For many decades companies have adopted enterprise resource planning (ERP) in streamlining their routine tasks saving significant time and resources. The success of an ERP solution depends greatly on its implementation, which businesses certainly can’t afford to ignore it and requires proper planning to get through.
Almost all of them do come with some known ERP implementation risk but undoubtedly it will add significant value for your company’s business growth. However, the purchase is just half of a task. Business owners need to take consideration of its implementation process and the end-user transition. So, it’s always better to overestimate and ‘over-ready’ for an ERP project. Businesses that run into the ERP implementation achieve a faster route to failure and run a risk of automating antiquated and inefficient business process.
In order to maximize the probability of successful implementation, businesses must engage in business process reengineering (BPR) which involves the analysis of business flows, figuring out the processes that are inefficient or sub-par, and looking for ways to optimize or replace it.
Michael Hammer, one of the founders of business process engineering, once urged that reengineering of a company is an all-or-nothing proposition with an uncertain result. This process can’t be planned meticulously and accomplished under careful measurements, in opposite it must be changed fundamentally.
He described the tendency of automating an inefficient process as ‘paving the cowpaths’—automate the business process without taking into consideration whether these processes are effective or ineffective in the first place.
His advice, published in Harvard Business Review in the 90s continues to remain valid until now:
Instead of embedding outdated processes in silicon and software, we should obliterate them and start over. We should “reengineer” our businesses: use the power of modern information technology to radically redesign our business processes in order to achieve dramatic improvements in their performance.
As time goes by, if the underlying corporate mindset still remains the same, there will be no ERP system able to transform business completely.
So, what are the steps to maximize the success probability of ERP implementation?
Redesign the business process to fit the software
Rethinking and restructure of the business process must be the first move by every business during the pre-implementation of ERP solution. It ensures a company’s operational business process to be aligned with the ERP system and allows businesses to reap the maximum benefits offered by ERP system.
Furthermore, comprehensive workflow and business requirements must be documented and discussed upon with the ERP vendor increases the probability that the ERP system will meet the organization’s system requirements and support the required operational processes. This provides great insights for the vendors to customize according to your business needs and minimize any process flow gaps. If it’s not handled in a proper way, it will cause several risks such as bad alignment of ERP solutions to business flow, on-going errors that were often overlooked during the implementation period due to inadequate testing and unnecessary features.
Get buy-in for change of management
Support of CEOs, CIOs, project managers, and IT managers play a significant role in accomplishing project objectives. With the direct involvement of senior’s management in the system implementation projects simply increases the projects perceived importance in a business which often encourages employees, end-users and the IT department to become more actively engaged, and provide support for, the ERP implementation.
Besides, by appointing a person-in-charge in the project with an extensive deep insight into all departments and knowledge of the organizational operational process, senior management is better in monitoring the progress of the implementation of ERP. Remember that the earlier you start preparing your team to turn on the switch, the more transparent and seamless the change will be.
Determine standardization in the early stage of the project
In Singapore, the Enterprise Singapore provides Enterprise Development Grant (EDG) with the aim of encouraging companies to grow and supporting businesses in their transformation journey. Since businesses able to get funding up to 70% of qualifying project, more small businesses are expected to adopt digital tool in the near future.
Most of the small businesses come to us for ERP system because of a need to standardize their business process. The extent of standardization depends on your business’s needs and priorities, all companies are different, it’s not a one size fits all approach.
It’s very important to decide the extent of standardization in the early phase as there might be an unexpected situation that occurs.
ERP can transform a business by providing visibility across departments and support smarter decision-making like it never had before. In many cases, life before ERP consisted of looking for problems and then fixing one issue at a time which is a waste of time. The implementation of ERP requires as much focus as selecting the ERP itself. Careful planning is the key.
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