A new ERP system will change your organization. Looking at it through a narrow IT prism may be it's demise. ERP is about people and processes and it is essencial to take them into account when planning a project

1. ERP – It’s not (only) about IT
Whenever someone aske me how to implement a new IT system like ERP I find myself worried. The
first step for a successful ERP implementation is to understand that ERP is not an IT solution but a
business solution that will need to be managed because it will change your organization.
ERP has already become a standard
acronym in business, and its
implementation changes processes and
work habits in the organisation. To be
successful these changes need to become
a continuous process over the years. It is
always a desirable to implement
additional modules and versions that
include innovations and improvements to
the daily processes of the business
Successful ERP implementation is a never-
ending project that improves your
business in every aspect.
THE STRATEGIC STAGE
The business management team must think about organisational processes, identify weaknesses,
examine key alternatives and make strategic decisions regarding the selection and implemention of
an ERP system that will best suit the business activities.
It is a significantly different to implementing a software that support background business processes
such as finance, budgeting and control, procurement or human resources. An ERP system will affect
most of the business activities.
During the strategic thinking stage, the management team must understand the implications of the
project and its implementation, and their effect on the business. Management should understand
that the only way for an ERP implementation process to be successful is for the business to change
and optimise the work processes (reengineering). This is the main benefit of this huge undertaking. It
is not a technological improvement of the software and the platform on which it is based.
THE PLANNING AND SELECTION STAGE
This is the only stage where IT considerations take precedence. You need to look at all the strengths
and weaknesses of your current system, and most importantly how business processes should look
in the future. This way you can use your records when consulting with ERP vendors and examine
their ways of achieving the desired goals and analyse their responses.
You can always consult acquaintances, do research on companies in your field and what works best.
If you chose to use advice on the subject, choose who has the capability and experience in
implementing different ERP systems to give you the right solution for you. Price is important but not
the only consideration.
You should take into account all of the parameters and adapt look for the ERP system thaty can
meet all your parameters and goals.

2. To answer which ERP system you should select, answer the following questions:
• What is your organization’s field of activity?
• When the process is over, what are your goals?
• What are your expectations form an ERP system?
Here are criteria to help your IT professionals choose the ERP solution that's best suited to your
needs:
- Stability: of the software package, of the software supplier and the implementing company, of
the platform
- Usefulness: Simplicity, effectiveness, intuitiveness
- Functional components: Modules included in the system, built-in business analytics and reports
capabilities, flexibility of the system for adjustments and developments
- Data Security: Blocking unauthorised users, preventing input of incorrect information, tracking
changes
- Business Process: Performance Management, assistance in decision-making, systematic
processes management
- Backup and restore data
- International aspect: Is the software adaptable to the legal terms in the countries where you
conduct business? Is the interface also available in other languages?
THE BUSINESS PREPARATION STAGE
From my experience the human element is the key success facture in ERP implementation. Many
believe that life will be easier if there weren’t any users or customers to service, but the human
element is critical because the project will dramatically affect the employees/users work
environment. Without their goodwill the project will fail.
Employees, managers and users generally do not like changes and certainly not changes in the habits
they have adopted for many years. In addition, organisational discipline is not exactly what the
millennium generation excel at, and if we are not careful we can get a destructive formula that
endangers the success of the project.
In my experience the following tips will help you to succeed:
- The business needs to have the full commitment and involvement of the senior
management and especially the CEO
- Every implementation stage needs a senior sponsor to “sell” the project internally
- HR director must be involved and engaged
- Appointment of a steering committee for the project headed by the main sponsor
- Appointment of a senior project manager – from the business (full-time) for the project.
- Key Users from different department or field, such as purchasing, inventory management
and storage, accounting, budgeting, costing, sales, etc.
- Manage management and user expectations regarding ERP and its response to the business
needs.
- Internal public relations among all managers and employees in the business – changes need
to be sold.
- The business needs to handle human aspects of the project from the outset: handling
objections (locating, publicizing, softening, incentives, etc.), organisational politics and more.
- Organising the IT unit for the project and the day it should take responsibility for the system.

3. - IT project manager that understand the business and not a “techie”.
THE IMPLEMENTATION STAGE
This is the main stage of the process and its success depends on both the supplier and the business.
For the implementation stage to succeed, a decision-making and change management mechanism
must be established at all levels - the level of the work teams that define the processes in each
module and at the higher levels of the project manager and the steering committee. This mechanism
needs to allow the key users to make decisions by limited and defined forums, and an efficient and
agreed-upon mechanism for escalating issues to decision-makers in cases of difficulty or
disagreement.
It is essential to document each decision using a decision tracking tool – even an MS Excel file - that
will assist in the management and monitoring of decision-making, as well as to establish a
mechanism to prevent misalignment of decisions.
The implementation stage includes intermediate steps that need to be defined as subprojects:
- data conversion and optimization
- interfacing
- acceptance testing
- user training
Each of these is a project by itself, for which a project manager and decision-making mechanisms are
to be defined and follow-up decisions are taken. These projects must be synchronised in the work
plan of the project and integrate in execution, both from the supplier and from the organization
sides, as well as external suppliers with specific purpose and expertise, such as testing or training
companies.
In my experience with many ERP implementation projects, lack of attention to training and
implementation are reasons for failure. There are two options to handle these issues successfully:
- Train the Trainers: the vendor will train a limited number of primary users that will then
guide all users in the organisation. To avoid delays and dissatisfaction it is recommended to
use a training and assimilation company that specialises in training users in ERP and is
responsible for preparing documentation for the user and conducting group and personal
training for all users of the organisation.
- Train the team – the vendor is responsible for the training of all users
As part of the training effort, a Support and Help Centre should be set up and staffed with the
trainers that guided the users, so that in the first month of the system operation users will have an
who to contact to receive telephone assistance and/or additional training.
To sum-up, if you want to succeed in an ERP project:
Set realistic expectations - Examine all aspects of implementation including times, business aspects,
technical know-how and more, anticipating possible challenges. Realistic expectations about
schedules and budget will leave a margin for problem solving.
Implement only a familiar and stable system that has been tested and installed by many customers
- Implementing an ERP system will affect every aspect of the business - customers, finance,
employees, suppliers and is key to business growth, so it is important to choose a solution is tried-
and-tested, suits the business needs and limitations and can grow with the business.

4. Investment matters! - This is one of the most important investments in the business, therefore it is
critical to check the return on investment based on Total Cost of Ownership vs long-term benefits.
For example, a high initial investment may provide the highest ROI if the system allows for
continuous business process improvement and scalability. A low initial investment may prove to be
short-sighted when annual license and maintenance bills start to pile-up, or a couple of years down
the line the system can no longer support the business growth.
If you do it right the benefits of successful assimilation are seen quickly and grow every year.
Start with defining the existing work processes. Map all the functions, information, inputs and
outputs in each process. Use tools such as flowcharts, organizational chart, table of functions.
Mapping of all existing processes in all departments of the company is critical to the optimization
and success of the system. Each department should map the steps, processes, and criteria for its
decisions.
After mapping, you can start the redefinition of processes with established information.
Optimize and define the most efficient processes – Do not adapt the new system to the old
problems associated with the old business processes. This is the basis for the failure of many
projects. To avoid this, you must first redefine the processes for maximum efficiency and quality
according to the goals that the business wants to achieve without regard to the limitations of the old
system. Then match the new system to the defined processes.
Define the keys to successful implementation - Examine and understand what is needed for the
success of an assimilation project. Here are some examples of common mistakes in ERP projects:
- Unrealistic ROI expectations or system benefits.
- Insufficient information leading to poor planning.
- Management or some departments do not support the project.
- Deficient relations with the consultants and/or vendors.
This is only a partial list, but in the end, it is important to get support from management and all
departments because this is a cross-company project. Anyone that sees the benefits they will have
from the changes will not see it as a threat but as an opportunity.
Some selling point:
- Less paperwork
- Fewer mistakes than manual data-entry
- Easier development of reports
- Real-time information that saves back-to-back verification
- Ability to create expectations for purchasing, accounting and engineering departments
- Transparency between all departments
- A uniform process throughout the chain of processes that reduces customer service and
credit problems
- Fewer duplicates
Remember, though, that each of the above benefits may also be a threat to some people. Be smart
enough to identify them and set their minds at peace with the forthcoming change. This may make
or break the project.