Most organizations don’t implement new ERP software for the technology. Instead, they are implementing to improve their business capabilities and competencies. However, most organizations don’t think enough about how they will build these internal competencies to be successful in the long term. Instead, they focus on technical aspects of their ERP transformations. An ERP Center of Excellence is the best way to build these internal capabilities. But, what exactly is a center of excellence and how can you build one as part of your longer-term ERP strategies?
Here are five things to keep in mind as you build your internal center of excellence:
1. Define the scope of your center of excellence
Every ERP center of excellence has different purposes, depending on the needs of the organization. Some are focused on extending the usage of software, while others might focus on continuously improving business processes. Still others might focus on ensuring master data is effectively managed. Whatever the purpose of your center of excellence, it is important you clearly define its scope and purpose as a starting point.
2. Define the roles and responsibilities required for your center of excellence
Just as you’ll want to define the scope, you’ll also want to define the roles, responsibilities and skills required to develop your internal center of excellence. These roles and skills will typically constitute a combination of functional, technical, software, support and business needs, along with short-term and longer-term needs. This requires a broad and cross-functional team understanding the software well, as well as the internal goals and objectives of the organization.
3. Focus on long-term, strategic needs – not just short-term support needs
Some see a center of excellence simply as a glorified IT help desk or support mechanism. The best centers, however, are those that don’t just focus on short-term support needs, but those focusing on more strategic needs as well. In particular, centers of excellence are especially effective when they look for ways to better support long-term strategic and operational objectives, such as better aligned business processes and benefits realization.
4. Use your center of excellence as a way to extend the lifecycle of your ERP software
Many organizations are forced to prematurely choose new ERP software due to misalignment between their operational needs and software capabilities. In many cases, simple upgrades or better use of their software can extend the useful lives of their ERP systems (think: advanced software modules and capabilities such as advanced planning or predictive analytics). A primary goal of your center of excellence should be to extend the lifecycle of and improve the alignment with your ERP software. After all, you’re probably not interested in doing another implementation sooner than you need to.
5. Don’t wait until after go-live to build your center of excellence
Since centers of excellence make organizations more self-sufficient and less reliant on external consultants, you should ideally start building one before your implementation is even completed. This will allow you to take better ownership of the software and the business benefits afforded by that technology, as well as to build those internal competencies sooner. This will enable you to accelerate the ERP implementation and post-implementation business benefits as well.
But don’t fear, if you’ve already completed a portion of your ERP initiative, it’s never too late to begin building these internal competencies. In addition, the perspective of an independent consultant will add value to you project in relation to building your center of excellence.