You’re planning to implement ERP (or any Complex Packaged Solution) and have gone through all information available to understand the critical success factors. We wanted to emphasize some of these success factors to maximize probability of your success. These insights are based on 25+ years of complex packaged solution implementations with clients in different industry verticals.
1. Executive/Sr. Leadership commitment, Business Case, Change Management and Project Management all are discussed widely and must always be in place prior to any complex systems implementation. In our experience, most organizations have realized the importance of these and ensure that these areas are appropriately addressed.
2. Software selection – Amongst the various criteria for selecting in ERP or any complex application system, the single most important criteria is to ensure the software meets your business needs. Most application solutions like ERP have industry vertical adaptations to meet specific needs of these industries. If the solution does not largely address specific industry needs of the industry in the current release, please steer away from making this selection. Do Not make your software selection based on future releases, product roadmaps, etc. Finally, clearly document your key requirements (highly condensed list). Have the software vendor demonstrate clearly how these requirements will be addressed in their solutions using your data and scenarios. This evaluation must be done in-depth and may take multiple days. Many organizations do not evaluate solutions correctly and the implementation results in significant budget and time overruns as well as customer dissatisfaction.
3. Phased vs Big-Bang implementation – Please read our blog: Pitfalls of Phased ERP Implementations by Module in addition to widely published pros/cons of each approach to make the final determination.
4. Functional Consultants – Ensure that your functional consultants have mastered the products for which you have engaged their services including significant experience implementing these in your industry vertical (if applicable). Don’t be afraid to seek services of boutique consulting firms or independent consultants if your primary implementation partner cannot provide consultants that meet these criteria. This is one of the key areas where we have seen many implementations fail. The consultants engaged did not have the skills and experience to apprise clients of best practices and fully leverage the solution functionality to meet business needs. Unnecessary customizations or modifications are done to the software to meet business needs or implemented processes are suboptimal and many times result in significantly more inefficiencies.
5. Business Leads/SME’s – Although Sr. Leaderships commits to have the best people with adequate bandwidth as part of project team at project initiation, we have seen that as project progresses these key resources are switched out or don’t have enough bandwidth to support the project needs. We cannot emphasize enough the need to have the right business subject matter experts (SME’s) engaged appropriately.
6. IT Leads – Your IT leads play a key pivotal role as a liaison between your business users and consultants, ensuring that the solutions implemented are architected appropriately, effective knowledge transfer has been done throughout the engagement and that your internal IT team can support the implemented solutions on an ongoing basis.
7. Technical Consultants – Most of the technical tasks can be handled by a broad range of resources with appropriate skills on the product/solution. However, you will run into a few complex customizations or modifications where only a highly skilled technical resource intimately familiar with the solution will suffice. With increasing trend to outsource technical work offshore to control costs, you need to be plan and mitigate this risk appropriately.
8. Blueprinting or Requirements/High Level Design – This is one of the biggest areas of failure in our opinion in packaged implementations. Organizations only do a high level requirements discussion during this phase and focus only on the “what” and not the “how”. The idea is to push the “how” to a later stage, typically during Realization phase of the project. We have seen so many project derail due to this misconception and approach. When you are implementing an ERP or a complex packaged solution, the most important thing is to identify “gaps” where the packaged solution cannot meet the business needs without further customizations or modifications accurately and early in a project. These can then be addressed through appropriate customizations, modifications or workarounds. Failure to do this early will result in significantly higher additional efforts, costs and slippages.
9. Data Migration – The data migration efforts from legacy to new system are significant. Most organizations significantly underestimate these efforts. All data migration development should be completed prior to System Testing.
10. Testing – Approximately 30% of the implementation efforts are typically expended in different types of Testing activities. In our experience, it is the failure in one of the earlier areas highlighted 1-9 that results in inadequate capabilities, time or environment where comprehensive testing cannot be completed before go-live.
11. Cutover Planning and Go-Live – For complex systems implementations, we recommend 2-3 mockups prior to go-live to ensure that the cutover activities are refined, sequenced appropriately and thoroughly tested prior to go-live. For complex global ERP implementations, the cutover planning itself is a mini-project and needs to be managed accordingly.