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Learn How to Successfully Implement ERP to Maximize Your ROI

Updated: Jul 9




You have made the strategic decision to invest in an ERP system. ERP systems were essential in connecting vital business processes within an organization for more than 20 years. When implemented properly, ERP can enhance customer responsiveness, increase information visibility, optimize inventories, and create a single version of truth for the company. Organizations of all sizes have realized over the past years that they need to implement digital technologies and tools to avoid having their business environment disrupted. ERP is the foundation of the digital transformation process as it records and stores all organizational transactions, making them accessible at any time to accelerate the process of making the right choices thus becoming the backbone of enterprise application landscape.

In our interaction with 1000s of large and small organization, we found the pattern that ERP investments doesn’t results in improved ROI. Instead it increased the overall costs. You might be having outdated process, legacy ERP systems, islands of automation and different business scenarios are possible. Fragmented processes, system will result in fragmented results. Only few organization had clear edge in effectively implementing ERP and maximizing ROI, benefits and growth. The guide is the result of close to 100+ successful ERP engagements of customers across different sizes, geographies provides leaders like you an steps approach to successfully implement ERP system in your organization, Leverage ERP for increased business efficiency, maximizing ROI with your ERP investment


Planning:

The initial phase involves adopting a "Begin with an end in mind" approach to effectively plan and strategize the reasons behind the necessity of an ERP system.

What you hope to accomplish by putting in place open-source ERP software like OODOO ERP or SAP ERP software/Oracle ERP? To start with ERP strategy must be

  • Help you operating as one company integrating cross functional collaboration promoting standardized ways of working    

  • To achieve operational efficiencies and improve customer satisfaction

  • To reduce costs and improve margins

  • To grow the business in new markets

You can modify to suit specific needs of your business but this is the first and must step and aligned with your strategic objectives of the business. The implementation of an ERP must be a business-driven initiative executed out in collaboration with IT. There are still isolated instances of automation in businesses that use software-centric ERP. In order to tackle this, the CEO/MD should directly oversee the formation of a strong team of stakeholders from across the organization. In order to define the specific problems that need to be addressed by ERP, the empowered team must be able to contribute their knowledge, expertise, and everyday concerns.

In short, you don't need an Oracle or SAP strategy; instead, you need a digital transformation plan that will support you in achieving your strategic objectives over the next several years.

Evaluation:

By implementing ERP in your company without reconsidering or reimagining your business processes, you will end up with a more expensive, outdated organization and higher technical expenses. Over 70% of ERP implementations fail, and companies that prioritize software without business process transformation eventually lose out on revenue and profitability.

Evaluate the gaps and difficulties in the present business processes first. How post-ERP processes should be in the future. define a specific instance of success. Create use cases and make advantage of the "Jobs to be done" method. Before implementing it fully, this method might assist in testing the problem and the potential benefits to your business.

ERP can be implemented in Finance, Manufacturing, Procurement, Inventory, Sales, Service, and Quality, depending on the size and type of organization. Decide the scope of your project.

An ERP implementation's success depends on choosing the correct vendor. In addition to having strong ERP capabilities, the vendor must possess business and industry knowledge as well as soft skills including cooperation, communication, and conflict resolution.

If the time permits and internal skills are available, the above tasks can be undertaken internally by the senior management. Otherwise, an external consultant with capability provide outcome on the above areas must be engaged

Implementation: 

You have analyzed the current and future state of organization, selected the potential vendor, what next? 

 

ERP implementation can be compared with river rafting. While the rafter have safety protection, it may not case with ERP implementation. 



Project Implementation to be executed considering the key factors as follows

- Clarity of Goal - Right People in Right Mix - Team Work - Good Project Management - Best Practice Process Systems, Process, People (Employees, Vendor, Leadership teams) are to be aligned to single goal towards success within constraints imposed by the environment


- ERP, also referred to as systems of records, facilitates the flow of information between various departments in accordance with business processes. ERP, or enterprise resource planning, facilitates information transfer across various departments in accordance with business processes. By giving the appropriate information to the right people at the right time, a well-implemented ERP system can create the figurative "single version of truth" for management decisions. A stable ERP system is also the strong base upon which your digital transformation journey can be begin with ease.

Consider the following during the implementation phase: - Map the ERP to Business need 

The previous phase would have given clear inputs on current and future business needs. Align with the digital strategy of the organization. ERP must be established as the primary system for all transactional data, as determined by your team. Organizational alignment for digital transformation can be achieved through change management programs and ERPLN training.

- Data is the lifeline 

A stable ERP system means you have wealth of transactional data since the day of implementation. These data can be used to identify areas for improvement in a variety of areas, including inventory analysis, production performance, purchase receipts, and sales delivery. Prior to doing an analysis, it is crucial to evaluate the data correction and cleansing. Maintaining current data in the system can be facilitated by bridging the process discipline required for timely ERP updates.

- Cloud Deployment 

The use of cloud ERP is catching up because it guarantees availability, accessibility, and many other benefits while freeing up organizational resources. For deployment and business purposes, take into consideration of cloud-based ERP. Cloud-based ERP integration can minimize investment while generating new value.

- Assess and manage risks 

Risk management is essential to ERP implementation, and it requires thoughtful consideration.


Build internal capabilities 

 External consultants will implement and leave. Their dependability must be reduced, hence it’s important to have dedicated ERP user team internally 

 

- Make training as on-going repeatable activity so that by the end of the project the key users are adequately knowledgeable 

- Train users on Trouble shooting for business continuity without disruption 

- Setup knowledge management system/repository 

- Develop contingency training plan for user turnover 

- Provide Post Go-Live stabilization support for a period of time for smooth functioning 


Post implementation 

Most of the ERP initiatives ends post go-live which is wrong approach. There must be a team that continuously tracks and improves benefits initially planned. This team must be there from a few months to few years till the original objective is achieved.


Successful ERP implementation bring: 

1. Savings in Costs of business Operations 

2. Making critical decisions faster 

3. Getting Single Version of Truth across Organization 

4. Become Agile, Faster and Flexible for change 

5. Be successful in Digital Era 


Please find below the Metrics derived after interviewing customers:

Success factors 

Things to look for in an ERP initiative


Its possible keeping in mind of the critical success factors:

1.      Clear Business goals, project scope

2.      Organization leadership commitment and involvement

3.      Right Implementation team

4.      Training on product and troubleshooting

5.      Change ready and agile team


Conclusion

Stable ERP system offers the foundation and you could maximize your ERP investment by adding tools/solutions from AI, RPA, Analytics and IOT solutions. It can help you automate processes, go paperless and responsive. All these solutions can bring visibility, transparency and single version of truth to help being dynamic in the VUCA world. All the more it can free up your employees from mundane, repeatable tasks and they can focus on business critical and creative work for adding value. 

 

ERP can make or break organization growth and it can lead to expensive old organization as against exponential growing organization. Focusing on the right goals and executing them can enhance the organization success.

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