Posted by Indusa Admin on September 20, 2016 5:21 am
When you finally decide to implement an ERP system, you probably have numerous expectations: everything from believing the ERP system will solve all your organizational problems, to envisioning an immediate ROI – the list is endless. Once you’ve decided to take the first step in implementing an ERP, setting a realistic timeline for execution is essential.
According to Panorama’s 2016 ERP Report, most companies struggle with setting the right ERP implementation timeline. 57% of organizations take longer than expected to implement their ERP systems – largely because they had unrealistic expectations in the first place. Miscalculations regarding budget, time, and resources early in the planning process are primary causes for failed ERP implementations.
A majority of organizations take longer than expected to implement their ERP systems, resulting in substantial budget overruns, something no organization would want. You do not want to invest in an ERP, only to see it fail.
Setting a Realistic ERP Implementation Timeline
Here are eight tips that will help you plan and execute an ERP implementation with a more realistic timeline:
1. Look Beyond the Sales Hype: While the use of implementation accelerators and industry best practices can facilitate a fast implementation, the truth is that every organization is unique, which makes every ERP project unique, requiring considerable time, effort, and resources to achieve success.
2. Benchmark: Many ERP vendors claim that their system can be deployed in a couple of months; however, this implementation scenario may not apply to your organization. Most ERP implementations take, on an average, 21 months. With that in mind, it is important for you to find out how much time other companies in your industry and of your size invest in their ERP initiatives and then arrive at an idealistic number.
3. Reengineer Processes: ERP vendors will often tell you to not worry about your business processes because implementing their software will solve all of your problems. But since ERP systems are built to cater to the entire spectrum of organizations, it may require considerable effort to define business processes that are unique to your business. Putting in the effort to reengineer your business processes slightly prior to implementing the software will reduce extensive customization required ultimately minimizing time, reducing costs, and maximizing business benefits.
4. Build a Comprehensive Implementation Plan: If you miss out on including key activities such as data conversion or training requirements or even process issues, then you are less likely to be working from a realistic standpoint. Involve all your ERP stakeholders and ensure that your implementation plan includes all of the tasks that are absolutely essential for a successful ERP implementation, and not just those that are proposed by your ERP vendor.
5. Embrace a Strong Governance Model: ERP implementations often overrun the timeline in absence of a strong governance model. Having well defined controls in place will ensure that customization requirements, scope expansions, and other typical risks don’t cause your project to derail. Having clearly defined processes in place will allow your project team to examine any decisions that could make a mess of the calculated timeframe.
6. Communicate: Communication between the various ERP implementation teams is key to arriving at a realistic timeline estimate. Integrating constructive communication plans into every phase of the implementation project and having weekly status meetings between the project committee and the implementation team from the start of the project kick off minimizes the chances of project derailment. Also, conversations with the ERP vendor will help in determining which goals are a priority and which are not, as this might alter the scope and corresponding timeline of the project.
7. Schedule Specific Deliverables: As the implementation team is majorly responsible for accurately scheduling the project, by understanding project priorities and configuring deliverables around them, you can move forward with the project with a realistic expectation about what it will take to complete the project in the way it was intended.
8. Prepare for Timeline Disruptions: No matter how well you plan your implementation strategy, it is always good to be prepared for timeline disruptions. Since most organizations aren’t ERP experts, there is a strong likelihood of not being able to anticipate or identify factors that can contribute to longer-than-expected commitments. By factoring in processes that might get stretched (like customizations or change management), you can weed out unrealistic expectations and assumptions and be prepared for a worst-case scenario. According to a Deloitte CIO survey, of the top 10 barriers to a successful ERP journey, developing and implementing a structured change management program can help address five barriers.
Getting It Right
Determining how long an ERP implementation will take is a daunting task. Since implementations are massive projects, they require substantial investments in terms of time, money, and resources. When you have unrealistic expectations from an ERP implementation, you may end up with corners being cut, additional money and time being invested, and key employees will most likely lose faith in the project.
Although ERP implementation failures are common due to several reasons, it’s not about pointing fingers, or keeping them crossed. It’s about making sure you get it right. So go on – be realistic, plan wisely, and get the ball rolling.
Download this eBook that provides guidelines and suggestions on how to avoid a failed ERP implementation and see the business results you intended to receive.
About the Author – Neha Kumar
Neha Kumar is a digital media evangelist and marketing professional. She overlooks Indusa’s content management, social media, online events, email marketing, blogs, digital campaigns, lead generation and inside sales activities on a broader scale.
Contibuting Author: Malavika Nityanandam