"5 Tips to Assure a Successful ERP Implementation"

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"Cincom Manufacturing Business Solutions are based on over three decades of experience, providing strategic value to manufacturing companies. Cincom's knowledge of manufacturing ensures delivery of robust products with rapid implementation resulting in fast Return-on-Investment (ROI) and excellent customer support."
Source: Cincom Systems

Resources Related to 5 Tips to Assure a Successful ERP Implementation:

• Enterprise Resource Planning (ERP) (Wikipedia)

5 Tips to Assure a Successful ERP Implementation

Executive Summary

This paper is aimed at individuals preparing to oversee an ERP implementation project.

These projects are frequently perceived to be less than successful. While there are many reasons why a given implementation project may be less than perfect, there are a few steps individuals, teams and companies can take to raise the likelihood of a successful project.

The paper will go into detail discussing five specific steps that must be completed to assure a positive outcome.

Implementation team formation will be discussed. We will look at team composition, specific goals, cautions and strategies necessary to bring an implementation project to a successful conclusion.

Development of the project plan is also an essential element of the project. Here we will look at what the plan should include, development of task lists, how success will be measured, determining accountability and monitoring progress. Project ownership, roadblock strategies and scheduling will also be covered here.

Advance publication of the plan is also a common characteristic of successful implementations. We will look at how a little internal PR will smooth the way for the many changes resulting from the new system. The importance of scheduling all major tasks and events in advance is examined in this section as well.

Progress reports are most useful as a way to keep everyone apprised of project progress. The reporting structure will differ for various groups within the organization. Dashboards for C-level employees are discussed. Recognition strategies are reviewed from the standpoint of gaining enthusiasm and buy in from the ultimate users and consumers of the system.

Finally the importance of flexibility is stressed. Once the project is underway, many things will surface that were either unplanned or unknown by the planners. These can be challenging. The paper talks about the importance of being able to modify on the fly as the project unfolds.

Introduction

Thus starts the Rogers and Hammerstein song, "My Favorite Things" from the musical The Sound of Music. One thing you will not likely find on any body's list of "My Favorite Things" is ERP Implementation projects.

And is it any wonder? These are high risk, long duration, often thankless projects. They too frequently end in failure with high visibility career casualties. History shows that championing and running an ERP implementation is not the best way to fast track it up the corporate ladder. That is, unless you happen to bring in the project on-time, under-budget and exceeding all expectations.

However, for most of us getting an ERP implementation successfully completed takes complete commitment and an abundance of time. The intent of these five tips are to help you make the most of your commitment in the least possible time.

What can be done to help assure a positive outcome with delighted users? How can you avoid the career ending disasters that seem to appear in the headlines almost every week?

Let's take a look at what you can do to help assure a successful implementation.

Pre Implementation Tips

It is essential that your management has bought into the system selection decision, that they support the project and that you have a named, active, participating executive sponsor. Having a senior management sponsor who can champion the change needed in your organization is a critical, must have step in the journey to having a successful ERP implementation.

Establish the Implementation Team

The first requirement is creating an implementation team that will be able to maximize the value delivered by the ERP system. The team should reflect the make up of the ERP user community meaning all functional divisions and management levels with in the organization will need to be represented on the team. This facilitates active ownership of the project by all involved.

• Be prepared to overcome adversity. The team will also need to be adept at overcoming resistance to change in the development of the system as it is deployed and brought online. Senior management inclusion on the team will help facilitate this.
• It is an enterprise wide project. This may be a surprise to some, but thinking of an ERP implementation as "an IT project" or a "Finance project" is a mistake. Ultimately, this will be a complete re-engineering of your company from the core business processes up to how the many tasks essential to attracting, selling and serving customers, including all supporting functions, are coordinated and synchronized for greater performance.
• Forget about vendor provided "turnkey" implementations. There is no such thing as a "one and done" ERP implementation. Your vendor will need to be actively involved, but, it must be your implementation. Even the world's greatest obstetrician can't have your baby for you, and a vendor can't implement your system.
• Include a C-level Champion on your team. No vendor can help you get over resistance to change. It is very important to have a senior manager or C-level executive (CFO, CIO, CEO) champion your ERP implementation. Your chances of success go up significantly when this person takes the leadership role of the project and defines the implementation team.

The system will ultimately involve many people and functions beyond IT and Finance - in fact it will touch every significant process and functional area of the company over time. Those people must be involved in the project to overcome resistance to change and give them a chance to "own" how their jobs will change when the system launches.

In a recent study published by Panorama Consulting Group, fully 38% of companies surveyed cited "lack of employee buy-in" as the primary problem facing the implementation team. Overcoming resistance is such a major issue that AMR Research has also shown that 70% of CRM projects fail due to lack of ownership and resistance to change.

Jill Dyche, best-selling author of CRM books and industry expert says that fears of how IT systems will change a person's job and potentially take valuable information away from them, robbing them of their status and job security, is the single biggest roadblock every company faces in rolling out new systems.

• Establish a Change Management Program. These fears can most effectively be addressed with a thorough change management program. Change management is the study of how to overcome resistance to change. Having a C-level executive is a great first step in your change management strategy and plan.
• Obtain constant feedback. Creating opportunities for users to provide feedback on everything from the system design to the GUI definition. This is how users will develop a sense of ownership in the system and see it as an improvement rather than a threat to their jobs.
• Include all functional areas. Acceptance is much easier to facilitate if participation in the implementation is both cross-functionally wide and vertically deep in terms of the organization hierarchy.
• Consider creating a User Advisory Council, which is a cross-functional team of the departments most affected by the ERP implementation. The User Advisory Council will remain in place well beyond the implementation to facilitate ongoing system and process tuning by interfacing the user community with IT.

From our experiences at Cincom this is a win/win: the developers get useful information on how existing processes work and how to improve them while users get an opportunity to influence design at multiple levels, leading to greater ownership of the system in the process.

Include ERP knowledgeable personnel. The team should also have some people with expertise in ERP, from system analysts to database designers to human factors engineering to make sure the system is in precise alignment to unmet needs while increasing process efficiency throughout your company. The Panorama study found "lack of ERP expertise" to be the second most commonly cited problem (33%) facing implementation teams. If this expertise is unavailable internally, go to a 3rd party.

Planning - the most important phase of implementation

During the initial phase of the project the implementation team will be primarily concerned with planning activities. The project will be complex in nature so tools such as project management software will be essential to establishing specific task lists, task ownership, task dependencies and scheduling.

Accountability is critical. There must be accountability at the task level for the ERP Implementation Project to make progress over time. Again, a C-level champion for your project is the best way to resolve conflicts as to which tasks get done. A clear line of authority makes it much easier to get this work done.

The planning phase will also determine what resources are required to facilitate the implementation. These will include funding requirements, physical space, human resources, systems, supplies and time.

Finally, the planning team needs to establish how performance will be measured. How will you know if you are succeeding or failing? Specific metrics should be agreed upon in advance to facilitate the definition of success and also to measure the performance of the project itself and those participating in it. These metrics could include such things as

• Actual spend vs. budget per module installed or department brought online.
• Task completions percentages over time
• Personnel educated prior to implementation.

This is an opportunity to inject ownership into the system on the part of users. Have the User Advisory Council work in conjunction with system developers and architects to define the Key Performance Indicators (KPIs) that will be used to measure system performance - again the critical aspect of this is getting users to own the performance of the system and increase adoption rates of its use.

Do not ever define KPIs or dashboards without the feedback of users; it is critical to have them involved to nurture ownership of the system and its performance.

It is also important to establish what accommodations must be made between the systems capabilities and your organizational needs. This gap analysis is necessary because no solution will fully address the unique requirements, organizational structure and needs that you present. This may best be accomplished by looking at these functional requirements through the lens of business process management (BPM). This is another skill set to include in the team membership.

Once the basic plan is established and accepted by the project champions (upper management) the real work will begin. Your system vendor will likely have valuable tools available to help you determine the specifics related to getting your system implemented.

The more complete and detailed your up-front plan is, the higher your likelihood of success. This plan has got to have the critical components of change management included too.

Make a very focused and deliberate strategy of getting users to own the system to ensure it is a success.

At this point, you will be utilizing basic project management processes. The foundation of your ERP implementation needs to be built on sound project management planning - but the execution will require the muscle of your senior management champion to make change happen constantly during the project.

Define the task list. Using all the information sources you have available, internal and from your vendor, lay out a task list. Start with the high level tasks and then expand each of those by identifying sub-tasks and individual required actions.

• Identify resources required to complete each task.
• Assign Accountability For Each Phase. Once this is completed, start matching team member experience or expertise to each task. This will help you determine who should own each phase of the implementation project. Don't forget to include management in this area. The more upper management is visibly involved, the more credibility the project will have. Ultimately, management should sign off on each major milestone when they are completed.
• Measure, Monitor and Modify. Be sure to continually measure the progress towards the project milestones and seek to understand how the dynamics of the group may be impacting exceptional performance in certain areas and shortcomings in others. Be sure to have your C-level champion celebrate the wins and understand what can be learned from the losses of getting tasks done on time.
• Always seek to impart ownership of the system to users. What needs to always be kept in mind by project management teams and the C-level champion is that the ERP implementation must seek to have a very high level of adoption if it is to be successful in bringing greater levels of efficiency and performance into the company. ERP implementations often lead to companies completely re-defining their business models over time. So, realize this system may change how you complete manufacturing, service, support, pricing or accounting processes. Making these changes effective for the long term all hinges on ownership of the system by users.
• Removing roadblocks is the job for the C-level champion, and this includes getting the team help when needed. Sooner or later, you will encounter something that is outside of everyone's area of experience. Do not rule out third party involvement in these situations. This is particularly true if there are political ramifications or similar sensitivities involved.
• Next is scheduling. Assign reasonable and realistic time requirements to each task and subtask. As these assignments are completed think about sequencing the tasks by identifying the dependencies for each task in terms of what must be done before starting a task and what can be started after finishing a given task. This will serve as the basis for your schedule.

Publish the Plan

Now that you have a plan, a schedule and tentative staffing/ownership established, publish these so everyone involved can review and comment as needed. You will most likely need to make some adjustments to your plan based on the feed back received

• Create buzz. You also want to create some buzz around the plan to make sure people see their contributions to the project as having value and giving them high visibility in the company.
• Identify Milestones. Finally identify the major milestones in your plan and determine who will accept or reject work completed toward fulfilling each milestone.
• Identify Ownership. Who will "sign off" and how will that be documented? It is important to publish this along with the plan itself since you will want to be able to confirm that all stake holders are identified and represented.

Report on progress early & often: Internal PR to Bring Lasting Change

Remember that change management and fear of what this system will do to day-to-day life in your company is the greatest risk the project has. Aggressively pursue PR and celebrate the small victories. Acknowledge individual performances contributing to the projects success. An internal newsletter is an excellent way to accomplish this.

• Establish creditability. Report project progress to all involved or affected by the project. Don't hesitate to report problems or difficulties encountered along the way as well as the more successful aspects of the implementation. Think credibility!
• Report frequently. Frequency of the reporting will vary throughout the project. Initially, the implementation team should publish minutes or at least meeting reports following each meeting. As the project gains momentum, a regular update schedule should be followed. In some cases these reports may be monthly, but keeping the project on center stage via weekly reports will have greater benefits. A combination of newsletters on a monthly basis, and short weekly updates may be the most desirable for larger projects.
• Aggressively control rumors. Most organizations have active rumor mills or gossip networks. If there are problems (and there will likely be problems) along the way, establish your team as the source for accurate information.
• Gather Feedback. Progress reports should contain links or instructions for your user community to provide feed back to you regarding the system. Act quickly on problems revealed and report on the resolutions in the next report.
• Recognize Excellence. These reports also offer an opportunity to single out people or groups for recognition of particularly meaningful contributions to the project. It is a team effort and everyone who contributes should feel appreciated for their hard work. Think about using plaques, medals, certificates and team golf shirts. These are all great ways to build the team and recognize individual performance. Bonuses and additional vacation days are also fine, but "visible" recognitions are better. They have the affect of advertising the value delivered by the employee and the effort recognized by management.

This is a big deal, it is important to everyone in the company. It does require the support and confidence of everyone in the company, so a "thank you" to those putting forth commendable effort is most appropriate.

Monitor, Measure and Modify

As the project moves forward, there will be unforeseen situations and phases of the operation that just don't go as planned. To the degree possible, tweak your own processes to accommodate these deviations. Don't suspend the entire project while a minor issue is resolved.

Executive level champions and stake holders will require constant updating. This is best accomplished through the use of project dashboards. These will give the C-level champion the kind of data that interests them without burdening them with minutia related to subtasks and minor issues.

In some cases, C-level participation in mid-course corrections may be necessary, keeping them up on your progress will make these corrections much easier to implement.

In Closing

Keep focused on what the purpose of the project is, what ERP can (and can not) do, what the defined goals are as originally set forth. Don't let "scope creep" kill your project. There is always a tendency for people to push other, unrelated projects into the middle of a large scale project like this.

Beware the naysayers and gloom merchants; kill this negativity by having a C-level champion that openly celebrates each small victory and elevates the project to the highest profile in the company.

Do not under estimate the importance of morale in this type of project and do not underestimate the potential negative impact those with poor attitudes can have on the overall project.

Let's summarize what we have covered.

1. Form your implementation team - involve management, IT, Finance and other functional areas affected by the system. Bring in end users from all levels of the organization. Consider third party involvement where needed.
2. Plan the implementation - tasks, sequence, time requirements and staffing.
3. Publish the plan and implementation schedule - collect feedback and make necessary adjustments
4. Report on progress - regular status reports covering the successful and problematic. Solicit feedback. Recognize excellence.
5. Tweak as you go. Nothing ever runs completely according to script, be prepared to ad lib and accommodate changes as required

ERP implementation can be effective and rewarding for those directly involved and for the organization as a whole. Careful planning, realistic expectations and effective communication are the basis for an implementation that will delight all concerned.