If you are thinking about investing in ERP software, you need to plan ahead and create strategies for a successful implementation process. Plus, the business owner must find the right advanced solution for the business. It involves a complex process of conducting lots of research and then finding a flexible solution suitable for your business. In this post, let us discuss more about the pros and cons, and the strategies that will help in the successful implementation process.
What is ERP?
Enterprise resource planning software is an advanced technology that helps the business to manage daily operations. It is an essential technology for the business as it has a centralized database which can be accessed by cross-functional teams. Large companies have implemented ERP to ease the processes and to remove all bottlenecks whereas small companies are adopting it to achieve sustainability and growth.
ERP has multiple modules which can seamlessly manage operations such as supply chain, accounting, manufacturing, managing projects, etc. In this system all the data is saved and stored, so that all the users can easily access based on their requirements. Further, it automates all the tedious and time-consuming tasks to give ample time for the employees to focus on mission-critical activities.
Strategies for ERP Implementation
When the plan for the ERP project is ‘on’, it is vital for the executives to be on board with the other members associated with it. It is a fact that when people work with a similar set of plans, the project tends to become successful. In addition, research on the scope and other crucial factors of the ERP implementation project. Factors such as speed, cost and business outcome must be considered. Listed below are the strategies of the ERP implementation plan which is common for all businesses.
- Demand
- Evaluation
- Project preparation
- Training
- Testing
- Go live and support
1. Demand
The first step is to find out the requirements of the business which is to create demands of the business. It will be helpful in investing in the right enterprise resource planning software.
2. Evaluatio
Analyze the requirements and check if the ERP technology you selected for the business will fulfill the needs. Always implement a working solution rather than going for an ideal result.
3. Project preparation
Form a team and select an employee to lead the team. Communicate with the employees regarding the project and collect their opinions and requirements. Plan for change management and risk management.
4. Training
Provide ample training to the employees, so that when the technology is implemented, their reliance on the IT team is limited as the IT staff will be busy with other crucial tasks. This will enable the employees to accept the change. Allotting time and sufficient resources for training is mandatory.
5. Testing
The technology should be first tested and analysis must be done, observing how well it is helping the business and how the employees are using it. The company can choose one area to implement first and then slowly proceed to the next one.
6. Go live and support
After deploying, the review should be done frequently analyzing its performance. The IT team will have a huge role to play supporting the employees and migrating the data into the system.
7. IT team and infrastructure
Check if your current IT infrastructure can support the new system. All these strategies are common for business. However, some businesses have different approaches which will be suitable for their business implementation process.
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Approaches to ERP implementation
1. Big Bang ERP Implementation
This approach ensures faster implementation and cost optimization. It includes all your staff to the new ERP in a single shot. Further, from the beginning, the company can reap the benefits of this ERP. The risk involved in this method is that once the system is implemented, it cannot be rolled back. This can result in multiple system failures.
2. Phased ERP Implementation
This approach is the opposite of the big bang approach. In this approach, selected modules are integrated step-by-step. You can take an example of a business implementing finance and accounting first in one location and then moving on to the next geographical location. This risk is less in this approach. The only con is that this approach is deployed slowly, so the benefits are also reaped slowly.
3. Parallel ERP Implementation
In this approach, both old and new ERP systems are operated simultaneously for a specific period. Even this approach lowers risk and related problems. Both the systems will be operating where the old system can be operated for normal functions and the new systems can be used for testing and deploying slowly. This won’t disrupt the current operations and ensures a smoother transition. In addition, the managers will have ample time to restore if any risk arises from the implementation of the new system.
The con is that this approach can be applied only for a short period as running two ERPs is an expensive affair.
4. Pilot ERP Implementation
This approach takes low commitment. In this, the system is implemented in one of the divisions to test its performance. This can be applicable to large-scale companies with multiple entities under it. The firm implements the technology in one entity and reviews the results. If it’s a success, then the system is integrated into the other entities too. If it fails, then they can just terminate the project.
5. Hybrid ERP Implementation
This implementation approach uses all of the above strategies. So, if a business wants to maximize its efficiency and lower the risk, then it should go for the hybrid approach. The hybrid approach is applied in multiple segments of the business to increase productivity.
Conclusion
ERP Implementation is a huge process which involves a lot of planning. Proper planning and everyone being on the same page helps in the successful implementation of the system. The company should also provide adequate training to the employees and must check if their current infrastructure supports the new technology. A change management and risk management plan should be in place when the implementation process is in action. ERP has many names in the current market. Hence, research well and invest in the right solution that is suitable for your business.
Author’s Bio:-
Sneha Rakte is a specialist in communication who excels at recognizing client requirements. She produces persuasive sales copy and high-converting content. She currently works with Sage Software Solutions, an industry leader in supplying small and medium-sized enterprises in India.