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“Wait…What Exactly is Business Process Management?”

Abstract Image of Business People's Silhouettes in a MeetingIt’s unlikely that someone would go on a long journey without first procuring a map and planning their route. People have an easy time visualizing a destination when planning their route but don’t understand the pitfalls that lie in the journey. Business process management is the roadmap to the destination of a successful ERP implementation.

Like all roadmaps, there are multiple routes to consider. Within an ERP implementation there are various levels of business process management to consider as you design your new system:

Business Process Management (BPM)Business process management is a holistic approach used to evaluate, improve and align business processes to an organization’s overall goals and strategy. It enables businesses to be more efficient and flexible to change.

Download our on-demand webinar, Business Process Reengineering: A Key Component of ERP ROI.

Business Process Improvement (BPI)There are a variety of approaches within business process management; the first being business process improvement. In this approach, it’s important to examine the key processes within an organization that are competitive differentiators. Six Sigma methodologies are used as a backbone to evaluate and improve key business processes. First, organizations identify the current state and primary key performance indicators to measure success. Next, organizations determine root cause, validate root cause and improve processes to optimize ultimate efficiency. Finally, organizations put a control plan in place to monitor the ongoing process and ensure checks are put in place to trigger appropriate responses if key metrics fall out of control.

Business Process Reengineering (BPR)Business process reengineering identifies the current process but requires a more radical change. It is used when current processes can’t be improved with minor changes but need to be redesigned from scratch, creating a new process from start to finish.

Business Process Optimization (BPO)Optimization looks at all of the existing processes within the business and seeks to improve them to reduce the company’s overall cost to produce. Before you place software atop a process, you want to ensure the process is operating at maximum efficiency, because when you automate an inefficient process, you only make an inefficient process faster. This is why BPM is so essential to an ERP implementation.

Today’s ERP systems are very flexible. There are multiple – sometimes even hundreds – of different ways ERP software may accommodate your business needs. Understanding your desired state prior to implementation activities will save time later in the process and reduce the risk of choosing the wrong configuration. It tells the ERP vendor how you want your processes designed so they can select the configuration that accurately aligns with those processes. It also gives you knowledge of what processes may require customization and an understanding of additional costs you may incur for it.

Choosing the right level of business process management is critical to designing a roadmap for your ERP implementation. Having a roadmap in place is a smart way to avoid the common pitfalls associated with getting lost along the way.

Written by January Paulk, Director of Organizational Change and Business Process Management Services at Panorama Consulting Solutions.

Is Your ERP Project as Innovative as You Think?

pointed fingerOrganizations implementing ERP software are ultimately looking to improve their business productivity and efficiency through innovative technology. To achieve this goal, organizations should ensure that organizational changes promote their long-term business strategy. Companies that are hoping to maximize business benefits from their new ERP software must rethink their business processes and continuous improvement strategies in order to achieve ERP success.

Business process management, coupled with continuous improvement, is imperative to any successful ERP implementation. In order for a business to thrive in a competitive marketplace, it must focus on process excellence, which ultimately leads to innovation. Business process management and continuous improvement create value across an organization by challenging the current state of the business and determining the efficiency of current state processes. When companies challenge the status quo, this will nurture continuous innovative thinking.

Watch our on-demand webinar, Tips for Selecting the Right ERP Software for Your Organization.

Managers must foster an environment where empowerment is given to all members of the organization before, during and after the ERP implementation. Supplemental education after the ERP go-live can create new thought processes and approaches since employees have already gained an understanding of the basic ‘block and tackle’ processes of the ERP system. They can subsequently challenge the status quo to seek business and process improvement.

An innovative organization involved in continuous improvement is agile and nimble. Such an organization is able to experiment with different solutions to a problem and can further understand business needs and industry opportunities presented through the agile learning process. Once the continuous improvement model is adopted, businesses can benefit from the outcome of performance improvement to fix short-term issues and develop a long-term strategy.

Continuous improvement must be adopted throughout an organization to achieve ERP success. If your organization adopts this philosophy and shifts its culture towards innovative thinking, you will increase your competitive advantage within your industry, leading to long-term success.

Finding Cost Savings Through Business Process Reengineering

When most executives think of ERP systems, they associate them with high costs. Their next thoughts are the risks involved in implementing new enterprise software, the potential of implementation failure, operational disruptions and a host of other things that make any rational person think long and hard before making such an investment.

When implemented effectively and correctly, ERP implementations can (and should) deliver cost savings. Business process reengineering typically yields costs savings ensuring a positive return on investment for your enterprise software initiative.

business process reengineering video still

Despite the allure of best practices, industry configured solutions and other ERP vendor sales hype, most enterprise initiatives don’t adequately focus on business process reengineering. Instead, business process design work is more typically relegated to “just changing our business processes to however the software works.” This traditionally flawed approach is a surefire path to implementation cost overrun and lack of benefits realization.

Instead, here are five steps to find cost savings through your business process reengineering efforts as part of your ERP implementation:

Step 1: Understand business process reengineering in the context of ERP systems. Today’s ERP systems are extremely robust and flexible. Even the simplest business processes have multiple workflow options and criteria that must be defined. If, on the other hand, you start your project without a clear vision of how you would like your business processes to look, you will either a) see your implementation costs skyrocket as the meter runs on the expensive technical consultants while you try to figure out your business processes, or b) you’ll end up deferring to the technical consultants to decide for you, which isn’t typically what’s best for your organization.

Step 2: Don’t treat all business processes equally. Not all of your business processes will require extensive reengineering. Focus on the ones that create competitive differentiators and help you service your customers in a unique way that is hard for others to replicate. For these areas, spend time defining how the processes should look in the new system – at least to the extent that you can without having the technical and functional knowledge of how specific screens within the system will look. For areas that are not of competitive advantage for your organization (think accounts payable), it is perfectly okay to defer to adopting the system’s basic functionality.

Boot Camp Pyramid Best Practices

Step 3: Define and quantify potential cost savings. Once you have mapped your to-be business processes, you must define where you think you could see cost savings and set cost improvement targets. A great place to begin is by looking at pain points of your current processes relative to the future state: those are typically hotbeds of inefficiency and potential cost reductions. Things like automation of manual processes, time spent looking for information in multiple systems and other current pain points will likely translate into potential efficiency gains. Take the time to quantify what those improvements may be and set benefits targets accordingly.

Step 4: Evaluate non-labor savings. In addition to labor-based gains that are often easier to see, be sure to also consider non-labor savings. For example, how much could you reduce inventory if you had better visibility into your supply chain and customer demand? How much could you reduce accounts receivable if you automated some of those processes? These non-labor cost savings are generally larger – and more tangible since most clients we work with don’t want to lay people off as a result of their ERP implementation – than labor-based benefits.

Step 5: Measure results and make incremental improvements. Few of your expected business benefits materialize if you fail to measure post-implementation results. Chances are that you will not achieve most of your expected cost savings right away. This is why you must understand how you compare to your targets and analyze the root causes of why you’re not yet achieving them. Common deterrents of cost savings include lack of employee understanding of the new processes and other basic issues that can be easily addressed through retraining and other means. Either way, ensure you are measuring, identifying root causes and implementing corrective action as part of your benefits realization efforts (learn more about ERP benefits realization best practices).

As you can see, even with as hefty of an investment as enterprise software is, you can truly find cost savings when you invest in the right software for your organization.

Learn more by registering for tomorrow’s webinar, Business Process Reengineering: A Key Component of ERP ROI.

When the CEO Says No to New ERP Software

pointed fingerYou know that your organization’s business processes are inefficient, but your boss just said “no” to your plea for new ERP software.  What do you do?

First, ask yourself, how did you propose the idea to your boss?  Was there a compelling vision for the system that is consistent with your organization’s vision? Did you speak in terms of business value? CEOs typically have a vision of how their organization should run, and this vision is based on business value. They may also have pressures from the board of directors or have private equity to meet financial objectives. ERP systems are expensive and implementations are disruptive. In order to make a commitment to a large project like ERP, you must show clear financial benefits.

Often, CEOs do not have a clear picture of exactly what obstacles prevent their organization from running efficiently. A CEO needs people who understand those details and yet have the ability to summarize information and create a compelling vision. Are you that person? If so, here are some suggestions on how to proceed:

1.   Understand Your Business. What differentiates your business in the marketplace? What drives customers to purchase services or products from your company instead of the competition?  What kind of changes could be made to your processes that could improve your company’s ability to compete? In order to make a compelling case for a new ERP system, you must quantify the benefits in economic terms.

2.   Understand the CEO. Learn the CEO’s vision and success drivers by reading or listening to statements made at company meetings, board reports or company vision statements. You can also learn from listening to the CEO’s reasons for rejecting the proposed ERP implementation. Find out how other initiatives have been presented to the CEO in the past, and consider these as lessons learned.

3.   Understand the Problems With the Current Systems. Some common problems include:

  • Users of the legacy systems complain that they have to manually re-enter data from one system to another
  • Inconsistency of data between systems
  • Lack of timely, accurate information
  • Many hours spent combining data from disparate systems in order to do analysis and reporting
  • Valuable information is not being collected or analyzed because the current system does not have the capability to manage the data.
  • Different locations or departments perform processes differently
  • Manual process steps are executed outside of the system because the current system does not support them.

4.   Seek Alliances From Other Functional Areas. Problems with systems and processes generally occur in multiple departments of an organization. Bright, business-oriented leaders throughout your organization may have similar frustrations as you do and have a vision for process improvements. Cross-functional teams within the business are good places to build relationships and discuss common problems that could be solved with a new ERP system.

5.   Create a Business Case. Employee complaints can be a good starting point for a business case. In order to generate a compelling case, you must quantify the projected customer service improvements, savings in labor hours and other potential benefits.

The tables below are a good way to get started in organizing this data:

 when your ceo says nooo

To complete the business case, you’ll need to project the savings overtime and compare it with the implementation costs of the ERP system.

6.   Seek Outside Help. If everything mentioned thus far has seemed a bit overwhelming when combined with your daily work load, you may not want to devote too much time to formalizing process issues. A business case also may not be possible for you to do alone. Specialized consulting firms can help with business process reengineering, building a business case and selecting an ERP system that fits your organization.

When the CEO says no to a new ERP system, don’t assume that the idea is dead. Think about your organization’s and consider ERP software a business tool, not just new technology. If the economic benefits are clear, you are likely to be successful in convincing your boss that a new ERP system is the right move.

Learn more by downloading Chapter One of An Expert’s Guide to ERP Success.

Written by Ed Spotts, Senior ERP Consultant at Panorama Consulting Solutions.

Surviving Stressful ERP Projects and Combating Fatigue

Group of Multiethnic Busy People Working in an OfficeYour ERP project is going great so far. You’ve selected a winning ERP system. Your project manager is exceptionally organized and has a structured timeline of deliverables that the team is quick to embrace. Everyone is on the same page and then . . . the inevitable happens. Everyone should have seen it coming – ERP project fatigue. If only ERP implementations were quick and painless, then no one would ever grow weary of business process management (BPM), organizational change management (OCM) or any other integral aspect of implementing an enterprise solution. Unfortunately, ERP implementations are anything but quick and project managers and core team members are only human. Although organizations should expect and anticipate the possibility of exhaustion, many organizations are simply not this proactive. Following are a few tips for combatting ERP project fatigue and reenergizing team members to achieve all the expected benefits of an ERP project:

  • Expect Fatigue – Keep in mind that energy usually wanes toward the middle of a project since team members forget their progress and only see the long road ahead. After the initial excitement of the project has worn off, emphasize the importance of looking at the big picture and of viewing the implementation in phases and concrete steps.
  • Assess Fatigue – Cultivating a strong relationship with team members is the best way to assess attitudes and opinions. Another way to encourage this kind of honest dialogue is to conduct focus groups and surveys and show how the feedback has influenced the direction of the project.
  • Acknowledge Fatigue – Never ignore the reality of a heavy, demanding schedule. Onerous workloads can intimidate even the most experienced team member. Also, never underestimate the value of recognition and encouragement. A little appreciation goes a long way when a team member is overwhelmed and worried about the future.
  • Combat Fatigue – Now it’s time to take action. Communicate your plan for combatting fatigue and, if necessary, adjust timelines and workloads. Role-sharing, task-rotation and team-building exercises are all great options for tackling the issues that potentially lead to reduced benefits realization and late delivery.

The earlier fatigue is addressed, the less likely it will affect the team’s performance. Be sure to visit our ERP Implementation page to learn how our independent ERP consultants provide direction to relieve the impact of stress and position your organization – and its people – for increased benefits and a high return on investment. Learn more by checking out our on-demand webinar, Business Process Reengineering: A Key Component of ERP ROI.

What is Business Process Management (and What Does it Have to do With ERP)?

Abstract Image of Business People's Silhouettes in a MeetingIt’s unlikely that someone would go on a long journey without first procuring a map and planning their route. People have an easy time visualizing a destination when planning their route but don’t understand the pitfalls that lie in the journey. Business process management is the roadmap to the destination of a successful ERP implementation. Like all roadmaps, there are multiple routes to consider.

Within an ERP implementation there are various levels of business process management to consider as you design your new system:

Business Process Management (BPM)Business process management is a holistic approach used to evaluate, improve and align business processes to an organization’s overall goals and strategy. It enables businesses to be more efficient and flexible to change.

Business Process Improvement (BPI)There are a variety of approaches within business process management; the first being business process improvement. In this approach, it’s important to examine the key processes within an organization that are competitive differentiators. Six Sigma methodologies are used as a backbone to evaluate and improve key business processes. First, organizations identify the current state and primary key performance indicators to measure success. Next, organizations determine root cause, validate root cause and improve processes to optimize ultimate efficiency. Finally, organizations put a control plan in place to monitor the ongoing process and ensure checks are put in place to trigger appropriate responses if key metrics fall out of control.

Business Process Reengineering (BPR)Business process reengineering identifies the current process but requires a more radical change. It is used when current processes can’t be improved with minor changes but need to be redesigned from scratch, creating a new process from start to finish.

Business Process Optimization (BPO)Optimization looks at all of the existing processes within the business and seeks to improve them to reduce the company’s overall cost to produce.

Before you place software atop a process, you want to ensure the process is operating at maximum efficiency, because when you automate an inefficient process, you only make an inefficient process faster. This is why BPM is so essential to an ERP implementation. Today’s ERP systems are very flexible. There are multiple – sometimes even hundreds – of different ways ERP software may accommodate your business needs. Understanding your desired state prior to implementation activities will save time later in the process and reduce the risk of choosing the wrong configuration. It tells the ERP vendor how you want your processes designed so they can select the configuration that accurately aligns with those processes. It also gives you knowledge of what processes may require customization and an understanding of additional costs you may incur for it.

Choosing the right level of business process management is critical to designing a roadmap for your ERP implementation. Having a roadmap in place is a smart way to avoid the common pitfalls associated with getting lost along the way.

Learn more by downloading our on-demand webinar, Business Process Reengineering: A Key Component of ERP ROI.

Written by January Paulk, Director of Organizational Change and Business Process Management Services at Panorama Consulting Solutions.

Linking Business Process Reengineering to Organizational (and ERP) Strategy

Group of Multiethnic Busy People Working in an OfficeWhat are some of your ERP goals? Are you striving for lower labor costs? Improved customer service? How about overall growth?

Whatever your company’s destination, well-designed business processes are the key to driving organizational strategy and achieving business goals during an ERP implementation.

If ERP success and improved organizational performance is your desired destination, then business process reengineering is the path to take. Business process reengineering involves translating business goals and strategies into tangible processes and value-driven process improvements. Your organization’s chosen ERP system should accommodate these “future state” business processes and bring your organization closer to achieving its goals.

To align business process reengineering with organizational strategy, organizations should begin by documenting and prioritizing their “current state” business processes. The level of importance of each process should be determined by evaluating its current level of efficiency and its potential degree of business impact. Beginning with the highest priority process or functional area, organizations should identify process inefficiencies, look for opportunities for improvement and, finally, decide what particular improvements support their business goals. During this stage, the focus is not on redesigning processes but on identifying high-level improvement targets that can help achieve business goals.

These improvement targets then guide the definition of “future state” business processes. During this stage, the implementation team should work with employees and executives to redesign processes that have the highest impact on business goals. Bringing the right mix of resources to the process definition team ensures that process changes are not only driven by business goals but also based on end-users’ experiential knowledge of what works and what doesn’t.

While focusing on high-level business goals is important, listening to end-users and employees creates value in itself and is a stepping stone to achieving overall business goals. This is why organizational change management and business process reengineering cannot be separated if your organization hopes to achieve business benefits and ERP success.

Business process reengineering should be value-driven. If your organization is not asking questions like, “What is our destination?” and “What business processes will help us get there?” then it will probably end up asking questions like, “Why is our ERP system not achieving business benefits?” and, worst of all, “Why did our ERP implementation fail?”

To learn more about business process reengineering, download our free, on-demand webinar, Business Process Reengineering: A Key Component of ERP ROI.

Know Your ERP Consultant

ERP systems are much more than just another application. The ERP system facilitates and directs the processes that are essential to conducting business and impacts the lives of the people who use it. With so much at stake, how do you find a trusted implementation partner to guide your team through a successful ERP implementation?

An organization confronted with this question might use Google to search for an ERP consulting firm, which would yield a long list of advisors trying to sell their services. With such an array of choices, you need to define specific criteria for evaluating a potential ERP consultant. Here are some questions you should ask:

  • What problems are driving my company to consider a new ERP system?
  • Do we have an executive sponsor for this ERP project?
  • Do we have a clear vision for the benefits that the ERP system will provide?

As the ERP landscape has evolved, the type of resources needed to select and implement ERP systems has also changed. Instead of using purely technical consultants who are experts in a specific technology or vendor, organizations can now engage ERP consultants who have expertise in organizational change management, business process reengineering and helping organizations achieve their goals. An ERP implementation is a business project, not a technology project.

Your ERP consultant should be able to work with your organization to gather business requirements, map processes and create efficiencies. They should also help your organization work through the issues that arise with new technology and a change in business processes.

ERP implementations consist of a complex web of non-technical challenges that can make or break your project. Following are six areas where your organization should partner with a trusted third-party:

  • Selecting an ERP system that supports the corporate vision
  • Creating a business case to help justify the implementation of a new ERP system
  • Identifying ways to streamline workflows through business process reengineering
  • Engaging end-users in requirements gathering and obtaining end-user buy-in to the project as a whole
  • Testing the ERP system before implementation to avoid post go-live issues
  • Training employees to use the new system and support system improvements

Bottom line: know your ERP consultant. While technical experts are required to implement an ERP system, business needs should drive your project. Ensure that your trusted implementation partner understands your business and has a proven track record of successful ERP implementations.

Learn more by downloading our white paper, Guide to Choosing an ERP Implementation Partner.

Written by Ed Spotts, Senior ERP Consultant at Panorama Consulting Solutions.

Three Tips for AVOIDING ERP Failure

All of us have participated in projects that have not gone as smoothly as we had hoped. Most of us will probably experience failed projects again in our lives because failure is part of the learning process both for individuals and organizations. However, not learning from mistakes and repeated patterns will cause projects to fail time and time again. Below are three ways to help ensure success in the future.

1. Have an accurate schedule that is upheld and/or modified as needed, within reason. Project architects should understand all of the moving parts involved in a project, who the key actors are and how long each task should take. Project architects should not be the random person in the office who is “volun-told” to make a schedule for a multi-million dollar project.

Even after a company invests in a project architect who builds a near-perfect schedule, it is up to the project manager to review all of the moving pieces to confirm that it is reasonable and executable at this moment in time. Maybe a key player is going on a three-month sabbatical; maybe there is a major holiday or business event or there may even be an anticipated lay off; all of these should be accounted for in the schedule.

Even after the schedule is “perfect” (at that moment in time), it needs to be followed, reviewed and revised on a regular basis. The project schedule is your blueprint to success.

2. The project triangle (time/scope/money) is a rule. The project triangle of time, scope and money constrains every project. If money is decreased, scope and time are decreased. If scope is increased, money and time increase. The project triangle shifts whenever a change occurs to any one of the three factors. This rule always applies , even to management.

If management wants to spend less money, they must be willing to make sacrifices, and those sacrifices must be articulated to re-calibrate expectations, which will also reset project success measurements. Having effective change management and contingency plans will help assuage these changes to the project triangle, but they will not alleviate all signs of change. Companies must be willing to accept these trade-offs.

3. Don’t be the project hero. Whenever a project is near failure, there is almost always someone who has had very passive participation in a project yet steps in at the eleventh hour to try and save the project.

Behind their backs, these people are called, “Project Heroes.” Project heroes, in effect, serve no purpose other than to annoy everyone who has been working diligently on a project for a very long time. Project heroes get in everyone’s way by demanding updates and asking questions that they would have had answers to had they been meaningfully participating in the project from the start.

Don’t be a project hero. Be the person who always shows up on time, has his homework done, can be relied upon and leads through example. Strong work ethic from management has tremendous flow-down results for employees.

Learn more by downloading our white paper, Ten Tips for a Successful ERP Implementation.

Written by Annalynn Evenstad, Associate General Counsel & Contracting Department Manager at Panorama Consulting Solutions.

 

Just How Innovative is Your ERP Consultant?

Group of Business People in Office BuildingInnovation as described by Rasmus Hansen and Jens Skibsted, “The new breed of innovation professionals can be placed in two categories: innovation custodians and innovation word-slingers. The custodians are middle managers assigned to oversee the innovators and their processes. The word-slingers are external consultants that will take corporate managers through endless innovation workshops or blabber on about the aforementioned processes.”

The truth about innovation is that it is usually accomplished by a hardheaded, single-minded visionary who bullies the world into accepting their innovative ideas. I think of the Wright Brothers and Thomas Edison. Innovation typically grows from the individual rather than a group or organization. Innovation is a difficult concept to teach or draw from most people.

So, how can an ERP consultant be innovative? How can he or she help a client nurture innovation within a government agency? The first requirement is an open mind. The second is a seasoned eye for weird ideas that can be translated to efficiencies and return on citizenship (ROC). Too often, consultants fall back on “best practices” that they have witnessed over the years. Just because it has always been done that way, does not necessarily mean it is the best way to accomplish a task. The QWERTY keyboard comes to mind. It was an important process for manual typewriters to keep typists from having jammed keys, but try and have your organization stop using the QWERTY keyboard and it will reveal the challenges of innovation.

Don’t give up yet. There is always a clever operator or end-user who has a great idea that they are bursting to share it with someone. An innovative consultant will listen to the idea, sort the fly dung from the pepper and frame it in such a way that stakeholders, particularly management, will accept it.

An ERP implementation is a great venue for innovation. The organization has already admitted that it needs some assistance with its processes and actions. It is open to suggestions and the innovative consultant (not the “innovation consultant”) can be the catalyst for success. An innovative consultant will seek out and shepherd those great ideas and translate them into a positive change.

Every organization can reinforce good ideas, promote changes to the status quo and nurture innovation wherever it grows. That defines an innovative ERP consultant.

Learn more by checking out our on-demand webinar, The Importance of Independent Verification and Validation and Project Management Oversight.

Written by Rich Farrell, Senior Account Executive at Panorama Consulting Solutions.

How to Answer Your Boss’ Top 5 Questions About ERP System ROI

Business people working at the officeWe have all heard the phrase “there is no ‘I’ in team.” That phrase has meaning not only in a personal manner, but also in your professional life—especially reigning true when you’re trying to implement a new ERP system. Selecting and implementing a new ERP is a team effort. Generally speaking, most of our clients involve multiple team members, stakeholders and executives in the decision, planning and implementation process.

However, none of that effort matters if your boss isn’t on board with the new investment. Whether you are an IT Manager trying to convince your CEO and CFO, a project team member trying to convince your IT Director, or you are involved in any other role with a superior, executive buy-in and involvement will be critical to your project’s success.

We commonly hear five questions from our clients’ management and executive teams. Here is a quick guide on how to answer each:

  1. “Why do we need to invest in a new ERP system now?” There is never a good time to invest the time and resources in a new system, but implementations generally get riskier over time. The longer we wait, the more our broken and inefficient business processes will cost us. Just as importantly, our implementation will become more complicated, risky and expensive the longer we wait to replace our current environment. Also, the sort of change to our business that we are talking about here is going to take a good deal of time, so it is better to start sooner – before we find ourselves in even more of a bind later. 
  1. “Why is our new ERP system going to be so expensive and why is it going to take so long to implement?” ERP implementations are business transformations, not just IT projects. According to research (see Panorama’s 2015 ERP Report for more detail), the average company takes roughly 18 months to implement their solution. They also spend approximately 4% of their annual revenue on their total cost of ownership. Based on where we fall on the spectrum relative to the “average” company in the study, we may spend more or less than that, but that is a general benchmark to gauge reality. Doing this project right the first time will be much less costly and time consuming than the alternative.
  1. “What are the biggest obstacles to achieving a solid return on our ERP system?” There are plenty of risks to achieving the ROI we expect, but we can mitigate these risks through proper implementation best practices. For example, taking the time to document our desired future state business processes, effectively addressing employee resistance to change through organizational change management and developing a solid benefits realization plan with target levels of performance will all optimize the odds of achieving our goals. We also need to ensure that we have the right ERP consultants helping us with this initative to further mitigate risk.
  1. “Why do we need to worry about documenting our business processes?” This is a good question that is commonly asked by executives. Many think that we should ignore current processes because they are all about to change, or that we should simply adopt the new ERP system’s business processes rather than documenting our own, but these approaches are proven not to not work very well. In order for us to understand what kind of software will work best for us, we need to clearly define our desired processes and business requirements. Today’s ERP systems are very robust and flexible, so we need to define how we want our processes to look so we can effectively configure and implement the system. This approach to business process reengineering will ultimately make our implementation more efficient and effective – saving us considerable time, money and heartache along the way.
  1. “Why do we need to worry about organizational change management when we are going to simply tell employees that they need to accept these changes?” You’re right that one approach is to simply “force” employees to change. However, that only goes so far. Employees may not consciously or actively intend to resist the changes, but because the changes are going to be so extreme for most employees, they simply won’t be able to comprehend and adapt to the changes without effective organizational change management. This is why our organizational change management plan needs to include more than basic end-user training – we also need to incorporate communications, change impact discussions, customization of training materials and a host of other organizational change activities to ensure we minimize costs and maximize the return on our investment.

While there is no E-R-P in T-E-A-M, they go hand in hand. While there may not be a guarantee or silver bullet for managing your ERP project’s ROI, the above responses should help your superior feel more comfortable about investing in your ERP initiative the right way.

Learn more by registering for our ERP Boot Camp in Denver on February 17-19.

The Secret Life of an ERP Expert Witness

iStock_000046211272_FullOver the last several years, I have been fortunate enough to be hired as an ERP expert witness in over a dozen high profile cases. While it is unfortunate that there have been so many well-known failures in the market – many that you have probably read about in the media – it is fortunate in that I have been able to have a front-row seat to some of the most widely publicized ERP failures in recent memory.

Since the courts order an extremely high degree of confidentiality in each of these cases, I am not able to discuss or share specific details of any of the situations and corresponding facts that I have observed. However, I have found that there are a number of common threads and patterns across the various cases. These patterns can serve as extremely valuable lessons for organizations about to embark on an ERP implementation of their own.

Below are a few of the most common lessons from my experience as an ERP expert witness:

Most ERP failures could have been avoided. When you read about any of the cases that we have been retained for, you would think that it was a disastrous anomaly created by some kind of evil, external force. Surprisingly, this is typically not the case. Instead, implementing organizations and their ERP consultants more often contribute to failure through a series of poor decisions, unrealistic expectations and too much focus on the wrong activities. For example, instead of focusing on critical organizational change management and business process reengineering activities, failing parties myopically focus on the technical aspects of the implementation.

ERP failures occur regardless of the ERP software being implemented. The media is more likely to cover failures and lawsuits related to SAP and Oracle, simply because their clients are more likely to be the high profile, Fortune 500 types. However, when we have looked for patterns among publicized failures across various ERP vendors, we have not been able to find any meaningful correlation between software implemented and failure rate. In other words, your project is just as likely to fail whether you are implementing SAP, Oracle, Microsoft Dynamics or any other software solution. Rather than pointing to your specific software solution to determine your likelihood of success or failure, it is more effective to look at the way that your software is being implemented.

Most failures can be traced back to unrealistic expectations. In each of the expert witness reports and testimonies that I have provided in these cases, I identified unrealistic expectations early in the project as a root cause of many problems later on. Beginning a project with unrealistically low time, money and resources leads to a series of bad decisions and cut corners – and those decisions are what lead to failure. For example, when operating under a severely compressed timeframe, project managers are more likely to cut organizational change management, training, testing and other key activities that are likely to make or break the implementation. When reviewing proposals from your software vendors or system integrators, it is critical that you question assumptions and add a dose of reality before staking your career on them.

I don’t know that ERP implementations will ever have a zero probability of failure, but our expert witness experience has helped us learn enough to create an ERP implementation framework and approach that gets our clients as close to zero as possible. By looking to the mistakes of others, we can all plan and execute our projects in a way that make us more likely to succeed.

Learn more by registering for our upcoming webinar, Confessions of an SAP Expert Witness.

What Exactly is Business Process Management?

Abstract Image of Business People's Silhouettes in a MeetingIt’s unlikely that someone would go on a long journey without first procuring a map and planning their route. People have an easy time visualizing a destination when planning their route but don’t understand the pitfalls that lie in the journey. Business process management is the roadmap to the destination of a successful ERP implementation. Like all roadmaps, there are multiple routes to consider. Within an ERP implementation there are various levels of business process management to consider as you design your new system:

Business Process Management (BPM)Business process management is a holistic approach used to evaluate, improve and align business processes to an organization’s overall goals and strategy. It enables businesses to be more efficient and flexible to change.

Business Process Improvement (BPI)There are a variety of approaches within business process management; the first being business process improvement. In this approach, it’s important to examine the key processes within an organization that are competitive differentiators. Six Sigma methodologies are used as a backbone to evaluate and improve key business processes. First, organizations identify the current state and primary key performance indicators to measure success. Next, organizations determine root cause, validate root cause and improve processes to optimize ultimate efficiency. Finally, organizations put a control plan in place to monitor the ongoing process and ensure checks are put in place to trigger appropriate responses if key metrics fall out of control.

Business Process Reengineering (BPR)Business process reengineering identifies the current process but requires a more radical change. It is used when current processes can’t be improved with minor changes but need to be redesigned from scratch, creating a new process from start to finish.

Business Process Optimization (BPO)Optimization looks at all of the existing processes within the business and seeks to improve them to reduce the company’s overall cost to produce. Before you place software atop a process, you want to ensure the process is operating at maximum efficiency, because when you automate an inefficient process, you only make an inefficient process faster. This is why BPM is so essential to an ERP implementation.

Today’s ERP systems are very flexible. There are multiple – sometimes even hundreds – of different ways ERP software may accommodate your business needs. Understanding your desired state prior to implementation activities will save time later in the process and reduce the risk of choosing the wrong configuration. It tells the ERP vendor how you want your processes designed so they can select the configuration that accurately aligns with those processes. It also gives you knowledge of what processes may require customization and an understanding of additional costs you may incur for it. Choosing the right level of business process management is critical to designing a roadmap for your ERP implementation.

Having a roadmap in place is a smart way to avoid the common pitfalls associated with getting lost along the way. Learn more about what business process management really is by listening to our on-demand webinar, Business Process Reengineering: A Key Component of ERP ROI.

Written by January Paulk, Director of Organizational Change and Business Process Management Services at Panorama Consulting Solutions.

Five Common (and Inaccurate) Myths of ERP Systems

Group of Business People in Office BuildingDon’t believe all of the hype. Mismanaged expectations and misinformation shared during sales cycles for ERP systems are major reasons why so many implementations fail.

Unfortunately, buyers of new ERP systems often rely on faulty information when making their purchasing decisions. These multi-million dollar investments can be risky at best when flawed assumptions underlie those decisions.

The good news? Educated buyers that go into their ERP implementations with their eyes wide open are much more likely to succeed than those that don’t. Being an educated buyer means being able to delineate between fact and fiction surrounding ERP systems.

Here are 5 common – yet inaccurate – myths that you should be aware of before investing too much in your new ERP initiative:

ERP implementations can be quick and inexpensive. ERP vendors and their sales reps love to sell the concept of quick and easy implementations. We’re all looking for that silver bullet or “easy button” that we can use to make our implementations easy, but these myths don’t exist – at least not yet. Be leery of terms like “implementation accelerators,” “out of the box functionality,” and “pre-configured solutions.” Things like these may have slight benefits, but they are typically not material enough to make a significant difference. The business transformation portion of your implementation will always be the most difficult aspect of your project, and no implementation tool can automate those activities.

No one is implementing on-premise ERP systems anymore. Industry analysts – many of whom are paid by upstart cloud and SaaS ERP vendors – have been calling for the demise of the on-premise model for several years now. According to both our experience and research outlined in our 2015 ERP Report, while SaaS solutions are gaining traction, a majority of new ERP implementations still leverage the on-premise model. This could change as CIOs and other executives become more educated and comfortable with the perceived risks of the cloud, but for now, plenty of organizations are still more comfortable with owning and managing their ERP systems within their four walls.

Your ERP system will drive your business process improvements. Too many organizations fall prey to the tendency to want to believe that their new ERP system will tell them how to reengineer and define their new business processes. Today’s ERP systems are far too sophisticated, robust and flexible to define your business processes for you. No matter what, workflows still need to be defined and software needs to be configured, so it is important to remember that new ERP software is no surrogate for engaging in critical business process management activities as part of your implementation. Here again, resist the temptation to believe that industry pre-configurations and out-of-the-box functionality will define your processes, because they won’t.

Organizational change management isn’t always necessary. Too often, we hear comments like “we’re not that complicated” or “our employees are excited for the change” as justifications for why organizational change management isn’t important to certain implementations. However, I have yet to see an implementation succeed without it. In fact, in each and every one of our ERP expert witness and project recovery engagements, organizational change management was a key contributor to the failure. It may be tempting to think that everyone is on board with the new initiative – and they very well may be, on the surface – but each and every organization needs organizational change management to make their ERP initiatives successful. And organizational change entails much more than end-user training. Learn more about what an effective organizational change management program looks like.

We can implement without any customization. Most executives are afraid to even think about customization, and rightfully so. However, our 2015 ERP Report shows that 91% of organizations end up doing some sort of customization during implementation. Of the 9% that manage to implement vanilla, out-of-the-box functionality, most are small upstart organizations without much complexity or sophisticated business processes. So unless you are a very small organization with very little complexity, chances are pretty high that you will need to customize your ERP system to meet your business needs and competitive differentiators.

There are plenty of things you’ll need to know before embarking on your ERP implementation, but these five myths are the most likely to derail your efforts. Sort through the fiction and stick to the facts to make sure your project is a success.

Learn more by downloading our 2015 ERP Report.

Top 10 Predictions for the ERP Industry in 2016

ERP-HistoryThe last year in the ERP industry has been an exciting one, with plenty of advances, changes and opportunities for improvement. As another year winds down and we prepare for the holidays, it is helpful to look ahead at what we think will be in store for the next year.

We may not be able to predict the future with 100% certainty, but there are a number of existing and emerging industry trends that will affect potential ERP buyers and implementers in the next year. Below are our top 10 predictions for the ERP industry in 2016:

 

1. Classification of Tier I ERP system will become obsolete. Although the systems themselves may not become obsolete, the definition of and difference between Tier I, Tier II and Tier III ERP systems certainly will. There are simply too many options and sophisticated technologies in the market to think that the big 3 incumbents (SAP, Oracle and Microsoft Dynamics) are the only packages capable of addressing the needs of large, upper mid-market and high-growth organizations. Even the biggest and most complex organizations have a multitude of options at their disposal. Our classification of Infor as the new Tier I system earlier this year was the first domino to fall in the demise of this dated and arbitrary classification scheme.

2. Increasing adoption of ERP systems among small and mid-size organizations. Up until recently, larger enterprises had a big technological advantage over their small and mid-size rivals. However, new SaaS ERP software and mobile technologies are becoming more cost-effective and easier to deploy, which is causing the smaller and mid-market to catch up to their Fortune 500 counterparts. Gone are the days where a company needs millions of dollars to deploy new enterprise technologies, which will make ERP systems, CRM software and other business technologies accessible to most.

3. Cloud ERP becomes a non-issue. The buzz behind cloud ERP systems is finally starting to die down – largely because most ERP vendors and third-party hosting providers have provided plenty of affordable options for companies wanting to migrate to the cloud. Research and data outlined in our 2015 ERP Report suggests that this trend will continue for the foreseeable future, but the big difference is that it will become a normal and accepted part of most ERP systems rather than a trendy buzzword hyped by industry analysts. The question is no longer about whether or not the cloud trend will continue, but it is instead about which organizations will move in this direction and which ones won’t.

4. High-profile ERP lawsuits expose the causes of ERP failures. Our ERP expert witness practice is growing like gangbusters, which is a reflection of the state of ERP implementations. Too many are failing and getting mired in lawsuits, many of which are very high profile and will expose the industry’s shortcomings. The parties and issues involved in these lawsuits are likely to underscore the reasons why ERP implementations fail, and more importantly, what can and should be done to avoid them.

5. Increasing gap between ERP implementation success and failure. ERP failures do not appear to be dissipating anytime soon. On the other hand, there are still plenty of success stories out there. The difference between the two extremes, however, will continue to become more apparent. The successful ones will do all the right things – effective project management, business process reengineering and effective organizational change management for example – while the failures will continue to ignore or underinvest in those areas. The differing results between these two groups will be even more extreme.

6. ERP project recovery becomes a hot skill set. As ERP failures continue to accelerate, those that can recover troubled ERP implementations to get them back on track will be in high demand – perhaps even more so than traditional project managers. It requires a unique skill set that can get to the root cause of what is causing the failure, which is why our project recovery services are in such high demand at the moment. Add to the fact that ERP failures are not likely to slow anytime soon, and it’s easy to see why these skills and toolsets are so hot right now.

7. Best of breed makes a comeback. For the last several years, single ERP systems with very little integration to other third-party systems have been the name of the game for most organizations. However, the increasing ubiquity of Salesforce, Workday and other functionally-focused enterprise systems has provided viable alternatives for companies looking for solutions that aren’t trying to be everything to everyone. Look for these best of breed solutions to take an increasing share of the market from incumbent ERP vendors.

8. SOA and technology integration becomes cool again. I’m not sure how cool it ever was – and there are certainly plenty of organizations that have been burned by trying to integrate a hodgepodge of ERP systems – but there are plenty of tools that are making this a feasible option for many. Given the rise of best of breed systems (see prediction #7), integration-related skillsets and toolsets are becoming important to a growing number of organizations and IT departments.

9. Customization becomes more accepted by the mainstream. For as long as I’ve been in the ERP industry, the word “customization” has terrified CFOs, CIOs and other executives. As outlined in our 2015 ERP Report, 9 out of 10 ERP implementations require some sort of customization in order to meet business needs, suggesting that this is a hard risk to hide from. Current ERP systems are making this concern a more acceptable and less risky form of implementation. It’s a slippery slope for certain, but one that can be managed in small doses.

10. Techies begin regaining control of ERP implementations. The previous three predictions are in many ways shifting the balance of power back toward the technical types and away from business stakeholders. Technical complexity typically increases dependence on IT and creates the risk of underemphasizing the business transformation aspect of ERP implementations and other enterprise software initiatives. This is not a welcome trend by any means since it escalates the risk of failure and runs counter to the fact that ERP implementations are more successful when treated as business transformations, but it is the reality of the current technological landscape outlined above.

The ERP industry is constantly changing, so understanding the dynamics at play are important in helping navigate and prepare for success. The above trends are the 10 biggest things to keep in mind as you prepare for your ERP implementation in the new year.

Download our 2018 ERP Report.

Panorama’s ERP Boot Camp: You Don’t Even Have to Cut Your Hair

I remember my first boot camp. At the end of it I could knock out 100 pushups in two minutes and turn my shoes into black mirrors, but there is not much need for that in corporate America. Panorama’s ERP Boot Camp, on the other hand, is exactly what you need in the corporate world, and you don’t even have to cut your hair.

ERP Boot Camp, December 9-11 in Anaheim, CA, shows you how to make tough decisions about your organization’s future: Do we need to implement a new ERP system? What ERP system should we implement? Below is a handy guide outlining what you will learn at Panorama’s ERP Boot Camp:

1.  Business process reengineering. Be exposed to all the successes and failures of past ERP implementations, and understand how business process reengineering played a role in the outcome. Panorama will provide several case studies from a variety of industry verticals of projects that went exceedingly well and projects that were train wrecks.

2.  Only the facts. We pride ourselves on our independence, and we are not beholden to any ERP system or firm. We give both sides to every story and provide an impartial and critical review of the different aspects of selection, implementation, project management and other key issues.

3.  We omit nothing. We discuss the technical, organizational and human-side of ERP projects, including selection, implementation, organizational change management and business process reengineering.

4.  Organizational change management. We will tell you why it is important, who should do it, how to do it and where all the friction will come from. It may surprise you.

5.  Ask questions, challenge the experts and throw donuts at the speakers. No question is a bad question and nothing is off limits except a human sacrifice, at least in Denver and parts of El Paso County.

6.  Meet industry experts and vendors for personalized counseling and advice. Ask them the hard questions during their presentations or one-on-one. They will give you insightful and candid advice that is hard won from hundreds of implementations.

Panorama will put on a good spread so that you will be well nourished mentally, physically and maybe emotionally during the sessions. I always cry during the technical fit analysis.

So there it is; why you need to go to ERP Boot Camp, cut your hair and stop listening to rock music . . .  oh wait wrong boot camp. Panorama’s ERP Boot Camp will give you the skills without the ills of an off-track ERP implementation. So come to Boot Camp, get your questions answered, learn the correct questions to ask and meet the experts. Register by November 18th for an Early Bird Discount.

Five Tricks to Ensuring the Treat of a Non-Spooky ERP Implementation

Abstract Image of Business People's Silhouettes in a MeetingWhen it comes to implementing new ERP software, it’s hard to know what to expect and you never know when a guy in a Michael Myers mask is going to come around the corner with a chainsaw (you never know if and when your ERP project could go completely off its projected course). Most executives worry about not realizing the potential benefits of their ERP implementation. When executives make an investment, they expect to get that investment back in the form of increased efficiency and ROI.

According to our 2015 ERP Report, most ERP implementations fail because they cost more than expected or take more time than expected. Also, the majority of projects fail to deliver the expected business benefits. This is where it is nice to have the pros take over. They can show you the tips and tricks to ensure that your ERP implementation is a success.

Here are a few tips to ensure maximum benefits realization from your ERP software:

  1. It’s okay to shoot for the stars. Rather than operating out of fear – whether it be fear of the project failing or fear of losing your job – try aiming for something even higher, such as delivering a set of business processes and related ERP functionality that will take your business to the next level. This mentality can and should affect every aspect of the project, such as where you focus your time and resources, how to bridge the gap between new technology and your employees and other critical mindsets that will ultimately make your project more successful.
  2. Put your focus on your people, not your technology. Don’t get caught up in the technological aspects of the implementation. ERP vendors invest billions of dollars per year in R&D to make the cool bells and whistles even cooler, but at the end of the day, the success (or failure) of your project won’t have anything to do with these technical features. Instead, it will come down to how well you handle business process reengineering and organizational change management – the two most important success factors for any ERP implementation.
  3. Don’t underestimate the cost, time and effort required for your ERP implementation. While it is important to not become too focused on implementation time and duration, you also have to remember that you will never achieve your expected business benefits and ROI if you don’t make it through your ERP project alive. When developing your project plan, don’t take your ERP vendors’ proposed project plans and estimated costs at face value. Instead, benchmark to other organizations, get someone – other than the vendor – to estimate your project’s time and cost and develop a plan and budget that makes sense for your organization. Setting realistic expectations early is the first step toward a ROI-driven and successful ERP implementation.
  4. Understand where the finish line really is. Just as marathon runners know that they are in for a 26-mile haul versus a 400-meter sprint, successful ERP implementers know where the finish line really is. Most organizations go into their ERP implementations with the expectation that they are going to implement everything that their new ERP systems have to offer. However, due to inadequate and misestimated time, budget and resources, most organizations end up quitting the race early and never realizing that expected functionality.
  5. Focus on the long-term alignment between your business and your new ERP system. To take point #4 one step further, successful organizations don’t ever really “end” their ERP implementations. Instead, they focus on ensuring alignment as their businesses evolves over time. The organizations that don’t institute this depth of focus end up experiencing misalignment between their business operations and technology – ultimately leading to a premature need to replace their systems. One of the ways we help our clients create this actionable philosophy within their organizations is to implement an ERP center of excellence that focuses on continuously improving and keeping their ERP systems aligned over time.

For more tips for ERP success, download our white paper, Ten Tips for a Successful ERP Implementation.

 

YouTube: How to Perform Business Process Mapping

One of the benefits of business process reengineering is the opportunity to improve inefficient processes that are costing your organization money. Mapping key business processes helps your organization identify exactly how processes should be improved to measurably streamline operations.

Watch this webinar clip for a high-level overview of how to perform business process mapping for your organization.

The full webinar is available here: Business Process Reengineering: A Key Component of ERP ROI.

For more YouTube videos and webinar clips, visit our YouTube Channel.

Seven Ways to Minimize ERP Software Customization

Seven Ways to Minimize ERP Software Customization

Customization is one of the biggest risks in any ERP implementation. While it may not be realistic to expect a “zero customization” implementation, here are seven things you and your team can do to limit ERP customization:

Expect that your project will require some customization. Expecting to implement ERP software with zero customization is the first mistake many organizations made. This expectation leads to underinvesting time, money and resources in your project – not to mention it creates a great deal of stress for the project team – so it is important to accept the fact that it is highly likely that you will need to customize to some degree.

Choose the right ERP software. Although some customization is highly likely, choosing the right ERP software is one way to minimize this need. Simply put, software that fits your business and its operational needs will require much less customization than software that is not a good fit. Be sure to take your time and invest in a thorough ERP selection process.

Don’t simply pave the cowpaths. If your project team is focused more on automating current processes rather than leveraging the potential functionality of your new system, then you are very likely to run into a high customization type of scenario. Chances are that your new ERP system is going to require customization to meet your business as it exists today, so it is important to look at your future state business processes rather than dwelling too much on your current processes as part of your business process reengineering efforts.

Establish the right project governance and controls for your implementation. Even the right ERP software can lead to high customization without the right controls in place. When developing your project plan and charter, it is important to establish the process and approval mechanisms for reviewing and approving customization. Such requests should not be approved unless there is a compelling business reason to do so. It should be expected that more customization requests will be denied than will be approved.

Invest heavily in organizational change management. Few people correlate organizational change management with customization, but they are directly related. The reason? Organizational resistance typically leads to more customization, and the desire for less customization leads to more organizational resistance. In other words, if you don’t invest enough in organizational change management, the odds of over-customizing your software increases exponentially. A well-planned and executed change management plan, on the other hand, will help mitigate this risk immensely.

Leverage ERP software configuration tools. Some project team members may not understand the difference between configuration and customization, so it is important for them to understand that customization of the software’s source code isn’t the only option when trying to tailor the software for your needs. Most ERP vendors provide fairly robust configuration and personalization tools that allow you to change the software to fit your needs without changing the code. Looking for ways to make less invasive changes to your system is a good way to minimize the need for customization.

Don’t force your ERP system to be everything to everyone. Unfortunately, no ERP system – no matter how strong – can fit every need of your entire organization. This means that there is going to be a natural tension between what your organization needs and what your ERP system can perform. This makes it of vital importance to recognize when and where it is appropriate to leverage your new ERP system versus leveraging a third-party bolt on. Each option has its own costs, risks and benefits, so it is important to take an objective and technology-agnostic view of those tradeoffs.

Bottom line: customization isn’t necessarily a bad thing, unless you pursue too much of it. Minimizing customization and focusing on business processes that are critical to preserving your competitive advantage will ensure you have a higher likelihood of success.

Schedule a Free 30-minute Consultation with an ERP Project Management Expert!

What is Business Process Management?

Abstract Image of Business People's Silhouettes in a MeetingIt’s unlikely that someone would go on a long journey without first procuring a map and planning their route. People have an easy time visualizing a destination when planning their route but don’t understand the pitfalls that lie in the journey. Business process management is the roadmap to the destination of a successful ERP implementation. Like all roadmaps, there are multiple routes to consider.

Within an ERP implementation there are various levels of business process management to consider as you design your new system:

Business Process Management (BPM)Business process management is a holistic approach used to evaluate, improve and align business processes to an organization’s overall goals and strategy. It enables businesses to be more efficient and flexible to change.

Business Process Improvement (BPI)There are a variety of approaches within business process management; the first being business process improvement. In this approach, it’s important to examine the key processes within an organization that are competitive differentiators. Six Sigma methodologies are used as a backbone to evaluate and improve key business processes. First, organizations identify the current state and primary key performance indicators to measure success. Next, organizations determine root cause, validate root cause and improve processes to optimize ultimate efficiency. Finally, organizations put a control plan in place to monitor the ongoing process and ensure checks are put in place to trigger appropriate responses if key metrics fall out of control.

Business Process Reengineering (BPR)Business process reengineering identifies the current process but requires a more radical change. It is used when current processes can’t be improved with minor changes but need to be redesigned from scratch, creating a new process from start to finish.

Business Process Optimization (BPO)Optimization looks at all of the existing processes within the business and seeks to improve them to reduce the company’s overall cost to produce.

Before you place software atop a process, you want to ensure the process is operating at maximum efficiency, because when you automate an inefficient process, you only make an inefficient process faster. This is why BPM is so essential to an ERP implementation. Today’s ERP systems are very flexible. There are multiple – sometimes even hundreds – of different ways ERP software may accommodate your business needs. Understanding your desired state prior to implementation activities will save time later in the process and reduce the risk of choosing the wrong configuration. It tells the ERP vendor how you want your processes designed so they can select the configuration that accurately aligns with those processes. It also gives you knowledge of what processes may require customization and an understanding of additional costs you may incur for it.

Choosing the right level of business process management is critical to designing a roadmap for your ERP implementation. Having a roadmap in place is a smart way to avoid the common pitfalls associated with getting lost along the way.

Learn more about what business process management really is by listening to our on-demand webinar, Business Process Reengineering: A Key Component of ERP ROI.

Written by January Paulk, Director of Organizational Change and Business Process Management Services at Panorama Consulting Solutions.