Most organizations implement new ERP software to improve their business capabilities and competencies. However, they don’t consider how they will build these internal competencies to be successful in the long term. Instead, they focus on technical aspects of their ERP implementations. An ERP center of excellence is the best way to build and sustain internal competencies. But, what exactly is a center of excellence, and how can you build one as part of your long-term IT strategy?
Here are five tips for building a 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 to 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 long-term needs. This requires a broad and cross-functional team that understands the software as well as the 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 that focus on strategic needs as well. Centers of excellence are especially effective when they look for ways to better support long-term operational objectives, such as better aligned business processes and benefits realization.
4. Use your center of excellence as a way to extend the life 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 current software can extend the useful lives of their 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 your ERP software. You’re probably not interested in doing another implementation sooner than necessary.
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 ownership of the software and business benefits, and build internal competencies sooner.
But don’t fear, if you’ve already completed a portion of your ERP initiative. It’s never too late to begin building internal competencies. The perspective of an independent consultant can help you build a center of excellence at any point in your project.