3 critical planning steps when implementing a new ERP system
An Enterprise Resource Planning (ERP) implementation is not just about the technology. It is the perfect synchronization of technology, human resource and enterprise management. The ERP software is capable of completely revolutionizing the way your manufacturing firm works. You need to be precautious, patient and agile while ERP system implementation is in progress.
Planning is the most crucial step when considering ERP software implementation. According to a survey conducted by Panorama Consulting Solutions, 70 percent of the respondents who installed ERP system didn’t know whether ERP implementation was a success or a failure. In order to avoid this ambiguity or failure of the project, you should consider following planning steps.
Setting up Goals & Streamline Workflow
The ERP implementation should be aligned with the right set of goals. If you don’t have an objective, you cannot successfully install an ERP system. An unfocused approach can delay the installation and further increase the costs as well. You should lay out clear expectations, and convey these to stakeholders, vendors, and employees. Everyone must be aware of the forthcoming changes so that they are mentally prepared.
ERP implementation automates, organizes and synchronizes processes to streamline the workflow. And therefore, it is mandatory to identify the processes that need attention. Prepare detailed workflows, mapping out each and every aspect of a process.
This will be beneficial in highlighting the efficiencies and inefficiencies of the processes. You will come to know whether two or more processes can be integrated at a certain point in the workflow or not. The vendor will be able to determine ERP software modules that can tackle problems.
Once you have identified goals and have a detailed outline of the workflows, you should begin with the drafting of project specifications, budgeting, setting up the timeline, software requirements, infrastructure setup, testing, training, and so on.
The planning stage is incomplete without cost analysis and estimation. The ERP implementation budget is influenced by the type of industry. As supply chain management and automation are core aspects of the manufacturing industry, you have to customize ERP software according to specific requirements.
The budget will be prepared after discussing hardware and software requirements with the service provider. The costing will depend on whether you prefer an on-premise or cloud-based ERP system, the level of automation and customization, data migration, scope of scalability, and so on.
Once the draft is prepared and ERP installation begins, it is not advised to customize ERP requirements because if you opt for changes in the midway, the ERP implementation process may become complex, thereby increasing the chances of failure. More importantly, frequent customizations will increase the expenditure as well. A minor customization can lead to a complete rollback, leading to loss of money and resources.
Data Migration, Training & Testing
Data transfer is a complicated task in ERP software implementation. The software works on an automated mode and therefore, you need to provide accurate and clean data for the proper functioning of the ERP. The process of data migration begins with the setting up a team of analysts to identify, sort, and organize data.
You must also communicate with the vendor to create customized databases that can store and process relevant information. Moreover, ensure data compatibility before migrating company data to the ERP system.
Once the ERP system is in place, the employees must be comfortable in using the software. To accomplish this task, you must arrange for orientation programs focusing on training for the employees. Consult with the vendor for the arrangement.
If you prefer on-premise training, this will be possible when the ERP system has been installed. Before that, you can ask the vendor to furnish end-user documentation so that employees are aware of the ERP software functioning.
Before the ERP system goes live, you should identify checkpoints that will assure the quality and seamless functioning of the system. You must check out ERP features to integrate, compatibility with devices, the process to handle various types of issues and bugs, and so on. You should ascertain these aspects before the live testing of the ERP software takes place once it is installed.
A wrong move during ERP software implementation can dismantle the complete manufacturing process. It is recommended to abide by these planning steps before you install a suitable ERP system in your organization.