pitches than personalized and relevant presentations. Some sales reps are especially skilled at selling their software’s “best practices” as one-size-fits-all functionality.

The key to finding the functionality best suited for your unique processes is creating a demo script based on your business requirements. If a vendor refuses to follow the script, consider it a red flag.

Your script should include a section that allows employees to see data move from the beginning to the end of a process. For example, if your demo is specific to showing the creation of a quality order, employees may want to see how the order is executed, how the variables are set up and how goods are quarantined when they don’t pass quality criteria. While these peripheral processes might not be the main objective of the demo, employees need to understand the full context. 

You’ll also want to ensure your script specifies that reporting work streams should be demoed alongside functional work streams. This gives employees a holistic view and gets them thinking about reporting requirements for implementation.

While a script is useful, you can’t predict everything employees will want to see. Employees may be eager to see a particular feature even it isn’t scheduled to be demoed. This impromptu demo request can be met if the right configurations are in place and the relevant data exists. 

Provide Data

Speaking of data, you’ll want to provide demo data to vendors, so they can demonstrate specific processes requested by employees. For example, the vendor’s existing demo data may be suitable to demonstrate typical manufacturing industry processes, but if your company is a car manufacturer it may not strike a chord if they are shown the quality management process for a batch of soda.

When a vendor createa data on the fly, this can derail a demo. Employees could become distracted, for instance, with the creation of a production order when the demo is about the quality management process.

Set Expectations

You should provide vendors with specific meeting times and a detailed agenda. Don’t let a vendor control the pace of your evaluation process by requesting to demo last or at a later date.

In our engagements with clients, we typically have the vendors spend the first hour of the day with subject matter experts addressing cross-functional requirements. This ensures vendors don’t waste time on these dashboards and workflows during the functional sessions.

Ensure an Adequate Number of Demo Staff

Having an extra demo resource who can illustrate actions taken by different roles can help employees visualize how the ERP system can pass data between different roles to accomplish a process. An extra demo resource can also be useful if the vendor needs to create impromptu demo data.

3. Prepare Employees

Be Informative

Provide information, such as the demo script and agenda, ahead of time, so participants have adequate time to plan for their absence within their departments.

Provide Guidelines

Oftentimes, ERP vendors steer away from the demo agenda to showcase special features, so participants must be trained to recognize this. Additional features that are not relevant to your requirements, should not be factored into participants’ final scores.

Another scoring guideline you’ll want to address is the importance of basing scoring on business requirements. Participants should evaluate ERP software based on requirements as opposed to vendor performance. When all is said and done, your daily life will revolve around the software, not the best performing vendor.

In addition, attendees should be instructed to be on time and attend the same sessions for each vendor. If participants aren’t consistent with attendance, they can’t provide reliable scoring. Our clients typically provide participants with scoring sheets based on demo scripts, so they can write comments as they go. This helps jog their memory when inputting their scores digitally.

5 Tips for Organizing Software Demos

1. Focus on the Goal

If you set expectations upfront, you are now in position to table questions that are not aligned with the goals of the demo. While you should be prepared to show certain features that are peripheral to your main objectives, you should also remind your audience of the expectations. After all, ERP software is too vast to demo every single feature.

2. Designate a Timekeeper

Once a demo starts to venture off track, it becomes difficult to make up for lost time. A demo that runs over schedule allows little time for questions and answers. While Q&A can always be conducted remotely, it’s most effective in person, so be sure your timekeeper alerts the room when it’s time for questions.

3. Develop a Method to Analyze Results

Feedback from participants must be recorded in a way that the project team is able to analyze afterwards. Make sure that everyone understands what each score represents and that you have a solid analysis process established to analyze the data.

4. Schedule Multiple Demos

It is important to schedule at least two to three ERP demos to give participants a chance to compare systems. Only demoing one software and making a decision by default does not ensure a best fit.

5. Leverage Several Data Points

While demos are a good starting point to help you evaluate long-list vendors, keep in mind that this information is provided by biased sources that have a vested interest in nudging you toward selecting their software.

In order to neutralize or validate any biases, it is important to leverage other data points from independent sources. For example, Panorama provides a number of free and unbiased data sources to aid your ERP selection process, including our 2019 ERP Report and 2019 Clash of the Titans Report.


A lot of prep work goes into guaranteeing successful demo sessions and a successful ERP selection. Panorama’s ERP consultants can assist your team in gathering requirements, preparing demo scripts, analyzing demo scores and assisting in all of the other activities outlined above.

3 Process Improvement Lessons From Financial Firms

3 Process Improvement Lessons From Financial Firms

While financial firms are notorious for being slow to adopt new business processes, operations teams within some financial firms are finding ways to break down organizational silos and gain new efficiencies.

How are they doing this? To understand their path to success, it’s important to first understand the silo mentality within financial firms.

A Silo Mentality

In many financial firms, there is a disconnect between the front-office team and the operations team. One reason for this silo mentality is a front-office focused mindset.

The Front Office Drives Revenue

Front office teams drive most of a firm’s revenue, whereas operations teams are ancillary. Therefore, it is no surprise that most executives funnel more money into improving technology or sales materials for front-office teams.

This mindset is one reason why process improvement is not a priority for many financial firms. From the perspective of the typical financial firm, focusing on revenue can result in millions of dollars in growth, whereas process improvement or process reengineering may only save a few hundred thousand. Many companies view business process management as a cost saving measure, not a money maker.

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The Operations Department Drives Efficiency

There are undoubtedly benefits when a firm focuses on efficiency. One company that represents this operations-focused approach is Bridgewater, one of the largest hedge funds in the world. Bridgewater relies heavily on algorithms and building custom software solutions.

Instead of operations being the neglected department, they work with the front office to design processes that allow analysts to dive deeper and work faster. The firm has a policy that rigorously vets and tests new technologies before adopting them. In fact, Ray Dalio, the founder of Bridgewater, states that “Bridgewater is even more a technology company than it is a hedge fund.”

How can one financial firm be so quick to embrace progress while other firms are so resistant to change? This is quite literally a million-dollar question, especially from an operations perspective.

In order for a firm to embrace a mindset of change, it is essential to make the the front-office team understand that the operations team is there for their benefit, and that change can make their lives easier.

3 Process Improvement Tips

Once a company changes its front-office focused mindset and breaks down its organizational silos, it can begin process improvement. Following are three tips for improving business processes:

1. Understand What the Front Office Wants

It can be difficult for operations to approach the front office to propose new ideas or changes. After all, disrupting the workflow of a portfolio manager working with billions of dollars can mean very expensive missed opportunities. However, it’s essential for operations to collaborate with the front office when it comes to process improvement.

All too often, operations teams work in a vacuum with no understanding of what the front office desires. This results in improvements that don’t solve front-office employees’ biggest issues.

The first step towards effective process improvement is for operations managers to understand front-office employees’ workflows. This includes common workflows (such as placing a trade) and uncommon processes that take a significant amount of time (such as monthly portfolio rebalances).

Nearly all financial firms still have labor-intensive, manual processes that can be overhauled. To identify these processes, we recommend conducting meetings to learn about the front office’s current headaches. During these meetings, try to understand what employees’ ideal workflows would look like.

Understanding each user’s workflow gives the operations team the opportunity to make small, incremental changes that streamline workflows – ultimately winning the favor to implement more significant changes.

2. Understand That Changes are Iterative

While it’s important to make end users realize that changes are for their benefit, do not overpromise. After all, large changes are iterative.

One reason for the iterative nature of change is that processes need to be tested, especially if they are heavily driven by technology.

When testing a process, never present a test to end users that has questionable calculations. First impressions are important, and the smallest error will make the end user question all numbers they see in the future.

Even if all numbers and calculations are accurate, a proposed process may not be wildly popular the first time it’s demonstrated. This does not mean the process should be discarded. Just be sure to take stakeholders’ suggestions into account and fix whatever shortcomings were noted. If stakeholders have opportunity for input, and they see an efficiency gain, they are less likely to deny the change.

However, some stakeholders, especially traders, can be set in their ways. They may push back simply because they are unwilling to change. Often, you can convince these individuals by crafting a simple message like, “you save two clicks each time you do this.” While this may sound small, a trader that places fifty or more trades a day can save a significant amount of clicking in a day.

Panorama often helps clients develop communication plans as part of their change management initiatives. These plans outline different messages that are likely to resonate with each type of end user.

3. Document and Share Process Changes

A process change is of no use if only one employee adopts it. This is why it’s essential to document process changes and share them with all end users. Knowledge preservation is especially important when a new employee joins the company or critical individuals leave the firm.

For traders and portfolio managers, providing a one-page print out can help them adopt business process changes more easily. This sheet might provide answers to frequently asked questions, freeing up resources within operations to focus on more critical tasks.

For more significant process changes affecting multiple departments and involving new technology, formalized training is necessary. When Panorama helps clients manage change, end users attend customized training sessions that familiarize them with the new processes within their own functional areas.

Shifting the Front-office Mindset

Within many financial institutions, inefficiency is primarily a result of a disconnect between front-office and operations teams. The two teams should not operate in silos but in collaboration to bring process changes that benefit both parties.

A critical step towards collaboration is eliminating the front-office focused mindset in favor of a team-oriented mindset. While this can take months or even years, it is essential that the front office understands that the operations team is there to help them – not hinder them.

While the operations team will never be the primary revenue driver for the firm, it’s a powerful ally to the front office. Operations teams that understand their role should instill this “alliance mindset” into the front office, so both parties can suggest and adopt process improvements.

Panorama’s business transformation consultants can help your company break down organizational silos and encourage collaboration, regardless of what industry you operate in. We’ll listen to every department’s unique needs, ensuring organizational and process changes benefit the whole organization.

How Artificial Intelligence Improves ERP Software

How Artificial Intelligence Improves ERP Software

While artificial intelligence (AI) is a relatively new technology, it has already demonstrated its disruptive potential and created a buzz in the software market. In fact, according to Gartner, as much as 80% of emerging technologies will have artificial intelligence as a key component by 2021.

Artificial Intelligence Within ERP Systems

AI allows ERP vendors to improve ERP systems using machine learning and natural-language interfaces. The AI in ERP systems provides actionable data insights enabling companies to improve their operational efficiency.

A good example of an AI-driven ERP solution is SAP Leonardo, which includes a number of microservices integrated with a cloud platform. Oracle also has introduced a number of AI-based tools for its ERP solutions, including digital assistants, advanced access and financial controls, and smart supply management.

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Another example of an AI ERP solution is Coleman AI from Infor. You can ask this bot to suggest the next offer for a certain customer, create a requisition for a particular item and help you with many other tasks.

9 Ways AI Improves ERP Software

1. Advanced Analytics

AI’s ability to work with massive amounts of data enables real-time, accurate data insights. For example, AI can analyze the buying behavior of different categories of customers, enabling you to tailor your products or services to the needs of a certain audience.

2. Warehouse Management

Artificial intelligence can test countless demand forecasting models with precision, adjusting to different types of variables, including changes in demand, supply chain disruptions and new product introductions.

For instance, BMW uses learning algorithms to track an item from the manufacturing stage until the moment it’s sold, monitoring 31 assembly lines in different countries.

3. Forecasting

AI-driven solutions can process historical data and make predictions for the future. These tools identify seasonal patterns in your business, offering suggestions on whether you should decrease or increase production.

Not only does AI reduce the costs of forecasting, but it also makes forecasting much more accurate. You can significantly reduce the risk of underproduction or overproduction, when you manufacture the right amount of inventory.

4. Financial Management

AI can automate quarterly and monthly processes and closing operations by verifying reports for accuracy and comparing account balances between independent systems.

For example, AI can categorize invoice data into different accounts and discern the difference between a phone purchase and a monthly phone bill.

5. Interdepartmental Processes

Connecting sales, inventory and accounting is not an easy task. However, AI is not afraid of massive amounts and various types of data, making it the perfect solution for creating a centralized platform.

6. Customer Service

If your company does field service, AI can use information about performance evaluations and employee qualifications to schedule service calls and assist with planning.

7. Production Processes

When integrated with an ERP system, AI can detect inefficient processes and suggest a solution that will cut costs.

AI also can identify processes that use too much energy. It enables predictive diagnostics, minimizing the waste of resources.

8. Human Resources

Another advantage of AI-enabled ERP software is that it can be proactive. For example, it can detect what employees need a raise. In addition, it can analyze data on the skills and experience of applicants, expediating the recruiting process.

9. Sales Automation

Chatbots powered by AI not only help customers but also conduct the whole sales triangle. Now, bots can cope with segmentation and provide responses in real time.

Should You Select an ERP System With AI Capabilities?

While ERP systems have always been able to integrate various functions within an organization, AI takes this integration to the next level. It does this by analyzing large amounts of data, making predictions and suggesting next steps.

Panorama’s ERP consultants can help your company select an AI-enabled ERP system that increases your operational efficiency and improves your customer experience.

About the Author
Ester Brierley is a competent QA Engineer in a software outsourcing company. Also, she is a virtual assistant and a seasoned content creator for College-Writers, and knows the secret for balancing freelancing and her full-time job.

Note: The inclusion of guest posts on the Panorama website does not imply endorsement of any specific product or service. Panorama is, and always will remain, completely independent and vendor-neutral.

The e-Commerce Conundrum: In-house vs. Third-party Shipping

The e-Commerce Conundrum: In-house vs. Third-party Shipping

As the e-commerce industry shifts from global to international, efficient shipping processes become vital for business success and continuity. If you’re looking to expand your shipping and delivery infrastructure, choosing the right e-commerce shipping model can help you lay a steady business foundation that promotes a positive customer experience.

In-house Shipping vs. Third-party Shipping

In-house shipping is a delivery model that places all shipping responsibilities on the business. Any task that relates to the delivery infrastructure is managed in-house by the personnel of the company. Often, companies that opt for the in-house shipping model operate their own storage facilities and vehicle fleets.

Third-party shipping is a delivery model that enables companies to delegate some or all delivery tasks to a third-party provider. From delivery fleets, fulfillment centers, packing and storage, to technological solutions—third-party delivery companies provide products and services designed to make shipping operations easier for business owners.

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If you are equipped to handle in-house shipping, you may reap the sweet fruits of your labor. Otherwise, you might benefit from delegating the responsibility to those that can make it profitable for you.

Know Your Supply Chain

Supply chains are the foundation of the delivery ecosystem and can either make or break a business. Unfortunately, supply chains are also very complex to create. The supply chain contains every aspect of making a sale, from the raw material of the product, the design process, the storage facility, the wrapping, delivery and any stage in the process until the product reaches its ultimate destination—the consumer.

Delivery is present at many stages of the supply chain. Any delay in the delivery, even the smallest, may disrupt the entire process and the supply time. To keep customers happy, supply time should be as promised with an emphasis on fast and scheduled delivery.

In-house Shipping—Control Your Supply Chain

Pro: Ultimate Control

Keeping shipping in-house enables companies to create their own delivery infrastructure. When you create every aspect of your supply chain, you are better able to improve business operations. You can continually improve deliveries and ensure that logistics are managed in accordance with the needs of the company.

Con: Operational Complexity

There are many things that can go wrong with in-house shipping. Inadequate delivery personnel can cause delivery losses or bad customer experience—which often result in monetary loss for the company. Inefficient management can turn daily delivery operations into a nightmarish mess in which orders get lost, forever buried in a poorly managed email account or incompatible CRM software.

Third-party Shipping—Monitor Your Supply Chain

Pro: Increase Efficiency

Prioritizing tasks can help you ensure each aspect of the business is run at capacity. You can do that by evaluating the company resources. If you don’t currently have the experience and skills needed to run a delivery operation in-house, you can hire an expert or choose among the many third-party service providers.

Nowadays, there is a third-party solution for almost any delivery need—from drop shipping, fulfillment centers, delivery trucks and storage facilities.

Con: No Flexibility

Most third-party shipping services come at fixed models and fixed prices. You have no control over the design of the delivery infrastructure, and you’re paying to use the service as is. While this model provides a solution for companies looking to scale slowly without incurring setup overhead, it doesn’t allow for much modification, if any.

Know Your Tech

It is almost impossible to run a business efficiently without the use of advanced technology. The technology you choose should fit your company’s unique business processes. Your ERP software should support you and not the other way around. Technology, after all, is intended to make life easier for people.

In-house Shipping—Design Your Tech

Pro: Ultimate Flexibility

One of the pluses of an in-house shipping model is the ability to customize the delivery technology solution according to your current IT infrastructure, or to choose a suite of solutions that integrate well with your existing ERP systems.

When you have control over the technology, you have control over the data. Data can be analyzed and turned into insights that improve business continuity and drive more sales.

Con: IT Overhead

Technology doesn’t manage itself. It needs professionals who understand it and have the skills to monitor, maintain and manage it. While IT talent doesn’t come cheap, it’s often an investment that pays off in the long term. Outsourcing IT often results in long wait lines to get proper support and fixed solutions that may not be right for your company.

Third-party Shipping—Use Their Tech

Pro: Enhanced Functionality

The technology provided by third-party shipping services usually comes with all the bells and whistles. These companies have a lot of experience and have spent substantial resources on efficient technologies. From delivery route optimization for faster delivery to smart tracking and live alert for customer convenience, third-party shipping services provide the full delivery experience.

Con: Fixed Infrastructure

While many third-party shipping providers can integrate with existing systems, they are usually ready-made technology products. You can’t make any changes to the system or customize it to fit the needs of your company. For better or worse, you can only use the system as it is offered by the third-party provider.

Know Your Budget

The budget is the heart of the company. It’s in every company’s best interest to ensure the budget supplies money efficiently to all departments. The importance of a budget for delivery purposes can be determined according to the type of business and the volume of deliveries the business is estimated to draw or currently sustains.

In-house shipping is a hefty undertaking that adds lines over lines to the delivery budget. The total monthly expense of in-house shipping is made up of many variables—from vehicle costs such as insurance and maintenance, employees costs such as wages and training, and storage facility costs such as space and equipment.

In-house Shipping—Govern Your Budget

Pro: Cheap at Scale

By managing shipping operations in-house, you gain full control over your budget. Yes, there’s a level of control in choosing a third-party provider. The difference lies in the ability to make changes at every level of the delivery infrastructure.

If a certain vehicle is proving to be expensive in lease and maintenance, you can replace it with another model to reduce costs. For example, a vehicle running on a hybrid engine can reduce fuel costs. In-house shipping enables you to improve every aspect of the delivery budget and continually reduce costs.

Con: High Set Up Costs

Before you can get to a point in which you’re running a profitable and efficient delivery machine, you need to set it up. As with every endeavor, the initial costs of getting the operation up and running can be expensive. The exact sum varies from business to business, so be sure to create a comprehensive estimation of the initial capital needed to set up your delivery operation. While online research is always good, it doesn’t replace an individual evaluation of the numbers as they apply to your company.

Third-party Shipping—Maintain Your Budget

Pro: Scalable Costs

If you have no experience in delivery operations or no desire to take part in that aspect of the business, you can take advantage of the services offered by third-party shipping providers. Often, third-party delivery providers help e-commerce owners start small and scale slowly by eliminating the need for setup capital. Often, third-party delivery services help e-commerce owners run a one-person business, further reducing the costs usually allotted for staff.

Con: No Transparency

When you outsource delivery tasks, you aren’t able to control how the budget is handled. You pay a monthly fee for the use of the service. You can’t know how much of the money goes towards training the drivers, vehicle costs or administration. You forfeit that right in favor of using a pre-existing infrastructure. Be sure to choose a third-party provider that can be a trusted partner for the long term.

Bottom Line—Know Your Business

Choose a delivery model that fits your business. Consider your business resources—including talent, tech and money. If you’re running a one-person e-commerce show, third-party providers can help you clear time for more important priorities. If you’re looking to improve your existing delivery ecosystem, you can integrate to a third-party solution. You can also go with a hybrid model that incorporates the strengths of both.

Panorama’s ERP consultants can help your company determine a delivery strategy that continually improves your bottom line.


Written by Limor Wainstein. Limor is a technical writer and editor at Agile SEO, a boutique digital marketing agency focused on technology and SaaS markets. She has over 10 years’ experience writing technical articles and documentation for various audiences, including technical on-site content, software documentation, and dev guides. She specializes in big data analytics, computer/network security, middleware, software development and APIs.
Note: The inclusion of guest posts on the Panorama website does not imply endorsement of any specific product or service. Panorama is, and always will remain, completely independent and vendor-neutral. If you are interested in guest blogging opportunities, click to read more about our submission guidelines.
ERP Data Migration and Cleansing Tips

ERP Data Migration and Cleansing Tips

What’s one of the most important questions to ask before beginning ERP implementation?

Is our data clean?

If your answer is no, you’re not alone. Most companies have data spread across multiple platforms and formatted in various ways. Our advice to these companies is to cleanse and import data before implementation to ensure their ERP software delivers accurate, real-time data. Proactive data migration also ensures minimal downtime at go-live and reduces the duration of operational disruption.

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However, ERP data migration is easier said than done. Most ERP vendors do not take responsibility for data migration or cleansing because it’s extremely costly. Therefore, your ERP project team must take on this responsibility.


5 Ways Data Issues can Cause ERP Failure

The perfect analogy to describe what an ERP system’s function is for a business is the heart to a human body. If the ERP system is the heart, then data is the blood moving from one part of the business to another – all flowing from and returning to the ERP system.

When data issues exist in your system, there are several ways this can cause ERP failure. Like the importance of blood in the human body, data cleanliness and integrity are essential for a successful ERP project.

Unfortunately, many ERP vendors exclude data migration from their deliverables. As such, it’s not surprising that 41% of respondents in our 2019 ERP Report reported that data issues caused their ERP project to run over-schedule. We also have seen data issues contribute to budget overruns.

So, how do data issues slow down an ERP implementation and propagate unexpected costs?

1. Your Integrations can Fail

If your business operations rely on partner data, such as shipping information, gift card balances or currency exchange rates, you probably have a few integrations to your enterprise resource planning system. When the data being passed back and forth between your ERP solution and a third party is unclean, it can cause your integrations to fail.

For example, let’s say your shipping methods are “Next Day” and “Standard Ground.” However, your shipping carrier has methods called “Next Day Air” and “Next Day Air Freight.” If your ERP system’s data is too specific (or in this example, not specific enough), the carrier might send back data that your system cannot accept. This will cause any records attempting to be created to error out. Your integration might attempt once more to create the failed records, and the cycle repeats itself. This can cause system performance to decrease and can slow down your ERP implementation process making it run over-schedule. Even though you’ve already gone live, the project recovery process still counts toward your total implementation duration.

We help companies avoid integration issues by preparing them for data conversion before implementation. This preparation involves developing a data strategy, defining the scope of data conversion and determining a data conversion approach.

2. ERP System Performance can Slow

Whether it’s from integrations attempting to repeatedly create records or from batch jobs running and erroring out, bad data can take a toll on your ERP system’s resources. This system lag can be amplified if your transaction volume is large, like during peak times in your business operations.

For example, data issues can cause a batch job to error out. Let’s say that your business runs both its master planning operations and point-of-sales operations through the enterprise system. Master planning is a system-intensive process as it accounts for many different variables like current sales, future orders and current stocking levels. For your point-of-sales operations, your registers and the ERP system need to communicate via a series of batch jobs to push the data back and forth.

If some of your future orders don’t have dates on them, the master planning job can error out. Your ERP system will continue to run the job, allocating more resources to it to balance the load. If your point-of-sales batch jobs start running at the same time, there will be minimal resources allotted to those jobs. As a result, cashiers may experience slower response times or no response at all.

Returning to the analogy of ERP software as the heart of business operations and data as the blood, when a person has a blood clot or blockage, the heart must pump even harder and expend more energy to deliver blood to the body. Sometimes, this can be fatal to a human body (or to a business).

3. Your Customer Satisfaction can Take a Hit

When your system has data issues, your customers notice. This is a data issue that has several prime examples. Consider a returning customer shopping online on your e-commerce site. She wants to buy running shoes to break in for a 5k she is running at the end of the month. She can’t remember what size in your brand fits her, so she looks up her order history to see what size she ordered in the past. Using her name and email she attempts to recall her profile, but the ERP system has duplicate records for her.

Let’s say the customer remembers her size and is ready to order. She checks the inventory levels that your site displays because a quick delivery is a key factor in her buying decision. The product seems to be in stock, so she makes the purchase.

However, it turns out the inventory levels displayed on your site were incorrect because of bad data in your system – your customer will not get her order for another two weeks. If you put yourself in her shoes, would you be a repeat customer?

Once a customer loses trust in your system’s data integrity, it’s nearly impossible to get it back. Consumers today rely on social media and review sites to determine where to spend their money. Disgruntled customers are more than happy to share their unpleasant encounters with the world, preventing you from gaining new customers without even interacting with them.

Improving the customer experience is an important business benefit for many companies. However, some companies do not cleanse their customer-facing data before migration. We recommend discussing data with all departments, so you can understand the various data sources and entry procedures.

If your business hopes to improve the customer experience, you should outline this goal before ERP selection so you can align every component of the project around this goal, especially the data component. Our ERP implementation methodology focuses on organizational alignment as this ensures the ERP software (and its data) support the organization’s goals.

4. Your System can Become Corrupted

Invalid data can cause your ERP system to become corrupted. Whether the data is invalid from a user error or from an automated system update, bad data can wreak havoc on your ERP system and cause functionality to behave unexpectedly.

For example, let’s say your business captures physical dimensions for products in various units of measure. You sell milk in liters and cheese in kilograms. Your ERP system has two item groups – one for liquids and another for solids. If your products are mistakenly assigned to the wrong item group, your cheese could be sold in liters, costing you money by charging much less than the quantity provided is worth.

This single mistake of assigning the wrong item group can cause a chain of downstream issues. When goods are shipped, the system may prompt the user to capture the weight in liters. As a result, all customer- and vendor-facing documentation may display orders for cheese in liters, making it confusing and even a little embarrassing to correct your ERP system’s data mistake.

5. Business Users can Make Bad Decisions

Arguably, the biggest failure that data issues can cause is allowing users to make key business decisions based on bad data. When users believe the system is correct, they don’t hesitate to order ten dozen more corrugated boxes because the warehouse inventory says they have zero on hand.

With bad data being the foundation of user decisions, inventory can be depleted or inflated. The same check to a vendor could be cut twice or not at all, causing your account standing to be damaged. Customers on an “opted out” list could be accidentally emailed by your marketing department and your company could be the target of a lawsuit. While some of these examples sound dramatic, they can be a reality if your ERP system is receiving or pumping out bad data.

Along these lines, once your business users distrust the data in the system, they will forever second guess your ERP system’s accuracy. For example, if a human resources manager denies a pay increase request for an employee because the data in the system says there is no budget, the employee might leave the company. If the human resource manager finds out later that the budget was incorrect, he or she might lose trust in the system’s data integrity.

In some companies, users distrust the data so much that they do their own data validation before making a decision, like exporting data into Excel and doing their own data massaging. This extra step of data validation outside of the system can cause inefficiencies in business processes and lead to low benefits realization.

Our ERP consulting services focus on change management during the data migration process. Designating process owners and data owners not only increases system buy-in, but it improves data integrity as these “owners” are accountable for ensuring data cleanliness and reliability.

11 Data Migration Tips

1. Assign Responsibility for Data Cleansing

There is a general misconception that the IT team can handle all the data cleaning. While there is data cleansing software, these packages can only help identify potential areas to be cleansed.

Someone still needs to know, for example, out of two different address records for a company, which one is correct. Also, someone knowledgeable needs to verify that a closing balance is in fact correct.

In most cases, the person who should cleanse these records is not in the IT department but is within the specific department that owns these records. These are called data owners, and they are critical for establishing standards and guidelines to maintain quality data.

IT staff should assist data owners by identifying the data flow, integration points where the data is being updated and what data sources exist.

Examples of Data Needing Cleansing

  • Duplicate customer or supplier accounts
  • Master data that isn’t classified with a common taxonomy
  • Blank description fields for products
  • Old product codes no longer in use
  • Data for a customer that has gone out of business
  • Critical data in Excel that is not in your system of record

2. Remove Duplicate Data

Duplicate items can be identified in two main ways: 1) Direct duplicates include two or more items possessing the same manufacturer name, part number and description. 2) Fit-form-function duplicates include two or more items that possess different manufacturer names and part numbers but have the same fit, form and function.

3. Don’t Migrate All Your Data

Companies continue to persist in the idea that they can migrate all the data from the legacy system over to new ERP software, and the software will somehow magically scrub and standardize it. That’s just not the case.

If you’re moving to a new house, would you put trash and clutter in the moving truck? Probably not, so when you’re moving to a new ERP system, you don’t need to bring over every single piece of data. Some of this data is unclean, unnecessary or pure junk.

The more useless data you bring over, the harder time you will have finding the data you really need, which can delay go-live.

Companies tend to hoard data, believing that someone, somewhere down the line just might need that one nugget of information. An ERP project is a great opportunity to clean house.

4. Determine What Data to Migrate

This can depend on what industry you’re in and your forecasting needs. Determining what data is important should be a collaborate effort that involves all departments.

5. Determine Resource Requirements

You will need developers to convert data and data owners to review and cleanse data. In addition, you may need executives to review certain types of data. Most likely, this will include data elements that relate to the core of the organization’s culture. These may be items your organization has avoided because they seem too hard to address.

Other resources you may need include resources for change management and business process management as you likely will need to train employees on how to input, manage and analyze data once the new system is implemented.

6. Consider Industry Regulations

Different industries have different regulatory requirements. For example, some regulations restrict the ability to change and/or export certain kinds of data records, such as HIPAA with electronic medical records.

You should carefully consider your method of data cleansing (e.g., in-system vs. Excel) if your company has industry-specific regulatory requirements.

7. Consider the Data Complexities of Global Projects

In global ERP projects, you’ll encounter different systems speaking a variety of ERP languages layered on top of cultural and language differences. It is vital to identify these complexities early and communicate to your project team where you see the need for executive decisions. This will eliminate slow periods in the data conversion, allowing developers to stay engaged.

If your project is global, you also will need a signed document from the executive steering committee stating who is responsible for data at the global, regional and country level for both master and transactional data.

8. Define Taxonomies and Attributes

Most ERP systems use some sort of taxonomy to classify items. Master records must be classified correctly, completely and to a level of detail that makes the record easy to identify for search and reporting functions.

While it is not necessary to choose one particular taxonomy, it is necessary to have a taxonomy that supports your company’s business initiatives. Therefore, you should ensure your ERP consultant has experience with taxonomy selection and deployment.

Item record attributes play a similar important role. Attributes define the item and are important for successful parametric searches. Incomplete or incorrect attributes prevent items from being found, resulting in proliferation of parts and bloated inventories.

To ensure a successful ERP data migration project, we recommend extracting, normalizing and completing item attributes beforehand. Because of the sheer volume of attributes to be extracted and enriched, an automated approach is the only practical way to execute this.

9. Develop New Processes

Once the initial data cleansing is complete, you will have more data to cleanse – unless you ensure employees adopt new processes that enable data accuracy. Even though these processes may be designed for legacy systems that will soon be retired, these processes are still worth developing. Consider the fact that most ERP projects last years. Can you endure two more years of dirty data?

We recommend that companies redesign their business processes and train employees both for the future state and this interim state. Both business process reengineering and organizational change management play a critical role in maintaining data cleanliness.

10. Test Before Migrating

Discover if you’re on the right track with your data by moving data to test environments. This will be time consuming and typically requires the development of unique code. Don’t make the mistake of leaving it until the last minute.

11. Use Your Data to Make Business Decisions

With your data migrated, your new processes established and your employees on board, you can almost breathe a sigh of relief – but not quite yet. Now, you must figure out what to do with your data insights.

Companies that have their eye on realizing business benefits from their ERP systems tend to address this issue early with change management and business process management. Knowing that an ERP software solution will enable increased data visibility, forward-thinking companies take advantage of this benefit by establishing data analysis processes. These companies also spend time training employees on these new processes.


Data migration is not usually a priority at the beginning of an ERP project. Instead, the focus is often on planning and design, while data migration is a muddled topic that people tend to avoid.

When companies avoid or delay data migration, their new system will provide unreliable data leading to technical challenges, customer dissatisfaction, low system usage and low benefits realization.

While data migration and cleansing may add cost to an already expensive ERP project, the effort will pay for itself almost immediately through the identification of excess inventory, reduced equipment downtime and improved data insights.

Panorama’s ERP consultants can help your organization develop a data migration strategy that ensures your ERP software provides reliable data to all stakeholders from the minute it goes-live until it’s retired.

5 Tips for Prioritizing ERP Requirements

5 Tips for Prioritizing ERP Requirements

When your organization decides to implement a new ERP system, it can be an exciting time for employees. There is hope on the horizon that the tedious workarounds or functional gaps within the current system will be replaced with a better and more advanced system.

It’s likely that your employees started making wish lists as soon as you announced the ERP project. These wish lists will continue to grow until someone (likely project management) reminds the team of the project constraints.

Anyone experienced in organizational change management will tell you that excitement around a new ERP implementation is a key success factor in user adoption. While turning away employees’ wish lists due to budget or time limitations may dampen the excitement, you also must control project scope.

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So, how do you implement a new ERP solution while ensuring both project feasibility and employee engagement? The answer is prioritization of ERP requirements before ERP selection.

Prioritizing ERP software requirements may sound like a simple task, but when all parts of the business believe their functional requirements are the most important, you may find yourself in a stalemate. Luckily, there are several strategies you can use to help your team reach a consensus and ensure a successful ERP project:

1. Clarify the Project Goals and Scope

You may be familiar with the “project management triangle” or “triple constraint” where scope, time and cost are depicted on each corner of a triangle with quality in the center. Usually, before an ERP project has begun, all three of these constraints are already decided. While time and cost are easy to quantify as the project progresses, scope can run amok – especially when it comes to meeting business requirements.

It’s because of this scope ambiguity that project kick-offs are important. With all team members (business users, analysts, ERP consultants, stakeholders, etc.) present, you should clearly define the business objective of the project and identify items that are definitely out of scope.

The goal of your project could be as simple as moving off your legacy system due to end of support or as complex as overhauling your e-commerce experience to modernize your customer service. Whatever your goal, make certain that all team members understand it, as this will minimize the amount of non-critical business requirements that arise during ERP requirements gathering.

2. Define Baseline Business Processes

Identifying the business processes that will be impacted by the ERP project helps you define project scope. In addition to identifying these processes, your team should document them as they exist in the current system. This will help establish a list of minimum requirements needed to keep the business operating.

When documenting business processes, the ERP project team should focus on business needs and not confuse current system limitations with what is truly needed. This is not the time to define future state processes but just to listen to employees’ needs.

3. Improve Your Processes

If you need to increase efficiency, break down silos or achieve another important business benefit, then business process reengineering is your new best friend. We recommend conducting business process reengineering before considering standard ERP functionality. Why before? It’s because functional areas that bring competitive advantage – such as customer service or supply chain management – should not be standardized.

Once you’ve improved the processes that differentiate your company from competitors, you can begin looking at ERP functionality. This will help you determine how to improve processes that may need to be standardized. These might be processes related to finance or human resources.

While differentiated processes should not be standardized, this is not to say that standardized processes can’t bring competitive advantage. In fact, ERP vendors spend countless dollars and hours refining system capabilities to meet the most frequently asked for features to appeal to the widest customer base. Taking advantage of a process recommended for your industry can help you to stay competitive.

4. Perform a Fit Gap Analysis

Now that you’re looking at ERP functionality, you can perform a fit gap analysis. This helps you identify where a new system fits your company’s requirements and where it doesn’t. Basically, for each requirement gathered, you should determine if each ERP system on your long list can meet the requirement natively (fit) or requires a modification (gap).

Requirements that are considered “fits” and can easily be configured are usually no-brainers when it comes to priority. Fit requirements that involve some additional effort, like a data conversion for example, can also be prioritized as these are usually easy wins for the project team.

Gap requirements, however, should be put lower on the priority list. Having a long list of gaps makes prioritization challenging, so you may want to weed through the erp requirements list to determine if the system can support these requirements in a different way than anticipated.

If there are any remaining gaps, you can justify these gaps by conducting a cost analysis. Here are some questions to keep in mind when justifying gaps:

  • What is the business impact if this requirement is not met?
    • Additional labor requirements?
    • Dollars lost?
    • Customer satisfaction impact?
    • Compliance issues?
  • Will this impact the project timeline?
    • How many hours are required?
    • Does the project have the appropriate resources to complete the work?

Based on this analysis, a cost can be associated with each gap requirement to determine if it can remain as a lower priority.

5. Classify Business Requirements

Now that all valid requirements are on the table and the gaps have been justified, the project team can classify each requirement into one of three categories: must have, value added and nice to have.


Any requirement that falls into this bucket is mission critical. Classifying a requirement as a must-have, signifies that the business cannot operate without it.

The dollar amount determined during the cost analysis of this requirement should be subtracted from the project budget since it is assumed this requirement will be met. Continue to subtract from the overall budget as requirements fall into this category as seeing the dollar amount decrease will help the team keep perspective as to which requirements are really a priority.


Value-added requirements are not mission critical. However, requirements that fall into this category could greatly enhance the business.

For example, let’s say your project mission is to simply replace the legacy system with new ERP software. As such, you are not designing new business processes that don’t already exist in the current system. If the current system does not have the ability to send customers an email when their online order has shipped, then this requirement is not technically within the project scope and is not a must-have requirement.

Considering that email confirmations are pretty standard in the e-commerce industry, meeting this requirement could add a lot of value to your company if you operate within this industry. That’s why this is an example of a value-added requirement.


Requirements that are classified as nice-to-have are often addressed in a later phase of the project. These types of requirements are those that are neither mission critical nor add a great amount of value to the business.

For example, a business user might want the ability to request a report that identifies the amount of late deliveries per vendor. While this data is readily available in the system, the user wants a report that provides a summary view. This would be considered a nice-to-have requirement.

When classifying requirements, we recommend keeping the project budget, timeline and scope top of mind. Also, it’s important to ensure collaboration among all departments and stakeholders, so you have a well-rounded perspective on what the business should prioritize.

What ERP System Fits Your Company Best?

The only way to answer this question is to prioritize your business requirements. This calls for organizational alignment around project goals, a clearly defined scope and, more often than not, process improvement.

Panorama’s ERP consultants are experts in business process reengineering and software selection. We can help your company find an ERP software solution that meets your highest priority requirements as well as several value-added and nice-to-have requirements.  

How Much Does it Cost to Implement an ERP System?

How Much Does it Cost to Implement an ERP System?

If your company is beginning ERP selection, you’re probably thinking a lot about cost. How much does system A cost compared to others? Does this fit within our budget? As important as these questions are, they miss the bigger picture – the total cost of ownership. In other words, how much will the implementation cost in addition to the cost of the technology itself?

A company’s unrealistic expectations regarding total cost of ownership is often the first domino to fall in an ERP failure. This leads to failure because companies end up cutting corners on activities that are critical success factors.

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Inaccurately estimating ERP project costs is more common than you might think. In fact, ERP vendors typically outline a one-dimensional estimate of implementation costs. These estimates often fail to include hidden expenses, like internal resources, external consultants and hardware upgrades.

Further, a software vendor will usually estimate implementation costs to be a 1:1 ratio between software licenses and technical implementation costs. This technical implementation cost is woefully low for most companies.

So, why do vendors make such low estimates? Sometimes, sales reps are trying to lowball their estimates to get the deal closed. Other times, sales reps do not truly know the costs required to make an implementation successful.


Common ERP Project Costs

Below are some common project costs, beyond the cost of the software itself. We recommend carefully quantifying these costs before investing in ERP software, so you can accurately weigh ERP business benefits vs. costs.

While these are not all the costs associated with an ERP project, they are the ones that are most likely to be overlooked during the budgeting and planning process.

1. Change Management

Many companies assume that the ERP vendor or systems integrator will handle this, but many don’t. Those that do, still require involvement from your internal employees.

Training, for example, is one component of organization change management that requires internal resources. Vendors and systems integrators will typically train the internal core team on how to use the “vanilla” software, but rarely customize the training to reflect the company’s unique software configurations and customizations.

As a result, your internal ERP project team must take charge of training activities. Not only should they customize training materials for software configurations, but they also should customize them for employees’ unique business processes.

In addition, there are a host of other change management activities that the internal ERP project team should be responsible for, including communication planning, business readiness assessments and focus groups, to name a few.

2. Business Process Management

Enterprise resource planning software presents an opportunity to standardize your operations across multiple locations and redesign processes that need improvement. This requires internal time and resources.

Don’t assume that the software will provide all the answers on how to run your business. Instead, recruit an internal team to help design your future state.

3. Resources for Backfilling

This might include contract or other employees you hire to manage the day-to-day activities of project team members who are no longer able to commit to their usual jobs.

4. Hardware and Infrastructure Upgrades

It is rare that an organization can implement a modern ERP system without a modern IT infrastructure to support it. Servers, databases, bandwidth, PCs and other components of an organization’s IT infrastructure often need to be upgraded to support the new enterprise system.

In addition, IT staff often need to be augmented with additional resources, training or outside consulting to support the new environment.

These costs are significant. Many companies implement cloud based solutions to save money on resources and infrastructure.

5. Longer Than Planned Implementation Duration

Given the amount of resources, time and money dedicated to an ERP project, even the slightest delays will affect the budget. To avoid delays, be sure your project plan includes overlooked activities, like requirements gathering, system design, testing, ERP data migration and interface development.

How to Scope Your ERP Project

Your project scope directly influences your project budget. While many organizations scope their project based on number of modules or number of users, we recommend considering other factors, such as the scope of change required to achieve business goals and your employees’ level of change readiness.

Here are three tips to keep in mind when scoping your ERP project:

1. Account for the complexities of your business.

Is your business relatively simple, or is your business a complex set of business processes supporting a diverse line of products? Be sure to get an independent view of your organization’s complexity when planning your ERP implementation. In other words, seek input from someone besides the person selling you the software.

Many complex businesses need a full ERP software solution that addresses all of their functional areas (human resources, supply chain management, etc.). Less complex companies may be looking for a point solution to address one specific area, like customer relationship management.

2. Focus on people and processes.

Technical activities are rarely the cause of project scoping issues. Instead, the primary causes are related to business process reengineering and change management activities. For example, failing to improve your business processes before selection can lead to unexpected costs during implementation.

3. Benchmark against other organizations.

We have all heard the anecdotal stories about what to expect from ERP projects. However, these isolated examples are rarely indicative of what the average project looks like. We recommend looking at broad sampling of organizations similar to yours to gain an understanding of what your project costs may be.

For example, our 2019 ERP Report reveals that SMBs use an average of seven full-time internal resources, and large enterprises use an average of 24 full-time internal resources. This does not necessarily mean that these people were committed 100% to the project. While some organizations may have had seven people spending half their time on the project, other organizations may have had 14 people spending a quarter of their time on the project.  

How to Control Costs

There is a fine line between cutting costs to save money and undermining the success of an EPR project. Cuts to ERP budgets that look good on paper can have disastrous consequences in the long-term.

Here are a few tips to help you control project costs without cutting essential activities:

1. Set realistic expectations.

More often than not, ERP vendors and their system integrators mismanage expectations on what total costs will look like. This makes it difficult for your company to set realistic expectations. As a result, you may end up presenting an inaccurate business case to executives.

When you realize your mistake, you may find that executives aren’t willing to increase the budget. While you may still encounter executive resistance if you have realistic expectations upfront, this is much less painful than losing your job because you set unrealistic expectations that resulted in a botched implementation.

Our ERP selection methodology helps clients develop a realistic business case. A business case should be used for more than just convincing executives to approve the project. It should also be used to prevent budget overruns.

2. Detail each of the cost components.

Setting realistic expectations requires an understanding of all essential project costs. This includes the obvious costs as well as the hidden costs: hardware upgrades, maintenance, internal resources, external consulting support, customization and a host of other budgetary items that companies often overlook or underestimate.

If you’re not sure what costs to include, we recommend developing a project plan. When we help clients develop project plans, they typically avoid incurring unexpected costs.

Once you have identified all the major cost components, you can then benchmark these line items to actual costs for companies similar to yours. Our 2019 ERP Report can be a good starting point for setting realistic benchmarks.

3. Respect the “untouchables” of your ERP budget.

There are certain, critical elements of an ERP project that should never be considered for the chopping block. One example is organizational change management. On paper, it may appear that you could save millions of dollars by removing all change management activities from your project plan. However, this doesn’t reflect the financial impact of employee resistance, project delays and other common risks of neglecting change management.

On the flip side, you will want to identify the areas that you can remove from your budget if necessary. For example, customization is one area that many companies decide not to spend too much money on, and this usually has few, if any, consequences.

As a general rule, if you want your project to be successful, then your budget should reflect a heavier focus on the business aspects of the project rather than the technical aspects.

4. Take your time during ERP selection.

Too many companies rush into ERP as if the world is going to end without it, and they don’t take the time to clearly lay out their business requirements. We recommend involving employees in ERP requirements gathering sessions to ensure your potential ERP solution can support the most important processes from each functional area.

One of our recent clients saw significant cost savings during implementation by investing in a thorough selection process. The CFO of the organization commented that the investment in selection did not increase the total project budget because money that would have been spent later in the project was simply spent earlier.

5. Negotiate with ERP vendors.

Did you know vendors may give you a discount if you negotiate with them? It’s true!

However, this is easier said than done, so most companies that want to negotiate their ERP software contract, hire an expert. When we help clients negotiate with vendors, we provide a total cost of ownership analysis that helps clients compare software contracts. In addition, we typically conduct three to four rounds of negotiation to reduce licensing fees and implementation costs.

How Much Does ERP Implementation Cost?

If you want an accurate estimate for your project, be sure to accurately scope your project and account for some of the most overlooked costs. Panorama’s ERP consultants can help you set realistic expectations that won’t scare executives nor get you fired for causing budget overruns.

10 Communication Tools for Change Agents

10 Communication Tools for Change Agents

Although both organizational change management and innovative communication tools have been around for some time, many organizations don’t combine them. As a change agent, you can pick and choose which tools work best for you, and you can adjust them to suit the needs of your ERP implementation

First, let’s lay down some ground rules for what makes an effective communication tool for change management:

  1. The tool must help the people involved understand the change.
  2. The tool must minimize disruption without dismissing concerns.
  3. The tool must instill accountability and delivery clarity.
  4. The tool should be able to boost employee morale and drive involvement.
  5. The tool should captivate your audience and promote buy-in.

Ultimately, communications tools should help tackle common challenges of implementing new ERP software, such as resistance to change. Following are ten traditional and modern tools you can add to your change toolkit:

Traditional Communication Tools

Traditional communication formats cultivate trust with most employees as something is comforting about interacting on a non-digital level.

In fact, if you’re in the early stages of business transformation, traditional communication tools might be most effective tools you have.

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1. Bulletin Board

Put up a bulletin board where employees can post questions. Make it clear that questions will receive answers, and statements will be read and recorded.

Some companies issue different colored index cards or pins to identify which department a question comes from. This helps you provide more relevant answers.

2. Town Hall Meetings

Failing to communicate the project vision is one of the common struggles in an ERP project or business transformation. Hosting town hall meetings allows you to effectively communicate with employees at all levels of the organization.

During these meetings, clearly explain the project vision in a compelling manner. Several times throughout the meeting, open the floor to questions. If you make people wait until the end, you’ll lose them.

If employees express frustration during the meeting, offer to meet with these individuals face-to-face. This may come as a surprise to some employees – according to Forbes, less than a third of employees believe that there will be any changes based on their input.

When our clients conduct town hall meetings, they typically find that these meetings increase alignment among executives, the ERP project team and the change management team.

3. Playbooks

Playbooks help coaches guide their teams to victory, and they can help you too. Essentially, you’re telling your employees what changes are coming and how they can prepare.

The playbook should be high-level and easy to skim. It should include:

  • The project’s one-sentence goal
  • The vision statement
  • A list of the people and systems directly impacted
  • A list of the people and systems indirectly impacted
  • A list of new technology being implemented

4. One-on-one Meetings

When our consultants work with change agents, we help them develop elevator pitches appropriate for each stakeholder group. The elevator pitch can be used in one-on-one meetings to explain why the change is happening and what specifically is changing.

These meetings should occur at key milestones throughout the project. They should be two-way conversations that encourage employees to share feedback.

In our experience, one-on-one meetings can be more emotional than team meetings, so we typically help change agents develop key messaging to address various emotional responses.

Mobile Communication Tools

While you may have security concerns about mobile apps for the workplace, these apps are specifically designed with security in mind. Here a few you should consider if you want to improve your change communication:

5. Slack

Slack is well-known for its desktop software that works as a team communication hub. In Slack, you can create different boards for anything and everything.

You can tag people in conversations, nudge them and mark certain statements with a tag making them easy to find later. The nudge and tagging features can make a big difference when it comes to addressing key issues with employees.

6. Troop

Troop allows individual communication and can store the entire history of a conversation.

This app also allows you to set administrators or moderators for group chats, so you can allow teams to discuss the project but have their manager moderate the discussion.

Software Communication Tools

Innovative software usually doesn’t have too much pushback when you try to integrate it into your change program. Most of these tools are reasonably priced and require no training.

7. Calendly

It’s more of a service than a software solution, and the only person that has to do anything is you. Create an account, and then use your unique code to direct people to your calendar. If someone wants to schedule a meeting with you, they must select from one of your open time slots.

8. Gensuite

A software solution specifically for change management teams, Gensuite focuses on the impact of change. Teams can use Gensuite to plan and manage risk while working towards legal compliance.

The system is flexible and allows stakeholders to engage in different steps of the change plan. You can customize controls, restrict certain users and automate communication.

9. Redbooth

Redbooth uses a task system to restrict and direct communication. The goal with Redbooth is to restrict communication to that which is relevant to the task or project. Employees must sort, organize and tag moveable tasks to keep communication concise and avoid repetitive questions.

10. Blogin

One of the biggest struggles that change agents face is helping employees work through deep-set feelings of uncertainty. A lot of this uncertainty comes from not having access to information.

Blogin acts as an internal company blog where you can archive company knowledge. It allows staff and team members to share information, search through the information, make suggestions for additions and ask questions.

Blogin keeps information flowing without disrupting the project. It’s a great place to put meeting minutes, your change management playbook and more.

Which Tools Will Work Best for You?

Change agents know that each project requires a different approach, which is why it’s critical to have more than just a few tools on hand.

Panorama’s ERP consultants can help you build a change activation toolkit that incorporates some of the tools mentioned here and provides guidelines for developing messaging. We’ll help you proactively lead and inspire your employees to embrace change.