We recently kicked off a multi-site ERP implementation for one of our large aerospace and defense clients. Given the fact that, according to our 2012 ERP Report, most ERP implementations take longer than expected, cost more than expected, and fail to deliver the expected business benefits, our team knows that the planning process is critical to making the project succeed.
This particular client, for whom we had also conducted an ERP software selection process for two of its key sites, is an interesting case study in how to properly plan for an effective implementation. The company possesses a number of complexities and variables that make a solid implementation planning process extremely important.
For example, this client has close to 20 independently operated locations across North America, many of which were acquired from other companies. In addition, it is owned by a larger parent company, has differing business processes across locations, and has some unique organizational change management challenges. Each of these complexities adds a potential wrinkle to the implementation and can make creating an effective implementation strategy and plan more difficult.
In order to address these and other implementation complexities, we embarked on a six-week implementation planning process, beginning with a three-day planning kick-off meeting attended by team members from all locations and culminating in the joint development of a detailed implementation strategy, plan and budget. Below are some of the lessons and areas of focus from this particular client, which are applicable in:
- SAP implementations
- Oracle E-Business Suite implementations
- Microsoft Dynamics implementations
- Tier II ERP implementations
Most of these lessons are not unique to this particular company, but instead represent best practices that can and should be implemented by any implementation:
Define and improve standardized business processes. After the excitement for a new ERP system builds, it is tempting to jump right in and start implementing without stopping to think first. It is important to define which business processes will be standardized and improved across business units and locations, versus those that will be localized to fit individual needs. A clear business process strategy and business blueprint is a prerequisite to accurately defining an implementation scope, plan and budget.
Create a solid organizational change management strategy and plan. Large, high-growth, multi-national, and acquisition-minded organizations are the most likely to feel the pain of organizational change management challenges, so an effective change strategy and plan is critical. A plan addressing things like organizational readiness, organizational change impact, and customized training development and deployment is critical to the success of the implementation project. In addition, effective organizational change management focuses on tailoring training and communication materials to specific business needs rather than leveraging canned and less relevant materials.
Focus on benefits realization. One of my pet peeves of ERP implementations is the “we’re implementing a new system because we have to” mentality. Although this perceived need may be the straw that broke the camel’s back and precipitated the ERP initiative in the first place, companies literally leave millions of dollars of wasted business benefits on the table when they don’t have a clear plan for benefits realization. Even if the project is already justified and approved, a business case, ROI analysis, and benefits realization plan will be critical to your success, and these related activities should be incorporated into the overall implementation plan.
Carefully create a thorough ERP implementation plan. It may sound like a no-brainer, but having a clear plan in place before software configuration, testing, training, and deployment is critical. And we’re not talking a boilerplate PowerPoint GAANT chart, we talking a full-blown implementation plan that includes the technical, business process, and organizational change management activities required to make projects successful. Most ERP vendors and system integrators focus on the technical and software aspects of an implementation, so it is important to develop a comprehensive and complete plan that includes all the necessary best practices to make the implementation succeed.
Whether embarking on an SAP, Oracle or Microsoft Dynamics implementation – or a project related to a Tier II ERP system like Infor, Epicor or IFS – these concepts are critical in the implementation planning process. We’ve learned over the years and validated with our research that most implementations begin succeeding or failing in the implementation planning stage of the project, so these best practices are critical to success and a key reason why most ERP consultants, vendors and system integrators don’t succeed.
Click through to learn more about our ERP implementation services and PERFECT Path ERP implementation methodology or contact us at 720-515-1377 to discover how Panorama can help your organization plan for ERP success.