“Mr.Subbu, how will you ensure that the ERP Implementation is a success?” Fred asked.
Subbu was sitting in the office of Fred who was the CIO of ABC Inc. that was in the process of implementing ERP. Subbu was an employee of the implementation partner SI Inc. His company had projected him as the project manager for the impending ERP Implementation Project. Joe, the production manager with ABC Inc., accompanied Fred and they were in the process of assessing Subbu’s suitability for the role. Joe will be managing the project from the customer side and he would be Subbu’s counterpart in the project.
“First of all it is very important to define the word success as it relates to ERP Implementation. Success means different things to different stakeholders. As CIO, Fred will define success as an On-time, On-budget implementation. Your CEO will define it as quick RoI and payback. Joe here would be very happy if his key processes are configured and his users start adopting ERP from day one. The Project Sponsor, your company CFO, will be happy if he gets all his critical reports on time to report to shareholders. I as a Project Manager would define success as developing my team and creating collaterals and getting high level of satisfaction rating from you.”
“As you can see, these different definitions of success make it a challenge and any challenge is an opportunity for me and my team to showcase our skills”
“But these expectations are not mutually exclusive” said Joe, “Just because I want quick adoption doesn’t mean that the project cannot deliver quick ROI. In fact quicker user adoption will lead to quicker ROI, correct?”
“Well, yes and no. ERP Adoption is one of the criteria for measuring ERP Success, However, the deliverables required for quick user adoption, like training and great manuals, may be different from those that get you quick RoI like increased sales and reduction in costs. In fact, as a PM, this reconciliation of expectations from different stakeholders will be one of the first tasks that I do”.
“Let us assume that we define ERP Implementation success as ‘Improved User Adoption’, how will you go about it?” Fred asked.
“An ERP implementation is successful if you focus on the end goal and do various small tasks well. There are six stages in an ERP implementation. If you do tasks associated with each stage well, you have a successful ERP Implementation,” Subbu said
“What are the six stages?” Joe asked. CEO had hinted at ample rewards and recognition on successful completion of the project. He was very keen to learn.
“The six stages are Preparation, Planning, Design, Testing, Training and Stabilization.”
“Preparation phase for this project has started already, identifying key resources from SI to lead the project is a key task in this phase and that is why you are interviewing me” Subbu continued, “this is the phase where your company is getting ready to implement ERP. You have chosen my company SI Inc. as your partner after verifying that we have expertise in implementing ERP for your industry.”
“In preparation phase you plan for Organizational Change Management. If not done already, you must create a new PMO to manage your project and adequately staff it with competent resources. You must have created new positions like ‘Project Quality Admin” and identified the right resources and would have provided them sympathetic support to handle the new responsibility.”
“Another key task in the Preparation stage is to clearly define your AS IS processes and reporting requirements. If you have not already done so, I would suggest you recruit a third-parry consultant to do this task. It is worth its weight in gold. In fact, the process of documenting the current processes will give you an insight into the inefficiencies plaguing the company”
“Data conversion will be the most important challenge you will face in the implementation. By now, my company should have shared the data migration template with you. Start preparing the data as per the template in the preparation stage itself”
“The planning stage comes next. This is the stage where you identify the project team. Ensure that the team prioritizes ERP implementation. Ensure that the implementation team is fully dedicated to the project. The other tasks in this phase are risk identification and having a clear internal communication plan”
“Third phase is the design phase. From this phase, the ownership shifts to the implementation consultants. The key task here is to identify the 20% of requirements that has 80% impact on the Organization. Consultant should provide multiple solutions, at least three, to each such requirement and let the customer choose the best solution. The main benefit of this approach is to get customer involved early in the project solutioning. That will always ensure that the project is successful.”
“There are some factors to be considered in testing phase. One is to ensure that you always test in data as close to real data as possible. Another aspect is to test the standard application processes early in the cycle using test data. Do a few sample transactions. This will help identify product bugs early. Other aspects in testing are, regression testing where you test the complete process flow, exception testing, where you manually create and test for errors and exceptions and finally neat documentation of test results”
“Testing should be complete. It should test the complete process including country localizations and budgeting and accounting impact and ensure to verify the outputs with the system generated reports” Subbu paused to take a sip of water.
“All these are common sense ideas” Joe said.
“You would be surprised how many projects miss these points. There was a case where after Go Live, the ERP System was printing payslips for ‘Test_Employee’ in the production system. Many of these common sense controls were violated” Subbu replied.
“The biggest mistake that companies do in Training phase is to scrimp on training budget. By the time training is due, the project will be under a lot of pressure and there is a tendency to rush through with training. We must understand that this is the phase where many users get their first exposure to ERP. Hence it is important to not tighten training budget or time.”
“That is the first thing. Other aspects for successful training include using real data, using innovative modes like audio, video and Wiki and using Adult Learning Techniques. While training, demonstrate as many reports as possible.”
“We come to the final phase, the stabilization phase. It covers hypercare and ongoing support activities. Here the ownership shifts to the customer. The immediate focus is to close hypercare successfully. This is where you iron out the initial teething problems. Ensure to update and close the project documentation. In parallel, identify the support team and support process. Ensure to have empathetic consultants supporting the application. Ensure to have a robust support framework including consultants and technology. Make sure that the key users, who were a part of implementation are transitioned to drive the support activities, at least in the first six months.”
“Ensure regular refresher trainings for the support team. That is very important”
“Let me conclude” said Subbu, “An ERP implementation project is a tango between the Customer and SI. There are some rules to be followed like regular communication between the partners. They say well begun is half done. In ERP Implementation it means understanding your critical requirements, selecting a product that meets those requirements and having an experienced implementation team that follows a structured and rigorous process.”
“As a PM, I follow this approach very rigorously. So to answer your question, this is how I will ensure that this implementation is a success” Subbu looked at Fred and Joe.
“Lets us go to cafeteria for a cuppa”, said Fred. His eyes glowed with satisfaction
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