How To Implement ERP? 4 Insanely Simple Steps!

Project Execution

Implementing ERP for your business can be a challenging initiative.

You often wonder where to start, whom to talk to? Questions such as how to implement ERP, implementation time, investment, forming a project team may often overwhelm you.

how to implement erp

As a sponsor of the project, you have more questions than answers. If you are not careful, you may make rash decisions or give up.

This post covers how to implement ERP within your organisation. The target audience for this post is the Business Executives and Project Sponsors.

The post reveals step by step process as to how to implement ERP.

Let us get started!

STEP 1: The GOAL – Zoom out

Before considering ERP implementation, you must know why you need ERP? How it fits within your overall business vision and goals? How ERP will fit within your business and technology landscape?

1. Look at the Big picture – before thinking How to implement ERP

The first step is to look at the Big picture for your entire enterprise. Understand business vision, goals, drivers, problems, risks, challenges, threats, and constraints. View the whole enterprise as one functioning unit. Get your team to document Big picture and share them with the executive group.

This work will answer the following vital question:

What do you need to meet your business vision and goals?

For instance:

We need a one centralised business system to manage all our operations. The business system should automate Finance, Procurement, Supply Chain and Sales processes.

2. Develop a Roadmap

ERP projects can take from 6 to 18 months. Do not try to do everything at once. Instead, work with your executive team to develop a roadmap from a business perspective. The roadmap may have many initiatives. The group of these initiatives helps you manifest your vision to reality. Note that you should not consider the roadmap as a final plan. As you learn more in the later steps, you should update the roadmap.

The roadmap helps you understand the sequence of planned projects. For example:

  • Project 1: Implement Finance operations with ERP
  • Project 2: Implement Procurement, Supply Chain and Sales

You have now good understanding of the Big picture and Roadmap. It is time to understand your needs for ERP implementation.

STEP 2: What do you need? Getting the crew ready

With the solid business context in mind, action all the prerequisites to start the ERP implementation.

1. Identify enterprise-wide business requirements

Form a team to work with each department and document their business requirements. Here, you want to identify what you wish the new ERP to do for you. Note that we are not concerned with how ERP will do it. Our focus is on a list of processes that ERP will execute for each department. For example:

  • Ability to manage pre-sales processes (quote, proposal)
  • Ability to manage jobs (manage labour time, consumables)

This information will help you assess the ERP products that meet your requirements.

2. Find an ERP product that meets your needs

Assess ERP products considering the Big picture, roadmap, and business requirements. This is an overly critical step. If you choose a wrong product, project cost can increase, and can affect returns of investment. So, seek expert advice, plan for a structured product selection process. The outcome of the step is a selected ERP product that you will implement within your business.

3. Find the trusted partners

For ERP implementation, you need a range of specialist skillsets. So, consider vendors that offer services in:

  • ERP implementation partner (Integrator)
  • Independent consultants/contractors to fill specialist skillset like Project Management/Change Management
  • Technical resources to manage IT infrastructure
  • Recruitment agencies to provide resources to backfill internal roles in the short term

4. Plan to form a solid internal Project team

ERP Project team includes internal and external resources. The internal resources are your employees who will form part of the Project team. For example, Subject Matter Experts (SMEs), Infrastructure support, Technical teams.

The success of your project largely depends on your team. So, choose the best individuals possible. You need the best resources that understand your business. They must have a clear understanding of the company’s current processes and future vision.

The SMEs have a critical role in the project. SMEs must be open and flexible to new innovative solutions. The project needs them from start to finish. So, choose the committed team players that are decisive and open to novel solutions.

You have now a clear understanding of the project objectives. You have selected software, implementation partners and the internal Project team—the next stage of planning your ERP journey.

STEP3: Plan the journey

In this stage, educate your team about the project’s objectives. You must communicate how the project helps to achieve an overall business goal.

Depending upon the size of the initiative and other factors, you plan a roadmap.

Finally, get the right people to sit in the correct positions to drive the ERP implementation.

Let us look in detail!

1. Document and communicate your vision

Communicate the project objective to the team. The team should know the purpose of the initiative, its importance in assisting business to meet its overall vision.

It helps to develop alignment within the team. The decision-makers can make the right decisions that support your company’s vision. Similarly, it helps the Project/Product Managers can prioritise work effectively.

2. Document and communicate your first project

Do not bite more than you can chew!

If the ERP initiative is significant, then consider breaking it into multiple projects. For example, you may want to implement few ERP modules within the first project. In the second project, you may wish to ERP integration with other systems.

Communicate the objective and scope of your first project. Define the scope of the subsequent project(s) at a high level. Focus on having crystal-clear clarity on the immediate project your team is about to embark on.

3. Get the right people on the bus and get them in the right positions

Ok, you now have a clear understanding of the end goal. You know what the outcome of the project will look like. For example, you will execute core Finance and Supply chain operations on the new ERP.

Now, identify the core team who will form the part of the Project team. For instance, you need Finance and Supply Chain Managers to own business requirements and data migration. Similarly, you may need IT Administrator to help in data extraction from the existing system.

So, work with your executive team members and vendors to design the Project team capable of delivering the quality outcome for you.

Congratulations the prerequisites to kick start ERP implementation are now complete. You are about to start the implementation.

STEP4: Start the journey

During this stage, you prepare for a solid Project launch and put robust project governance procedures in place.

1. Project kickstart

This is the exciting part. You sit with the entire project team and formally launch the project. During the launch, you must communicate:

  • The Objective of the project
  • What is expected from each Project Team member?
  • The known risk, constraints, issues
  • The high-level project plans
  • Detailed breakdown of immediate next steps on the project

Project Launch is a joint responsibility of the entire executive team. So, work with Project Managers, Business Executives, Architectures, and other senior members to prepare for a solid launch.

2. Monitor and control the moving parts

Throughout the project execution, you must oversee the project. Please focus on the end goal and redirect your team to it. There will be uncertainties, new information, risks, issues, and surprises. It is part of every project. Ensure the alignment and focus of your Project team towards the end goal. Your leadership and attention to detail to oversee the project is one of the leading factors of the project success.

To conclude, ERP implementations are complex. It is too easy to be distracted by what is possible—for instance, the fancy dashboard, automated workflows, mobile apps. Keep your focus on what do your business needs in the short, medium, and long term. Break the big piece of work into smaller manageable projects. Get the right people and empower them to do the necessary work and make decisions. Rigorously oversee the project execution. Sound project governance is a key to project success. So, make sure you are on the ball!

Before you jump onto something else, take some time and reflect on your past experiences of ERP implementation. What do you do differently this time?

If you are sponsoring ERP project for the first time, prepare a checklist of things to do. Seek guidance from the people who have been on this journey before. Do not reinvent, reuse instead.

I wish you all the best in your journey!