- Management Basics
- Management Functions
- Organizational Behaviour
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- People Management
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- Human Resource Management
- Human Resource Development
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- Job Analysis & Design
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- Competency Based Assessment
- Employee Development
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- Participative Management
- Employee Relationship Management
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- Knowing Your Employees
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- Employee Behaviour
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- Employee Engagement
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- Social Entrepreneurship
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- Operations
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- Enterprise Resource Planning - I
- Enterprise Resource Planning - II
- Business Process Management
- Globalization
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- Disaster Recovery Management
- Business Continuity Management
- Project Management
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- Management Information System
- Database Management System
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- Total Quality Management
- Six Sigma - Introduction
- Six Sigma - Define Phase
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- Six Sigma - Team
- Import & Export Management
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Implementation of ERP System
An ERP implementation could be a great occasion to assess and optimize existing business processes, control points, breaking points between departments, and interfaces with trading partners. But, often, due to resistance to changes and departmental clouts, ERP implementation is comprehended as an exercise to automate legacy processes. This may lead to little improvement in underlying business processes, resulting no appreciable return on investment. Automating existing manual processes peculiar to a company necessitates, significant source code customization, as even a best fit ERP product match to a maximum of 85% to 90% of legacy processes. Source code customization will not only require changing of software objects but also need changing data models. The efforts needed to make such changes are significant in terms of development, testing and documentation. The future cost of maintenance and upgrades will be substantial, affecting entire life cycle of the system. Unless a considered view favoring process changes is taken as a part of implementation strategy, pressure will mount subsequently for more and more customization, when the exercise of Business Process Mapping and Gap Analysis is taken up during implementation. ERP systems are highly configurable and contain series of design trade off to meet various nuances of the same business cycles / processes. This should, normally, be sufficed to cover needed processes, probably with a little bit of swapping whenever needed. At occasions, it may be imperative to change source code to account for some unique core processes of the organizations. Procedure for authorization of such changes, normally requiring attention from sponsor, should also form part of the strategy document. Implementation Methodology: Selection of implementation methodology constitutes an important component of implementation strategy. Most popular implementation methodology is “big bang” approach where on a scheduled cut-off date; entire system is installed throughout the organization. All users move to the new system and manual / legacy systems are discontinued. The implementation is swift and price tag is lesser than a phased implementation. On the flip side, risk element is much higher and resources for training, testing and hand holding are needed at a much higher level, albeit for a shorter period of time. Another major implementation strategy is “phased implementation”, where roll out is done over a period. This method is less focused, prolonged and necessitates maintenance of legacy system over a period of time. But, phased implementation is less risky, provides time for user’s acquaintance and fall back scenarios are less complicated. There are various choice of phasing such as i) phased roll out by locations for a multi location company ii) phased roll out by business unit e.g. human resources iii) Phased roll out by module e.g. general ledger. Methodology of implementation should form an important constituent of implementation strategy, which should be formulated after considering availability of resources, state of preparedness, risk perception, timeframe of implementation and budgetary provisions. Other important strategy issues:
Conclusion: A proper implementation strategy, drawn in advance and containing important strategic directions, should favorably impact project execution. An outside consultant, at this stage, also helps to formulate a proper strategy as well as making a Request for Proposal (RFP) document for selection of vendor, which constitutes the next phase.
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