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3 Common Components of an ERP Planning Strategy
Developing an enterprise resource planning (ERP) strategy can be a confusing process. With so many ways to go about choosing and installing the system, it can be difficult to ascertain which one is most beneficial to the business. In addition to vendor selection and end-user training, figuring out the most advantageous approach to implementation is one of the more critical decisions that need to be made when integrating an ERP platform.
According to the ERP Consultant Network blog, there are three common types of ERP installation strategies: phased rollout, parallel adoption and big bang. Each has its own unique benefits and drawbacks. Decision-makers must carefully understand the inner workings of all three and make an informed decision on which method will best suit the company at large.
Another common component of a sound ERP implementation strategy is selecting the platform that will provide value to a company from the first day it is brought online. There are a number of software packages today that are industry specific, and others that have been created based on the size of the organization.
For example, an ERP platform designed for a small business that has fewer than 100 employees won’t work for a company that has more than 500 staff members. A wrong choice during the platform selection process will not only be costly from a financial perspective, but will make it extremely difficult for an organization to reap a return on its investment.
“As you’re looking for a solution you have to ensure that the system is specific to your organization,” Nick Castellina, a research analyst at the Aberdeen Group, told IBM’s Forward View magazine. “Whether it’s industry-specific or process-specific, you have to have that functionality.”
When developing an ERP strategy, here are a number of best practices to ensure that process goes smoothly:
- Understand the three implementation processes: The big bang, phased rollout and parallel adoption methods have their own associated pros and cons. The ERP Consultant Network blog wrote that while some organizations will choose one or the other, there is also the possibility of using a combination of all three. The decision-making process should be one that identifies the least risky and most efficient installation method that will allow the company to still function while the new system is being put in place.
- Make staff training a priority: If workers don’t understand the benefits of an ERP system or how to use it, it can be difficult for the company to realize the full value of the solution. “You really have to commit to employee training on an ongoing basis to continue to keep them in the loop on how to actually get the most out of ERP,” Nick Castellina told IBM. Making sure that staff members understand the ways in which an ERP solution will make their day-to-day tasks easier to complete, as well as how to properly engage with the software, will go a long way in an organization being able to have a successful implementation.
- Top-down communications keep everyone informed: Learning and adjusting to new things can be challenging. This is particularly true for those who have become accustomed to proceeding in a specific manner, thus becoming set in their ways. This is a common hurdle seen during many ERP implementations. To guard against this, organizational leaders must communicate to their subordinates, who in turn must deliver the message to those they oversee, to explain the purpose of the new system and the expectation that all who have been given access to the ERP platform to use it daily.