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Whether you’ve been through an ERP implementation before or it’s your flagship voyage, planning and executing this enormous project successfully will always be a complex feat. An experienced ERP implementation partner can make a world of difference in how well you navigate that complexity – and how many overtime hours you put in to make it happen.
That’s because implementation partners have pretty much seen it all. They know that mistakes and shortcomings in an ERP implementation can often be traced back to the planning phase, and what goes into a successful implementation.
“The truth is in the middle,” says Sandy Williams, Executive Leader, Client Experience Strategy at Enavate. “A failed ERP Implementation is not necessarily the partner’s fault, and it is not the client’s fault; it’s the alignment of expectations.”
ERP implementations often demand more of businesses than they expect. A partner contributes all they can, but the majority of preparation will come from your internal knowledge and your own team’s efforts. Many small businesses find that the biggest challenge is making the time and commitment to implement the ERP with smaller staffs and fewer resources.
At Enavate, our team has executed hundreds of successful ERP implementations. To help you start off on the right foot, we put together some of our top recommendations for ERP implementation best practices.
Put together a team of leaders and managers from all relevant departments. Your all-star task force that can best represent the challenges of the company and how all processes weave through each department.
An ERP implementation affects your entire organization. The team leading this effort is critical to ensuring you’re making decisions that work for everyone and solve for your actual challenges. With their input, you can fully vet what you need internally, as opposed to only looking at the implementation from one or two points of view.
“Looking at the whole picture and having buy-in from team members who are going to be implementing within is critically important,” Williams says. “If an operations manager decides they want a new system to better facilitate warehouse management, but they haven’t involved finance, accounting or customer service, that team hasn’t gotten buy-in.”
Your team will make determinations about your software, implementation partner, priorities along the timeline, project milestones and post-implementation needs. Your team will also be critical throughout an ERP implementation to ensure success, helping their own departments manage their expectations and productivity during the process and training them to understand how to use the system to its full potential.
Having a project team will help plan strategically, set realistic goals, understand the scope and budget involved, and cover all your bases.
Departments that may need representation on an ERP project team include:
Evaluate existing processes in each department and function of your business and consider whether technology alone will do the trick.
A new ERP won’t be as effective in improving operations if you don’t also improve inefficient processes. Oftentimes, as organizations assess their processes in the planning phase, they discover that there are process challenges that would persist regardless of new technology. Addressing these challenges prior to a new ERP system will only make the new system more effective.
Organizations also discover exactly where they do need a technology solution to enable process improvement. And they learn which existing processes can’t be replicated in the new system in a way that’s optimal. It’s important to identify those situations ahead of time so you can truly map needs to solutions.
It’s helpful to source feedback and insight from all employees, as well as stakeholders and customers, to understand whether or not existing processes work.
The project team and implementation partner should work together to define your business drivers and ERP project goals according to your challenges, process issues and functionality wish list.
You know you need a new ERP system, especially if your current system is draining your budget and hampering your progress. But what problems are you trying to solve? And how can you dream bigger with your implementation? The less clear you are on your business drivers, the more challenging your ERP implementation is likely to be.
Examples of common major business drivers include enabling growth, allowing for scalability and improving upon inefficiencies in current business processes (such as too much manual work done outside of the system). Any business project – especially one so consequential as an ERP implementation – should include clearly defined goals and metrics for measuring ERP performance.
When you define your needs and wants, and when you consider the project’s holistic impact on your business, you will get more out of your implementation. You are more likely to end up with the system and configuration you need to compete and grow. Best yet, when you have a plan on how to measure your success, you can easily see the impacts on your business post ERP implementation and back that success up with data.
Make sure the ERP system you choose meets your business requirements and will help you reach and exceed your goals.
Though core functionalities such as financials are typically straightforward, not all ERP systems are made the same or are ideal for all industries. And there are additional functionalities and applications you can integrate as part of your implementation. You don’t want to miss out on the functionalities you need to be successful. And you don’t want to find out after implementation that your new system doesn’t integrate with existing software and applications you rely on and cannot phase out.
Up to this point, your project team will have mapped out goals, processes, priorities and budget. Use these to determine which capabilities the company needs (and which it doesn’t). The cross-functional project team will bring insights from their departments, such as whether finance needs specific support for regulatory compliance, or the analytics team needs improved dashboards for reporting.
Also consider the industry-specific functionality you need to succeed in your business. For example, process manufacturers need an ERP with a strong process manufacturing functionality, such as Microsoft Dynamics Business Central or Microsoft Dynamics Finance and Supply Chain Management. And nonprofits have nuances around fund accounting and grant management. Further, the sports and entertainment industry have specific requirements for managing revenue recognition.
Work with your partner early in the process to understand your needs, identify the right solutions and determine if there are any gaps to fill. A partner with experience implementing ERPs for your industry will be able to identify which are actual gaps and which were simply workarounds you had to use due to your aged and/or disparate systems.
Understand what workflows and data need to be migrated and what configurations or customizations might be necessary to achieve that.
Data migration is one of the most pivotal steps in the implementation process. Work with your implementation partner to map out the exact journey of your data. This journey includes data cleansing ahead of migration, protection during migration, and management and security after the migration journey. Will you migrate your data manually or with automated tools? How much responsibility will your partner carry throughout?
Also, understand that “the data part” takes a lot of time. And the older and more disparate your systems are, the more complex you can expect your data journey to be – especially if you’re already running with a lean team strapped for time.
Moving to a new ERP system is your opportunity for a fresh start. You don’t want to be carrying over unnecessary, cluttered and inaccurate data. But the responsibility of identifying the right data and workflows to pull over falls to individual teams and their power users, or subject matter experts. Only you and your team can get your data and workflows truly prepped – to identify the current setup, what they like and don’t like, and what data they want to move.
Your partner will only be able to help so far – as in consulting and planning around data cleansing with you. Be prepared to spend months on this process before the implementation even begins, which is a big ask (that is well worth it in the long run) from teams that are already swamped in their day-to-day tasks.
Choose an ERP implementation partner that offers the level of support and service you need from start to finish – and beyond.
Not all businesses need the same amount of involvement and support from their implementation partner; not all ERP partners provide the same services. Additionally, not all ERP partners engage in the same methodologies for implementation. Assess several potential partners for suitability. And contact their references to learn about their actual experiences. Also, ask others in your industry for their referrals. Research partners and solutions at user events, on user channels and even on social media like LinkedIn. Ask others what software they’re using and what they look for in a partner.
In your discussions with potential partners, ask them how your ERP system can address your specific business drivers and challenges. Ask them about their methodology and what you can expect throughout the process. Your partner should be able to provide a clear roadmap, including:
If they can’t outline their methodology, address your concerns, prove experience with your platform or industry, or show referenceable clients, they may not be the partner for you.
When you end up in a mismatched relationship with an implementation partner, it can lead to headaches today and into the future. Look for a partner that looks beyond just the software, that will pick up the phone when you call with a new challenge years after implementation.
Don’t let price, popularity or one amazing feature be the deciding factors in any of your decisions around your ERP implementation – from your system to your partner.
If you choose based on the lowest rate or the shiniest product, you are likely to end up with an ERP system or partner that doesn’t meet your business needs. As soon as you start to see the red flags, reassess your partnership. The sooner you leave the wrong partnership and find the right one, the less headaches and heartaches you will have to endure.
A successful ERP implementation depends greatly on company buy-in at all levels in the organization, not just your all-star task force team. Support from within the organization, especially your front-line workers, will help you work with the tide instead of against it.
Prepare your organization for an optimal experience with your new system from day one. Optimal means they don’t just know how to use it, but they are on board: They know why it’s an improvement and how it helps them perform their daily tasks and reach short- and long-term goals.
Change management and onboarding aren’t simple. If you’ve ever introduced a new anything to your team, you know it’s challenging to gain acceptance over the skepticism. The key is to communicate and work with your employees throughout, as opposed to dropping the technology in their lap and watching morale plummet.
Gaining full company support through change management is critical, particularly with those employees who interact with clients. An ERP implementation is a significant change, not a simple upgrade. How your employees work is going to look and feel different. Prepare them with an understanding of the value of a new system, as well as thorough training and testing championed by power users in each department.
Your implementation partner can be incredibly resourceful and helpful in training and change management and may even have ideas that make your implementation timeline more suitable to your employees’ needs. Consider the fact that any extension in a project typically means additional costs. Be sure to vet your partner for the level of training and change management they support to ensure your project expectations will meet the reality.
As part of training and change management, request that your teams create testing scripts alongside your consultants. These testing scripts map out the day-to-day process, which is only enhanced by the expertise of your team members who perform those processes. These scripts can be turned into incredibly useful internal manuals.
One common issue with ERP implementations is that companies map out their implementation journey prior to choosing a partner. It would be an incredible feat to have accurately determined your own timeline and budget. There are many variables at play that your partner will understand more clearly based on their experience, including the age of your system, the difficulty of cleansing the data, and the level of change management you’ll need.
Analyze your business as it stands today and write out how you want it to look in the future. Knowing where you are and where your destination point is will allow your partner to clearly define your journey, the best way to get there and show you how much easier life will be once you reach that destination point. It will increase your rate of success to end up with the best ERP system and partner for your business, and you’ll be on a faster track to capture ROI and business benefits.
Many small to midsize businesses do not have the experience of doing a complete overhaul of their ERP systems. And why would they? These businesses are experts in their field, not in various ERP systems and implementations. The number one priority and factor of having a successful ERP implementation is to partner with the right ERP experts who know their system and know how to best help your entire company function with new software.
Our insights don’t end here. We live and breathe optimal ERP implementations. If you have questions and want to learn more about succeeding with your ERP project, get in touch.
Sandy Williams is Sr. Leader of Client Experience Strategy at Enavate. She has spent the past 20 years in the Microsoft SMB and Enterprise space optimizing technology, experience, and implementation methodologies to ensure the delivery of a smooth, frictionless and consistent experience to clients. Sandy has worked in various industries with the Microsoft solution stack to architect, re-design business processes and implement customer success through business needs and industry best practices.