How do I implement an ERP System?

Enterprise Resource Planning (ERP) was initially targeted at manufacturing concerns, but these days the term can encompass any product that can be produced or used across an enterprise. A soundly implemented ERP system can lead to breaking down of horizontal organizational structure and replacing it with a heavily integrated structure where strategy, business processes, organization and technology fuses almost seamlessly.

At the implementation stage, it is assumed that you appreciate the Critical Success Factors (CFSs) which must be considered during the selection system. One must also have considered the benchmarks to be used to measure progress or lack of it. Measuring success in a transparent manner can motivate staff and it helps to keep the project on course and geared towards the CSFs. Involving the staff in an ERP implementation is critical for success as they are the ones who will end up using it. It will diminish the resistance to change, which is inherent in human beings.

Here are a few steps that can contribute to a successful implementation.

Implementation team

The management can put together a small implementation team that is picked among the best representatives from each department. The individuals chosen should have intense knowledge of the processes in their departments and be reform minded. The implementation team should be answerable to a steering committee that on its part consists of a group of executives that have the responsibility of seeing the project succeed. The steering committee will also be responsible for making sure that the project is on schedule and that the objectives of the project are being met and that any stumbling block is removed.

Documenting of Processes in all Areas

The team responsible for implementing should then start documenting the critical areas that are intended to be covered by the ERP system. This should be accompanied by a thorough appraisal of the weaknesses of each area. The input of the other members of staff can be of importance in this respect.

Roll out the ERP System

The implementation team should work out an implementation plan preferably using a project-planning tool. Some efforts should be directed at ensuring that the data transferred is pure, and that no data is lost during the transition stage. The implementation team should create a change management process for transforming the business processes, create an acceptable methodology for approving and testing and develop a system for training the staff.

Some of the problems that have dogged many ERP projects in the past during the implementation stage include underestimating the costs of the system. Many managers do not appreciate that ERP is a process oriented program, and lack of process documentation leads to delays and rising costs. Some even go ahead and implement budget cuts for ERP implementation. This creates imbalances in one aspect or the other. For instance, poorly trained staff is unlikely to avail the institution the full benefits of the ERP system. Avoid customization of the system if you do not have a substantial budget for it. Also use a phased approach in implementing to avoid “shock and awe” effects.

For more information on ERP read What is Enterprise Resource Planning or ERP?

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