It takes money to make money. Sometimes you have to invest slightly more in order to get the biggest pay out. Six Sigma is widely recognized as an important tool in business process reengineering initiatives, but the toolset is not always associated with effective ERP implementations. However, our experience shows that a disciplined Six Sigma methodology greatly enhances ERP benefits realization.
Not only can Six Sigma help keep your implementation project on track along the way, but it can also enhance the benefits realized from your technology investments. Here are some of the key ways that Six Sigma increases ERP benefits realization:
Six Sigma supports a broader business transformation beyond ERP software. The most successful ERP software initiatives are those that are managed more as business transformations rather than technology initiatives. By beginning an ERP implementation with clearly defined and well-designed business processes – a hallmark of Six Sigma initiatives – your organization is making a conscious decision to let your business drive your ERP software rather than the other way around. In addition, Six Sigma will help ensure that you don’t simply automate your current processes, but that you instead reengineer your business processes in a way that will be more effective and efficient in the future. Your implementation is destined to become much more successful than those that focus entirely on the technical and functional aspects of the project.
Six Sigma provides the performance measures required for any successful change initiative. It’s widely known that if you don’t measure it, you won’t achieve it. Unfortunately, too many organizations neglect to define the specific performance measures and metrics that will be used to drive and manage business benefits moving forward. Six Sigma methodologies call for well-defined performance measures, which most ERP implementations can benefit from. When creating your business case early in your initiative it is vital to also define how those potential benefits translate into more granular and actionable performance measures. Only then can you connect the dots between your business case justification and the more specific ways that individuals and workgroups contribute to expected business benefits.
Six Sigma makes for a faster and cheaper ERP implementation. It may sound counterintuitive, but baking Six Sigma concepts into your project will actually make your ERP implementation faster and cheaper. Having clearly defined business processes up front avoids much of the ambiguity, inefficiency and ineffectiveness common in most ERP implementations. Too often, organizations think that their chosen software will drive business process changes – a very flawed and costly assumption. Today’s software is too flexible and robust to assume that it will tell you how to run your business. You must tell your software how it needs to support your business needs and requirements.
Six Sigma enables effective organizational change management. Not much helps enable organizational change management, training and employee communications as much as the tangible business processes and performance measures afforded by Six Sigma tools. Well-engineered business processes, thorough process documentation and clear performance metrics all help drive adoption and accountability. In addition, these factors are important inputs into key organizational change deliverables such as training manuals, employee communications and other key organizational change management tools critical to employee acceptance of the new system. Only through effective employee acceptance and adoption can you expect your ERP implementation to deliver tangible business benefits.
Six Sigma can save your organization money by increasing benefits realization. If you are investing in ERP, do it right the first time. Learn more about Six Sigma by registering for tomorrow’s webinar, Six Sigma Quick Hits.