Enterprise Resource Planning (ERP) implementations are monumental undertakings that can transform the way organisations operate. They should result in increased efficiency, improved processes, and better decision-making capabilities. Yet, they are not without their challenges. In this article, we would like to share some valuable lessons learned from our decades of experience as an independent ERP consultancy.
1. Robust Planning is Non-Negotiable
Perhaps the most critical lesson is the importance of robust planning. ERP implementations involve a myriad of moving parts, from software selection to data migration, system configuration, and end-user training. Creating a detailed project plan with well-defined goals and milestones is paramount. But note that doesn’t mean just creating a nice plan at the outset to tick the box then forget about it – the plan should be a true reflection at any point in time of where the project actually is and what actually needs to be done. The trick is getting the right level of detail to make it fit for purpose.
2. Change Management is Crucial
ERP implementations introduce significant changes to an organisation’s workflows and processes – and therefore the people. Employees need to adapt to new ways of working and taking them on this change journey is often the hardest aspect of the project. Effective change management, including clear communication, training, and support, is key to ensuring a smooth transition.
3. Selecting the Right ERP System is Vital
The choice of ERP system can make or break the implementation project. Careful consideration of the organisation’s unique business needs, scalability, and compatibility with both the vendor and the system is crucial. This needs to be at a detailed level up front to ensure business requirements are translated to system requirements for the assessment and fit to be done well. Conduct thorough vendor and solution evaluations and consider long-term support and roadmap.
4. Data Migration Requires Precision
ERP systems integrate data from various business functions, providing a single source of truth for decision-making. C-suite executives can access comprehensive and integrated data that enables them to gain insights into various aspects of the business, such as customer behaviour, market trends, product performance, and more. ERP software also provides robust analytics capabilities, such as data visualisation, predictive analytics, and trend analysis, empowering C-suite executives to make data-driven decisions to manage growth effectively.
5. Customisation vs Configuration vs Out-of-the-Box Solutions
These days most ERP implementations will start with the objective to have a vanilla, out the box solution approach – and rightly so. However, there is still sometimes the need for unavoidable customisations to align the ERP if there are unique business processes and requirements. But it should be undertaken with much caution, and only as a last resort. Most modern ERP systems can be tailored and configured to a high degree without actually being customised. Consider this capability in your ERP selection process. Excessive customisation can lead to high costs, extended timelines, and increased maintenance challenges.
6. Testing: Early and Often
Thorough testing throughout the implementation process is crucial. Identify issues early and address them promptly. This reduces the risk of problems arising after the system goes live. But also the earlier in the project they can be identified and fixed the less the impact on overall budget and timelines.
7. Contingency for Delays and Budget Adjustments
ERP implementations are complex business change projects to undertake. Be prepared for unforeseen delays and budget adjustments. It’s better to build in contingencies from the outset and be able to re-plan to and absorb the changes.
8. Data Security and Compliance are Paramount
ERP implementation doesn’t end when the system goes live. The bedding in period is critical so ensure it is properly resourced. Ongoing support, maintenance, and user training are vital for long-term success. Be ready to address issues, optimise processes, and adapt to evolving business needs. Don’t fall in to the trap of standing down the project team too early.
9. Post-Implementation Support is Essential
Protecting sensitive data and ensuring compliance with regulations is a must. Robust security measures and data governance protocols are essential components of ERP implementation
10. Continuous Improvement is the End Goal
The ERP system is a tool for continuous improvement. Encourage a culture of ongoing assessment and optimisation. Set out your project plan and timeline with an optimisation stage built in and planned for from the outset – set those expectations with steering and stakeholders. The optimisation stage is often where the bulk of the tangible business benefits and ROI are delivered. Regularly review processes and functionalities to extract the full value of your ERP system.
Conclusion
In the world of ERP implementations, challenges are inevitable, but so are opportunities for growth and improvement. These lessons learned come from our first hand experience as an independent ERP consultancy and provide valuable insights for organisations embarking on their ERP journey. The key is to remain agile, learn from each phase, and continuously adapt to make the most of this transformative process.